<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
------
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 29, 1997
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
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THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to _________________
Commission file number 0-21794
GENZYME TRANSGENICS CORPORATION
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(Exact name of registrant as specified in its charter)
Massachusetts 04-3186494
- -------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Five Mountain Road, Framingham, Massachusetts 01701
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(508) 620-9700
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Registrant's telephone number, including area code
Indicate by check whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X . No .
--------- -----------
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at August 4, 1997
----- -----------------------------
Common Stock, $0.01 par value 17, 294, 675
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GENZYME TRANSGENICS CORPORATION
TABLE OF CONTENTS
PAGE #
------
PART 1. FINANCIAL INFORMATION
ITEM 1 - Unaudited Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets as of June 29, 1997
and December 29, 1996...................................................3
Condensed Consolidated Statements of Operations for the
Three Months and Six Months Ended June 29, 1997 and June 30, 1996.......4
Condensed Consolidated Statements of Cash Flows for
the Six Months Ended June 29, 1997
and June 30, 1996.......................................................5
Notes to Unaudited Condensed Consolidated
Financial Statements....................................................6
ITEM 2
Management's Discussion and Analysis of
Financial Condition and Results of Operations...........................8
PART II. OTHER INFORMATION
ITEM 1
Legal Proceedings......................................................11
ITEM 2
Changes in Securities..................................................11
ITEM 4
Submission of Matters to a Vote of Security Holders....................12
ITEM 6
Exhibits and Reports on Form 8-K.......................................13
SIGNATURES..................................................................15
EXHIBIT INDEX...............................................................16
<PAGE>
GENZYME TRANSGENICS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, dollars in thousands except per share amounts)
<TABLE>
June 29, December 29,
1997 1996
--------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents......................... $6,397 $8,894
Accounts receivable, net.......................... 8,720 7,499
Unbilled contract revenue......................... 6,414 6,740
Other current assets.............................. 1,213 1,509
------- -------
Total current assets.......................... 22,744 24,642
Net property, plant and equipment.................. 24,440 20,566
Costs in excess of net assets acquired, net........ 20,114 20,695
Investment in Joint Venture........................ 280 283
Other assets....................................... 787 518
------ ------
$68,365 $66,704
------ ------
------ ------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.................................. $1,740 $2,992
Accounts payable - Genzyme Corporation............ 2,530 1,339
Revolving line of credit.......................... 6,000 6,000
Accrued expenses.................................. 6,392 5,911
Advance payments.................................. 7,674 6,649
Current portion of long-term debt................. 1,875 1,867
------ ------
Total current liabilities..................... 26,211 24,758
Long-term debt, net of current portion............ 8584 5,708
Deferred lease obligation......................... 560 508
Other liabilities................................. 264 526
------ ------
Total liabilities............................. 35,619 31,500
Stockholders' equity:
Preferred stock, $.01 par value, authorized
5,000,000 shares, none outstanding;............. - -
Common stock, $.01 par value; 24,000,000 shares
authorized; 17,276,765 and 17,130,901 shares
issued and outstanding at June 29, 1997 and
December 29, 1996, respectively ............... 173 171
Capital in excess of par value.................... 53,782 52,974
Accumulated deficit............................... (21,199) (17,931)
Accumulated translation adjustments............... (10) (10)
------ ------
Total stockholders' equity...................... 32,746 35,204
------ ------
$68,365 $66,704
------ ------
------ ------
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
GENZYME TRANSGENICS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands except share and per share amounts)
<TABLE>
Three months ended Six months ended
------------------- -------------------
June 29, June 30, June 29, June 30,
1997 1996 1997 1996
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues
Services................................ $11,404 $ 9,381 $22,545 $18,176
Research and development................ 4,190 1,990 7,983 3,548
------ ------ ------ ------
15,594 11,371 30,528 21,724
Costs and operating expenses:
Services................................ 9,308 8,156 18,695 15,777
Research and development................ 4,219 2,112 7,066 4,099
Selling, general and administrative..... 3,561 2,834 7,154 5,417
Equity in loss of Joint Venture......... 220 94 531 134
------ ------ ------ ------
17,308 13,196 33,446 25,427
------ ------ ------ ------
Loss from operations..................... (1,714) (1,825) (2,918) (3,703)
Other income (expense):
Interest income......................... 62 3 92 11
Interest expense........................ (233) (363) (417) (673)
Other income............................ - - - 318
------ ------ ------ ------
Loss before provision for income taxes... (1,885) (2,185) (3,243) (4,047)
Provision for income taxes............... 5 - 25 92
------ ------ ------ ------
Net loss................................. $(1,890) $(2,185) $(3,268) $(4,139)
------ ------ ------ ------
------ ------ ------ ------
Net loss per common share................ $ (0.11) $ (0.16) $(0.19) $ (0.31)
------ ------ ------ ------
------ ------ ------ ------
Number of common shares outstanding
for purposes of computing net loss
per share.............................. 17,212 13,318 17,177 13,245
------ ------ ------ ------
------ ------ ------ ------
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
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GENZYME TRANSGENICS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, dollars in thousands except per share amounts)
<TABLE>
Six Months Ended
----------------
June 29, June 30,
1997 1996
-------- --------
<S> <C> <C>
Cash flows for operating activities:
Net loss........................................................ $ (3,268) $ (4,139)
Adjustments to reconcile net loss to net
cash used by operating activities:
Depreciation and amortization................................. 2,029 1,799
Adjustment to Goodwill........................................ - (143)
Equity in loss of Joint Venture............................... 531 134
Changes in assets and liabilities,
Accounts receivable and unbilled contract revenue............. (895) (2,968)
Other current assets.......................................... 296 (344)
Accounts payable.............................................. (1,252) (1,910)
Accounts payable - Genzyme Corporation........................ 1,191 833
Other accrued expenses........................................ 693 144
Advance payments.............................................. 1,025 542
------- -------
Net cash provided by (used in) operating activities........... 350 (6,052)
Cash flows for investing activities:
Purchase of property, plant and equipment....................... (4,911) (788)
Investment in Joint Venture..................................... (528) -
Restricted cash................................................. - 950
Other assets.................................................... (299) (67)
------- -------
Net cash provided by (used in) investing activities........... (5,738) 95
Cash flows from financing activities:
Net proceeds from the issuance of common stock.................. 598 530
Proceeds from long-term debt.................................... 4,869 -
Repayment of long-term debt..................................... (2,366) (1,109)
Investment and advances by Genzyme Corporation.................. - 3,092
Other long-term liabilities..................................... (210) (176)
------- -------
Net cash provided by financing activities..................... 2,891 2,337
------- -------
Net decrease in cash and cash equivalents........................ (2,497) (3,620)
Cash and cash equivalents at beginning of period................. 8,894 4,400
------- -------
Cash and cash equivalents at end of period....................... $ 6,397 $ 780
------- -------
------- -------
Noncash investing and financing activities:
Property acquired under capital leases.......................... $ 381 $ 669
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
GENZYME TRANSGENICS CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation:
These unaudited condensed consolidated financial statements should be read in
conjunction with the Annual Report on Form 10-K for the fiscal year ended
December 29, 1996 of Genzyme Transgenics Corporation (the "Company") and the
financial statements and footnotes included therein. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to Securities and Exchange Commission rules and regulations.
Per share information is based upon the weighted average number of shares of
Common Stock outstanding during the period.
The financial statements for the six months ended June 29, 1997 and June 30,
1996 are unaudited but include, in the Company's opinion, all adjustments
(consisting only of normally recurring accruals) necessary for a fair
presentation of the results for the periods presented.
2. Accounting Policies:
The accounting policies underlying the quarterly financial statements are those
set forth in Note 2 of the financial statements included in the Company's Annual
Report on Form 10-K for the year ended December 29, 1996.
3. Joint Venture:
In February 1997, the Company reached an agreement with a joint venture formed
by the Company and Sumitomo Metal Industries, Ltd. (the "Joint Venture") under
which the Company may receive up to $4.4 million in future milestone payments
for the development of Antithrombin III ("AT-III"). In 1997, the Company earned
$1.4 million in the first quarter and $1.0 million in the second quarter in
milestone payments under the agreement. In March 1997, the Joint Venture
partners agreed to raise $2.4 million in additional equity, of which the Company
contributed $528,000 in April 1997 to maintain its 22% ownership interest.
4. Extension of the Convertible Debt and Development Funding Agreement:
On March 30, 1997, the Company amended its Convertible Debt and Development
Funding Agreement with Genzyme Corporation ("Genzyme"), dated March 29, 1996
(the "Agreement"), to provide for continued funding by Genzyme, of the
development costs of the AT-III program through June 30, 1997. On June 30,
1997, the Company and Genzyme agreed to extend the Agreement until December 31,
1997. Under the extended agreement, Genzyme will provide $7.0 million in
development funding in 1997. During the extension
6
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period, the Company negotiated the terms of a joint venture with Genzyme, the
principal terms of which were agreed to in July 1997 (see Note 8).
5. Pharming, B.V. Litigation:
In April 1997, the Company reached an agreement to settle its arbitration
with Pharming, B.V., a Netherlands corporation ("Pharming") in connection
with a license agreement between the two parties. Under the terms of the
agreement, the Company paid $200,000 to Pharming in May 1997 in return for a
stipulation dismissing all claims submitted in the arbitration proceedings
and a clarification of certain terms of the license agreement.
6. Mason Debt Financing:
In June 1997, the Company completed a financing for the expansion of its
Mason Laboratory. The financing package provides $5.0 million in available
funds from a consortium of state and local government agencies in conjunction
with a commercial bank. The loan carries a 10-year amortization schedule
with a variable interest rate adjusted annually. The current rate is
9.25%. The Company utilized $3.8 million of the line in June to fund the
initial phase of renovations and to refinance $800,000 of existing mortgage
debt. The remaining $1.2 million is available through December 31, 1998 for
additional renovations of the facility, if any.
7. Redfield Debt Financing:
In June 1997, the Company obtained from a commercial bank, in conjunction with a
state government agency, a $1,050,000 loan for the expansion of its Redfield
Laboratory. The loan has an annual interest rate of 10% with a balloon payment
due July 1, 1998. This loan is renewable each year.
8. Subsequent Event:
On July 22, 1997, the Company and Genzyme announced an agreement to establish a
joint venture for the development, marketing and distribution of AT-III. A
definitive agreement has not yet been signed. Under the terms of the agreement,
Genzyme will provide 70 percent of the development costs, up to a maximum
contribution of $33 million, and the Company will fund the remaining 30 percent.
Development costs in excess of $33 million will be funded equally by the
partners. In addition to the funding, both partners will contribute
manufacturing, marketing and other resources to the joint venture at cost and
will share profits from product sales equally. The agreement covers all
territories other than Asia and may include milestone payments from Genzyme to
the Company after the product has been approved by the United States Food and
Drug Administration.
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Three months ended June 29, 1997 and June 30, 1996
Total revenues for the three-month period ending June 29, 1997 were $15.6
million, compared with $11.4 million in the comparable period of 1996, an
increase of $4.2 million or 37%. Service revenues increased to $11.4 million in
the second quarter of 1997 from $9.4 million in the second quarter of 1996, an
increase of $2 million or 22%. Research and development revenue increased to
$4.2 million in the second quarter of 1997 from $2 million in the second quarter
of 1996, an increase of $2.2 million or 111%, due primarily to increased funding
received from Genzyme Corporation ("Genzyme") for the development of the lead
compound, transgenic Antithrombin III ("AT-III"), the achievement of a $1
million milestone from the joint venture formed by the Company and Sumitomo
Metal Industries, Ltd. (the "Joint Venture") and increased commercial activity.
Cost of services for the second quarter of 1997 were $9.3 million compared to
$8.2 million in the comparable period of 1996, an increase of $1.2 million or
14% due to increased service revenues. Research and development expenses
increased to $4.2 million in the second quarter of 1997 from $2.1 million in the
second quarter of 1996, an increase of $2.1 million or 100%. The increase is
due to costs associated with the manufacturing facility coming on-line for
the production of AT-III material for clinical trials and increased activity in
the research and commercial programs.
Gross profit for the second quarter of 1997 was $2.1 million versus $1.1 million
in the second quarter of 1996. Gross profit on services for the second quarter
of 1997 was $2.1 million, reflecting a gross margin of 18%, versus $1.2 million
and a gross margin of 13% in the second quarter of 1996. The improvement in
services margins was primarily due to increased services revenues and a shift to
higher margin services.
Selling, general and administrative ("SG&A") expenses increased to $3.6 million
in the second quarter of 1997 from $2.8 million in the second quarter of 1996,
an increase of $727,000 or 26%. The increase is due to the increased marketing
efforts and administrative personnel required to generate the increase in
revenue.
Interest income increased to $62,000 in the second quarter of 1997, from $3,000
in the second quarter of 1996 due to the investment of funds from the Company's
secondary public offering and the receipt of interest on funds that were held in
escrow last year. Interest expense decreased to $233,000 in the second quarter
of 1997 from $363,000 in the second quarter of 1996 due to lower borrowings in
1997.
The Company recognized $220,000 of Joint Venture losses during the second
quarter of 1997 compared to $94,000 in the comparable period of 1996. The
increase was due to additional
8
<PAGE>
research by the Joint Venture including increased research funding to the
Company (see Note 3 to the Financial Statements appearing in this Report).
Six months ended June 29, 1997 and June 30, 1996
Total revenues for the six-month period ending June 29, 1997 were $30.5 million,
compared with $21.7 million in the comparable period of 1996, an increase of
$8.8 million or 41%. Service revenues increased to $22.5 million during the
first six months of 1997 from $18.2 million in the comparable period of 1996, an
increase of $4.4 million or 24%. Research and development revenue increased to
$8 million during the first six months of 1997 from $3.5 million in the
comparable 1996 period, an increase of $4.4 million or 125%, due primarily to
increased funding received from Genzyme for the development of AT-III, the
achievement of $2.4 million in milestones from the Joint Venture and increased
commercial activity.
