SECURED CONSTRUCTION TO PERMANENT NOTE
$1,750,000.00 July 23, 1999
Boston, Massachusetts
For value received, the undersigned promises to pay to USTrust ("Bank"), or
order, at Bank, the principal sum of One Million Seven Hundred Fifty Thousand
($1,750,000.00) Dollars, together with interest as hereinafter provided:
interest only shall be payable monthly on the first day of first month next
succeeding the date hereof through and including December 1, 1999 on the
principal sum from time to time outstanding at the Base Lending Rate for
commercial loans from time to time in effect at the Bank plus one (1%) percent
per annum. The term "Base Lending Rate" as used herein shall mean the rate of
interest announced by Bank from time to time at its head office as its Base
Lending Rate, it being understood that such rate is a reference rate and not
necessarily the lowest rate of interest charged by the Bank. On December 1, 1999
(the "Conversion Date ") the outstanding principal balance hereunder shall be
amortized (based upon a twenty year amortization) over a five year term at an
interest rate equal the Bank's cost of funds on the Conversion Date plus two
hundred twenty-five basis points (or interest shall continue to accrue at the
Base Lending Rate plus one (1%) percent as hereinafter described). Beginning on
the Conversion Date, the principal balance of this Note shall be payable in
sixty consecutive monthly installments as follows: $7,291.67 on January 1, 2000,
and the same amount (except the final installment which shall be the amount of
the outstanding principal balance, together with all accrued but unpaid interest
thereon) on the first day of each month thereafter. Beginning on the Conversion
Date interest shall be payable at the fixed rate equal to the Bank's cost of
funds on the Conversion Date plus two hundred and twenty-five basis points or at
the undersigned's election prior to the Conversion Date, shall remain at the
Base Lending Rate plus one (1%) percent per annum. If no election is made by the
undersigned, interest shall continue at the variable rate set forth above, which
interest shall be payable commencing on January 1, 2000 and on the first day of
each month thereafter until this Note is fully paid. Interest shall be
calculated on the basis of actual days elapsed and a 360-day year.
In all events, the entire unpaid principal balance, together with all
accrued interest thereon shall be paid in full on December 1, 2004.
This Note may be prepaid in whole or in part (prior to the Conversion Date)
without premium or penalty. If this Note is prepaid, in whole or in part, after
the Conversion Date (and a fixed interest rate is in effect), whether
voluntarily or as a result of acceleration or otherwise, the undersigned shall
reimburse the Bank for the loss, if any, including any loss profits resulting
from such prepayment, as reasonably determined by the Bank. The undersigned
shall pay shall loss upon presentation by the Bank of a statement of the amount
of such loss setting forth the Bank's calculation thereof, which notice and
calculation (including the method of calculation) shall be deemed true and
correct absent manifest error. Any partial prepayments shall be applied in the
inverse order of maturity.
If this Note is not paid in full on the date of maturity or upon the
exercise by the Bank of its rights in the event of the undersigned's default,
interest on unpaid balances shall thereafter be payable at a fluctuating
interest rate per annum equal to four (4%) percent greater than the rate of
interest specified herein.
At the option of the holder, this note shall become immediately due and
payable without notice or demand upon the occurrence at any time of any of the
following events of default: (1) the failure by the undersigned to pay when due
any principal, interest, fees, costs and expenses due to the holder hereunder or
otherwise; (2) if any statement, representation or warranty made in or in
connection with the loan evidenced by this note, or in any supporting financial
statement of the undersigned or of any guarantor hereof shall be found to have
been false in any material respect;(3) the institution by or against the
undersigned or any guarantor hereof of any proceedings pursuant to Title 11 of
the United States Code entitled "Bankruptcy" (commonly referred to as the
Bankruptcy Code) or any other law in which the undersigned or any guarantor
hereof is alleged to be insolvent or unable to pay their respective debts as
they mature or the making by the undersigned or any guarantor hereof of an
assignment for the benefit of creditors; (4) the service upon the holder hereof
of a writ in which the holder is named as trustee of the undersigned or of any
guarantor hereof; (5) the occurrence of an event of default under or termination
for any
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reason of the Amended and Restated Loan and Security Agreement (Accounts
Receivable and Inventory) dated October 31, 1994, as amended, between the Bank
and Turbotec Products, Inc. (the "Agreement"); or (6) the occurrence of an event
of default under that certain Construction Loan Agreement between the
undersigned and the Bank of even date.
Any deposits or other sums at any time credited by or due from the Bank to
the undersigned or any guarantor hereof, and any securities or other property of
the undersigned or any such guarantor, in the possession of the Bank, may at any
and all times be held and treated as security for the payment of the liabilities
hereunder; and the Bank may apply or set off such deposits or other sums, at any
time, and without notice to the undersigned or to any such guarantor, against
any of such liabilities, whether or not the same have matured, and whether or
not other collateral is available to the Bank.
The undersigned agrees to pay all costs of collection including reasonable
fees of attorneys.
No delay or omission on the part of the holder in exercising any right
hereunder shall operate as a waiver of such right or of any other right of such
holder, nor shall any delay, omission or waiver on any one occasion be deemed a
bar to or waiver of the same or any other right on any future occasion. Every
one of the undersigned and every indorser or guarantor of this note regardless
of the time, order or place of signing waives presentment, demand, protest and
notices of every kind and assents to any one or more extensions or postponements
of the time of payment or any other indulgences, to any substitutions, exchanges
or releases of collateral if at any time there be available to the holder
collateral for this note, and to the additions or releases of any other parties
or persons primarily or secondarily liable.
This note is secured pursuant to the terms of an Open-End Mortgage Deed of
even date herewith on property located at 651 Day Hill Road, Windsor,
Connecticut, and a Security Agreement - Inventory, Accounts, Equipment and Other
Property dated September 4, 1992.
All rights and obligations hereunder shall be governed by the law of the
Commonwealth of Massachusetts and this note shall be deemed to be under seal.
Witness: THERMODYNETICS, INC.
_______________________ By: ___________________________________
Robert I. Lieberman
Treasurer and Chief Financial Officer
