EXHIBIT 10.2
CYTOGEN CORPORATION
LOAN AND SECURITY AGREEMENT
This Agreement is between the undersigned Borrower and
the undersigned Lender concerning loans to be made by Lender to
Borrower.
SECTION 1. PARTIES
1.1 The "Borrower" is identified in Section 10.6(c)
and its successors and assigns. If more than one Borrower is
specified in Section 10.6(c), all references to Borrower shall
mean each of them, jointly and severally, individually and
collectively, and the successors and assigns of each.
1.2 The "Lender" is The CIT Group/Credit Finance,
Inc. and its agents, designees, representatives, successors and
assigns.
SECTION 2. TERM LOANS
Lender shall make term loans to Borrower on the terms
and conditions set forth in Section 10.2. ("Term Loan"). Such
Term Loan shall be evidenced by a promissory note (the
"Promissory Note") delivered by Borrower to Lender and shall be
repaid, together with interest and other amounts, in accordance
with this Agreement and the Promissory Note.
SECTION 3. INTEREST AND FEES
3.1 Interest.
(a) Interest on the Term Loans shall be payable by
Borrower on the first day of each month, calculated upon the
closing daily balances in the loan account of Borrower for each
day during the immediately preceding month, at the per annum
rate set forth as the Interest Rate in Section 10.4(a). The
Interest Rate shall increase or decrease by an amount equal to
each increase or decrease, respectively, in the Prime Rate (as
defined below), effective as of the date of each such change.
On and after any Event of Default or termination or non-renewal
hereof, interest on all unpaid Obligations shall accrue at a
rate equal to two percent (2%) per annum in excess of the
Interest Rate otherwise payable until such time as all
Obligations are indefeasibly paid in full (notwithstanding entry
of any judgment against Borrower or the exercise of any other
right or remedy by Lender), and all such interest shall be
payable on demand. In no event shall charges constituting
interest exceed the rate permitted under any applicable law or
regulation, and if any provision of this Agreement is in
contravention of any such law or regulation, such provision
shall be deemed amended to conform thereto.
(b) The "Prime Rate" is the rate of interest publicly
announced by The Chase Manhattan Bank in New York, New York, or
its successors and assigns, from time to time as its prime rate.
3.2 Closing Fees. Borrower shall pay to Lender at
closing a Closing Fee in the amount set forth in Section
10.4(c).
SECTION 4. GRANT OF SECURITY INTEREST
4.1 Grant of Security Interest. To secure the
payment and performance in full of all Obligations, Borrower
hereby grants to Lender a continuing security interest in and
lien upon, and a right of setoff against, and Borrower hereby
assigns and pledges to Lender, all of the Collateral.
4.2 "Obligations" shall mean any and all Term Loans,
revolving loans, accommodations and all other indebtedness,
liabilities and obligations of every kind, nature and
description owing by Borrower to Lender and/or its affiliates,
including principal, interest, charges, fees and expenses,
however evidenced, whether as principal, surety, endorser,
guarantor or otherwise, whether arising under this Agreement or
otherwise, whether now existing or hereafter arising, whether
arising before, during or after the Term or after the
commencement of any case with respect to Borrower under the
United States Bankruptcy Code or any similar statute, whether
direct or indirect, absolute or contingent, joint or several,
due or not due, primary or secondary, liquidated or
unliquidated, secured or unsecured, original, renewed or
extended and whether arising directly or howsoever acquired by
Lender including from any other entity outright, conditionally
or as collateral security, by assignment, merger with any other
entity, participations or interests of Lender in the obligations
of Borrower to others, assumption, operation of law, subrogation
or otherwise and shall also include all amounts chargeable to
Borrower under this Agreement or in connection with any of the
foregoing.
4.3 "Collateral" shall mean all of the following
property of Borrower:
(a) All now owned and hereafter acquired right, title
and interest of Borrower in, to and in respect of all: accounts,
interests in goods represented by accounts, returned, reclaimed
or repossessed goods with respect thereto and rights as an
unpaid vendor; contract rights (except contract rights in which
the granting of a security interest would result in a default or
impermissible assignment under the related contract); chattel
paper; investment property; documents; instruments; letters of
credit, bankers' acceptances or guaranties; cash moneys,
deposits, securities, bank accounts, deposit accounts, credits
and other property now or hereafter held in any capacity by
Lender, its affiliates or any entity which, at any time,
participates in Lender's financing of Borrower or at any other
depository or other institution; agreements or property securing
or relating to any of the items referred to above;
(b) All now owned and hereafter acquired right, title
and interest of Borrower in, to and in respect of goods,
including, but not limited to:
(i) All inventory, wherever located, whether now
owned or hereafter acquired, of whatever kind, nature
or description, including all raw materials, work-in-
process, finished goods, and materials to be used or
consumed in Borrower's business; and all names or
marks affixed to or to be affixed thereto for purposes
of selling same by the seller, manufacturer, lessor or
licensor thereof and all inventory which may be
returned to Borrower by its customers or repossessed
by Borrower and all of Borrower's right, title and
interest in and to the foregoing (including all of
Borrower's rights as a seller of goods);
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(ii) All equipment and fixtures, wherever
located, whether now owned or hereafter acquired,
including, without limitation, all machinery,
equipment, motor vehicles, furniture and fixtures, and
any and all additions, substitutions, replacements
(including spare parts), and accessions thereof and
thereto (including, but not limited to Borrower's
rights to acquire any of the foregoing, whether by
exercise of a purchase option or otherwise);
(iii) All consumer goods, farm products,
crops, timber, minerals or the like (including oil and
gas), wherever located, whether now owned or hereafter
acquired, of whatever kind, nature or description;
(c) All now owned and hereafter acquired right, title
and interests of Borrower in, to and in respect of any personal
property in or upon which Borrower has or may hereafter have a
security interest, lien or right of setoff;
(d) All present and future books and records relating
to any of the above including, without limitation, all computer
programs, printed output and computer readable data in the
possession or control of the Borrower, any computer service
bureau or other third party; and
(e) All products and proceeds of the foregoing in
whatever form and wherever located, including, without
limitation, all insurance proceeds and all claims against third
parties for loss or destruction of or damage to any of the
foregoing.
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SECTION 5. COLLECTION AND ADMINISTRATION
5.1 Collections. Borrower will, at its expense as
Lender requests, direct that all remittances and all other
proceeds of accounts and other Collateral be sent to a lock box
designated by Lender, and deposited into a bank account selected
by Lender under arrangements with the bank providing that all
funds deposited in the bank account are to be transferred solely
to Lender. Borrower shall bear all risk of loss of any funds
deposited into such account. In connection therewith, Borrower
shall execute such lock box and bank account agreements as
Lender shall specify. Any collections or other proceeds
received by Borrower shall be held in trust for Lender and
immediately remitted to Lender in kind.