Cost of services during the first six months of 1997 were $18.7 million compared
to $15.8 million in the comparable period of 1996, an increase of $2.9 million
or 18% due to increased service revenues. Research and development expenses
increased to $7.1 million during the first six months of 1997 from $4.1 million
in the comparable period of 1996, an increase of $3 million or 72%. The
increase is due to costs associated with the manufacturing facility coming
on-line for the production of AT-III material for clinical trials and increased
activity in the research and commercial programs.
Gross profit for the first six months of 1997 was $4.8 million versus $1.8
million in the comparable period of 1996. Gross profit on services for the
first six months of 1997 was $3.9 million, reflecting a gross margin of 17%,
versus $2.4 million and a gross margin of 13% in the comparable period of 1996.
The improvement in services margins was primarily due to increased services
revenues and a shift to higher margin services.
SG&A expenses increased to $7.2 million in the second quarter of 1997 from $5.4
million in the comparable period of 1996, an increase of $1.7 million or 32%.
The increase is due to the increased marketing efforts and administrative
personnel required to generate the increase in revenue.
Interest income increased to $92,000 in the first six months of 1997, from
$11,000 in the comparable period of 1996, due to the investment of funds from
the Company's secondary public offering and receipt of interest on funds held in
escrow last year. Interest expense decreased to $417,000 in the first six
months of 1997 from $673,000 in the comparable period of 1996 due to lower
borrowings in 1997.
The Company recognized $531,000 of Joint Venture losses during the first six
months of 1997 compared to $134,000 in the comparable period of 1996. The
increase was due to additional research by the Joint Venture including increased
research funding to the Company (see Note 3 to the Financial Statements
appearing in this Report).
9
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company had cash and cash equivalents of $6.4 million at June 29, 1997.
During the first six months of 1997, the Company had a $2.5 million net
decrease in cash. $4.9 million was invested in capital equipment, further
expansion of the transgenic production facility and the expansion of the
Mason Laboratories facility and $2.4 million was used to pay down long-term
debt. Sources of funds during the period included $350,000 of cash provided
by operations (due primarily to a decrease in non-cash working capital of
$1.1 million and $2.6 million of non-cash charges offset by the net loss of
$3.3 million), $4.9 million in proceeds from the issuance of long-term debt
and $598,000 in proceeds from the issuance of common stock.
In June 1997, the Company completed a $3 million expansion of its Mason
Laboratory facility. The Company obtained $5 million in long-term financing for
this project from a consortium consisting of state and local government agencies
in conjunction with a commercial bank. In June 1997, the Company received
approximately $3.8 million in funds of which approximately $800,000 was used to
pay down existing long-term debt. In connection with the financing, the Company
issued 20,000 warrants at the closing market value on June 26, 1997 of $8.75.
The remaining $1.2 million in financing is available to fund future renovations
of this facility, if any, through December 31, 1998.
The Company had a working capital deficit of $3.5 million at June 29, 1997
compared to a deficit of $116,000 at December 29, 1996. As of June 29, 1997,
the Company had approximately $8.3 million available under the Genzyme
Convertible Debt and Development Agreement and $2.6 million available under
various capital lease lines. Under the Company's 1997 operating plan,
existing cash balances along with funds available under the bank line and the
Convertible Debt and Development Agreement are expected to be sufficient to
fund the Company through June 30, 1998. The Company expects to continue to
operate with negative working capital for the foreseeable future.
Management's current expectations regarding the sufficiency of the Company's
cash resources are forward-looking statements and the Company's cash
requirements may vary materially from such expectations. Such forward-looking
statements are dependent on several factors, including the results of the
Company's testing services business, the ability of the Company to enter into
any transgenic research and development collaborations in the future and the
terms of such collaborations, the results of research and development and
preclinical and clinical testing, competitive and technological advances, and
regulatory requirements. If the Company experiences increased losses, the
Company may have to seek additional financing through collaborative arrangements
or from public or private sales of its securities, including equity securities.
There can be no assurance that additional funding will be available on terms
acceptable to the Company, if at all. If additional financing cannot be
obtained on acceptable terms, to continue its operations the Company could be
forced to delay, scale back or eliminate certain of its research and development
programs or to enter into license agreements with third parties for the
commercialization of technologies or products that the Company would otherwise
undertake itself.
10
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PART II
ITEM 1: Legal Proceedings
On April 23, 1997, the Company and Pharming, B.V., a Netherlands
corporation ("Pharming"), entered into a Settlement Agreement, thereby ending
arbitration proceedings which were initiated by Pharming on December 21, 1995.
The arbitration was filed under a license agreement between the companies dated
September 21, 1994 (the "License Agreement"), in which the Company and Pharming
cross-licensed various intellectual property rights under certain patents
relating to the transgenic production of proteins. Pharming claimed breach of
the License Agreement by the Company on various grounds, and the Company denied
Pharming's allegations and filed a counterclaim alleging that Pharming's request
for arbitration was filed for improper purposes.
Under the Settlement Agreement, a stipulation dismissing all claims was
submitted to the tribunal and the Company paid Pharming $200,000, which payment
was made in May 1997. Also, in connection with the settlement, the companies
amended the License Agreement to clarify the terms under which (i) the Company
and its affiliates may work in transgenic cattle under the existing license to
Pharming's promoter patent and (ii) Pharming and its affiliates may work in
transgenic goats under the existing license to the Company's promoter patent.
The amended License Agreement further specifies that the Company and Pharming
each have a right of first refusal to perform the work in goats and cattle,
respectively, which the other party would seek to contract to a third party.
Finally, the amended License Agreement clarifies that the agreement's conditions
and restrictions apply only to the cross-licensed patents, and that no rights
other than the cross-licensed patents are conferred on the parties. All other
material terms of the original License Agreement remain in force.
ITEM 2: Changes in Securities
In June 1997, the Company completed acquisition of a line of credit of
$5,000,000 for the expansion of its Mason Laboratory. On June 26, 1997, in
consideration of this loan, the Company issued to Government Land Bank d/b/a
The MassDevelopment a warrant to purchase shares of the Company's Common
Stock (a "Warrant"). At any time during the ten-year period commencing on
the date of issuance, the Warrant is convertible into either (i) 20,000
shares of Common Stock at an exercise price of $8.75 per share or (ii) that
number of shares of Common Stock which is equal to the product of (x) the
difference between the fair market value of one share of Common Stock and the
exercise price per share of the Warrant and (y) the number of shares of
Common Stock for which the Warrant is to be exercised, divided by the fair
market value of one share of Common Stock. Because the issuance of the
Warrant did not involve a public offering, exemption from registration with
the Securities and Exchange Commission was claimed under Section 4(2) of the
Securities Act of 1933, as amended.
11
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ITEM 4: Submission of Matters to a Vote of Security Holders
At the Annual Meeting of Stockholders held on May 28, 1997, the Company's
stockholders voted as follows:
(a) To reelect Mr. Alan E. Smith to the Board of Directors for a three-year
term.
Nominee Total Vote "FOR" Total Vote Withheld
------- ---------------- -------------------
Alan E. Smith 15,949,663 364,620
The terms in office of Robert W. Baldridge, Henry E. Blair, Francis J. Bullock,
James A. Geraghty, Henri A. Termeer and Alan W. Tuck continued after the
meeting.
(b) To amend the Company's 1993 Employee Stock Purchase Plan to increase the
number of shares of the Common Stock of the Company that may be subject to
awards under the Plan from 300,000 shares to 900,000 shares.
Total Vote for the Proposal 12,550,511
Total Vote Against the Proposal 542,084
Abstentions 54,927
(c) To amend the Company's 1993 Equity Incentive Plan to increase the number of
shares of the Common Stock of the Company that may be subject to awards
under the Plan from 2,015,000 shares to 2,515,000 shares.
Total Vote for the Proposal 12,311,852
Total Vote Against the Proposal 780,383
Abstentions 55,287
(d) To amend the Company's 1993 Director Stock Option Plan to increase the
number of shares of the Common Stock of the Company that may be subject to
awards under the Plan from 50,000 shares to 100,000 shares.
Total Vote for the Proposal 12,614,518
Total Vote Against the Proposal 683,577
Abstentions 65,355
(e) To amend the Company's Restated Articles of Organization to increase the
aggregate number of shares of Common Stock that the Company may issue from
24,000,000 shares to 40,000,000 shares.
Total Vote for the Proposal 16,042,926
Total Vote Against the Proposal 228,150
Abstentions 43,207
12
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ITEM 6: Exhibits and Reports on Form 8-K
(a) Exhibits.
3 Articles of Amendment to the Restated Articles of Organization of
the Company filed with the Secretary of the Commonwealth of
Massachusetts on June 26, 1997. Filed herewith.
4 Common Stock Purchase Warrant, dated as of June 26, 1997, issued
to Government Land Bank d/b/a The MassDevelopment. Filed
herewith.
10.1 Amendment Agreement, dated April 23, 1997, between the Company
and Pharming, B.V. Filed as Exhibit 10.1 to the Company's
Quarterly Report on Form 10-Q dated May 12, 1997 and
incorporated herein by reference.
10.2.1 Loan Agreement, dated as of May 22, 1997, between TSI Redfield
Laboratories, Inc. ("TSI") and Jefferson County, Arkansas
("Jefferson County"). Filed herewith.
10.2.2 Promissory Note in the amount of $350,000.00, dated as of
May 22, 1997, executed by TSI and issued to Jefferson County.
Filed herewith.
10.2.3 Mortgage, dated as of May 22, 1997, entered into by and between
TSI and Jefferson County, Arkansas. Filed herewith.
10.2.4 Guaranty Agreement, dated as of May 22, 1997, executed by
the Company in connection with the Loan Agreement, dated as of
May 22, 1997, between TSI and Jefferson County. Filed herewith.
10.3 1993 Equity Incentive Plan, as amended through May 28, 1997.
Filed herewith.
10.4 1993 Employee Stock Purchase Plan, as amended through May 28,
1997. Filed herewith.
10.5 1993 Director Stock Plan, as amended through May 28, 1997.
Filed herewith.
10.6 Fourth Amendment to Term Loan Agreement, dated as of June 17,
1997, between the Company and The First National Bank of Boston.
Filed herewith.
10.7 Seventh Amendment to Revolving Credit Agreement, dated as of June
17, 1997, among the Company, certain of its subsidiaries and
BankBoston, N.A.
10.8.1 Loan Agreement, dated as of June 26, 1997, between GTC Mason
Laboratories ("Mason") and the Emerging Technology Fund of the
Government Land Bank d/b/a MassDevelopment ("MassDevelopment").
Filed herewith.
13
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10.8.2 Promissory Note in the amount of $5,000,000.00, dated as of June
26, 1997, executed by Mason and issued to MassDevelopment. Filed
herewith.
10.8.3 Mortgage and Security Agreement, dated as of June 26, 1997,
entered into by and between Mason and MassDevelopment. Filed
herewith.
10.8.4 Guaranty, dated as of June 26, 1997, executed by the Company in
connection with the Loan Agreement, dated as of June 26, 1997,
between Mason and MassDevelopment. Filed herewith.
10.8.5 Hazardous Materials Indemnification Agreement, dated as of June
26, 1997, entered into by and between Mason and MassDevelopment.
Filed herewith.
10.9.1 Loan Agreement, dated as of June 27, 1997, between TSI and
Simmons First National Bank ("SFNB"). Filed herewith.
10.9.2 Promissory Note in the amount of $700,000.00, dated as of June
27, 1997, executed by TSI and issued to SFNB. Filed herewith.
10.9.3 Promissory Note in the amount of $350,000.00, dated as of June
27, 1997, executed by TSI and issued to SFNB.
10.9.4 Mortgage, dated as of June 27, 1997, entered into by and between
TSI and SFNB. Filed herewith.
10.9.5 Security Agreement, dated as of June 27, 1997, entered into by
and between TSI and SFNB. Filed herewith.
10.9.6 Unconditional Guaranty, dated as of June 27, 1997, executed by
TSI Corporation, Inc. in connection with the Loan Agreement,
dated as of May 22, 1997, between TSI and SFNB. Filed herewith.
10.9.7 Unconditional Guaranty, dated as of June 27, 1997, executed by
the Company in connection with the Loan Agreement, dated as of
June 27, 1997, between TSI and SFNB.
10.10.1 Amendment No. 2, dated as of March 30, 1997, to Convertible Debt
and Development Funding Agreement, dated as of March 29, 1996,
between the Company and Genzyme Corporation ("Genzyme"). Filed as
Exhibit 99.1 to the Company's Current Report on Form 8-K dated
March 31, 1997 and incorporated herein by reference.
10.10.2 Amendment No. 3, dated as of June 30, 1997, to Convertible Debt
and Development Funding Agreement, dated as of March 29, 1996,
between the Company and Genzyme. Filed herewith.
27 Financial Data Schedule. Filed herewith.
(b) Reports on Form 8-K.
On April 3, 1997, the Company filed a Current Report on Form 8-K,
disclosing the execution of Amendment No. 2 to the Convertible Debt and
Development Funding Agreement dated as of March 29, 1996, between the
Company and Genzyme Corporation.
14
<PAGE>
GENZYME TRANSGENICS CORPORATION AND SUBSIDIARY
FORM 10-Q
JUNE 29, 1997
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: August 13, 1997 GENZYME TRANSGENICS CORPORATION
BY: /s/ JOHN B. GREEN
-------------------------------------
John B. Green
Duly Authorized Officer,
Vice President and
Chief Financial Officer
15
<PAGE>
EXHIBIT INDEX
Exhibit Description
------- -----------
3 Articles of Amendment to the Restated Articles of Organization of
the Company filed with the Secretary of the Commonwealth of
Massachusetts on June 26, 1997. Filed herewith.
4 Common Stock Purchase Warrant, dated as of June 26, 1997, issued
to Government Land Bank d/b/a The MassDevelopment. Filed
herewith.
10.1 Amendment Agreement, dated April 23, 1997, between the Company
and Pharming, B.V. Filed as Exhibit 10.1 to the Company's
Quarterly Report on Form 10-Q dated May 12, 1997 and
incorporated herein by reference.
10.2.1 Loan Agreement, dated as of May 22, 1997, between TSI Redfield
Laboratories, Inc. ("TSI") and Jefferson County, Arkansas
("Jefferson County"). Filed herewith.
