TERM NOTE
$31,000,000.00 Hartford, Connecticut
October 5, 2000
FOR VALUE RECEIVED, THE UNDERSIGNED, VERMONT PURE HOLDINGS, LTD., (f/k/a VP
Merger Parent, Inc.), a Delaware corporation with an office located at Catamount
Industrial Park, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 05060 ("HOLDINGS"), CRYSTAL ROCK
SPRING WATER COMPANY, a Connecticut corporation with an office at ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("CRYSTAL ROCK"), PLATINUM
ACQUISITION CORP., (f/k/a Vermont Pure Holdings, Ltd.), a Delaware corporation
with an office at Catamount Industrial Park, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 05060
("PLATINUM") and VERMONT PURE SPRINGS, INC., a Delaware corporation with an
office at Catamount Industrial Park, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 05060 ("VPS",
and collectively with holdings, CRYSTAL ROCK AND PLATINUM, the "OBLIGORS "),
hereby jointly and severally promise to pay to the order of ▇▇▇▇▇▇▇ BANK, a
federally chartered savings bank (the "Lender"), at its office at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or at such other place as the holder hereof
may designate, the principal amount of thirty-one million and 00/100 DOLLARS
($31,000,000.00) (the "Principal Amount") in lawful money of the United States,
together with interest on the Principal Amount, beginning on the date hereof,
before and after maturity or judgment, at a per annum rate determined as
provided below. All payments shall be made in lawful money of the United States
in immediately available funds.
1. INTEREST RATE: The Principal Amount shall bear interest at a per
annum rate equal to a fixed rate equal to the LIBOR Rate (as determined for each
Interest Period applicable thereto) for Interest Periods of one (1) month plus
the Applicable Margin. All computations of interest hereunder shall be made on
the basis of a three hundred sixty (360) day year and the actual number of days
elapsed.
2. CONTINUATION OF INTEREST PERIODS. Any LIBOR Rate Loan shall be
continued as such (less the amount of principal that is due and payable at the
end of such expiring Interest Period) for an Interest Period of one (1) month on
the first business day of each month, provided that no LIBOR Rate Loan may be
continued as such: (i) at a time when any Event of Default (or event or
condition which would constitute an Event of Default but for the giving of
notice or passage of time or both) has occurred and is continuing and (ii) after
the date that is one (1) month prior to the Termination Date, in which event the
Principal Amount shall bear interest as a Prime Rate Loan.
-1-
3. PAYMENTS OF INTEREST. Monthly payments of interest shall be due and
payable in arrears on the fifth day of each month (or if such day is not a
Business Day, on the first Business Day thereafter) until this Note is paid in
full.
4. PAYMENTS OF PRINCIPAL. Obligors shall pay monthly installments of
principal on the fifth day of each month (or if such day is not a Business Day,
on the first Business Day thereafter)in the amounts of:
a. $208,333 for each month from November 2000 through October 2001;
b. $291,666 for each month from November 2001 through October 2002;
c. $333,333 for each month from November 2002 through October 2003;
d. $333,333 for each month from November 2003 through October 2004;
e. $375,000 for each month from November 2004 through October 2005;
f. $458,333 for each month from November 2005 through October 2006;
and
g. $583,335 for each month from November 2006 through October 2007.
If not sooner paid, the aggregate outstanding Principal Amount of this Note,
together with all accrued and unpaid interest thereon and any other fees or
charges then due, shall be due and payable on the Termination Date.