5.2 Charges to Loan Account. At Lender's option, all
payments of principal, interest, fees, costs, expenses and other
charges provided for in this Agreement, or in any other
agreement now or hereafter existing between Lender and Borrower,
may be charged on the date when due, as principal to any loan
account of Borrower maintained by Lender. Interest and any other
amounts payable by Borrower to Lender based on a per annum rate
shall be calculated on the basis of actual days elapsed over a
360-day year.
5.3 Payments. All Obligations shall be payable at
Lender's office set forth in Section 10.6(a) or at Lender's bank
designated in Section 10.6(b) or at such other bank or place as
Lender may expressly designate from time to time for purposes of
this Section.
5.4 Loan Account Statements. To the extent that
Lender renders to Borrower loan account statements, such
statements shall be considered correct and binding upon Borrower
as an account stated, except to the extent that Lender receives,
within sixty (60) days after the mailing of such statements,
written notice from Borrower of any specific exceptions by
Borrower to that statement.
5.5 Direct Collections. Lender may, at any time, (a)
notify any account debtor that the accounts and other Collateral
which includes a monetary obligation have been assigned to
Lender by Borrower and that payment thereof is to be made to the
order of and directly to Lender, (b) send, or cause to be sent
by its designee, requests (which may identify the sender by a
pseudonym) for verification by telephone, in writing or
otherwise of accounts and other Collateral directly to any
account debtor or any other obligor or any bailee with respect
thereto, (c) demand, collect or enforce payment of any accounts
or such other Collateral, but without any duty to do so, and
Lender shall not be liable for any failure to collect or enforce
payment thereof, (d) take or bring, in the name of Lender or
Borrower, all steps, actions, suits or proceedings deemed by
Lender necessary or desirable to effect collection of or other
realization upon the accounts and other Collateral, (e) after an
Event of Default, change the address for delivery of mail to
Borrower and to receive and open mail addressed to Borrower, and
(f) after an Event of Default, extend the time of payment of,
compromise or settle for cash, credit, return of merchandise,
and upon any terms or conditions, any and all accounts or other
Collateral which includes a monetary obligation and discharge or
release the account debtor or other obligor, without affecting
any of the Obligations. Lender shall use its good faith efforts
to provide Borrower with contemporaneous notice of Lender's
exercise of its rights set forth in clause (a) of this Section
5.5, provided however, that Lender's failure to provide such
contemporaneous notice, or any notice, shall not be deemed a
breach by Lender of its obligations to Borrower and Borrower
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shall have no right or remedy as a result thereof. At Lender's
request, all invoices and statements sent to any account debtor,
other obligor or bailee, shall state that the accounts and such
other Collateral have been assigned to Lender and are payable
directly and only to Lender.
5.6 Attorney-in-Fact. Borrower hereby irrevocably
appoints Lender as Borrower's attorney-in-fact and authorizes
Lender at Borrower's sole expense, to exercise at any time in
Lender's discretion all or any of the powers necessary for
Lender to obtain information about the Collateral or to enforce
Lender's rights.
5.7 Liability. Borrower hereby releases and
exculpates Lender, its officers and employees, from any
liability arising from any acts under this Agreement or in
furtherance thereof, except for gross negligence or willful
misconduct. Lender will not have any liability to Borrower for
lost profits or other special, exemplary, punitive, or
consequential damages.
5.8 Administration of Accounts. After written notice
by Lender to Borrower or without notice after an Event of
Default, Borrower shall not, (a) amend, modify, settle or
compromise any of the accounts or any other Collateral which
includes a monetary obligation, (b) release in whole or in part
any account debtor or other person liable for the payment of any
of the accounts or any such other Collateral, or (c) grant any
credits, discounts, allowances, deductions, return
authorizations or the like with respect to any of the accounts
or any such other Collateral.
5.9 Documents. Borrower shall deliver to Lender, as
Lender may request, all documents, schedules, invoices, proofs
of delivery, purchase orders, statements, contracts and all
other information evidencing or relating to the Collateral, in
form and substance satisfactory to Lender and duly executed by
Borrower. Without limiting the provisions of Section 5.5,
Borrower's granting of credits, discounts, allowances,
deductions, return authorizations or the like will be promptly
reported to Lender in writing. In no event shall any schedule
or confirmatory assignment (or the absence thereof or omission
of any of the accounts or other Collateral therefrom) limit or
in any way be construed as a waiver, limitation or modification
of the security interests or rights of Lender or the warranties,
representations and covenants of Borrower under this Agreement.
Any documents, schedules, invoices or other paper delivered to
Lender by Borrower may be destroyed or otherwise disposed of by
Lender six (6) months after receipt by Lender, unless Borrower
requests their return in writing in advance and makes prior
arrangements for their return at Borrower's expense.
5.10 Access. Lender shall have access, prior to an
Event of Default during reasonable business hours and on or
after an Event of Default at any time, to all of the premises
where Collateral is located for the purposes of inspecting or
copying the Collateral, and all Borrower's books and records.
Lender may, at no charge, use such of Borrower's personnel,
equipment, including computer equipment, programs, printed
output and computer readable media, supplies and premises for
the collection of accounts and realization on other Collateral
as Lender, in its sole discretion, deems appropriate. Borrower
hereby irrevocably authorizes all accountants and third parties
to disclose and deliver to Lender at Borrower's expense all
financial information, books and records, work papers,
management reports and other information in their possession
regarding Borrower. Lender shall use its good faith efforts to
provide Borrower with contemporaneous notice of Lender's
visit(s) to any such accountants or third parties, provided
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however, that Lender's failure to provide such contemporaneous
notice, or any notice, shall not be deemed a breach by Lender of
its obligations to Borrower and Borrower shall have no right or
remedy as a result thereof.
5.11 Environmental Audits. From time to time, but not
more frequently than semi-annually (provided Borrower is not in
default) as requested by Lender, at the sole expense of
Borrower, Borrower shall provide Lender complete access to all
of Borrower's facilities for the purpose of conducting an
environmental audit of such facilities as Lender may deem
necessary.
SECTION 6. ADDITIONAL REPRESENTATIONS, WARRANTIES AND
COVENANTS
Borrower hereby represents, warrants and covenants to
Lender the following, (all of such representations, warranties,
and covenants being continuing in nature so long as any of the
Obligations are outstanding):
6.1 Financial and Other Reports. Borrower shall keep
and maintain its books and records in accordance with generally
accepted accounting principles, consistently applied ("GAAP").
Borrower shall, at its expense, (a) on or before the fifteenth
(15th) day of each month, deliver to Lender true and complete
monthly agings of its accounts receivable and accounts payable,
and (b) on or before the twenty fifth (25th) day of each month,
deliver to Lender true and complete monthly internally prepared
interim financial statements, all in such form, and together
with such other information with respect to the business of
Borrower or any guarantor, as Lender may request, which shall
present fairly, in all material respects, the financial position
of Borrower as of the end of each such period and the results of
its operations and cash flows during such period, all in
accordance with GAAP, and certified by the treasurer or chief
financial officer of Borrower. Annually as soon as available,
but not later than ninety (90) days after the end of each fiscal
year of Borrower, Borrower shall deliver to Lender audited
financial statements of Borrower prepared by and accompanied by
the unqualified report and opinion thereon of an independent
certified public accountant acceptable to Lender; provided,
however, that such report may be qualified only by those events
and circumstances referenced in Borrower's December 31, 1997
audited financial statements .