10.2.2 Promissory Note in the amount of $350,000.00, dated as of
May 22, 1997, executed by TSI and issued to Jefferson County.
Filed herewith.
10.2.3 Mortgage, dated as of May 22, 1997, entered into by and between
TSI and Jefferson County, Arkansas. Filed herewith.
10.2.4 Guaranty Agreement, dated as of May 22, 1997, executed by
the Company in connection with the Loan Agreement, dated as of
May 22, 1997, between TSI and Jefferson County. Filed herewith.
10.3 1993 Equity Incentive Plan, as amended through May 28, 1997.
Filed herewith.
10.4 1993 Employee Stock Purchase Plan, as amended through May 28,
1997. Filed herewith.
10.5 1993 Director Stock Plan, as amended through May 28, 1997.
Filed herewith.
10.6 Fourth Amendment to Term Loan Agreement, dated as of June 17,
1997, between the Company and The First National Bank of Boston.
Filed herewith.
10.7 Seventh Amendment to Revolving Credit Agreement, dated as of June
17, 1997, among the Company, certain of its subsidiaries and
BankBoston, N.A.
10.8.1 Loan Agreement, dated as of June 26, 1997, between GTC Mason
Laboratories ("Mason") and the Emerging Technology Fund of the
Government Land Bank d/b/a MassDevelopment ("MassDevelopment").
Filed herewith.
16
<PAGE>
10.8.2 Promissory Note in the amount of $5,000,000.00, dated as of June
26, 1997, executed by Mason and issued to MassDevelopment. Filed
herewith.
10.8.3 Mortgage and Security Agreement, dated as of June 26, 1997,
entered into by and between Mason and MassDevelopment. Filed
herewith.
10.8.4 Guaranty, dated as of June 26, 1997, executed by the Company in
connection with the Loan Agreement, dated as of June 26, 1997,
between Mason and MassDevelopment. Filed herewith.
10.8.5 Hazardous Materials Indemnification Agreement, dated as of June
26, 1997, entered into by and between Mason and MassDevelopment.
Filed herewith.
10.9.1 Loan Agreement, dated as of June 27, 1997, between TSI and
Simmons First National Bank ("SFNB"). Filed herewith.
10.9.2 Promissory Note in the amount of $700,000.00, dated as of June
27, 1997, executed by TSI and issued to SFNB. Filed herewith.
10.9.3 Promissory Note in the amount of $350,000.00, dated as of June
27, 1997, executed by TSI and issued to SFNB.
10.9.4 Mortgage, dated as of June 27, 1997, entered into by and between
TSI and SFNB. Filed herewith.
10.9.5 Security Agreement, dated as of June 27, 1997, entered into by
and between TSI and SFNB. Filed herewith.
10.9.6 Unconditional Guaranty, dated as of June 27, 1997, executed by
TSI Corporation, Inc. in connection with the Loan Agreement,
dated as of May 22, 1997, between TSI and SFNB. Filed herewith.
10.9.7 Unconditional Guaranty, dated as of June 27, 1997, executed by
the Company in connection with the Loan Agreement, dated as of
June 27, 1997, between TSI and SFNB.
10.10.1 Amendment No. 2, dated as of March 30, 1997, to Convertible Debt
and Development Funding Agreement, dated as of March 29, 1996,
between the Company and Genzyme Corporation ("Genzyme"). Filed as
Exhibit 99.1 to the Company's Current Report on Form 8-K dated
March 31, 1997 and incorporated herein by reference.
10.10.2 Amendment No. 3, dated as of June 30, 1997, to Convertible Debt
and Development Funding Agreement, dated as of March 29, 1996,
between the Company and Genzyme. Filed herewith.
27 Financial Data Schedule. Filed herewith.
17
<PAGE>
EXHIBIT 3
FEDERAL IDENTIFICATION
NO. 04-3186494
THE COMMONWEALTH OF MASSACHUSETTS
William Francis Galvin
Secretary of the Commonwealth
One Ashburton Place, Boston, Massachusetts 02108-1512
ARTICLES OF AMENDMENT
(General Laws, Chapter 156B, Section 72)
We, John B. Green, Vice President, and Lynnette C. Fallon, Assistant Clerk,
of Genzyme Transgenics Corporation located at Five Mountain Road, Framingham,
Massachusetts 01701, certify that these Articles of Amendment affecting articles
numbered: __3__ of the Articles of Organization were duly adopted at a meeting
held on May 28, 1997, by vote of 16,022,519 shares of Common Stock of 17,198,532
shares outstanding.
The total presently authorized is:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS
- --------------------------------------------------------------------------------
NUMBER OF NUMBER OF
TYPE SHARES TYPE SHARES PAR VALUE
- --------------------------------------------------------------------------------
Common: Common: 24,000,000 $0.01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Preferred: Preferred: 5,000,000 $0.01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Change the total authorized to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS
- --------------------------------------------------------------------------------
NUMBER OF NUMBER OF
TYPE SHARES TYPE SHARES PAR VALUE
- --------------------------------------------------------------------------------
Common: Common: 40,000,000 $0.01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Preferred: Preferred: 5,000,000 $0.01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
The foregoing amendment(s) shall become effective when these Articles of
Amendment are filed in accordance with General Laws, Chapter 156B, Section 6,
unless these articles specify, in accordance with the vote adopting the
amendment, a later effective date not more than thirty days after such filing,
in which event the amendment will become effective on such later date.
Later effective date: __________________________
SIGNED UNDER THE PENALTIES OF PERJURY, this 28th day of May, 1997.
/s/ John B. Green, Vice President
- ---------------------------------
/s/ Lynnette C. Fallon, Assistant Clerk
- ---------------------------------------
<PAGE>
EXHIBIT 4
THE WARRANT REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AS AMENDED, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT OR AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE ACT.
20,000 Shares
COMMON STOCK PURCHASE WARRANT
To subscribe for Shares of
Common Stock
of
Genzyme Transgenics Corporation
Void after June 26, 2007
THIS CERTIFIES THAT, for value
received, the Government Land Bank d/b/a The MassDevelopment (the "Holder"), is
entitled to subscribe for and purchase from Genzyme Transgenics Corporation, a
Massachusetts corporation (the "Company"), Twenty Thousand (20,000) shares (the
"Warrant Shares") of the Company's Common Stock, par value $0.01 per share (the
"Common Stock"), at a price of $8.75 per share (with adjustments provided for
herein, the "Warrant Price"), at any time from and after the date hereof to and
including the close of business on the last business day before June 26, 2007
(the "Exercise Period"), subject to the terms and conditions stated in this
Common Stock Purchase Warrant (this "Warrant"). A single "Warrant" shall,
subject to adjustment as provided herein and unless the context shall otherwise
require, represent the right to purchase one share of Common Stock at the
Warrant Price.
1. Exercise of Warrant: At Holder's option the rights represented by
this warrant may be exercised by the Holder in either the manner provided for in
section (a) below or in the manner provided for in section (b) below.
(a) Cash Exercise of Warrant: The rights represented by this Warrant may
be exercised by the Holder hereof in whole or in part by the surrender of this
Warrant and delivery of an executed Subscription Form in the form appended
hereto to the Company at its principal office at 5 Mountain Road, Framingham,
Massachusetts 01701 at any time or times within the Exercise Period, accompanied
by payment for the shares of Common Stock so subscribed for in cash or certified
or bank checks. This Warrant shall be deemed to have
<PAGE>
been exercised immediately prior to the close of business on the date on
which the Company shall have received both the duly executed Notice of
Exercise and payment for the shares of Common Stock so subscribed, and the
person entitled to receive the securities deliverable upon such exercise
shall be treated for all purposes as the holder upon exercise thereof as of
the close of business on such date. In the event of the partial exercise of
the rights represented by this Warrant, a new Warrant representing the number
of shares as to which this Warrant shall not have been exercised shall be
promptly issued to the Holder. In any event, such a new Warrant and a
certificate or certificates for the Common Stock purchased by exercise of
this Warrant shall be delivered by the Company to the Holder not later than
ten days after payment is made for the purchased Common Stock.
(b) Net Exercise of Warrant. In lieu of exercising this Warrant for cash
as provided in the preceding Section 1(a), the Holder may convert this Warrant
(the "Conversion Right"), in whole or in part, into the number of Warrant Shares
calculated pursuant to the following formula by surrendering this Warrant (with
the Subscription Form in the form attached hereto duly executed) at the
principal office of the Company specifying the number of Warrant Shares the
rights to purchase which the Holder desires to convert:
X = Y(A-B)
----------
A
where: X = the number of shares of Common Stock to be issued to the
Holder;
Y = the number of shares of Common Stock subject to this Warrant
for which the Conversion Right is being exercised (which
shall not be more than the number of Warrant Shares as to
which this Warrant is then exercisable less the number of
Warrant Shares with respect to which this Warrant has been
previously exercised or as to which the Conversion Right has
been previously exercised);
A = the fair market value of one share of Common Stock;
B = the Exercise Price
As used herein, the fair market value of a share of Common Stock shall mean with
respect to each share of Common Stock the closing price per share of the
Company's Common Stock on the principal national securities exchange on which
the Common Stock is then listed or admitted to trading or, if not then listed or
admitted to trading on any such exchange or system, the average of the bid and
offer price per share on Nasdaq Small Cap Market or other system, in each case
averaged over the 20 trading days consisting of the day as of which the current
fair market value of Common Stock is being determined and the nineteen
consecutive trading days prior to such day. If at any time such quotations are
not available, the current fair market value of a share of Common Stock shall be
the highest price per share which the Company could obtain from a willing buyer
(not a current employee or director) for shares of Common Stock sold by the
Company could obtain from a willing buyer (not a
2
<PAGE>
current employee or director) for shares of Common Stock sold by the Company,
as determined in good faith by the Board of Directors of the Company, unless
(i) the Company shall become subject to a merger, acquisition or other
consolidation pursuant to which the Company is not the surviving party, in
which case the current fair market value of a share of Common Stock shall be
deemed to be the value received by the holders of the Company's Common Stock
for each share of Common Stock pursuant to such transaction; or (ii) the
Holder shall exercise its Conversion Right to purchase such shares in
conjunction with the initial underwritten public offering of the Company's
Common Stock pursuant to a registration statement filed under the Securities
Act, in which case, the fair market value of a share of Common Stock shall be
the price per share at which all registered shares are sold to the public in
such offering. The Company agrees that the shares so converted shall be
deemed to be issued to the Holder hereof as the record owner of such shares
as of the close of business on the date on which this Warrant shall have been
surrendered as aforesaid. In the event of any conversion of this Warrant,
certificates for the shares of stock so converted shall be delivered to the
Holder hereof within ten (10) business days thereafter and, unless this
Warrant has been fully converted or expired, a new Warrant representing the
portion of the shares, if any, with respect to which this Warrant shall not
then have been converted, shall also be issued to the Holder hereof within
such ten (10) business day period.
2. Reservation of Shares: Payment of Taxes.
(a) The Company covenants that it will, at all times during which this
Warrant may be exercised, reserve and keep available out of its authorized
Common Stock, solely for the purpose of issue upon exercise of this Warrant,
such number of shares of Common Stock as shall then be issuable upon the
exercise of this Warrant. The Company covenants that all shares of Common Stock
which shall be issuable upon exercise of this Warrant shall, at the time of
delivery, be duly and validly issued, fully paid, nonassessable and free from
all taxes, liens and charges with respect to the issue thereof (other than those
which the Company shall promptly pay or discharge).
(b) The Company shall pay all documentary, stamp or similar taxes and all
other charges that may be imposed with respect to the issuance of this Warrant,
or the issuance, or delivery of any share of Common Stock upon exercise of this
Warrant.
3. Investment Representation. The Holder by accepting this Warrant
represents that this Warrant is acquired for the Holder's own account for
investment purposes and not with a view to any offering or distribution and that
the Holder has no present intention of selling or otherwise disposing of this
Warrant or the underlying shares of Common Stock.
4. Adjustments.
(a) Stock Dividends and Stock Splits. If, at any time after the date
hereof and before the termination of the Exercise Period, (i) the Company shall
fix a record date for the issuance of any stock dividend payable in shares of
Common Stock or (ii) the number of shares of Common Stock outstanding shall have
been increased by a subdivision or split-up of shares of Common Stock, then, on
the record date fixed for the determination of holders of Common Stock entitled
to receive such dividend or immediately after the effective date of
3
<PAGE>
such subdivision or split-up, as the case may be, the number of shares of
Common Stock to be delivered upon exercise of this Warrant will be
appropriately increased so that the Holder thereafter will be entitled to
receive the number of shares of Common Stock that the Holder would have owned
immediately following such action had this Warrant been fully exercised
(without regard to vesting dates) immediately prior thereto, and the Warrant
Price will be appropriately adjusted.
(b) Combination of Stock. If at any time after the date hereof and
before the termination of the Exercise Period the number of shares of Common
Stock outstanding shall have been decreased by a reverse stock split or other
combination of the outstanding shares of Common Stock, then, immediately after
the effective date of such combination, the number of shares of Common Stock to
be delivered upon exercise of this Warrant will be appropriately decreased so
that the Holder thereafter will be entitled to receive the number of shares of
Common Stock that the Holder would have owned immediately following such action
had such Warrant been fully exercised (without regard to vesting dates)
immediately prior thereto, and the Warrant Price will be appropriately adjusted.
(c) Reorganization, etc. If any capital reorganization of the Company, or
any reclassification of the Common Stock, or any consolidation of the Company
with or merger of the Company with or into any other person or any sale, lease
or other transfer of all or substantially all of the assets of the Company to
any other person (including, without limitation, any individual, partnership,
joint venture, corporation, trust or group thereof) shall be effected in such a
way that, following consummation of such transaction, the holders of Common
Stock shall be entitled to receive stock, securities or assets with respect to
or in exchange for Common Stock, then, upon exercise of this Warrant in
accordance with Section 1 hereof, the Holder shall have the right to receive the
kind and amount of stock, securities or assets receivable upon such
reorganization, reclassification, consolidation, merger or sale, lease or other
transfer by a holder of the number of shares of Common Stock that the Holder
would have been entitled to receive upon exercise of this Warrant pursuant to
Section 1 hereof had such Warrant been exercised immediately before such
reorganization, reclassification, consolidation, merger or sale, lease or other
transfer, subject to adjustments that shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Section 4.