5. DEFINITIONS. As used in this Note and not defined elsewhere in this
Note, the following terms shall have the following meanings:
a. "Applicable Margin" means:
i. 2.25% if the ratio of Senior Funded Debt to EBITDA
is greater than 3.0 to 1.0;
ii. 1.75% if the ratio of Senior Funded Debt to
EBITDA is greater than 2.5 to 1.0 and less than
or equal to 3.0 to 1.0;
iii. 1.50% if the ratio of Senior Funded Debt to
EBITDA is greater than 2.0 to 1.0 and less than
or equal to 2.5 to 1.0;
iv. 1.25% if the ratio of Senior Funded Debt to
EBITDA is greater than 1.5 to 1.0 and less than
or equal to 2.0 to 1.0; and
-2-
v. 1.00% if the ratio of Senior Funded Debt to
EBITDA is less than or equal to 1.5 to 1.0;
as that ratio is calculated in accordance
with the Loan and Security Agreement. The
Applicable Margin on the date of this Note
is 1.75% and shall continue to be the
Applicable Margin until a new Applicable
Margin is determined and is to go into
effect as hereinafter set forth. A new
Applicable Margin shall be determined 120
days after the end of each fiscal year of
Holdings, commencing with the fiscal year
ending October 31, 2001, based upon the
audited fiscal year end financial statements
for that fiscal year provided to Lender
within 90 days after the end of that fiscal
year as required in the Loan and Security
Agreement. Such Applicable Margin will
automatically go into effect for the
Interest Period commencing after the date of
determination and shall continue in effect
until a new Applicable Margin is determined
and is to go into effect; provided, however,
that if the audited fiscal year end
financial statements required in the Loan
and Security Agreement are not provided to
Lender within 120 days after the end of any
fiscal year, the Lender shall not be
required to adjust the Applicable Margin and
the Applicable Margin to go into effect for
THE INTEREST PERIOD COMMENCING AFTER THAT
120TH day shall be 2.25% until a new
Applicable Margin is determined and is to go
into effect unless otherwise agreed to by
Lender.
b. "Business Day" means any day other than a Saturday, Sunday
or day which shall be in the State of Connecticut a legal holiday or day on
which commercial banks in Hartford, Connecticut are required or authorized by
law to close.
c. "EBITDA" means EBITDA as defined in the Loan and Security
Agreement.
d. "Interest Period" means with respect to the Principal
Amount bearing interest at the LIBOR Rate, an available period of one (1) month,
provided that:
i. if any Interest Period would otherwise end
on a day that is not a Business Day, such
Interest Period shall end on the immediately
following Business Day; and
ii. any Interest Period that begins on the last
Business Day of a calendar month (or on a
day for which there is no numerically
corresponding day in the calendar month at
the end of such Interest Period) shall end
on the last Business Day of a calendar
month.
-3-
e. "LIBOR Rate" means, with respect to any LIBOR Rate Loan for
each applicable Interest Period, the rate per annum determined by the Lender to
be equal to the quotient of (a) the London Interbank Offered Rate for such LIBOR
Rate Loan for such Interest Period, divided by (b) one (1) minus the Reserve
Percentage for such Interest Period, expressed as follows:
LIBOR RATE = LONDON INTERBANK OFFERED RATE
1 - Reserve Percentage
f. "LIBOR Rate Loan" means that the Principal Amount bears
interest at a rate equal to the LIBOR Rate plus the Applicable Margin.
g. "Loan and Security Agreement" means the Loan and Security
Agreement dated today by and among the Obligors and Lender relating to this
Note.