6.2 Trade Names. Borrower may from time to time
render invoices under its trade names set forth in Section
10.6(g), and Borrower represents that: (a) each trade name does
not refer to another corporation or other legal entity, (b) all
accounts and proceeds thereof (including any returned
merchandise) invoiced under any such trade names are owned
exclusively by Borrower, and (c) Lender may receive, endorse and
deposit to any loan account of Borrower maintained by Lender all
checks or other remittances made payable to any trade name of
Borrower representing payment with respect to such sales or
services.
6.3 Losses. Borrower shall promptly notify Lender in
writing of any loss, damage, investigation, action, suit,
proceeding or claim relating to a material portion of the
Collateral or which may result in any material adverse change in
Borrower's business, assets, liabilities or condition, financial
or otherwise.
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6.4 Books and Records. Borrower's books and records
concerning accounts and its chief executive office are and shall
be maintained only at the address set forth in Section 10.6(d).
Borrower's only other places of business and the only other
locations of Collateral, if any, are and shall be the addresses
set forth in Sections 10.6(e) and (f) hereof, except Borrower
may change such locations or open a new place of business after
thirty (30) days' prior written notice to Lender. Borrower
shall execute and deliver or cause to be executed and delivered
to Lender such financing statements, amendments, financing
documents and security and other agreements as Lender may
reasonably require.
6.5 Title. Borrower has and at all times will
continue to have good and marketable title to all of the
Collateral, free and clear of all liens, security interests,
claims or encumbrances of any kind except in favor of Lender and
except, if any, those set forth on Schedule A hereto ("Permitted
Liens").
6.6 Disposition of Assets. Borrower shall not,
directly or indirectly: (a) sell, lease, transfer, assign,
abandon or otherwise dispose of any part of the Collateral or
any material portion of its other assets (other than (i) sales
of inventory to buyers in the ordinary course of business, and
(ii) sales, leases, transfers, assignments or other disposition
of Collateral pursuant to Borrower's strategic restructuring
objectives in effect as of the date hereof including, without
limitation, the spin-off its wholly-owned subsidiary, Axcel
Biosciences ("Axcel"), so long as and to the extent that (X)
Borrower is not and would otherwise not be in default of any of
its obligations under this Agreement, and (Y) if any such
Collateral being sold, leased, transferred, assigned or disposed
of consists of machinery and equipment referenced in that
certain appraisal dated September 14, 1998 conducted by ▇▇▇▇▇
▇▇▇▇▇▇ Appraisal Corporation for Lender (the "Appraisal"), such
machinery and equipment is no longer useful in the ordinary
course of Borrower's business and the net proceeds received by
Borrower upon the sale of such machinery and equipment shall be
paid to Lender and applied as a prepayment against the Term Loan
together with such additional amount as is necessary so that the
total amount paid by Borrower against the Term Loan equals or
exceeds the appraised value of such machinery and equipment, as
set forth on the Appraisal, or (b) consolidate with or merge
with or into any other entity, or permit any other entity to
consolidate with or merge with or into Borrower, or (c) form or
acquire any interest in any firm, corporation or other entity,
or (d) change its corporate name or trade name or otherwise
conduct business under any assumed or fictitious name, other
than as set forth in Section 10.6(g).
6.7 Insurance. Borrower shall at all times maintain,
with financially sound and reputable insurers, adequate
insurance (including, without limitation, at the option of
Lender, earthquake and flood insurance) with respect to the
Collateral and other assets. All such insurance policies shall
be in such form, substance, amounts and coverage as may be
satisfactory to Lender and shall provide for thirty (30) days'
prior written notice to Lender of cancellation or reduction of
coverage. Lender may obtain, at Borrower's expense, any such
insurance should Borrower fail to do so and adjust or settle any
claim or other matter under or arising pursuant to such
insurance or amend or cancel such insurance. Borrower shall
provide evidence of such insurance and a lender's loss payable
endorsement satisfactory to Lender. Borrower shall deliver to
Lender, in kind, all instruments representing proceeds of
insurance received by Borrower. Lender may apply any insurance
proceeds received at any time to the cost of repairs to or
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replacement of any portion of the Collateral and/or, at Lender's
option, to payment of or as security for any of the Obligations
in any order or manner as Lender determines.
6.8 Compliance With Laws. Borrower is and at all
times will continue to be in compliance with the requirements of
all material laws, rules, regulations and orders of any
governmental authority relating to its business (including laws,
rules, regulations and orders relating to income, withholding,
excise, property and social security taxes, minimum wages,
employer and employee contributions and similar items,
securities, employee retirement and welfare benefits, employee
health and safety, or environmental matters) and all material
agreements or other instruments binding on Borrower or its
property. Borrower shall pay and discharge all taxes,
assessments and governmental charges against Borrower or any
Collateral when due unless the same are being contested in good
faith. Lender may establish reserves for the amount contested
and penalties which may accrue thereon.
6.9 Accounts. All statements made and all unpaid
balances and other information appearing in the invoices,
agreements, proofs of rendition of services and delivery of
goods and other documentation relating to the accounts, and all
confirmatory assignments, schedules, statements of account and
books and records with respect thereto, are true and correct and
in all respects what they purport to be.
6.10 Equipment. With respect to Borrower's equipment,
Borrower shall keep the equipment in good order and repair and
in running and marketable condition, ordinary wear and tear
excepted.
6.11 Intentionally Left Blank.
6.12 Affiliated Transactions. Borrower will not,
directly or indirectly: (a) lend or advance money or property
to, guarantee or assume indebtedness of, or invest (by capital
contribution or otherwise) in any person, firm, corporation or
other entity; or (b) declare, pay or make any dividend,
redemption or other distribution of capital on account of any
shares of any class of stock of Borrower now or hereafter
outstanding; provided, however, that Borrower may declare and
pay dividends on certain preferred stock that it may issue, so
long and to the extent that (i) the payment of any such dividend
does not violate applicable state law, and (ii) Borrower is not
and would otherwise not be in default of any of its obligations
under this Agreement, or (c) make any payment of the principal
amount of or interest on any indebtedness owing to any officer,
director, shareholder, or affiliate of Borrower; or (d) make any
loans or advances to any officer, director, employee,
shareholder or affiliate of Borrower; or (e) enter into any
sale, lease or other transaction with any officer, director,
employee, shareholder or affiliate of Borrower on terms that are
less favorable to Borrower than those which might be obtained at
the time from persons who are not an officer, director,
employee, shareholder or affiliate of Borrower. In connection
with clauses (a) and (d) of this Section 6.12, Borrower may make
advances or contribute additional capital to Axcel in connection
with Borrower's spin-off of Axcel, so long as and to the extent
that Borrower is not and would otherwise not be in default of
any of its obligations under this Agreement.