(d) Rights Offering. If the Company, at any time after the date of
issuance of this Warrant and before the termination of the Exercise Period,
shall issue or sell or fix a record date for the issuance of rights, options,
warrants or convertible or exchangeable securities to all holders of Common
Stock entitling them to subscribe for or purchase Common Stock (or securities
convertible into Common Stock) at a price per share (or having a conversion
price per share) that, together with the value of any consideration paid for any
such rights, options, warrants or convertible or exchangeable securities (as
determined in good faith by the Board of Directors of the Company) is less than
the average of the last sale prices of the Common Stock as reported on the
National Market System of the National Association of Securities Dealers
Automated Quotation System ("Nasdaq") or, if the Common Stock is not included in
the National Market System of Nasdaq, the average of the bid prices for the
Common Stock as reported on the Nasdaq quotation system, in either case over the
period of five trading days immediately preceding the applicable date (the
"Market Price") on the date
4
<PAGE>
of such issuance or sale or on such a record date then, immediately after the
date of such issuance or sale or on such record date, the Holder shall have
the right to receive, upon the same terms as the holders of Common Stock, the
kind and amount of rights, options, warrants or convertible or exchangeable
securities receivable in such offering by a holder of the number of shares of
Common Stock that the Holder would have been entitled to receive upon
exercise of this Warrant pursuant to Section 1 hereof had such Warrant been
exercised immediately before such issuance or the record date for such
issuance.
(e) Special Dividend. If (other than in dissolution or liquidation)
securities of the Company (other than shares of Common Stock or securities
issued pursuant to the Company's Shareholder Rights Plan or any similar plan) or
assets (other than cash dividends payable out of retained earnings as indicated
on the most recent quarterly balance sheet of the Company) are issued by way of
a dividend on outstanding shares of Common Stock, then the Warrant Price shall
be adjusted so that it shall equal the price determined by multiplying the
Warrant Price in effect immediately prior to the close of business on the record
date for the determination of the stockholders entitled to receive such dividend
by a fraction, the numerator of which shall be the last sale price of the Common
Stock on such record date less the then fair market value as determined, in good
faith, by the Board of Directors of the Company, whose determination shall be
conclusive, of the portion of the securities or assets distributed applicable to
one share of Common Stock and the denominator of which shall be such closing
price. Such adjustment shall become effective immediately prior to the opening
of business on the day following such record date.
(f) Definition of Common Stock. For purpose of this Section 4, the term
"Common Stock" shall mean (i) the class of stock designated as the Common Stock
of the Company on the date hereof, or (ii) any other classes of stock resulting
from successive changes or reclassification of such shares consisting solely of
changes in par value or from par value to no par value, or from no par value to
par value.
(g) Limitations. Anything in this Section 4 to the contrary
notwithstanding, no adjustment in the Warrant Price in accordance with the
provisions of 4(a), 4(b), 4(c), 4(d) or 4(e), hereof need be made if such
adjustment would amount to a change in such Exercise Price of less than $0.01;
provided, however, that the amount by which any adjustment is not made by reason
of the provisions of this Section 4(g) shall be carried forward and taken into
account at the time of any subsequent adjustment in the Exercise Price.
(h) Readjustments. If an adjustment is made under Sections 4(a), 4(b),
4(c), 4(d) or 4(e), and the event to which the adjustment relates does not
occur, then any adjustments in the Warrant Price or the number of Warrant Shares
that were made in accordance with such sections shall be adjusted back to the
Warrant Price and the number of Warrant Shares that were in effect immediately
prior to the record date for such event.
(i) Notice of Adjustment under this Warrant. Upon any adjustment of the
Warrant Price or the number of Warrant Shares issuable upon exercise of this
Warrant, then and in each such case the Company shall give written notice
thereof, in the form of an officer's certificate, to the Holder which notice
shall state the Warrant Price resulting from such adjustment and the increase or
decrease, if any, in the number of Warrant Shares
5
<PAGE>
purchasable at such price upon the exercise of this Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based. Failure to give such notice, or any defect therein,
shall not affect the legality or validity of the subject adjustments.
(j) Certificate of Independent Public Accountants. The Company may retain
a firm of independent public accountants of recognized standing, acceptable to
the Holder, to make any adjustment or computation required under this Section 4,
and a certificate signed by such firm shall be conclusive evidence of the
correctness of the computation made under this Section 4.
5. Fractional Warrants and Fractional Shares. If the number of shares of
Stock purchasable upon the exercise of this Warrant is adjusted pursuant to
Section 4 hereof, the Company shall nevertheless not be required to issue
fractions of shares, upon exercise of this Warrant or otherwise, or to
distribute certificates that evidence fractional shares. With respect to any
fraction of a share called for upon any exercise hereof, the Company shall pay
to the holder an amount in cash equal to such fraction multiplied by the current
market value of such fractional share, determined as follows:
(a) If the Common Stock is listed on a national securities exchange or
admitted to unlisted trading privileges on such exchange or listed for trading
on the National Market System of Nasdaq, the current value shall be the last
sale price of the Common Stock reported on such exchange or Nasdaq on the last
business day prior to the date of exercise of this Warrant or if no such sale is
made on such day, the average of the high and low bid and asked prices for such
day on such exchange; or
(b) If the Common Stock is not listed or admitted to unlisted trading
privileges, the current value shall be the mean of the last reported bid and
asked prices reported by the National Quotation Bureau, Inc. on the last
business day prior to the date of the exercise of this Warrant; or
(c) If the Common Stock is not so listed or admitted to unlisted trading
privileges and bid and asked prices are not so reported, the current value shall
be an amount:
(i) determined in good faith, in such reasonable manner as may be
prescribed by the Board of Directors of the Company with the agreement of the
Holder; or
(ii) in the absence of such agreement as determined by an Independent
Financial Expert (as hereinafter defined) selected by the Holder from a group
consisting of three Independent Financial Experts chosen by the Company. The
costs and expenses of any such appraiser or investment banking firm in making
such valuation shall be paid by the Company. "Independent Financial Expert"
shall mean a nationally recognized appraiser or investment banking firm that
does not (and whose affiliates do not) have a direct or indirect financial
interest in the Company, the Holder (other than in its trading accounts or as a
participating underwriter in an offering of securities) or any of the
stockholders of the Company, that has not been, and at the time it is called
upon to determine Market Price, is not (and none of whose affiliates is) a
promoter, director or officer of the Company or any of
6
<PAGE>
its affiliates or any of the Holder or the stockholders of the Company or an
underwriter with respect to any of the securities of the Company or any of
the stockholders of the Company, and that has not provided any advice or
opinions to the Company or any of the stockholders of the Company during the
two years prior to the date it is called upon to serve as Independent
Financial Expert except as an Independent Financial Expert pursuant hereto;
provided, that if the Holder or stockholders of the Company is a commercial
bank, an institutional investor or an affiliate thereof, the conduct by such
investment banking firm of investment banking transactions in the ordinary
course of its business (including, without limitation, underwritings of
securities, private placements, broker-dealer transactions and mergers and
acquisitions) in which such Holder or stockholder of the Company is a
participant shall not by itself result in the disqualification of such firm
from being an Independent Financial Expert pursuant hereto.
6. Loss or Mutilation. Upon receipt by the Company of evidence
satisfactory to it of the ownership of and loss, theft, destruction or
mutilation of this Warrant and (in case of loss, theft or destruction) of
indemnity satisfactory to it, and (in the case of mutilation) upon surrender and
cancellation thereof, the Company shall (in the absence of notice to the Company
that this Warrant has been acquired by a bona fide purchaser) execute and
deliver to the registered holder in lieu thereof a new Warrant of like tenor
representing an equal aggregate number of Warrants.
7. Warrant Holder Not Deemed Stockholder. No holder of this Warrant
shall, as such, be entitled to vote or to receive dividends or be deemed the
holder of Common Stock that may at any time be issuable upon exercise of this
Warrant for any purpose whatsoever, nor shall anything contained herein be
construed to confer upon the holder of this Warrant, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issue or reclassification of stock, change of par value or
change of stock to no par value, consolidation, merger or conveyance or
otherwise), or to receive notice of meetings, or to receive dividends or
subscription rights, until such holder shall have exercised this Warrant and
been issued shares of Common Stock in accordance with the provisions hereof.
8. Registration. This Warrant shall be numbered and shall be registered
in a warrant register (the "Warrant Register") as it is issued. Subject to its
compliance with the foregoing, the Company shall be entitled to treat the
registered Holder this Warrant on the Warrant Register as the owner in fact of
this Warrant for all purposes and shall not be bound to recognize any equitable
or other claim to or interest in this Warrant on the part of any other person or
entity, and shall not be liable for any registration or transfer of this Warrant
which is registered or to be registered in the name of a fiduciary or the
nominee of a fiduciary unless made with the actual knowledge that a fiduciary or
nominee is committing a breach of trust in requesting such registration or
transfer, or with the knowledge of such facts that its participation therein
amounts to bad faith.
9. Rights of Action. All rights of action with respect to this Warrant
are vested in the holder of this Warrant, and any holder or holders of this
Warrant, without consent of any other holder, may, in his own behalf and for his
own benefit, enforce against the Company his
7
<PAGE>
right to exercise this Warrant for the purchase of shares of Common Stock in
the manner provided in this Warrant.
10. Agreement of Warrant Holder. The Holder of this Warrant, by its
acceptance
hereof, consents and agrees with the Company:
(a) The Holder is acquiring this Warrant for investment only and not with
a view to resale, distribution or division thereof among others.
(b) This Warrant is transferable only on the registry books of the Company
by the Holder hereof in person or by his attorney duly authorized in writing and
only if this Warrant is surrendered at the office of the Company, duly endorsed
or accompanied by a proper instrument of transfer satisfactory to the Company,
together with payment of any applicable transfer taxes; and
(c) The Company may deem and treat the person in whose name this Warrant
is registered as the holder and as the absolute, true and lawful owner of this
Warrant for all purposes.
11. Piggyback Registration Rights.
(a) If the Company shall file a registration statement (other than on Form
S-4, Form S-8, or any successor form) to register shares of Common Stock for its
own account with the Securities and Exchange Commission (the "Commission") while
any Warrant Shares are outstanding or issuable upon outstanding Warrants and any
such outstanding Warrant Shares or issuable Warrant Shares are not either (i)
the subject of an effective Registration Statement filed with the Commission or
(ii) eligible for sale under the provisions of the Commission's Rule 144 without
regard to volume limitations ("Registrable Shares"), the Company shall give all
the then holders of an Registrable Shares (the "Eligible Holders") prior written
notice of the filing of such registration statement. If requested by any
Eligible Holder in writing within 15 days after receipt of any such notice, the
Company shall, at the Company's sole expense (other than the fees and
disbursements of counsel for the Eligible Holders and the underwriting
discounts, if any, payable in respect of the Registrable Shares sold by any
Eligible Holder), register or qualify all or, at each Eligible Holder's option,
any portion of the Registrable Shares of any Eligible Holders who shall have
made such request, concurrently with the registration of such other securities,
all to the extent requisite to permit the public offering and sale of the
Registrable Shares through the facilities of all appropriate securities
exchanges and the over-the-counter market, and will use its best efforts through
its officers, directors, auditors, and counsel to cause such registration
statement to become effective as promptly as practicable. Notwithstanding the
foregoing, if the managing underwriter of any such offering shall advise the
Company in writing that, in its opinion, the distribution of all or a portion of
the Registrable Shares requested to be include in the registration concurrently
with the securities being registered by the Company would materially adversely
affect the distribution of such securities by the Company for its own account,
then the number of Registrable Shares held by such Eligible Holder to be
included in such registration statement shall be reduced or eliminated to the
extent advised by such managing
8
<PAGE>
underwriter.
(b) In the event of a registration pursuant to the provisions of this
Section 11, the Company shall use its best efforts to cause the Registrable
Shares so registered to be registered or qualified for sale under the securities
or blue sky laws of such jurisdictions as the Eligible Holders may reasonably
request; provided, however, that the Company shall not be required to qualify to
do business in any state by reason of this Section 11(b) in which it is not
otherwise required to qualify to do business.
(c) The Company may at any time prior to the effectiveness of any such
registration statement, at its sole discretion, withdraw such registration
statement and abandon or postpone the proposed offering in which any Eligible
Holder elected to participate. After the effectiveness of such registration
statement, the Company shall use its best efforts to keep effective any
registration or qualification contemplated by this Section 11 and shall from
time to time amend or supplement each applicable registration statement,
preliminary prospectus, final prospectus, application, document and
communication for such period of time as shall be required to permit the
Eligible Holders to complete the offer and sale of the Registrable Shares
covered thereby. The Company shall in no event be required to keep any such
registration or qualification in effect for a period in excess of nine months
from the effective date of such registration; provided, however, that, if the
Company is required to keep any such registration or qualification in effect as
its relates to securities other than the Registrable Shares beyond such period,
the Company shall keep any such qualification or registration in effect as it
relates to the Registrable Shares for so long as such registration or
qualification remains or is required to remain in effect in respect of such
other securities.
(d) In the event of a registration pursuant to the provisions of this
Section 11, the Company shall furnish to each Eligible Holder such number of
copies of the registration statement and of each amendment thereto (including
each preliminary prospectus), all of which shall conform to the requirements of
the Act and the rules and regulations thereunder, and such other documents, as
any Eligible Holder may reasonably request to facilitate the disposition of the
Registrable Shares included in such registration.
(e) In the event of an underwritten registration pursuant to the provision
of this Section 11, each Eligible Holder participating in such registration
shall enter into a reasonable and customary underwriting agreement which such
underwriter and customary custody and power of attorney agreements with the
Company, containing conventional representations, warranties, indemnifications,
allocation of expenses and customary closing conditions, including, without
limitation, opinions of counsel to the Eligible Holder. Any Eligible Holder who
fails to enter into such an underwriting agreement may be excluded from such
registration.
(f) The Company agrees that until all the Registrable Shares have been
sold under a registration statement or pursuant to Rule 144 under the Act, it
shall keep current in filing all reports, statements and other materials
required to be filed with the Commission to permit holders of the Registrable
Shares to sell such securities under Rule 144.