h. "London Interbank Offered Rate" means, with respect to any
applicable Interest Period, the rate per annum (rounded upward, if necessary, to
the nearest 1/32 of one percent) as determined on the basis of the offered rates
for deposits in U.S. dollars, for a period of time comparable to such Interest
Period which appears on the Telerate page 3750 as of 11:00 a.m. London time on
the day that is two London Banking Days preceding the first day of such Interest
Period; provided, however, if the rate described above does not appear on the
Telerate System on any applicable interest determination date, the London
Interbank Offered Rate shall be the rate (rounded upwards as described above, if
necessary) for deposits in dollars for a period substantially equal to the
interest period on the Reuters Page "LIBO" (or such other page as may replace
the LIBO Page on that service for the purpose of displaying such rates), as of
11:00 a.m. (London Time), on the day that is two (2) London Banking Days prior
to the beginning of such interest period. "Banking Day" shall mean, in respect
of any city, any date on which commercial banks are open for business in that
city. If both the Telerate and Reuters system are unavailable, then the rate for
that date will be determined on the basis of the offered rates for deposits in
U.S. dollars for a period of time comparable to such Interest Period which are
offered by four major banks in the London interbank market at approximately
11:00 a.m. London time, on the day that is two (2) London Banking Days preceding
the first day of such Interest Period as selected by the Lender. The principal
London office of each of the four major London banks will be requested to
provide a quotation of its U.S. dollar deposit offered rate. If at least two
such quotations are provided, the rate for that date will be the arithmetic mean
of the quotations. If fewer than two quotations are provided as requested, the
rate for that date will be determined on the basis of the rates quoted for loans
in U.S. dollars to leading European banks for a period of time comparable to
such Interest Period offered by major banks in New York City at approximately
11:00 a.m. New York City time, on the day that is two London Banking Days
preceding the first day of such Interest Period. In the event that ▇▇▇▇▇▇ is
unable to obtain any such quotation as provided above, it will be deemed that
the LIBOR Rate pursuant to an Interest Period cannot be determined.
-4-
i. "Prime Rate" means the variable per annum rate of interest
so designated from time to time by Lender as its prime rate. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate being
charged to any customer.
j. "Prime Rate Loan" means that the Principal Amount bears
interest at a rate equal to ▇▇▇▇▇▇'s Prime Rate. The interest rate on each Prime
Rate Loan shall change immediately, without notice or demand of any kind to
Obligors, each time that ▇▇▇▇▇▇'s Prime Rate changes so that the rate of
interest on a Prime Rate Loan is at all times equal to ▇▇▇▇▇▇'s Prime Rate.
k. "Reserve Percentage" means the maximum aggregate reserve
requirement (including all basic, supplemental, marginal and other reserves)
which is imposed on member banks of the Federal Reserve System against
"Euro-currency Liabilities" as defined in Regulation D. With respect to the
LIBOR Rate, any change in the interest rate because of a change in the Reserve
Percentage shall become effective, without notice or demand of any kind, on the
date on which such change in the Reserve Percentage becomes effective.
l. "Senior Funded Debt" means Senior Funded Debt as defined in
the Loan and Security Agreement.
m. "Termination Date" means October 5, 2007.
6. ILLEGALITY. Notwithstanding any other provisions hereof, if any
applicable law or governmental regulation, guideline, order or directive, or any
change therein or in the interpretation or application thereof by any
governmental authority charged with the interpretation or the administration
thereof (whether or not having the force of law) shall make it unlawful for the
Lender to make or maintain LIBOR Rate Loans as contemplated by this Note: (i)
the obligation of the Lender to continue LIBOR Rate Loans shall forthwith be
canceled, and (ii) such amounts then outstanding shall be automatically
converted, without notice, to Prime Rate Loans on the last day of the then
current Interest Period or within such earlier time as required by law. If any
such conversion of LIBOR Rate Loans is made on a day that is not the last
Business Day of the then current Interest Period applicable thereto, Obligors
shall pay the Lender such amount or amounts required pursuant to Section 11
below.