6.13 Fees and Expenses. Borrower shall pay, on
Lender's demand, all costs, expenses, filing fees and taxes
payable in connection with the preparation, execution, delivery,
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recording, administration, collection, liquidation, enforcement
and defense of the Obligations, Lender's rights in the
Collateral, this Agreement and all other existing and future
agreements or documents contemplated herein or related hereto,
including any amendments, waivers, supplements or consents which
may hereafter be made or entered into in respect hereof, or in
any way involving claims or defenses asserted by Lender or
claims or defenses against Lender asserted by Borrower, any
guarantor or any third party directly or indirectly arising out
of or related to the relationship between Borrower and Lender or
any guarantor and Lender, including, but not limited to the
following, whether incurred before, during or after the Term or
after the commencement of any case with respect to Borrower or
any guarantor under the United States Bankruptcy Code or any
similar statute: (a) all costs and expenses of filing or
recording (including Uniform Commercial Code financing statement
filing taxes and fees, documentary taxes, intangibles taxes and
mortgage recording taxes and fees, if applicable); (b) all title
insurance and other insurance premiums, appraisal fees, fees
incurred in connection with any environmental report, audit or
survey and search fees; (c) all fees as then in effect relating
to the wire transfer of loan proceeds and other funds and fees
then in effect for returned checks and credit reports; (d) all
expenses and costs heretofore and from time to time hereafter
incurred by Lender during the course of periodic field
examinations of the Collateral and Borrower's operations
including, without limitation, field examiner, travel, food and
lodging, plus a per diem charge at the rate set forth in Section
10.4(d) for Lender's examiners in the field and office; and (e)
the costs, fees and disbursements of in-house and outside
counsel to Lender, including but not limited to such costs, fees
and disbursements incurred as a result of a workout,
restructuring, reorganization, liquidation, insolvency
proceeding or litigation between the parties hereto, any third
party and in any appeals arising therefrom.
6.14 Further Assurances. At the request of Lender,
at any time and from time to time, at Borrower's sole expense,
Borrower shall execute and deliver or cause to be executed and
delivered to Lender, such agreements, documents and instruments,
including waivers, consents and subordination agreements from
mortgagees or other holders of security interests or liens,
landlords or bailees, and do or cause to be done such further
acts as Lender, in its discretion, deems necessary or desirable
to create, preserve, perfect or validate any security interest
of Lender or the priority thereof in the Collateral and
otherwise to effectuate the provisions and purposes of this
Agreement. Borrower hereby authorizes Lender to file financing
statements or amendments against Borrower in favor of Lender
with respect to the Collateral, without Borrower's signature and
to file as financing statements any carbon, photographic or
other reproductions of this Agreement or any financing
statements signed by Borrower.
6.15 Environmental Condition. None of Borrower's
properties or assets has ever been designated or identified in
any manner pursuant to any statute, regulations, ordinances,
laws or orders pertaining to environmental matters
(collectively, "Environmental Laws") as a hazardous waste or
hazardous substance disposal site, or a candidate for closure
pursuant to any Environmental Laws. No lien arising under or in
connection with any Environmental Laws has attached to any
revenues or to any real or personal property owned by Borrower.
Borrower has not received a summons, citation, notice, or
directive or other communication from the Environmental
Protection Agency or any other federal or state governmental
agency concerning any action or omission by Borrower resulting
in the releasing, or otherwise exposing of hazardous waste or
hazardous substances into the environment. Borrower is and will
continue to be in compliance (in all material respects) with all
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Environmental Laws and other legal requirements pertaining to
the production, storage, handling, treatment, release,
transportation or disposal of any hazardous waste or hazardous
substance.
6.16 Year 2000 Compliance. The Borrower shall take
all action necessary to assure that its computer-based systems
are able to effectively process data including dates and date
sensitive functions. The Borrower represents and warrants that
the Year 2000 problem will not result in a material adverse
effect on the Borrower's business condition. Upon request, the
Borrower shall provide assurance acceptable to the Lender that
the Borrower's computer systems and software are or will be Year
2000 compliant on a timely basis. The Borrower shall
immediately advise Lender in writing of any material changes in
the Borrower's Year 2000 plan, timetable or budget.
6.17 Organization and Qualification. Borrower is a
business corporation, duly organized, validly existing and in
good standing under the laws of the State set forth in Schedule
D-1 hereto and will (i) do or cause to be done all things
necessary to keep in full force and effect its existence and its
qualification to do business and good standing in such State and
any other jurisdiction(s) in which such qualification is
necessary for the proper conduct of its business or wherein it
owns or leases any property, a schedule of which is attached
hereto as Schedule D-2, and conduct and operate its business in
substantially the manner in which same is presently conducted
and operated; (ii) at all times maintain, preserve and protect
all material patents, franchises, trademarks, trade names,
copyrights and other general intangibles; and (iii) comply with
all material agreements to which it is subject.
6.18 Indemnification.
(a) Borrower hereby indemnifies and agrees to
protect, defend and hold harmless Lender and Lender's directors,
officers, employees, agents, attorneys and shareholders from and
against any and all losses, damages, expenses or liabilities of
any kind or nature and from any suits, claims, or demands,
including all reasonable counsel fees incurred in investigating,
evaluating or defending such suits, claims or demands suffered
by any of them and caused by, relating to, arising out of,
resulting from, or in any way connected with this Agreement, or
any other collateral document, and any transaction contemplated
herein or therein (other than actions arising out of the gross
negligence or willful misconduct of Lender), including but not
limited to, suits, claims or demands based upon any act or
failure to act by Lender in connection with this Agreement or
any other collateral document, and any transaction contemplated
herein or therein. If Borrower shall have knowledge of any
claim or liability hereby indemnified against, it shall give
prompt written notice thereof to Lender. This covenant shall
survive payment of the Obligations.
(b) Lender shall give Borrower prompt notice of all
suits, actions or proceedings instituted against Lender with
respect to which Borrower has indemnified Lender, and Borrower
shall have the right to participate in any such suit, action or
proceeding. Lender shall also have the right, at the sole
expense of Borrower, to participate in, or at Lender's election,
assume the defense or prosecution of such suit, action, or
proceeding, and in the latter event the Borrower may employ
counsel and participate therein. Lender shall have the right to
adjust, settle, or compromise any claim, suit, or judgment after
notice to Borrower, unless Borrower desires to litigate such
10
claim, defend such suit, or appeal such judgment and
simultaneously therewith deposit with Lender additional
collateral security sufficient to pay any judgment rendered,
with interest, costs, and expenses; and the right of Lender to
indemnification under this Agreement shall extend to any money
paid by Lender in settlement or compromise of any such claims,
suits, and judgments in good faith, after notice to Borrower.