12. Transfer and Exchange: Restrictions: Legend.
9
<PAGE>
(a) This Warrant and the Warrant Shares issued upon exercise of this
Warrant shall not be sold or transferred unless either (i) they first shall
have been registered under the Securities Act, or (ii) the Company first
shall have been furnished with an opinion of legal counsel, reasonably
satisfactory to the Company, to the effect that such sale or transfer is
exempt from the registration requirements of the Securities Act; provided,
however, that this Warrant and the Warrant Shares may be transferred in whole
or in part by the Holder to any corporation or entity controlling, controlled
by or under common control with the Holder without any such opinion or
registration so long as the transferee has complied with the other provisions
of this Warrant.
(b) Each certificate representing the Warrant Shares and shares issued in
respect of
the Warrant Shares shall bear a legend substantially in the following form:
"The shares represented by this certificate have not been registered under
the Securities Act of 1933, as amended, and may not be offered, sold or
otherwise transferred, pledged or hypothecated unless and until such shares
are registered under such Act or an opinion of counsel satisfactory to the
corporation is obtained to the effect that such registration is not
required."
The foregoing legend shall be removed from the certificates representing
any Warrant Shares at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Securities Act.
(c) Subject to the foregoing, this Warrant and all rights hereunder are
transferable, in whole or in part, on the books of the Company to be maintained
for such purpose, upon surrender of this Warrant at the principal office of the
Company, together with a written assignment of this Warrant duly executed by the
holder or his agent or attorney; provided, however, that this Warrant shall not
be transferred to more than ten (10) transferees in the aggregate.
(d) This Warrant is exchangeable, upon the surrender hereof at the office
or agency of the Company, for new Warrants of like tenor representing in the
aggregate the right to subscribe for and purchase the number of shares which may
be subscribed for and purchased hereunder, each of such new Warrants to
represent the right to subscribe for and purchase such number of shares as shall
be designated by said holder hereof at the time of such surrender.
13. Information Covenants.
(a) Notice of Stockholder Meetings. Nothing contained in this
Agreement shall be construed as conferring upon the Holder the right to vote or
to consent to or receive notice as a stockholder in respect of the meetings of
stockholders or the election of directors of the Company or any other matter, or
any rights whatsoever as a stockholder of the Company; provided, however, that
if a meeting of the stockholders of the Company is called or if consents of the
Company's stockholders are solicited to consider and take action on a proposal
for (i) the declaration of a dividend with respect to any shares, other than in
cash, (ii) the redemption or repurchase of any shares, other than pursuant to
repurchase agreements
10
<PAGE>
with employees, (iii) the voluntary dissolution of the Company or (iv) any
consolidation, merger or sale of all or substantially all of its property,
assets, business and good will as an entirety, then the Company shall cause a
notice thereof to be sent by first class mail, postage prepaid, at least
twenty (20) business days prior to the record date for determining
stockholders entitled to vote at such meeting or to take action with respect
to such consent, to the Holder at the Holder's address appearing on the
Warrant Register.
(b) Notice of Distributions. If the Company determines to make any
distribution on its Common Stock, then the Company shall deliver a notice of its
intention to make such distribution by first class mail, postage prepaid, at
least twenty (20) business days prior to the record date for such distribution
to the Holder at the Holder's address appearing on the Warrant Register.
(c) Proper Books and Records; Inspection. The Company covenants that
it will keep proper books and records in which full, true and correct entries in
conformity with generally accepted accounting principles shall be made of all
dealings and transactions in relation to its business and activities. The
Company further covenants that it will permit, and will cause each of its
subsidiaries to permit, any person designated in writing by the Holder to visit
and inspect any of its properties, to examine its corporate, financial and
operating records and to make copies thereof or extracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers,
employees and independent accountants, all at such times, upon reasonable
notice, as may reasonably be desired.
14. Representations and Warranties. The Company represents and warrants
to the Holder as follows:
(a) Organization and Standing. Each of the Company and its
subsidiaries is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdictions of incorporation and have all
requisite corporate power and authority to carry on its business as now
conducted and as proposed to be conducted.
(b) Capitalization. The authorized capital stock of the Company
consists of 40,000,000 shares of Common Stock and 5,000,000 shares of Preferred
Stock. The outstanding Common Stock was 17,198,532 as of April 1, 1997, and
except for issuances upon exercise of employee stock options and pursuant to the
Company's Employee Stock Purchase Plan, has not changed since that date. The
Company has outstanding options and warrants and described in the Company's
report on Form 10-K for the year ended December 31, 1996.
(c) Authorization; Consents. All corporate action on the part of the
Company and its officers and directors necessary for the authorization,
execution and delivery of this Warrant, and the performance of all obligations
of the Company under this Warrant and for the authorization, issuance and
delivery of the Warrant, has been taken. This Warrant, when executed and
delivered by all parties hereto, shall constitute the legal, valid and binding
obligation of the Company, enforceable in accordance with its terms, except to
the extent the enforceability hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws now or hereafter in effect relating to
creditors' rights generally or
11
<PAGE>
by general equitable principles. All consents, approvals, orders and
authorizations of any governmental authority which may be required of the
Company in connection with the sale of the Warrant and the execution,
delivery and performance of this Warrant have been obtained.
(d) Validity of Securities. This Warrant, when issued and delivered
in accordance with its terms, and the Shares issued upon exercise of the
Warrant, when issued, paid for and delivered in accordance with the terms of
this Warrant, shall be duly and validly issued and outstanding, fully paid,
nonassessable and free and clear of all liens and encumbrances, other than the
transfer and other restrictions as contemplated herein.
(e) Securities Laws. The issuance of this Warrant and the issuance
of Shares upon exercise of this Warrant are exempt from the registration
requirements of the Securities Act and any securities or "blue-sky" laws or
regulations of any applicable jurisdiction. Neither the Company nor any agent
acting for it has offered this Warrant or any other equity or debt securities of
the Company for sale or solicited any offers to buy this Warrant or any other
equity or debt securities of the Company in such a manner that would cause the
offer, issuance or the sale of this Warrant to violate the provisions of the
Securities Act or of any securities or "blue-sky" laws or regulations in any
applicable jurisdiction.
(f) No Conflict. The execution, delivery and performance by the
Company of this Warrant and the issuance and delivery of this Warrant and the
issuance of Shares upon exercise of this Warrant does not and will not (i)
violate any provision of law or regulations applicable to the Company, the
Certificate of Incorporation or by-laws of the Company or any order, judgment or
decree of any court or other agency of government binding on the Company, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any material contractual obligation of the Company
or (iii) require any approval of stockholders of the Company, or any approval or
consent of any person under any contractual obligation which is binding upon the
Company.
(g) Governmental Consents. The execution, delivery and performance
by the Company of this Agreement and the issuance and delivery of this Warrant
and the Warrant Shares issuable upon exercise hereof to the Holder do not
require any registration with, or notice to, or other action to, with or by, any
federal, state or other governmental authority or regulatory body.
15. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been made when
delivered or mailed first class, certified mail, postage prepaid as follows: if
to the Holder of this Warrant, at the address of such Holder as shown on the
registry books maintained by the Company; if to the Company, at its principal
office located at Five Mountain Road, Framingham, Massachusetts 01701,
Attention: Chief Financial Officer, or at such other office designated by the
Company by notice.
16. Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts.
17. Binding Effect. This Warrant shall be binding upon and inure to the
benefit of
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<PAGE>
the Company, its successors and assigns, and the Holder and its permitted
assigns and successors. Nothing herein is intended or shall be construed to
confer upon any other person any right, remedy or claim, in equity or at law,
or to impose upon any other person any duty, liability or obligation.
18. Termination. This Warrant shall terminate at the close of business on
the last day of the Exercise Period of this Warrant or such earlier date upon
which all Warrants have been exercised.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
Chief Financial Officer and its corporate seal to be hereunto affixed, and
attested, as of the day of June, 1997.
GENZYME TRANSGENICS CORPORATION
By: /s/ John B. Green, Jr.
---------------------------
John B. Green, Jr.
Vice President and Chief Financial Officer
(SEAL)
Attest:
/s/ Peter J. Dawson
- ------------------------------------------
Peter J. Dawson
13
<PAGE>
SUBSCRIPTION FORM
TO: GENZYME TRANSGENICS CORPORATION
1. Check Box that Applies:
____ The undersigned hereby elects to purchase ______ shares of Common
Stock of GENZYME TRANSGENICS CORPORATION pursuant to the terms of the attached
Warrant, and tenders payment of the purchase price of such shares in full.
____ The undersigned hereby elects to convert the attached Warrant into
______ shares of Common Stock of GENZYME TRANSGENICS CORPORATION pursuant to the
terms of the attached Warrant.
2. Please issue a certificate or certificates representing said shares of
Common Stock in the name of the undersigned or in such other is specified below:
- --------------------------------------------------------------------------------
(Name)
- --------------------------------------------------------------------------------
(Address)
3. The undersigned represents that the aforesaid shares of Common Stock
are being acquired for the account of the undersigned for investment and not
with a view to, or for resale in connection with, the distribution thereof that
the undersigned has no present intention of distribution or reselling such
shares.
----------------------------------------------
Signature
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<PAGE>
ASSIGNMENT
(to be executed by the registered holder in order to assign warrants)
FOR VALUE RECEIVED,_________________________________________________________
hereby sells, assigns and transfers unto________________________________________
(please print or type name and address)
Please insert Social Security or other identifying number:______________________
of the warrants represented by this Warrant, and hereby irrevocably constitutes
and appoints Attorney
to transfer this Warrant on the books of the Company, with full power of
substitution in the premises.
Dated: X
---------------------------- -----------------------------
-------------------------------
Signature Guaranteed
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE BACK OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER AND MUST BE
GUARANTEED BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE
AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE, PACIFIC STOCK EXCHANGE OR
MIDWEST STOCK EXCHANGE.
190497-1
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<PAGE>
Exhibit 10.2.1
LOAN AGREEMENT
THIS LOAN AGREEMENT (herein called the "Agreement") is made and entered
into as of the 22nd day of May, 1997 by and between Jefferson County, Arkansas
(herein called "Lender"), and TSI Redfield Laboratories, Inc. (herein called
"Borrower").
W I T N E S S E T H:
WHEREAS, Lender is authorized to loan grant funds to qualified applicants
under the Arkansas Industry and Aerospace Development Fund Program ("AIADFP")
conducted under the auspices of the Arkansas Industrial Development Commission
("AIDC"), with funds provided through the State of Arkansas, to facilitate
economic development and the creation of jobs within the State of Arkansas; and
WHEREAS, the loan of said grant funds from Lender to Borrower will permit
the construction of facilities, and the creation of new employment opportunities
for low to moderate income persons; and
WHEREAS, Borrower will use the loan funds to construct improvements upon
the property described herein.
NOW, THEREFORE, for and in consideration of the mutual covenants
hereinafter contained, the parties hereby covenant and agree as follows:
1. Conditioned upon receipt of the grant funds by Lender from AIDC under
its Grant Agreement with Lender dated April 23, 1997, as amended, (herein called
"Grant Agreement") Lender agrees to loan and Borrower agrees to borrow the sum
of Three Hundred Fifty Thousand and No/100's Dollars ($350,000.00) (herein
called the "Loan"), which sum shall be used by Borrower as set out above.
2. Loan proceeds will be utilized only for those purposes specifically
identified
<PAGE>
within the Grant Agreement.
3. One of the purposes of the Grant Agreement is to create employment for
low and moderate income persons.
4. Borrower agrees to use its best efforts to achieve that
purpose and agrees that the interest rate on the Loan specified
in the Note shall be adjusted in accordance with the following,
but in no event to exceed the maximum rate allowed by law:
(a) If, by June 30, 1999, no less than eighteen (18)
jobs having a minium average annual salary of
$23,088 have not been created by Borrower and
verified by the AIDC, the interest rate of the
Loan will be raised to the maximum allowable under
Arkansas law and will remain at that rate for the
remaining term of the Loan or any extension or
renewal of same.
5. Borrower shall execute in favor of the Lender its
Promissory Note ("Note") in the principal sum of $350,000.00
with five and one half percent 5.5% interest as stated in
the Note, being in the form attached hereto as Exhibit "A".
Said sum shall be repaid according to the Note's terms.
6. Borrower acknowledges that the funds for the Loan will
come to Lender under the terms of the Grant Agreement and agrees
that the disbursement of the funds from the Loan shall be made in
accordance with the Grant Agreement attached hereto as Exhibit
"B". Borrower agrees to comply with the terms and restrictions
of the Grant Agreement and to provide to Lender and/or the AIDC,
at the Borrower's expense such reports, audits, documentation, or
other information as may be required in connection therewith.
<PAGE>
7. Nothing in this transaction shall impair Lender's
compliance with the terms of the Grant Agreement, and in the
event of any such conflict, the terms of the Grant Agreement
shall control, and the terms of all documents used in this
transaction shall be deemed modified accordingly; provided,
however, that in event of any such conflict, Lender will attempt
to have said Grant Agreement amended or modified to accommodate
such conflict, and this override provision shall apply only if
such request is denied.
8. Borrower, acknowledges that it understands and will
comply with the following applicable federal laws and regulations
which are conditions for receipt of the funds provided herein:
(a) Borrower will comply with the provisions of Public
Law 88-352 which refers to Title VII of the Civil
Rights Act of 1964, 42 U.S.C. Section 2000 d, et
seq. The law provides that no person in the
United States will on the grounds of race, color,
or national origin, be denied the benefits of, or
be subjected to discrimination under, any program
or activity receiving federal financial
assistance.
(b) Borrower will comply with the provisions of
Section 109 of the Housing and Community
Development Act of 1974, as amended, which
requires that no person in the United States may
be excluded from participation in or be denied any
program activity funded in whole or part with
Community Development funds made available
pursuant to Title I of the Housing and Community
Development Act of 1974, as amended, on the
3
<PAGE>
grounds of race, color, national origin, or sex.
Section 109 further provides that any regulations
under the Age Discrimination Act of 1975, 42
U.S.C. Section 6101, et seq., or with respect to
any otherwise qualified handicapped individual as
provided in Section 504 of the Rehabilitation Act
of 1973, 29 U.S.C. Section 794, will also apply to
any such program or activity.