7. BASIS FOR DETERMINING LIBOR INADEQUATE OR UNFAIR. In the event that
the Lender shall have determined (which determination, absent manifest error,
shall be conclusive and binding upon Obligors) that (i) by reason of
circumstances affecting the Interbank LIBOR market, adequate and reasonable
means do not exist for determining the LIBOR Rate, or (ii) Dollar deposits in
the relevant amount and for the relevant maturity are no longer available to the
Lender in the Interbank LIBOR market, or (iii) the continuation of LIBOR Rate
Loans has been made impractical or unlawful by the occurrence of a contingency
that materially and adversely affects the Interbank LIBOR market, or (iv) the
LIBOR Rate will not adequately and fairly reflect the
-5-
cost to the Lender of maintaining LIBOR Rate Loans, or (v) the LIBOR Rate shall
no longer represent the effective cost to the Lender of U.S. Dollar deposits in
the relevant market for deposits in which it regularly participates, the Lender
shall give the Obligors notice of such determination as soon as practicable. If
such notice is given all LIBOR Rate Loans shall be automatically converted,
-6-
without notice, to Prime Rate Loans effective on the last Business Day of the
then current Interest Period applicable thereto. Until such notice has been
withdrawn, the LIBOR Rate shall not be continued.
8. COSTS AND EXPENSES. The Obligors shall pay all taxes levied or
assessed on this Note or the debt evidenced hereby against the Lender, together
with all costs, expenses and attorneys' and other professional fees incurred in
any action to collect and/or enforce this Note or to enforce the Loan and
Security Agreement or any other agreement relating to this Note or the Loan and
Security Agreement or any other agreement or in any litigation or controversy
arising from or connected with the Loan and Security Agreement or any other
agreement, or this Note.
9. INCREASED COSTS. In the event that applicable law, treaty or
regulation or directive from any government, governmental agency or regulatory
authority, or any change therein or in the interpretation or application
thereof, or compliance by the Lender with any request or directive (whether or
not having the force of law) from any central bank or government, governmental
agency or regulatory authority, shall:
a. subject the Lender to any tax of any kind whatsoever
(except taxes on the overall net income of the Lender) with respect to the Loan
and Security Agreement, this Note or any of the loans made by it, or change the
basis of taxation of payments to the Lender in respect thereof (except for
changes in the rate of tax on the overall net income of the Lender);
b. impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirements against assets held by,
deposits or other liabilities in or for the account of, advances, loans or other
extensions of credit by, or any other acquisition of funds by, any office of the
Lender, including (without limitation) pursuant to Regulations of the Board of
Governors of the Federal Reserve System; or
c. in the opinion of the Lender, cause this Note, any loan
made under this Note or under the Loan and Security Agreement to be included in
any calculations used in the computation of regulatory capital standards; or
d. impose on the Bank any other condition;
and the result of any of the foregoing is to increase the cost to the Lender, by
an amount that the Lender deems to be material, of making, converting into,
continuing and/or maintaining the loans made pursuant to this Note (the "Loans")
or to reduce the amount of any payment (whether of principal, interest or
otherwise) in respect of any of such Loans, then, in any case, the Obligors
shall promptly pay the Lender, upon its demand, such additional amounts
necessary to compensate the Lender for such additional costs or such reduction
in payment, as the case may be (collectively the "Additional Costs"). The Lender
shall certify the amount of such Additional Costs to the Obligors, and such
certification, absent manifest error, shall be deemed conclusive.
-7-
10. CAPITAL ADEQUACY PROTECTION. If, after the date hereof, the Lender
shall have determined that the adoption of any applicable law, governmental
rule, regulation or order regarding capital adequacy of banks or bank holding
companies, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Lender with any request or directive regarding capital adequacy (whether
or not having the force of law and whether or not failure to comply therewith
would be unlawful, so long as the Lender believes in good faith that such has
the force of law or that the failure to so comply would be unlawful) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on any of the Lender's capital as a consequence of
the Lender's obligations hereunder to a level below that which the Lender could
have achieved but for such adoption, change or compliance (taking into
consideration the Lender's policies with respect to capital adequacy immediately
before such adoption, change or compliance and assuming that the Lender's
capital was fully utilized prior to such adoption, change or compliance) by an
amount deemed by the Lender in its judgment to be material, then, promptly upon
demand, the Obligors shall immediately pay to the Lender, from time to time as
specified by the Lender, such additional amounts as shall be sufficient to
compensate the Lender for such reduced return, together with interest on each
such amount from the date of such specification by the Lender until payment in
full thereof at the highest rate of interest (other than the default rate of
interest) due on the Loans. A certificate of the Lender setting forth the amount
to be paid to the Lender shall, in the absence of manifest error, be deemed
conclusive. In determining such amount, the Lender shall use any reasonable
averaging and attribution methods.