(c) If any suit, action, or proceeding is brought by
Lender against Borrower for breach of this covenant of
indemnity, separate suits may be brought as causes of action
accrue, without prejudice or bar to the bringing of subsequent
suits on any other cause of action, whether theretofore or
thereafter accruing.
6.19 Authority and Subsidiaries. Borrower has the
lawful power to own its properties and to engage in the
businesses it conducts; and has no subsidiaries or joint venture
partners other than as set forth on Schedule B hereto.
6.20 Litigation. Except as described on Schedule C
attached hereto, Borrower is not a party to or, to its best
knowledge, threatened with, any litigation, suit, action,
investigation (whether civil or criminal), proceedings or
controversy before any Court, administrative agency or other
governmental authority and Borrower is not in violation of or in
default with respect to any judgment, order, writ, injunction,
decree or rule of any court, administrative agency or
governmental instrumentality or in any material respect under
any regulation of any administrative agency or governmental
instrumentality.
6.21 Patents and Trademarks. Borrower holds no
United States or foreign patents and has no United States or
foreign patent applications pending and has no federally
registered trademarks or trade names and operates under no
fictitious names, other than as disclosed in Section 10.6(g)
below.
SECTION 7. EVENTS OF DEFAULT AND REMEDIES
7.1 Events of Default. All Obligations shall be
immediately due and payable, without notice or demand, upon the
termination of this Agreement or, at Lender's option, upon or at
any time after the occurrence or existence of any one or more of
the following "Events of Default":
(a) Borrower fails to pay when due any of the
Obligations or fails to perform any of the terms of this
Agreement or any other existing or future financing, security or
other agreement between Borrower and Lender or any affiliate of
Lender;
(b) Any representation, warranty or statement of fact
made by Borrower to Lender in this Agreement or any other
agreement, schedule, confirmatory assignment or otherwise, or to
any affiliate of Lender, shall prove inaccurate or misleading in
any material respect;
(c) Any guarantor revokes, terminates or fails to
perform any of the terms of any guaranty, endorsement or other
agreement of such party in favor of Lender or any affiliate of
Lender;
11
(d) Any judgment or judgments aggregating in excess
of the amount set forth in Section 10.6(h) or any injunction or
attachment is obtained against Borrower or any guarantor which
remains unstayed or undischarged for a period of ten (10) days
or is enforced;
(e) The usual business of Borrower or any guarantor
ceases or is suspended;
(f) Any change in the chief executive officer, chief
operating officer, or controlling ownership of Borrower;
(g) Borrower or any guarantor is unable to pay its
debts as they become due, makes an assignment for the benefit of
creditors, makes or sends notice of a bulk transfer or calls a
general meeting of its creditors or principal creditors;
(h) Any petition or application for any relief under
the bankruptcy laws of the United States now or hereafter in
effect or under any insolvency, reorganization, receivership,
readjustment of debt, dissolution or liquidation law or statute
of any jurisdiction now or hereafter in effect (whether at law
or in equity) is filed by or against Borrower or any guarantor;
(i) The indictment or threatened indictment of
Borrower or any guarantor under any criminal statute, or
commencement or threatened commencement of criminal or civil
proceedings against Borrower or any guarantor pursuant to which
statute or proceedings the penalties or remedies sought or
available include forfeiture of any of the property of Borrower
or such guarantor which Lender believes may have a material
adverse effect on the Collateral or Borrower's business;
(j) Any default or event of default occurs on the
part of Borrower under any material agreement, document or
instrument to which Borrower is a party or by which Borrower or
any of its property is bound.
(k) Lender in good faith believes that either (i) the
prospect of payment or performance of the Obligations is
impaired or (ii) the Collateral is not sufficient to secure
fully the Obligations; or
(l) Any material change occurs in the nature or
conduct of Borrower's business.
7.2 Remedies. Upon the occurrence of an Event of
Default and at any time thereafter, Lender shall have all rights
and remedies provided in this Agreement, any other agreements
between Borrower and Lender, the Uniform Commercial Code and
other applicable law, all of which rights and remedies may be
exercised without notice to Borrower, all such notices being
hereby waived, except such notice as is expressly provided for
hereunder or is not waivable under applicable law. All rights
and remedies of Lender are cumulative and not exclusive and are
enforceable, in Lender's discretion, alternatively,
successively, or concurrently on any one or more occasions and
in any order Lender may determine. Without limiting the
foregoing, Lender may (a) accelerate the payment of all
Obligations and demand immediate payment thereof to Lender, (b)
with or without judicial process or the aid or assistance of
others, enter upon any premises on or in which any of the
Collateral may be located and take possession of the Collateral
or complete processing, manufacturing and repair of all or any
12
portion of the Collateral, (c) require Borrower, at Borrower's
expense, to assemble and make available to Lender any part or
all of the Collateral at any place and time designated by
Lender, (d) collect, foreclose, receive, appropriate, setoff and
realize upon any and all Collateral, (e) sell, lease, transfer,
assign, deliver or otherwise dispose of any and all Collateral
(including, without limitation, entering into contracts with
respect thereto, by public or private sales at any exchange,
broker's board, any office of Lender or elsewhere) at such
prices or terms as Lender may deem reasonable, for cash, upon
credit or for future delivery, with the Lender having the right
to purchase the whole or any part of the Collateral at any such
public sale, all of the foregoing being free from any right or
equity of redemption of Borrower, which right or equity of
redemption is hereby expressly waived and released by Borrower.
If any of the Collateral is sold or leased by Lender upon credit
terms or for future delivery, the Obligations shall not be
reduced as a result thereof until payment therefor is finally
collected by Lender. If notice of disposition of Collateral is
required by law, ten (10) days' prior notice by Lender to
Borrower designating the time and place of any public sale or
the time after which any private sale or other intended
disposition of Collateral is to be made, shall be deemed to be
reasonable notice thereof and Borrower waives any other notice.
In the event Lender institutes an action to recover any
Collateral or seeks recovery of any Collateral by way of
prejudgment remedy, Borrower waives the posting of any bond
which might otherwise be required.
7.3 Application of Proceeds. Lender may apply the
cash proceeds of Collateral (other than accounts) actually
received by Lender from any sale, lease, foreclosure or other
disposition of the Collateral to payment of any of the
Obligations, in whole or in part and in such order as Lender may
elect, whether or not then due. Borrower shall remain liable to
Lender for the payment of any deficiency together with interest
at the highest rate provided for herein and all costs and
expenses of collection or enforcement, including reasonable
attorneys' fees and legal expenses.
7.4 Lender's Cure of Third Party Agreement Default.
Lender may, at its option, cure any default by Borrower under
any agreement with a third party or pay or bond on appeal any
judgment entered against Borrower, discharge taxes, liens,
security interests or other encumbrances at any time levied on
or existing with respect to the Collateral and pay any amount,
incur any expense or perform any act which, in Lender's sole
judgment, is necessary or appropriate to preserve, protect,
insure, maintain, or realize upon the Collateral. Lender may
charge Borrower's loan account for any amounts so expended, such
amounts to be repayable by Borrower on demand. Lender shall be
under no obligation to effect such cure, payment, bonding or
discharge, and shall not, by doing so, be deemed to have assumed
any obligation or liability of Borrower.