(c) Borrower will comply with Executive Order 11246,
as amended, which applies to all federally
assisted construction contracts and subcontracts.
Borrower will not discriminate against any
employee or applicant for employment because of
race, color, religion, sex, or national origin and
will take affirmative action to ensure that
applicants are employed, and that employees are
treated during employment, without regard to their
race, color, religion, sex or national origin.
Such action will include, but not be limited to
the following: employment, upgrading, promotion or
transfer, recruitment, or recruitment advertising;
layoff or termination; rate of pay or other forms
of compensation; and selection for training,
including apprenticeship.
(d) Borrower will comply with the Copeland
"Anti-Kickback" Act, 18 U.S.C. Section 874 as
supplemented by the Department of Labor
Regulations, 29 CFR Part 3.
(e) Borrower will comply with the Davis-Bacon Act, as
amended, 40 U.S.C. Section 276a, et seq.
(f) Borrower will comply with the National Environment
Policy Act
4
<PAGE>
of 1969, 42 U.S.C. Section 4321, et seq., and 24 CFR Part 58.
(h) Borrower hereby agrees to comply with all other
federal and state laws as outlined in AIDC ACED
Administrative Procedures Manual and all
supplements thereto.
9. Borrower represents and warrants as follows:
(a) Borrower is a duly organized corporation existing
and in good standing under the laws of the State
of Arkansas, and has full power and authority to
deliver this Agreement, the Note, the security
documents, and each and every other instrument or
document required herein to be delivered, and to
perform the transactions contemplated hereby and
thereby, and is duly qualified to do business
wherever necessary to carry out its present
operations.
(b) The making and performance of this Agreement, the
Note, the security documents, and each and every
other document required to be delivered hereunder
are within Borrower's powers, have been duly
authorized by all necessary corporate action, have
received all necessary governmental approvals, and
do not contravene any law, regulation or decree or
any contractual restriction (otherwise than those
which shall be waived or discharged at the time of
making of the Loan) binding on Borrower.
(c) This Agreement, the Note, and security documents,
and each and every other document required to be
delivered hereunder,
5
<PAGE>
when duly executed and delivered, will be legal and binding
obligations of Borrower enforceable in accordance with their
respective terms.
(d) There are no pending or threatened actions or
proceedings before any court or administrative
agency which may materially adversely affect the
financial conditions or operations of Borrower
except as specifically disclosed in writing to the
Lender prior to the date of this Agreement.
(e) Federal and state income tax returns required of
Borrower have been timely filed or an appropriate
extension for filing obtained, and to the best of
the knowledge and information of said parties no
claims are being asserted with respect to such
taxes, except as may have been previously
described in writing to Lender or for which
adequate reserves are maintained.
10. The obligation of Lender to make the Loan is subject to the
conditions precedent that Lender shall have received at closing, in
form and substance satisfactory to Lender, the following:
(a) The Promissory Note, this Agreement, and all
security documents.
(b) Certified copies of Borrower's Articles of
Incorporation filed with the Arkansas Secretary of
State; the Bylaws certified by the Secretary of
Borrower; a Certificate of Good Standing of
Borrower from the Arkansas Secretary of State.
6
<PAGE>
(c) Certified copies of corporate resolutions from
Borrower evidencing authorization for the
undertakings contemplated hereby, including the
authorization to procure and guarantee credit,
borrow money, pledge as security and/or mortgage
on behalf of the Borrower, and designating
corporate officers with such authorization.
(d) Certified copies of all documents evidencing
necessary action and governmental approvals, if
any, with respect to this Agreement, the Note, and
security documents (or a certificate that no such
documents are required).
(e) Opinion letter of Borrower's attorney in a form
and content acceptable to Lender, if required,
including an opinion that Genzyme Transgenics
Corporation is authorized to guarantee repayment
of this loan; the binding nature of the loan
documents;and the authority of the officers to
sign the loan documents.
(f) A Mortgagee's title insurance policy in an amount
of at least $350,000.00 issued by a company
approved by Lender, insuring the fee simple title
of TSI Redfield Laboratories,Inc and the priority
of the Mortgage given Lender in conjunction with
the Loan.
11. If any of the following events (herein called "Events of
Default"") shall occur and be continuing, then the Loan shall be in
default, and at the option of Lender shall be
7
<PAGE>
subject to acceleration and enforcement as permitted by law, to wit:
(a) Borrower shall default in any payment of principal
of or interest on the Note pursuant to the terms
thereof, including all grace periods; or
(b) Any representation or warranty made in connection
with the execution and delivery of this Agreement,
the Note, or any of the security documents or in
any certificate furnished pursuant hereto or
thereto shall prove to be at any time incorrect in
any material respect; or
(c) Borrower shall default in the performance of any
other term, covenant or agreement contained in
this Agreement, including a temporary failure to
employ the persons specified in Paragraph 3 and 4
of this Agreement, the Note, or any of the
security documents; or
(d) Borrower shall be or become insolvent or bankrupt
or have ceased or cease paying its debts as they
mature or make an assignment of or for the benefit
of creditors, or a trustee or receiver or
liquidator shall be appointed for either all or
for a substantial part of its property, or
bankruptcy, reorganization, arrangement,
insolvency, or similar proceedings shall be
instituted by or against Borrower under the law of
any jurisdiction (provided, however, that in the
event an involuntary bankruptcy action is
commenced against Borrower, Borrower
8
<PAGE>
shall have 90 days to secure the dismissal of such action);
or
(e) Any security document or interest therein shall be
canceled (except by operation of law upon payment
in full of the indebtedness secured thereby) or
otherwise cease to be in full force and effect and
enforceable in accordance with its terms against
Borrower or any mortgage given Lender does not
vest in Lender a fully perfected and valid
security interest, except when waived in writing.
12. No failure or delay on the part of any holder of the Note in
exercising any power or right hereunder or under any security document
shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power preclude any other or further
exercise thereof or the exercise of any other right or power
hereunder. No modification or waiver of any provision of this
Agreement, the Note, or any security document, nor consent to any
departure by Borrower therefrom shall be effective except only in the
specific instance and for the purpose for which given. No notice to
or demand of Borrower in any case shall entitle Borrower any other or
further notice or demand in similar or other circumstances. The
holder of the Note shall in no event be required to exercise any of
its remedies with respect to any security document before exercising
any remedies hereunder or otherwise to enforce the provisions of this
Agreement, the Note, or other security document.
13. Whenever any payment to be made hereunder or under the Note
shall be stated to be due on a Saturday, Sunday or a public holiday
under the laws of the State of Arkansas, such payment may be made on
the next succeeding business day and such extension of time
9
<PAGE>
shall in such case be included in computing interest, if any, in connection
with such payment.
14. All communications and notices provided for hereunder shall
be in writing and mailed or delivered to the parties hereto at their
business addresses set forth below or, as to each party, at such other
address as shall be designated by such party in a written notice to
the other parties.
JEFFERSON COUNTY, ARKANSAS Barraque at Main Street
Pine Bluff, Arkansas 71601
TSI Redfield Laboratories, Inc. 100 East Boone St.
Redfield, Arkansas 72132
15. Borrower agrees to pay all costs and expenses in connection
with the preparation, execution, and delivery of this Agreement, the
Note, and the security documents (including the reasonable fees and
out-of-pocket expenses of counsel for Lender and/or the AIDC) and any
and all fees, taxes or expenses payable in connection with the filing,
refiling, recording and rerecording of any security documents and
costs and expenses, if any, in connection with the enforcement of this
Agreement, the Note, and the security documents, as well as any and
all liabilities with respect to or resulting from any amount payable
or determined to be payable in connection with the preparation,
execution, delivery and enforcement of this Agreement, the Note and
the security documents or such filing, refiling, recording,
rerecording of any security document.
16. This Agreement shall be binding upon and inure to the
benefit of Borrower and Lender, and their respective heirs, personal
representatives, successors and assigns, except that Borrower may not
assign or transfer its rights hereunder without the prior written
10
<PAGE>
consent of Lender. The term "Lender" as used anywhere within the
terms of this Loan Agreement shall include any successor or assignee
of Lender.
17. This Agreement and the Note shall be deemed to be contracts
under the laws of the State of Arkansas and for all purposes shall be
governed by and construed in accordance with the laws of said State or
the laws of the United States of America, as shall be applicable.
18. This Agreement shall remain in full force and effect until
the Note is paid in full.
19. All available loan proceeds hereunder must be drawn by
Company within three(3)months from the date of loan closing. Any
funds not so drawn will be utilized by Lender to reduce the
outstanding principal amount of this loan.
20. No equipment, machinery, or other personalty of Borrower
shall be removed from the premises of Borrower's place of business
without the prior written consent of Lender, except in the ordinary
course of the Borrower's business and disposition of worn-out,
obsolete or unused equipment.
21. Borrower shall provide Lender with quarterly interim
financial statements during the term of This Loan within forty five
(45) days of the end of each calendar quarter.
22. Within 90 days of the end of each fiscal year, Borrower and
Guarantor shall provide Lender with year-end compiled financial
statements during the term of This Loan.
23. In conjunction with Paragraphs 3 and 4 hereof, Borrower
shall provide quarterly job creation reports to Lender and A.I.D.C.
within ten (10) days following the end of each calendar quarter.
24. Borrower covenants, represents and warrants that to the
extent it uses,
11
<PAGE>
generates, manufactures, stores or disposes of, on, under or about its
manufacturing premises ("Premises") or transports to or from the Premises any
flammable explosives, radioactive materials, hazardous wastes, toxic
substances, or related materials (hereinafter "Hazardous Materials"), it will
do so only in full compliance with the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Section 9601,
et seq.); the Hazardous Materials Transportation Act (49 U.S.C. Section 1801,
et seq.); the Resource Conservation and Recovery Act (42 U.S.C. Section 6901,
et seq.); and all other statutes and regulations governing, defining or
regulating the manner and method of storage, transportation or disposition of
Hazardous Materials. Borrower further agrees to indemnify and hold harmless
Lender, its directors assigns, officers, employees and agents, from and
against any and all liability (i) including foreseeable and unforeseeable
consequential damages, directly or indirectly arising out of use, generation,
storage or disposition of Hazardous Materials by the Borrower or any operator
of the Premises during Borrower's ownership thereof, and (ii) including,
without limitation, the cost of any required or necessary remediation,
repair, cleanup or detoxification and the preparation of any closure or other
required plans, whether such action is required or necessary prior to or
following transfer of title attributable, directly or indirectly, to the
presence or use, generation, storage, release, threatened release, or
disposal of Hazardous Materials by any person on the Premises during
Borrower's ownership thereof, and the Borrower's obligations pursuant to this
indemnity shall survive satisfaction or discharge of this Loan indebtedness,
and shall survive, notwithstanding that the alleged liability of Lender shall
be by reason of any exercise by it of control or dominion over the Premises
or the activities of the Borrower.
12
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date first above written.
LENDER:
JEFFERSON COUNTY, ARKANSAS
BY: /s/ Jack Jones
-------------------------------
County Judge
ATTEST:
BY: Pamela Watkins
-----------------------
TITLE: County Clerk
---------------------
BORROWER:
TSI REDFIELD LABORATORIES, INC.
BY: /s/ John B. Green
----------------------------------
TITLE: Treasurer
--------------------------------
13
<PAGE>
ACKNOWLEDGMENT
STATE OF ARKANSAS )
) ss:
COUNTY OF JEFFERSON )
BE IT REMEMBERED, that on this day came before me, the
undersigned Notary Public, within and for the County and State
aforesaid, duly commissioned, qualified and acting, Jack Jones and
Pamela Jones who stated that they County Judge and County Clerk of
Jefferson County, Arkansas, duly authorized in their respective
capacity to execute the foregoing instrument for and in the name and
behalf of said Jefferson County, and further stated and acknowledged
that they have so signed, executed and delivered said foregoing
instrument for the consideration, uses and purposes therein mentioned
and set forth.
DATED this 4th day of June, 1997.
/s/ Cheryl Ann Watterson
------------------------------
Notary Public
My Commission Expires:
/s/ 6-14-2005
- --------------
[Seal]
14
<PAGE>
ACKNOWLEDGMENT
STATE OF Arkansas )
) ss:
COUNTY OF Pulaski )
BE IT REMEMBERED that on this day came before me, the undersigned
Notary Public, within and for the County and State aforesaid, duly
commissioned, qualified and acting, John B. Green who acknowledged
that he is the Treasurer of TSI Redfield Laboratories, Inc. duly
authorized in his respective capacity to execute the foregoing
instrument for and in the name and behalf of said Company, and further
stated and acknowledged that he has so signed, executed and delivered
said foregoing instrument for the consideration, uses and purposes
therein mentioned and set forth.
DATED this 22nd day of May, 1997.
/s/ John Kooistra III
--------------------------
Notary Public
My Commission Expires:
09-30-01
- ---------
15
<PAGE>
EXHIBIT A
PROMISSORY NOTE
$350,000.00 _____ day of May, 1997
LITTLE ROCK, ARKANSAS
FOR VALUE RECEIVED, the undersigned promises to pay to the order
of Jefferson County, Arkansas, the principal sum of Three Hundred
Fifty Thousand and 00/100 dollars ($350,000) with interest on the
outstanding principal amount hereof from September 1, 1997 until
maturity at the rate of five and one half percent (5.5%) per annum.
This indebtedness shall become due and payable as follows:
Provided that the entire principal balance of the loan
evidenced by this Promissory Note is disbursed to the
Borrower prior to August 1, 1997, principal and interest
shall be due and payable in sixty (60) consecutive quarterly
installments of Eight Thousand Six Hundred Four and 58/100's
Dollars each ($8,604.58). The first such installment shall
be due and payable on October 1, 1997 and each successive
quarterly installment shall be due and payable on the first
day of each calendar quarter thereafter.
All payments made hereunder shall be applied first to accrued
interest and any balance to principal.
The indebtedness represented by this Promissory Note is secured,
among other things, by a guaranty agreement and a lien and security
interest in real estate.