11. INDEMNITY. The Obligors agree to indemnify the Lender and to hold
the Lender harmless from any loss (including any of the additional costs
referred to above and any lost profits) or expense that it may sustain or incur
as a consequence of (i) a default by any Obligor in the payment of the principal
of or interest due on this Note, or (ii) the making of a prepayment of the
Principal Amount bearing interest based upon the LIBOR Rate on a day which is
not the last day of the then current Interest Period applicable thereto,
including, but not limited to, in each case any such loss or expense arising
from the reemployment of funds obtained by it or from fees, interest or other
amounts payable to terminate the deposits from which such funds were obtained.
The Lender shall prepare a certificate as to any additional amounts payable to
it pursuant to this Section 11, which certificate shall be submitted by the
Lender to the Obligors and shall, absent manifest error, be deemed conclusive.
12. LAWFUL INTEREST. All agreements between Obligors and Lender are
hereby expressly limited so that in no event whatsoever, whether by reason of
acceleration of maturity of the indebtedness evidenced hereby or otherwise,
shall the amount paid or agreed to be paid to Lender for the use or the
forbearance of the indebtedness evidenced hereby exceed the maximum permissible
under applicable law. As used herein, the term "applicable law" shall mean the
law in effect as of the date hereof provided, however, that in the event there
is a change in the law which results in a higher permissible rate of interest,
then this Note shall be governed by such new law as of its effective date. In
this regard, it is expressly agreed that it is the intent of Obligors and
-8-
Lender in the execution, delivery and acceptance of this Note to contract in
strict compliance with the laws of the State of Connecticut from time to time in
effect. If, under or from any circumstances whatsoever, fulfillment of any
provision hereof or of any of the Loan Documents (as defined in the Loan and
Security Agreement) at the time of performance of such provision shall be due,
shall involve transcending the limit of such validity prescribed by applicable
law, then the obligation to be fulfilled shall automatically be reduced to the
limits of such validity, and if under or from any circumstances whatsoever
Lender should ever receive as interest an amount which would exceed the highest
lawful rate, such amount which would be excessive interest shall be applied to
the reduction of the principal balance evidenced hereby and not to the payment
of interest. This provision shall control every other provision of all
agreements between Obligors and Lender.
13. DUE DATE; LATE CHARGE. If this Note or any payment hereunder
becomes due on a day which is not a Business Day, the due date of this Note or
payment shall be extended to the next succeeding Business Day and such extension
of time shall be included in computing interest and fees in connection with such
payment. Without limiting the Lender's rights and remedies with respect to the
Event of Default that will have occurred, if the entire amount of any required
principal and/or interest payment is not paid in full within fifteen (15) days
after the same is due, Obligors shall pay to the Lender a late fee equal to the
greater of five percent (5%) of the required payment or fifteen dollars
($15.00).
14. PREPAYMENTS.
a. Obligors may prepay the Principal Amount, or any portion
thereof, only upon at least three (3) Business Days prior written notice to
Lender (which notice shall be irrevocable and shall state the amount to be
prepaid). If Obligors refinance this Term Note with any other entity, Obligors
shall pay to Lender a prepayment premium equal to
i. three percent (3%) of the amount prepaid if the
prepayment is made from the date of this Note
through October 4, 2001;
ii. two percent (2%) of the amount prepaid if the
prepayment is made from October 5, 2001 through
October 4, 2002; and
iii. one percent (1%) of the amount prepaid if the
prepayment is made from October 5, 2002 through
October 4, 2003. Notwithstanding the foregoing,
in the event the Obligors acquire a company or
business for a purchase price in cash of
$10,000,000 or more which requires financing
and Lender is unwilling or unable to
accommodate or arrange such financing, the
foregoing prepayment premiums shall be reduced
by fifty percent (50%).
