SECURED PROMISSORY NOTE
Execution
Copy
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$5,000,000.00
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April__,
2010
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FOR VALUE
RECEIVED, Cytomedix Acquisition Company, LLC, a Delaware limited liability
company (“Buyer”), and
Cytomedix, Inc., a Delaware corporation (“Parent”, and together
with Buyer, “Obligors”), hereby
jointly and severally promise to pay to the order of Sorin Group USA, Inc. a
Delaware corporation (“Seller”), without
setoff or counterclaim (except to the extent explicitly permitted pursuant to
Section 8.8 of the Asset Purchase Agreement), at the principal office of Seller
in Arvada, Colorado, or such place as the holder of this Note may from time to
time designate, the principal sum of Five Million Dollars ($5,000,000), payable
as follows: (i) installments of $800,000 (Eight Hundred Thousand Dollars) each
on the six and twelve month anniversaries hereof, (ii) installments of
$1,200,000 (One Million Two Hundred Thousand Dollars) each on the eighteen and
twenty-four month anniversaries hereof, and (iii) an installment of $1,000,000
on the thirtieth month anniversary hereof (the “Maturity
Date”). All amounts payable on this Note shall be payable in
lawful money of the United States of America. Each Obligor further
covenants and agrees as follows:
1. Reference to Other
Documents. This Note is issued pursuant to Section 2.4 of the
Asset Purchase Agreement.
2. Certain
Definitions. As used in this Note, the following terms shall
have the following meanings:
“Asset Purchase
Agreement” shall mean that certain Asset Purchase Agreement, dated as of
April __, 2010 by and among Seller, Buyer and Parent.
“Business Day” shall
mean any day other than a Saturday, Sunday or other day on which banks in New
York, New York or Milan, Italy are required or authorized to close.
“Note” shall mean this
Secured Promissory Note.
Terms
used and not otherwise defined in this Note and defined in the Uniform
Commercial Code as in effect from time to time in the State of Delaware (the
“Code”) shall
have the meanings set forth in the Code.
3. Interest. The
unpaid principal balance of this Note shall bear interest, payable in arrears at
the time of each scheduled payment of principal hereunder, computed at the rate
of 2.7% per
annum. All principal, interest and other amounts unpaid after
an Event of Default shall bear interest, payable on demand, computed at a rate
equal to 4% per annum plus the rate otherwise payable hereunder. Interest shall
be calculated for the actual number of days elapsed, using a daily rate
determined by dividing the annual rate by 360.
4. Prepayment. This
Note may be prepaid by Obligors, in whole or in part, at any time and from time
to time, without premium or penalty. All prepayments shall be applied
against scheduled payments of principal due hereunder in the inverse order of
their maturity.
5. Security
Interest. To secure payment of its obligations under this
Note, Buyer grants to Seller a security interest in all of the property
described below in which Buyer has or acquires an interest, wherever located,
whether now owned or hereafter arising or acquired (collectively, the “Collateral”): (a)
all equipment, fixtures, and inventory, including all spare and repair parts,
special tools, equipment and replacements for any of the foregoing, and any
software embedded therein or related thereto; (b) all accounts, contract rights,
documents, chattel paper (including electronic chattel paper), instruments, and
general intangibles, and all returned or repossessed goods the sale of which
gave rise to any of the foregoing; (c) all financial assets, investment
property, securities, security entitlements, securities accounts, commodity
contracts, and commodity accounts, including all substitutions and additions
thereto, and all dividends, distributions and sums distributable or payable
from, upon or in respect of such property; (d) all commercial tort claims; (e)
all deposit accounts and all cash balances from time to time credited to such
accounts; (f) all letter-of-credit rights; (g) all supporting
obligations that support the payment or performance of any of the foregoing; and
(h) all additions and accessions to, all proceeds, products, offspring and
profits of, and all rights and privileges incident to, any of the
foregoing..
In order
to induce Seller to accept this Note from Obligors, Buyer warrants that while
any amount under this Note remains unpaid: (a) Buyer is the owner of
the Collateral free of all encumbrances and security interests except the
security interests of Seller and other security interests Seller may permit in
writing from time to time; (b) Seller has a valid and perfected security
interest in the Collateral; (c) the execution and delivery of this Note will not
violate or constitute a breach of any agreement or restriction to which Buyer is
a party or is subject; (d) the name appearing below the signature of ▇▇▇▇▇ is
Buyer’s correct and exact name; (e) Buyer does not use any other names; (f) the
address appearing below Buyer’s name is ▇▇▇▇▇’s principal business address (and
Buyer shall advise Seller in writing at least thirty (30) days before any change
of name or principal business address).
Buyer
shall: (a) keep the Collateral free from all liens, encumbrances and
security interests (other than the security interests of Seller and other
security interests Seller may permit in writing from time to time); (b) defend
it against all claims and legal proceedings by persons other than Seller; (c)
pay and discharge when due all taxes, license fees, levies and other charges
upon it; (d) and not sell, lease, license or otherwise dispose of it except in
the ordinary course of business prior to the occurrence of an Event of
Default. Loss of or damage to the Collateral shall not release Buyer
from any of the obligations under this Note. Buyer shall pay all
expenses and, upon request, execute and deliver any further documents and take
any further actions reasonably deemed advisable by Seller to preserve the
Collateral or to establish, determine priority of, perfect, continue perfected,
terminate and/or enforce Seller’s interest in it or rights under this
Note. Buyer shall pay and discharge all lawful taxes, assessments and
governmental charges upon Buyer or against its properties prior to the date on
which penalties attach, unless and to the extent only that such taxes,
assessments and charges are contested in good faith and by appropriate
proceedings by ▇▇▇▇▇.