The maker, endorsers, sureties, guarantors, and all other persons
now or hereafter liable hereon waive presentment, demand for payment,
protest and notice of dishonor, and the endorsers, sureties, and
guarantors consent that the owner or holder hereof shall have the
right, without notice, to deal in any way at any time with any party
hereto or to grant to any such party any extensions of time for
payment of any of said indebtedness or any other indulgences or
forbearances whatever without in any way affecting the personal
liability of any party hereunder.
If any payment due under this Promissory Note is not paid
within fifteen (15) days after the date payment is due, the
entire principal amount outstanding hereunder together with all
accrued interest thereon shall at once become due and payable,
without notice, at the option of the holder hereof. Failure to
exercise such option shall not constitute a waiver of the right
to exercise such option at any time thereafter. A late charge of
Fifty and 00/100 Dollars ($50.00) will be assessed against the
undersigned for any payments not received within fifteen (15)
days after the due date thereof.
<PAGE>
If this obligation, after default, is placed in the hands of
an attorney for collection, the maker will be obligated to pay
the holder hereof an additional sum as attorney's fee, not to
exceed ten percent (10%) of the unpaid principal plus all accrued
interest and all costs and expenses of collection.
This is the Note referred to in, and is entitled to the
benefits of, the Loan Agreement of even date herewith between the
undersigned and original payee named above, as the same may be
amended from time to time, which Loan Agreement, among other
things, contains provisions relating to the prepayment and
acceleration of the maturity hereof, and the adjustment of the
aforesaid interest rate, upon the happening of certain stated
events. Reference is also made to said Loan Agreement, as the
same may be amended from time to time.
The loan evidenced by this Promissory Note was negotiated
and consummated in the State of Arkansas and it is understood and
agreed that the legality, enforceability, and construction hereof
shall be governed by Arkansas law, and to the extent applicable,
by the laws of the United States of America.
TSI Redfield Laboratories, Inc.
By:
Title:
<PAGE>
INDUSTRY AND AEROSPACE DEVELOPMENT FUND PROGRAM
GRANT AGREEMENT
PART I - SIGNATORY SHEET
Grantee: Jefferson Counts Grant Control#: IADF-9601
Grant Amount: $350.000 Activity Type: Loan for Industry
GRANTOR GRANTEE
Arkansas Industrial Development Name: Jefferson County
Commission Address: Barraque at Main Street, Pine
Bluff, AR
71601
#1 Capitol Mall, Room 4B 210 County: Jefferson
Little Rock, Arkansas 72201 Phone: (501) 541-5360
Phone: (501) 682-5193
1. This Grant Agreement is entered into by the Arkansas
Industrial Development Commission, herein referred to as the
Grantor, and Jefferson County, herein referred to as the Grantee,
for the purpose of providing funds to the Grantee to undertake a
project which will foster and encourage economic development
pursuant to Acts 59 and 60 of 1992 and its successors. The
Grantee agrees to initiate and complete an IADF project in
accordance with the terms of this Grant Agreement. This Grant
Agreement consists of this Signatory Sheet (Part I), General
Terms and Conditions (Part II), and Scope of Work, Special
Conditions and Budget (Part III), and any attachments referenced
herein.
2. The Grantee Wither warrants it wit-conduct and administer
the grant in accordance with this Grant Agreement and all
applicable State laws and regulations.
3. Approved for the Grantor Approved for the Grantee
BY: BY:
/s/ Del Boyette /s/ Jack Jones
--------------- --------------
Signature Signature
4/23/97 4/21/97
------- -------
Date Date
Del Boyette Jack Jones
Executive Director, AIDC County Judge, Jefferson County
EXHIBIT B
<PAGE>
INDUSTRY AND AEROSPACE DEVELOPMENT FUND PROGRAM
GRANT AGREEMENT
PART II - GENERAL TERMS AND CONDITIONS
In consideration of the general terms and conditions hereinafter
contained, the Grantor and the Grantee agree as follows:
1. COMPENSATION AND METHOD OF PAYMENT. The Grantor will utilize
a grant request for payment procedure and will authorize the
Grantee to draw up to $350,000 against a Grant Award through
the State Treasury, consistent with all fiscal requirements
stipulated herein. The Grantee may request and receive authorized
grant funds by submitting appropriate forms and documentation,
subject to approval by the Grantor, for payments of allowable
expenses incurred by the Grantee while undertaking approved
project activities in accordance with this Grant Agreement. These
expenses must be identified by line item categories which
correspond to the line item categories on this Grant Agreement's
Scope of Work-Budget. Requisitions will be mailed to the Grantor,
and the Grantor will review and approve the requisitions before
issuing Payment to the Grantee.
It is expressly understood that the Grantor will honor requests
for payment and disburse funds only to the extent that funds have
been released to the Grantor therefore, consistent with the
requirements of the General Accounting and Budgetary Procedures
Law, the Revenue Stabilization Law and any other applicable
fiscal control laws and regulations promulgated by the Department
of Finance and Administration.
2. LEGAL AUTHORITY. By signing the Grant Agreement Document's
Signatory Sheet, the Grantee certifies that it possesses legal
authority to accept grant funds and to execute the project
described in this Grant Agreement. This act of signing will also
certify that the Grantee will comply with all parts of this
Agreement.
3. WAIVERS. No conditions or provisions of this Grant
Agreement may be waived unless approved by the Grantor, in
writing.
4. ASSIGNABILITY. The Grantee will not assign any interest in
this Grant Agreement and will not transfer any interest in the
same (whether by assignment or novation).
5. SPECIAL CONDITIONS. The Grantee will comply with all special
conditions and attachments incorporated herein to this grant
award. Compliance approval and clearance of special conditions
will be given by the Grantor in writing after receipt and review
of evidence of compliance from the Grantee. Official notification
of a special condition and the Grantor's approval and/or
clearance of special conditions must be retained by the Grantee
in its files.
<PAGE>
6. FINANCIAL MANAGEMENT AND ACCOUNTING. The Grantee will
establish and maintain a financial management and accounting
system which conforms to generally accepted accounting principles
and complies with all applicable State requirements.
7. ALLOWABLE COSTS. All costs necessary to carry out the
eligible activities in the project must be consistent with and
not exceed the limitations imposed by special conditions, scope
of work and budget.
8. AMENDMENTS AND MODIFICATIONS. The Grantor will consider
project amendments if they are necessitated by actions beyond the
control of a Grantee. The Grantee may request or the Grantor may
require an amendment or modification of the Grant Agreement.
However, such amendment or modification will not take effect
until approved, in writing, by the Grantor. The Grant must be
signed and returned to AIDC by the Grantee within 3 working days.
The Grantee must request prior approval for all amendments or
modifications. Amendments will not be approved which would
materially alter the circumstances under which the grant was
originally funded.
9. RECORD KEEPING. The Grantee agrees to keep such records as
the Grantor may require. All such records, and other records
pertinent to the grant and work undertaken as part of the
project, will be retained by the Grantee for a period of three
years after the final audit of the program.
10. ACCESS TO RECORDS. The Grantor and duly authorized officials
of the State will have full access and the right to examine any
pertinent documents, papers, records, and books of the Grantee
and of persons or organizations with which the Grantee may
contract, which involve transactions related to this Grant
Agreement. The Grantee's contract with other persons or
organizations must specifically provide for the Grantor's access
to documents as provided herein.
11. REPORTS. The Grantee, at such times and in such forms as
the Grantor may require, will furnish the Grantor with such
periodic reports as it may request pertaining to the activities
undertaken pursuant to this Grant Agreement, the costs and
obligations incurred in connection therewith, and any other
matters covered by this Grant Agreement. Failure to comply will
result in sanction upon Grantee, Administrator, Engineer or Sub
Contractor. This sanction will result in AIDC not working with
said persons for a period of not less than one year or more than
five years and/or a suspension of existing funding.
12. OBLIGATIONS REGARDING THIRD PARTY RELATIONSHIPS. The
Grantee will remain fully obligated under the provisions of the
Grant Agreement notwithstanding its designation of any third
party or parties for the undertaking of all or any part of the
project described herein. Any subcontractor which is not the
Grantee will comply with all lawful requirements of the Grantee
necessary to ensure that the project is carried out in accordance
with the provisions of this Grant Agreement. The Grantee shall
secure all such services in accordance with applicable State law
and the
<PAGE>
provisions of this Grant Agreement, and shall notify the
Grantor, in writing, of the method utilized to Secure services,
the name and address of the service provider(s), the scope of
work anticipated and the terms of compensation.
13. CONFLICT OF INTEREST. No officer or employee of the
Grantor, no member, officer, or employee of the Grantee or its
designees or agents, no member of the governing body of the
jurisdiction in which the project is undertaken or located and no
other official of such locality or localities who exercises any
functions or responsibilities with respect to the project during
his tenure, will have any personal or pecuniary gain or interest,
direct or indirect, in any contract or subcontract, or the
proceeds thereof, for work to be performed in connection with the
project assisted under this agreement. The Grantee will
incorporate, or cause to incorporate, in all such contracts or
subcontracts a provision prohibiting such interest pursuant to
the purpose of this provision. The Grantor reserves the right to
waive certain provisions of this clause in the event of a
situation, once justified as unavoidable by the Grantee, and
approved by the Grantor which necessitates such a waiver.
14. POLITICAL ACTIVITY. No portion of the funds provided
hereunder will be used for any partisan political activity or to
further the election or defeat of any candidate for public office
or influence the approval or defeat of any ballot issue.
15. NOTICES. The Grantee will comply with all public notices or
notices to individuals required by applicable State laws.
16. PROHIBITION AGAINST PAYMENTS OF BONUS OR COMMISSION. The
assistance prodded under this Grant Agreement will not be used in
payment of any bonus or commission for the purpose of obtaining
approval of the application for such assistance or any other
approval or concurrence under this Grant Agreement.
17. TERMINATION BY MUTUAL AGREEMENT. This Grant Agreement may be
terminated, in whole or in part, prior to the completion of
project activities when the Grantor determines that continuation
is not feasible or would not produce beneficial results
commensurate with the further expenditure of funds. The Grantee
will not incur new obligations for the terminated portion after
the effective date, and will cancel as many outstanding
obligations as possible. The Grantor will make funds available to
the Grantee to pay for allowable expenses incurred before the
effective date of termination
18. TERMINATION FOR CAUSE. If the Grantee fails to comply with
the terms of the Grant Agreement, or fails to use the grant for
only those purposes set forth herein, the Grantor may:
(a) Suspend Grant Payments - After notice to the Grantee,
suspend the grant and withhold any further payment or
prohibit the Grantee from incurring additional
obligations of grant funds, pending corrective action
by the Grantee or a decision to terminate by the
Grantor.
<PAGE>
(b) Terminate in toto - Terminate the grant in whole, or in
part at any time before the final grant payment is
made.
The Grantor will promptly notify the Grantee in writing of its
determination to terminate, the reason for such termination, and
the effective date of the termination. Payments made to the
Grantee or recoveries by the Grantor will be in accordance with
the legal rights and liabilities of the parties.
19. RECOVERY OF FUNDS. In the event of a default or violation of
the terms of the Grant Agreement by the Grantee, the Grantor may
institute actions to recover all or part of the proper funds paid
to the Grantee.
20. DISPUTES. Except as otherwise provided in this agreement,
any dispute concerning a question of fact arising under this
agreement which is not disposed of by provision of the Grant
Agreement, will be decided by the Grantor which will reduce its
decision to writing and mail or otherwise furnish a copy thereof
to the Grantee. The decision of the Grantor will be final and
conclusive. This does not preclude the consideration of questions
of law in connection with decisions provided for in the preceding
paragraph; provided that nothing in this Grant Agreement will be
construed as making final the decision of any administrative
official, representative, or board on a question of law.
21. INDEMNIFICATION. The Grantee will defend, protect, and save
harmless the Grantor from and against all claims, suits, and
actions arising from any act or omission of the Grantee or any
employee or agents of either in the performance of this Grant
Agreement. However, this clause shall not be construed to waive
A.C.A Section 21-9-301 (1991 supp.).
22. SEVERABILITY. If any provision under this Grant Agreement
or its application to any person or circumstances is held invalid
by any court of competent jurisdiction, this invalidity does not
affect other provisions of the Grant Agreement which can be given
effect without the invalid provision.
23. PERFORMANCE. The Grantor's failure to insist upon the strict
performance of any provision of this contract or to exercise any
right based upon breach thereof or the acceptance of any
performance during such breach, will not constitute a waiver of
any rights under this Grant Agreement.
24. ENFORCEMENT. If the Grantor determines that a Grantee's
performance fails to meet the terms and conditions of its Grant
Agreement, several courses of action may be pursued in order to
resolve the problem. The Grantor may take any of the following
actions, severally or in combination:
(a) Request additional information from the Grantee to
verify the nature of inadequate performance;
<PAGE>
(b) Conduct a site visit to examine pertinent records and
recommend remedial cause of action;
(c) Issue a letter of warning, advising the Grantee of the
deficiency, recommendations for corrections, date by
which performance must be corrected and notice that
more serious sanctions may be imposed if the situation
continues or is repeated;
(d) Suspend funding of questioned activities until remedies
are effected;
(e) Require reimbursement of funds improperly spent; or
(f) Refer the matter to the Attorney General of Arkansas
with a recommendation that a civil action be
instituted.
25. AUDIT. The Grantee will be responsible for the conduct of a
financial and compliance audit within a reasonable period after
completion of project activities. Such audit may be performed by
a certified public accountant whose services are secured through
open, competitive bidding process or during the course of an
audit conducted by staff of the Legislative Joint Audit
Committee. The Grantor reserves the right to recover any unspent
or questioned balance of grant funds, if any, from the Grantee
after final audit.
26. CLOSE-OUT. The Grantor will advise the Grantee to initiate
close-out procedures when the Grantor determines, in consultation
with the Grantee, that there are no impediments to close-out and
that the following criteria have been met or soon will be met:
(a) All costs to be paid with grant funds have been
incurred with the exception of any unsettled third
party claims against the Grantee. Costs are incurred
when goods and services are received and/or contract
work is performed;
(b) The last required progress report has been submitted.