-9-
b. If any prepayment occur on a day other than the last day of
the Interest Period, Obligors shall pay to Lender, upon request of Lender and in
addition to any amount which may be due and payable pursuant to the preceding
paragraph, such amount or amounts as shall be sufficient (in the reasonable
opinion of Lender) to compensate it for any loss, cost, or expense incurred as a
result of: (i) any payment on a date other than the last day of the Interest
Period; and (ii) any failure by any Obligor to make a prepayment on the date for
payment specified in any Obligor's written notice.
c. If by reason of an Event of Default, Lender elects to
declare the Note to be immediately due and payable, then any prepayment premiums
and other amounts which would have been due if a prepayment been made at that
time shall become due and payable in the same manner as though the Obligors had
exercised such right of prepayment. In the event of any prepayments, the
Obligors shall pay all accrued interest on the Principal Amount being paid to
the date of the prepayment and, in the case of prepayments in full, all fees,
charges, costs, expenses and other amounts then due hereunder.
d. Any partial prepayment shall be applied against principal
payments in the inverse order of maturity and shall not reduce the monthly
payments of principal due hereunder.
15. EVENTS OF DEFAULT. The Obligors agree that the occurrence of an
Event of Default under the Loan and Security Agreement shall constitute an Event
of Default under this Note. Reference is hereby made to the Loan and Security
Agreement for the other terms and conditions relating to the Loan evidenced by
this Note which are incorporated in this Note by reference. Upon the occurrence
of any Event of Default, the Lender, at its option, may declare all amounts
outstanding hereunder, together with accrued interest thereon and all applicable
late charges, other amounts due under this Note and all other liabilities and
obligations of the Obligors to the Lender to be immediately due and payable,
whereupon the same shall become immediately due and payable; all of the
foregoing without demand, presentment, protest or notice or any kind, all of
which are hereby expressly waived by the Obligors. Failure to exercise such
option shall not constitute a waiver of the right to exercise the same in the
event of any subsequent default. Notwithstanding the foregoing, upon the
occurrence of an Event of Default relating to the bankruptcy or insolvency of
any Obligor or any guarantor, all amounts outstanding hereunder, together with
accrued interest thereon and all applicable late charges, other amounts due
under this Note and all other liabilities and obligations of the Obligors to the
Lender shall be immediately due and payable. Upon the occurrence of any Event of
Default, without in any way affecting the Lender's other rights and remedies, or
after maturity or judgment, the interest rate applicable to the outstanding
principal balance of this Note shall, at the option of Lender, change without
notice to a floating per annum rate equal to four percentage points (4.0%) above
the otherwise applicable rate and Obligors' right to select pricing options
shall cease.
16. LIEN AND RIGHT OF SETOFF. Each Obligor hereby grants to Lender,
Manufacturers and Traders Trust Company and any other Participant (as defined in
the Loan and Security Agreement, a lien, security interest and right of setoff
as security for all liabilities and obligations
-10-
to Lender, Manufacturers and Traders Trust Company or any other Participant,
whether now existing or hereafter arising, upon and against all deposits,
credits, collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Lender, Manufacturers and Traders Trust Company or any
other Participant or any entity under common control with such party, or in
transit to any of them. At any time, without demand or notice, Lender,
Manufacturers and Traders Trust Company or any other Participant may, if an
event which constitutes or which with notice or lapse of time, or both, would
constitute an Event of Default under this Note, the Loan and Security Agreement
or any of the other Loan Documents (as defined in the Loan and Security
Agreement) has occurred, set off the same or any part thereof and apply the same
to any liability or obligation of any Obligor even though unmatured and
regardless of the adequacy of any other collateral securing the Loan. ANY AND
ALL RIGHTS TO REQUIRE LENDER, MANUFACTURERS AND TRADERS TRUST COMPANY OR ANY
OTHER PARTICIPANT TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH
RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF ANY OBLIGOR, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. The Obligors acknowledge that
Manufacturers and Traders Trust Company is purchasing a participation interest
in the Loans and the provisions of this paragraph are for the benefit of
Manufacturers and Traders Trust Company, and as an inducement to Manufacturers
and Traders Trust Company to purchase such participation interest.