SECTION 8. JURY TRIAL WAIVER; CERTAIN OTHER WAIVERS AND
CONSENTS
8.1 JURY TRIAL WAIVER. BORROWER AND LENDER EACH
WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
INSTITUTED BY EITHER OF THEM AGAINST THE OTHER WHICH PERTAINS
DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE OBLIGATIONS, THE
COLLATERAL, ANY ALLEGED TORTIOUS CONDUCT BY BORROWER OR LENDER,
OR, IN ANY WAY, DIRECTLY OR INDIRECTLY, ARISES OUT OF OR RELATES
TO THE RELATIONSHIP BETWEEN BORROWER AND LENDER. IN NO EVENT
13
WILL LENDER BE LIABLE FOR LOST PROFITS OR OTHER SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.
8.2 Counterclaims. Borrower waives all rights to
interpose any claims, deductions, setoffs or counterclaims of
any kind, nature or description in any action or proceeding
instituted by Lender with respect to this Agreement, the
Obligations, the Collateral or any matter arising therefrom or
relating thereto, except compulsory counterclaims.
8.3 Jurisdiction. Borrower hereby irrevocably
submits and consents to the nonexclusive jurisdiction of the
State and Federal Courts located in the State in which the
office of Lender designated in Section 10.6(a) is located and
any other State where any Collateral is located with respect to
any action or proceeding arising out of this Agreement, the
Obligations, the Collateral or any matter arising therefrom or
relating thereto. In any such action or proceeding, Borrower
waives personal service of the summons and complaint or other
process and papers therein and agrees that the service thereof
may be made by mail directed to Borrower at its chief executive
office set forth in Section 10.6(d) or other address thereof of
which Lender has received notice as provided herein, service to
be deemed complete five (5) days after mailing, or as permitted
under the rules of said Courts. Any such action or proceeding
commenced by Borrower against Lender will be litigated only in a
Federal Court located in the district, or a State Court in the
State and County, in which the office of Lender designated in
Section 10.6(a) is located and Borrower waives any objections
based on forum non conveniens or venue in connection therewith.
8.4 No Waiver by Lender. Lender shall not, by any
act, delay, omission or otherwise be deemed to have expressly or
impliedly waived any of its rights or remedies unless such
waiver shall be in writing and signed by an authorized officer
of Lender. A waiver by Lender of any right or remedy on any one
occasion shall not be construed as a bar to or waiver of any
such right or remedy which Lender would otherwise have on any
future occasion, whether similar in kind or otherwise.
SECTION 9. TERM OF AGREEMENT; MISCELLANEOUS
9.1 Term. This Agreement shall only become
effective upon execution and delivery by Borrower and Lender and
shall continue in full force and effect for a term set forth in
Section 10.7 from the date hereof ("Term").
9.2 Early Termination. Borrower may also terminate
this Agreement without penalty by giving Lender at least thirty
(30) days' prior written notice and payment in full of all of
the Obligations as provided herein. Thirty (30) days after
receipt by Lender of such notice, Lender shall not be obligated
to make any further loans, advances or other accommodations to
or for the benefit of Borrower. Lender shall also have the
right to terminate this Agreement at any time upon or after the
occurrence of an Event of Default. If Lender terminates this
Agreement upon or after the occurrence of an Event of Default,
or if Borrower shall terminate this Agreement as permitted
herein effective prior to the end of the then-current Term,
Borrower shall pay to Lender on the effective date of
termination, in full, all Obligations
14
9.3 Termination Indemnity Deposit. Upon termination
of this Agreement by Borrower, as permitted herein, in addition
to payment of all Obligations which are not contingent, Borrower
shall deposit such amount of cash collateral as Lender
determines is necessary to secure Lender from loss, cost, damage
or expense, including reasonable attorneys' fees, in connection
with any open accommodations or remittance items or other
payments provisionally credited to the Obligations and/or to
which Lender has not yet received final and indefeasible
payment.
9.4 Notices. Except as otherwise provided, all
notices, requests and demands hereunder shall be (a) made to
Lender at its address set forth in Section 10.6(a) and to
Borrower at its chief executive office set forth in Section
10.6(d), or to such other address as either party may designate
by written notice to the other in accordance with this
provision, and (b) deemed to have been given or made: if by
hand, immediately upon delivery; if by telex, telegram or
telecopy (fax), immediately upon receipt; if by overnight
delivery service, one day after dispatch; and if by first class
or certified mail, three (3) days after mailing.
9.5 Severability. If any provision of this Agreement
is held to be invalid or unenforceable, such provision shall not
affect this Agreement as a whole, but this Agreement shall be
construed as though it did not contain the particular provision
held to be invalid or unenforceable.
9.6 Entire Agreement; Amendments; Assignments. This
Agreement and the Promissory Note referred to in Section 2,
contain the entire agreement of the parties as to the subject
matter hereof, all prior commitments, proposals and negotiations
concerning the subject matter hereof being merged herein.
Neither this Agreement nor any provision hereof shall be
amended, modified or discharged orally or by course of conduct,
but only by a written agreement signed by an authorized officer
of Lender. This Agreement shall be binding upon and inure to the
benefit of each of the parties hereto and their respective
successors and assigns, except that any obligation of Lender
under this Agreement shall not be assignable nor inure to the
successors and assigns of Borrower.
9.7 Discharge of Borrower. No termination of this
Agreement shall relieve or discharge Borrower of its
Obligations, grants of Collateral, duties and covenants
hereunder or otherwise until such time as all Obligations to
Lender have been indefeasibly paid and satisfied in full,
including, without limitation, the continuation and survival in
full force and effect of all security interests and liens of
Lender in and upon all then-existing and thereafter-arising or
acquired Collateral and all warranties and waivers of Borrower.
9.8 Usage. All terms used herein which are defined
in the Uniform Commercial Code shall have the meanings given
therein unless otherwise defined in this Agreement and all
references to the singular or plural herein shall also mean the
plural or singular, respectively.
9.9 Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State in
which the office of Lender set forth in Section 10.6(a) below is
located (the "Applicable State") (without regard to the
Applicable State's conflicts of laws principles) except that
Borrower specifically consents to the applicability of New
15
Jersey law (without regard to New Jersey conflicts of laws
principles) with respect to Lender's exercise and enforcement of
the remedy of confession of judgment by warrant of attorney set
forth in the Warrant of Attorney to Confess Judgment executed
contemporaneously herewith and Borrower expressly waives any
defense which Borrower may have against the enforcement by
Lender of the confession of judgment remedy, based upon any
theory of law or equitable principle whatsoever, including,
without limitation, any claim by Borrower that the governing
laws of the Applicable State may not permit the entry of
judgment by confession.