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Seller
has no duty to protect, insure, collect or realize upon the Collateral or
preserve rights in it against prior parties. ▇▇▇▇▇ authorizes Seller
to prepare and file financing statements describing the Collateral in such
jurisdictions as Seller deems appropriate. No delay on the part of Seller in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, power or
privilege hereunder preclude other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies
herein specified are cumulative and not exclusive of any rights or remedies
which Seller would otherwise have.
6. Setoff. Each
Obligor grants Seller a security interest and lien in any and all monies,
balances and accounts now or hereafter owed Seller by such Obligor and agrees
that Seller may, and Seller reserves the right to, charge and set off against
any such monies, balances and accounts any amounts owing on the Note, whether
due or not. This right of set off may be exercised notwithstanding
the subordination provisions below.
7. Rights of
Holder. Without affecting the liability of either Obligor, the
holder of this Note may, from time to time and without notice, renew or extend
the time for payment, accept partial payments, release or impair any collateral
security for payment of this Note, or agree not to sue any party liable on
it.
8. Default. If
any one or more of the following conditions or events (each an “Event of Default”)
shall occur:
a. Default in Payment of
Note: If Obligors shall default in the payment of any
principal, interest or other amount due under the terms of this Note;
or
b. Default in Compliance with
Note Terms: If Obligors shall default in the performance of or
compliance with any term (other than payment of any principal or interest
hereon) contained in this Note and such default shall not have been remedied
within ten (10) Business Days after the occurrence thereof; or
c. Breach of Representation or
Warranty: If any representation or warranty made by Obligors
in this Note proves to be incorrect in any material respect or is breached in
any material respect; or
d. Other
Agreements: If any representation or warranty set forth in
Article IV of the Purchase Agreement shall cease to be true at any time while
any principal or interest on this Note remains outstanding (notwithstanding that
such representations and warranties are made as of execution of the Asset
Purchase Agreement and Closing thereunder, for purposes of this Note such
representations and warranties shall be deemed to be continually remade);
or
e. Bankruptcy; Insolvency;
Involuntary or Voluntary Liquidation or Dissolution: If either
Obligor (1) shall make an assignment for the benefit of creditors, or (2) shall
admit in writing its inability to pay a major part of its debts as they become
due, or (3) shall become the subject of any insolvency, bankruptcy,
receivership, or dissolution proceeding and, if such proceeding is instituted
against such Obligor, shall have been consented to or acquiesced in by such
Obligor, or shall remain un-dismissed for 60 days, or an order for relief shall
have been entered against such Obligor (any event under this clause (e) being a
(“Bankruptcy Default”));
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Then
Seller may at any time, (x) at the option of Seller, by written notice given to
either Obligor, declare this Note to be, and this Note shall thereupon become,
due and payable, without any presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived, and Obligors forthwith will pay
to Seller (i) the whole of the principal balance of this Note (then
outstanding), (ii) all interest owed, (iii) all other sums, as provided in this
Note and (iv) all costs incurred by Seller in connection with this Note or any
renewal, extension, or change of or substitution for this Note or any part
thereof, whether made or incurred at the request of Obligors and including all
costs of enforcement, including reasonable attorneys’ fees and (y) exercise any
and all rights of a secured party upon default under the
Code. Notwithstanding the foregoing, in the event of a Bankruptcy
Default all sums referred to in (i) through (iv) above shall automatically
mature and become immediately payable by Obligors. Seller’s receipt
of any payment after the occurrence of an Event of Default shall not constitute
a waiver of such default or any of the Seller’s rights and
remedies.
9. Guaranteed. The
obligations of each Obligor hereunder are secured, in part, by that certain
Limited Guarantee Agreement dated the date hereof given by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ in
favor of Seller.
10. Waiver. The
obligations of each Obligor hereunder shall be joint and several,
and the liability of each Obligor shall be absolute and
unconditional, regardless of the liability of the other Obligor; and each
Obligor acknowledges that Seller has not made any representations or warranties
regarding the financial condition of any other Obligor or the value of any
collateral. Each Obligor and any indorsers, sureties or guarantors
waive presentment, demand, notice of dishonor and protest, and agree to pay all
costs of collection, before and after judgment, including reasonable attorneys’
fees and legal expenses.
11. Governing
Law. This Note is governed by the internal laws of the State
of Delaware, except to the extent superseded by federal law.
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This Note
was executed as of the date first written above.
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CYTOMEDIX
ACQUISITION COMPANY, LLC
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By:
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▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, President
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CYTOMEDIX,
INC.
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By:
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▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, CEO
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OBLIGORS’
ADDRESS:
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c/o
Cytomedix, Inc.
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▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
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Rockville,
MD 20850
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Attention: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, Chief Executive Officer
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Fax:
▇▇▇.▇▇▇.▇▇▇▇
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