17. NO WAIVER. Failure by the Lender to insist upon the strict
performance by Obligors of any terms and provisions herein shall not be deemed
to be a waiver of any terms and provisions herein, and the Lender shall retain
the right thereafter to insist upon strict performance by the Obligors of any
and all terms and provisions of this Note or any agreement securing the
repayment of this Note.
18. GOVERNING LAW. This Note shall be governed by the laws of the State
of Connecticut.
19. REPLACEMENT NOTE. Upon receipt of an affidavit of an officer of
Lender as to the loss, theft, destruction or mutilation of this Note or any
other Loan Document which is not of public record, and, in the case of any such
mutilation, upon cancellation of this Note or other Loan Document, Obligors will
issue, in lieu thereof, a replacement Note or other Loan Document in the same
principal amount thereof and otherwise of like tenor.
20. JOINT AND SEVERAL LIABILITY. All obligations, covenants and
agreements of the Obligors pursuant to this Note or any of the other Loan
Documents shall be the joint and several obligations, covenants and agreements
of each of the Obligors.
21. PREJUDGMENT REMEDY AND OTHER WAIVERS. EACH OBLIGOR ACKNOWLEDGES
THAT THE LOAN EVIDENCED BY THIS NOTE IS A COMMERCIAL TRANSACTION AND WAIVES ITS
RIGHT TO NOTICE AND HEARING UNDER CHAPTER 903a OF THE CONNECTICUT GENERAL
-11-
STATUTES, OR AS OTHERWISE ALLOWED BY ANY STATE OR FEDERAL LAW WITH RESPECT TO
ANY PREJUDGMENT REMEDY WHICH LENDER MAY DESIRE TO USE, AND FURTHER, WAIVES
DILIGENCE, DEMAND, PRESENTMENT FOR PAYMENT, NOTICE OF NONPAYMENT, PROTEST AND
NOTICE OF PROTEST, AND NOTICE OF ANY RENEWALS OR EXTENSIONS OF THIS NOTE, ALL
SURETYSHIP DEFENSES AND ALL RIGHTS UNDER ANY STATUTE OF LIMITATION. EACH OBLIGOR
ACKNOWLEDGES THAT IT MAKES THIS WAIVER KNOWINGLY, VOLUNTARILY, WITHOUT DURESS
AND ONLY AFTER CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER WITH ITS
ATTORNEYS.
22. JURY WAIVER. EACH OBLIGOR AND ▇▇▇▇▇▇ MUTUALLY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF
ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR
ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR
ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR
WRITTEN) OR ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT
FOR LENDER TO ACCEPT THIS NOTE AND MAKE THE LOAN. EACH OBLIGOR ACKNOWLEDGES THAT
IT MAKES THIS WAIVER KNOWINGLY, VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER
CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER WITH ITS ATTORNEYS.
-12-
IN WITNESS WHEREOF, the Obligors have caused this Note to be duly
executed as of THE 5TH day of October, 2000.
VERMONT PURE HOLDINGS, LTD.
(f/k/a VP Merger Parent, Inc.)
By________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
CRYSTAL ROCK SPRING WATER COMPANY
By:____________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
PLATINUM ACQUISITION CORP.
(f/k/a Vermont Pure Holdings, Ltd.)
By:____________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
VERMONT PURE SPRINGS, INC.
By:____________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
-13-