SECTION 10. ADDITIONAL DEFINITIONS AND TERMS
10.1 Intentionally Left Blank
10.2 Term Loan:
$750,000.00, payable in thirty-five (35) equal
consecutive monthly principal installments of
$12,500.00 and one final installment of the
entire unpaid principal balance thereof, as more
fully set forth in the Promissory Note.
10.3 Intentionally Left Blank
10.4 Interest, Fees & Charges:
(a) Interest Rate: Prime Rate plus three
percent (3%) per annum.
(b) Intentionally Left Blank
(c) Closing Fee: $15,000.00
(d) Field Examination per diem charge per
examiner: $650.00
10.5 Intentionally Left Blank
10.6 (a) Lender's Office:
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(b) Lender's Bank:
Bank of America Illinois
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(c) Borrower: Cytogen Corporation
16
(d) Borrower's Chief Executive Office:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(e) Intentionally Left Blank
(f) Borrower's Other Offices and Locations of
Collateral:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
[storage location] [to be completed by
Borrower]
(g) Borrower's Trade Names for Invoicing:
[insert trade names, if any] [to be
completed by Borrower]
(h) Judgment Amount: $25,000.00
10.7 Term: Three (3) years
IN WITNESS WHEREOF, and intending to be legally bound,
Borrower and Lender have duly executed this Agreement this _20th__
day of October, 1998.
THE CIT GROUP/CREDIT FINANCE, INC.
By: _/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
CYTOGEN CORPORATION
By: _/s/ H. ▇▇▇▇▇▇ ▇▇▇▇▇▇
H. ▇▇▇▇▇▇ ▇▇▇▇▇▇, President
SCHEDULE A
Permitted Liens
1. Liens created under this Loan and Security
Agreement and related documents in favor of the Lender.
2. Liens upon equipment and machinery granted in
connection with the acquisition of such equipment and machinery
by Borrower after the date hereof (including, without
limitation, pursuant to leases and installment sale contracts),
provided that:
(i) each such lien attaches only to the
equipment and machinery acquired with the debt secured thereby,
and
(ii) the principal amount of the indebtedness
secured by any item of equipment or machinery shall not exceed
100% of the cost thereof (excluding labor).
__________________________________
SCHEDULE B
Subsidiaries and Joint Venture Partners
Axcell Biosciences Corporation
The above does not include dormant subsidiaries
___________________________
SCHEDULE C
Litigation and Violations
1. The Company has been served with a complaint, denominated as
a class action complaint, relating to its adoption of a
shareholder rights plan in June, 1998. The lawsuit claims
primarily that (in a case unrelated to Cytogen) the Delaware
chancery court has indicated that a particular provision in the
rights plan may be held inconsistent with Delaware law, that the
Company's rights plan should be revised, and that the plaintiff
and his counsel are entitled to an award of aKomeys' fees to the
extent that it prompted this change. The provision at issue is
common to rights plans adopted by Delaware corporations, and
Cytogen is advised that virtually identical suits have been
filed against a number of Delaware corporations. Cytogen has
advised the plaintiff s counsel that it believes that the
provision has not been held invalid; that to the extent the
provision is held invalid, the rights plan automatically ▇▇▇▇▇▇
it from the plan; and that the lawsuit will not benefit the
stockholders. The plaintiff s counsel has agreed to dismiss the
lawsuit with no application for fees if the Company revises its
rights plan. The Board of Directors of the Company will take
this maker up at its meeting on October. 19, 1998.
18
2. The Company has received a notice from a third parry that it
believes that the Company's ProstaScint product infringes that
party's patent related to location of intracellular markers. The
Company has reviewed the patent claim, does not believe that
infringement is present, and believes, based on advice of
counsel, that the third party patent is invalid. An opinion of
outside patent counsel was obtained during the period of
development of ProstaScint to the effect that such other patent
was invalid by reason of fraud The third party patent expires in
November, 1999. The Company is in discussions with this third
party toward resolving these issues and does not believe that
this claim is likely to have a significant adverse effect on the
Company's financial position or results of operations.
______________________________________
SCHEDULE D-1
Jurisdiction of Borrower's Incorporation
Delaware
_______________________________________
SCHEDULE D-2
Jurisdictions where Borrower is Required to be Qualified
Arkansas
California
Colorado
Delaware
Florida
Georgia
Illinois
Maryland
Massachusetts
Michigan
New Jersey
New York
Ohio
Pennsylvania
Rhode Island
Texas
Washington
Wisconsin
19
CYTOGEN CORPORATION
TERM PROMISSORY NOTE
$750,000.00 October 19, 1998
For value received and intending to be legally bound,
CYTOGEN CORPORATION ("Maker"), a Delaware corporation, hereby
promises to pay, without set-off or defalcation, to the order of
THE CIT GROUP/CREDIT FINANCE, INC. ("Payee"), a Delaware
corporation, at its offices at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other place as Payee may designate to
Maker in writing, the principal sum of Seven Hundred and Fifty
Thousand Dollars ($750,000.00) in lawful money of the United
States of America, together with interest on the outstanding
balance thereof at the floating rate per annum set forth below.
All interest shall be calculated based upon a 360-day year and
the actual number of days elapsed.
The principal amount of this Note shall be repaid in
thirty-five (35) equal consecutive monthly installments of
Twelve Thousand Five Hundred Dollars ($12,500.00) each, due and
payable on the first day of each month, commencing on November
1, 1998 and continuing on the first day of each succeeding
month. One final installment of Three Hundred Twelve Thousand
Five Hundred Dollars ($312,500.00), plus any other unpaid
principal and accrued and unpaid interest, costs, fees and
expenses shall be due and payable on October 1, 2001. All
principal payments hereunder shall be subject to acceleration
and payment in full upon the occurrence of an Event of Default
(as hereinafter defined).
This Note shall bear interest on the principal balance
remaining unpaid from time to time at a floating rate equal to
the Prime Rate plus three percent (3.00%) per annum (the
"Interest Rate"). For purposes hereof, the term "Prime Rate"
means the interest rate per annum publicly announced by The
Chase Manhattan Bank in New York, New York from time to time as
its prime rate, whether or not such announced rate is the best
rate available at such bank. The Interest Rate under this Note
shall be increased or decreased as and when the Prime Rate
changes. Installments of interest shall be due and payable,
concurrently with each payment of principal, on the first day of
each month commencing November 1, 1998 and continuing thereafter
until the principal amount of this Note and all accrued interest
is paid in full.
At the time any payment is due hereunder, Payee may,
at its option, charge the amount thereof to any account of Maker
maintained by Payee or any affiliate of Payee.
The indebtedness evidenced by this Note represents
advances made by Payee pursuant to Section 2 of a Loan
and Security Agreement of even date herewith entered into by and
between Maker and Payee (the "Loan Agreement"). All capitalized
terms used herein and not otherwise defined shall have the
meanings ascribed to them in the Loan Agreement.
20
Payment of this Note is secured by a first priority
lien on and security interest in the Collateral. Payee shall
not be required to resort to the Collateral for payment, but may
proceed against Maker and/or any guarantors in such order and
manner as Payee may choose.
If any payment of principal or interest due hereunder
shall not be paid on or before the due date thereof, interest
shall accrue on such overdue amount from the date such payment
is due at an annual rate equal to the Interest Rate plus two
percent (2%) ("Default Rate").
Each of the following events (each an "Event of
Default") shall constitute an event of default hereunder:
(a) Maker shall fail to pay principal and/or interest
as aforesaid on or before the date on which it shall fall due
hereunder or shall fail to perform any of the other terms of
this Note or any other existing or future financing, security or
other agreement between Maker and Payee or any affiliate of
Payee (hereinafter collectively referred to as the "Loan
Documents").
(b) The occurrence of an "Event of Default" under the
Loan Agreement or the other Loan Documents or if the Loan
Agreement shall expire by its terms, or be terminated or not
renewed for any reason whatsoever.
Upon the occurrence of an Event of Default, in
addition to all rights and remedies of Payee under the Loan
Agreement or other documents executed in connection therewith,
the entire unpaid principal balance of this Note together with
interest accrued thereon at the rate hereinbefore specified, and
all other sums due by Maker hereunder and under the Loan
Agreement or the other Loan Documents shall, at the option of
Payee and without notice to Maker, become due and payable
immediately and payment of the same may be enforced and
recovered in whole or in part at any time by one or more of the
remedies provided to Payee in this Note, in the Loan Agreement,
or the other Loan Documents; and in such case the Payee may also
recover all costs of suit and other expenses in connection
therewith, together with reasonable attorneys' fees for
collection.
The remedies of Payee as provided herein, in the Loan
Agreement, or in the other Loan Documents shall be cumulative
and concurrent and may be pursued singly, successively or
together against the Maker and/or any other obligor and/or
against the Collateral and/or any other property pledged or
assigned to Payee as security for this Note, at the sole
discretion of Payee, and such remedies shall not be exhausted by
any exercise thereof but may be exercised as often as occasion
therefor shall occur.
Payee shall not by any act or omission to act be
deemed to have waived any of its rights or remedies hereunder
unless such waiver is in writing and signed by Payee, and then
only to the extent specifically set forth therein. A waiver of
one event shall not be construed as continuing or as a bar to or
waiver of any right or remedy on a subsequent event.
Maker hereby waives and releases all errors, defects
and imperfections in any proceedings instituted by Payee under
the terms of this Note, the Loan Agreement, the other Loan
Documents or in connection with the Collateral, as well as all
benefit that might accrue to Maker by virtue of any present or
21
future laws exempting any of the property comprising the
Collateral or any other property, real or personal, or any part
of the proceeds arising from any sale of such property, from
attachment, levy or sale under execution, or providing for any
stay of execution, exemption from civil process or extension of
time for payment, as well as the right of inquisition on any
real property that may be levied upon under a judgment obtained
by virtue hereof, and Maker hereby voluntarily condemns the same
and authorizes the entry of such voluntary condemnation on any
writ of execution issued thereon, and agrees that such real
property may be sold upon any such writ in whole or in part in
any order desired by Payee.
Maker hereby waives presentment for payment, demand,
notice of nonpayment, notice of protest and protest of this
Note, and all other notices in connection with the delivery,
acceptance, performance, default or enforcement of the payment
of this Note, and agrees that the liability of Maker shall be
unconditional without regard to the liability of any other party
and shall not be in any manner affected by any indulgence,
extension of time, renewal, waiver or modification granted or
consented to by Payee; and Maker hereby consents to any and all
extensions of time, renewals, waivers or modifications that may
be granted by Payee with respect to the payment or other
provisions of this Note, and to the release of the Collateral,
or any part thereof, with or without substitution, and agrees
that Maker's endorsers, guarantors or sureties may become
parties hereto without notice to Maker or affecting the Maker's
liability hereunder.
Notwithstanding anything to the contrary herein
contained, the total liability of Maker for payment of interest
pursuant hereto shall not exceed the maximum amount, if any, of
such interest permitted by applicable law to be contracted for,
charged or received, and if payments by Maker to Payee include
interest in excess of such maximum amount, Payee shall apply
such excess to the reduction of the unpaid principal amount due
pursuant hereto, or if none is due, such excess shall be
refunded to Maker. Any such application or refund shall not
cure or waive any Event of Default. In determining whether or
not any interest payable under this Note or the Loan Agreement
or with respect to the Collateral exceeds the highest rate
permitted by law, any non-principal payment (except payments
specifically stated in this Note to be "interest"), including
without limitation prepayment premiums and late charges, shall
be deemed, to the extent permitted by applicable law, to be an
expense, fee, premium or penalty rather than interest.
If any provision hereof is found by a court of
competent jurisdiction to be prohibited or unenforceable, it
shall be ineffective only to the extent of such prohibition or
unenforceability, and such prohibition or unenforceability shall
not invalidate the balance of such provision to the extent it is
not prohibited or unenforceable, nor invalidate the other
provisions hereof, all of which shall be liberally construed in
favor of Payee in order to effect the provisions of this Note.
As used herein, the words "Payee" and "Maker" shall be
deemed and construed to include the respective successors and
assigns of Payee and the respective successors and permitted
assigns of Maker. This Note shall be construed and enforced in
accordance with and governed by the laws of the State of
Illinois (without regard to Illinois' conflicts of laws
principles) except that Maker specifically consents to the
applicability of New Jersey law (without regard to New Jersey's
conflicts of laws principles) with respect to Payee's exercise
and enforcement of the remedy of confession of judgment by
warrant of attorney set forth in the Warrant of Attorney to
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Confess Judgment executed contemporaneously herewith and Maker
expressly waives any defense which Maker may have against the
enforcement by Payee of the confession of judgment remedy, based
upon any theory of law or equitable principle whatsoever,
including, without limitation, any claim by Maker that the
governing laws of Illinois may not permit the entry of judgment
by confession.
IN WITNESS WHEREOF, Maker has duly executed this Note
as of the day and year first above written.
CYTOGEN CORPORATION
By:_/s/ ▇. ▇▇▇▇▇▇ Reiser_______
H. ▇▇▇▇▇▇ ▇▇▇▇▇▇, President
STATE OF _NEW JERSEY____ :
COUNTY OF _MIDDLESEX_____ :
On the _19th_ day of October, 1998 before me
personally came _H. ▇▇▇▇▇▇ ▇▇▇▇▇▇, to me known, who, being by me
duly sworn, did depose and say that he is the President of
Cytogen Corporation, the corporation described herein and which
executed the foregoing instrument; that said instrument was
signed and sealed on behalf of said corporation by authority of
its board of directors; and that they acknowledged said
instrument to be the free act and deed of said corporation.
/s/ ▇▇▇▇▇ ▇. Hansen___________
Notary Public
My Commission Expires: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Notary Public, State of New Jersey
ID No. 2217403
Qualified in Middlesex County
Commission Expires September 1, 2003
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