The Grantee's failure to submit or update will not
preclude the Grantor from effecting close-out if it is
deemed to be in the State's interest. Any excess grant
amount which may be in the Grantee's possession will be
returned in the event of the Grantee's failure to
furnish or update the report; and
(c) Other responsibilities of the Grantee under this Grant
Agreement and any close-out agreement, and applicable
laws and regulations appear to have been carried out
satisfactorily or there is no further State interest in
keeping the grant open for the purpose of securing
performance.
27. The Grantee agrees, as a condition of receiving grant
assistance, to abide by and adhere to any policy directives,
rules, regulations or other requirements which may be
<PAGE>
issued from time to time by the Grantor, and which in the opinion of the
Grantor are necessary for efficient or legal execution of the project.
28. The Grantee agrees to see that all work is performed and
completed in a manner consistent with timeliness established at
the Grants inception. Failure to meet these timeliness without
acceptable justification may result in sanction and or obligation
of finding to Grantee and/or Sub Contractors.
<PAGE>
PART III - SCOPE OF WORK, SPECIAL CONDITIONS, BUDGET
SECTION A - SCOPE OF WORK
Grantee: Jefferson Counts Amendment# N/A
Grant Control#: IADF-9601 Amendment Date N/A
The project, described more fully herein, consists of a grant to
the Grantee to benefit Genzyme Transgenics Corporation (the
"Company"). The proceeds of the loan will be utilized by the
Company to construct a large animal facility at Redfield
Laboratories. Redfield Laboratories is located at 100 East Boone
Street in Redfield. The Company will create a minimum of eighteen
(18) new jobs with a minimum average annual salary of $23,088 as
a result of the project.
Explanation of Source and Use of Funds
Subject to satisfactory performance of the conditions and
stipulations contained herein, the Grantor will disburse up to
$350,000 to the Grantee, which will be loaned to the Company to
construct a large animal facility.
It is expressly understood that other financial participants in
the project include:
1. Arkansas Capital Corporation (ACC) - $350,000 for construction
2. Simmons First National Bank - a restructuring of the existing debt
Failure of any other financial participant to execute anticipated
agreements shall constitute grounds to nullify the Grant
Agreement, at the discretion of the Grantor.
Documentation of Financial Obligations
Grantor shall cause the following documents to be prepared:
1. A loan agreement between the Grantee and the Company
reflecting, at a minimum:
a. Maximum principal amount of $350,000;
b. Annual interest rate of 5.5% per annum;
c. Maximum term of 15 years;
d. All loan proceeds must be drawn down and expended no
later than three (3) months from the date of loan
closing. Funds not drawn within the time frame will be
applied to a direct reduction of the principal of the
loan. The total loan amount will then be re-amortized
according to the above referenced repayment schedule.
<PAGE>
e. Interest begins accruing on the first day of the fourth
month following loan closing. Principal and interest
payments shall be due and payable quarterly for the
term of the loan.
The quarterly principal and interest payments shall be
calculated based on the amount of loan funds drawn down
three (3) months from the date of loan closing. If the
maximum loan amount is drawn down, the quarterly
payments shall be $8,604.58.
f. No prepayment penalty;
g. Funds may be used only for costs associated with the
construction of the large animal facility.
h. A minimum of eighteen (18) jobs will be created no
later than June 30, 1999, with a minimum average annual
salary of $23,088. Records verifying the salary level
of the jobs created will be maintained by the Company
for use by the Grantor to monitor compliance with state
laws and regulations.
i. If by June 30, 1999, a minimum of eighteen (18) jobs
are not created and this is verified, the Grantor has
the option to declare the loan in default and demand
full payment upon notice to the Company.
j. If by June 30, 1999, the average annual salary level of
the new jobs created is not $23,088, the Grantor has
the option to declare the loan in default and demand
full payment upon notice to the Company.
k. Quarterly interim financial statements due within
forty-five (45) days of the end of each quarter for the
term of the loan;
l. Year-end audited financial statements due within ninety
(90) days of the close of each fiscal year for the term
of the loan.
2. A promissory note between the Grantee and the Company;
3. An assignment of financial interest in the loan, promissory
note, and mortgage to the Grantor;
4. A second mortgage on the facility, in favor of the Grantee,
with proceeds assigned to the Grantor;
5. Such other intents, assurances or certifications as are
necessary, in the opinion of the Grantor, to perfect and
secure the loan.
<PAGE>
SECTION B - SPECIAL CONDITIONS
Grantee: Jefferson County
Grant Control #: IADF-9601
1. Funds shall not be disbursed until the following special
conditions are met:
a. The Company provides to the Grantor documentation that
Simmons First National Bank has extended the terms of
its existing debt to a minimum of ten (10) years.
b. The Company provides to the Grantor documentation of a
$350,000 commitment from the Arkansas Capital
Corporation.
2. In the event of default or violation by the Company, the
Grantee shall be obliged only to assist the Grantor in
pursuing any and all legal remedies to recover any grant
funds received and expended hereunder by the Company. It is
expressly understood that the Grantor shall not require any
financial remedy by the Grantee for any failure of
obligation by the Company.
<PAGE>
SECTION C - BUDGET
Grantee: Jefferson County Amendment#: N/A
Grant Control#: IADF-9601 Amendment Date: N/A
Category: Industry and Aerospace
Activity: Loan for Industry
Cost Classification Source(s) of Funds Cost Classification
Sub-Costs IADF ACC Total
Loan to Industry
Construction 350,000 350,000 700,000
Totals 350,000 350,000 700 000
<PAGE>
Exhibit 10.2.2
PROMISSORY NOTE
$350,000.00 22nd day of May, 1997
LITTLE ROCK, ARKANSAS
FOR VALUE RECEIVED, the undersigned promises to pay to the order of
Jefferson County, Arkansas, the principal sum of Three Hundred Fifty Thousand
and 00/100 dollars ($350,000) with interest on the outstanding principal amount
hereof from September 1, 1997 until maturity at the rate of five and one half
percent (5.5%) per annum. This indebtedness shall become due and payable as
follows:
Provided that the entire principal balance of the loan evidenced by
this Promissory Note is disbursed to the Borrower prior to August 1,
1997, principal and interest shall be due and payable in sixty (60)
consecutive quarterly installments of Eight Thousand Six Hundred Four
and 58/100's Dollars each ($8,604.58). The first such installment
shall be due and payable on October 1, 1997 and each successive
quarterly installment shall be due and payable on the first day of
each calendar quarter thereafter.
All payments made hereunder shall be applied first to accrued interest and
any balance to principal.
The indebtedness represented by this Promissory Note is secured, among
other things, by a guaranty agreement and a lien and security interest in real
estate.
The maker, endorsers, sureties, guarantors, and all other persons now or
hereafter liable hereon waive presentment, demand for payment, protest and
notice of dishonor, and the endorsers, sureties, and guarantors consent that the
owner or holder hereof shall have the right, without notice, to deal in any way
at any time with any party hereto or to grant to any such party any extensions
of time for payment of any of said indebtedness or any other indulgences or
forbearances whatever without in any way affecting the personal liability of any
party hereunder.
If any payment due under this Promissory Note is not paid within fifteen
(15) days after the date payment is due, the entire principal amount outstanding
hereunder together with all accrued interest thereon shall at once become due
and payable, without notice, at the option of the holder hereof. Failure to
exercise such option shall not constitute a waiver of the right to exercise such
option at any time thereafter. A late charge of Fifty and 00/100 Dollars
($50.00) will be assessed against the undersigned for any payments not received
within fifteen (15) days after the due date thereof.
<PAGE>
If this obligation, after default, is placed in the hands of an attorney
for collection, the maker will be obligated to pay the holder hereof an
additional sum as attorney's fee, not to exceed ten percent (10%) of the unpaid
principal plus all accrued interest and all costs and expenses of collection.
This is the Note referred to in, and is entitled to the benefits of, the
Loan Agreement of even date herewith between the undersigned and original payee
named above, as the same may be amended from time to time, which Loan Agreement,
among other things, contains provisions relating to the prepayment and
acceleration of the maturity hereof, and the adjustment of the aforesaid
interest rate, upon the happening of certain stated events. Reference is also
made to said Loan Agreement, as the same may be amended from time to time.
The loan evidenced by this Promissory Note was negotiated and consummated
in the State of Arkansas and it is understood and agreed that the legality,
enforceability, and construction hereof shall be governed by Arkansas law, and
to the extent applicable, by the laws of the United States of America.
TSI Redfield Laboratories, Inc.
By: /s/ John B. Green
----------------------
Title: Treasurer
-------------------
<PAGE>
Exhibit 10.2.3
MORTGAGE
This MORTGAGE (hereinafter referred to as "Mortgage") entered
into as of the 22nd day of May, 1997 by TSI Redfield Laboratories, Inc.
(hereinafter referred to as "MORTGAGOR," whether one or more), having its, his
or their address for notice hereunder at 100 East Boone Street, Redfield,
Arkansas 72132 in favor of Jefferson County, Arkansas,(hereinafter referred to
as "MORTGAGEE"), whose principal office of business is located at 301 North
Center Street, Suite 201, Lonoke, Arkansas 72086.
That Mortgagor, in consideration of the indebtedness secured hereby and the
discharge of all obligations set forth herein, and for the sum of $10.00, and
other good and valuable considerations, in hand paid, the Mortgagor does hereby
grant, bargain, sell, convey and mortgage to Mortgagee, its successors and
assigns forever the following described real property (hereinafter called
"Mortgaged Property") located in Jefferson County, Arkansas, and all personal
property attached thereto that provides heat, light, water, gas, power, air
conditioning, floor coverings, and appliances, used or to be used in connection
with the operation of the improvements located on the Mortgaged Property, to
wit:
See Exhibit "A" attached hereto.
TO HAVE AND TO HOLD the mortgaged property unto Mortgagee and its
successors and assigns forever, and Mortgagor does hereby bind itself, its
successors and assigns to warrant and forever defend the title to the mortgaged
property unto Mortgagee against every person whomsoever lawfully claiming or to
claim the same or any part thereof, subject to the Permitted Encumbrances
described on Exhibit "B" hereto, which include, without limitation, the Mortgage
granted to Simmons First National Bank of Pine Bluff and any renewal,
modification, extension or refinancing thereof (the "Prior Mortgage").
The foregoing conveyance is given as a Mortgage for the purpose of securing
the principal indebtedness of Mortgagor under a certain Promissory Note of even
date herewith in the sum of Three Hundred Fifty Thousand and No/100 Dollars
($350,000.00), and the Mortgagor is justly indebted to the Mortgagee for
advances made or to be made hereafter by Mortgagee to Mortgagor aggregating the
principal sum aforesaid. All sums secured by this Mortgage are to be used for
the construction of improvements upon the Mortgaged Property, it being mandatory
upon the Mortgagee to make such advances. In the absence of Mortgagor's default
hereunder, the Mortgagee is unconditionally obligated to make advances of the
loan for the purposes set forth herein.
Provided, however, this mortgage is made, executed and delivered upon the
following additional conditions, to wit:
1. INSURANCE: That the buildings now on said mortgaged
<PAGE>
property or that may be hereafter erected thereon shall be kept constantly
insured against loss from such hazards and in such amounts and by such
companies as are approved by or found satisfactory to the Mortgagee, its
successors and assigns. Subject to the rights of the mortgagee under the
Prior Mortgage, Mortgagor shall cause loss payable clauses to be attached to
all such policies providing for payment of the proceeds thereof to Mortgagee,
its successors and assigns, as its interest may appear, and all such policies
shall be delivered to Mortgagee and held by it, its successors and assigns,
until all indebtedness secured by this mortgage has been paid in full.
Mortgagee is hereby authorized and empowered to collect under such policies
and the proceeds of any such collection shall be applied, subject to the
rights of the mortgagee under the Prior Mortgage, first, to the costs and
expenses of collection, including attorney's fees, if any, and second, toward
payment of the indebtedness hereby secured; provided Mortgagee may, at its
election, subject to the rights of the mortgagee under the Prior Mortgage,
permit the insurance proceeds to be used by Mortgagor to restore the damaged
or destroyed improvements or reimprove said lands. Any balance remaining
after repayment of Mortgagor's obligations secured by thie Mortgage, shall be
returned to the Mortgagor.
2. TAXES AND OTHER PAYMENTS: Mortgagor has filed all federal, state,
county and municipal and other tax returns required to have been filed by
Mortgagor and has paid and will pay all real property taxes prior to delinquency
which have become due pursuant to such returns or pursuant to any assessments
received by Mortgagor, and Mortgagor does not know of any basis for any
additional assessment in respect of any such taxes. Mortgagor will pay in full
all real property taxes on the mortgaged property, and no lien for same will be
permitted to be created.
3. LITIGATION: There are no judgments entered nor actions, suits or
proceedings pending against Mortgagor, or to the knowledge of Mortgagor
threatened against or affecting Mortgagor which, if determined adversely to
Mortgagor, the execution of which would adversely affect Mortgagor's solvency or
its ability to pay any agreement with Mortgagee or satisfy all other obligations
under this mortgage.
4. REIMBURSEMENT OF EXPENDITURES: If, after notice to Mortgagor and a
reasonable opportunity to comply with its obligations hereunder, Mortgagee shall
expend any sum or sums for the protection of any of the mortgaged property or
the lien of this mortgage, the repayment of such sum or sums on demand (with
interest thereon at the rate of interest set forth in the Promissory Note
secured hereby) shall be the obligation of the Mortgagor; and such obligations
to repay will constitute a part of the indebtedness secured hereby. The
expenditures thus made reimbursable will include (without limiting the
foregoing) taxes, special improvement assessments, insurance premiums, repairs
and maintenance expenses, compensation for watchman and sums paid to discharge
prior liens, other than the Permitted Encumbrances. The
<PAGE>
cost of any abstract of title or title insurance procured by the Mortgagee to
facilitate the foreclosure will also constitute a part of the reimbursable
expense secured hereby.
5. IMPROVEMENTS PROTECTED: The Mortgagor shall keep the improvements
constructed upon the mortgaged property in good condition and repair and shall
prevent any waste thereof.
6. ENVIRONMENTAL AND INDUSTRIAL HYGIENE COMPLIANCE: Mortgagor covenants,
represents and warrants that to the extent it uses, generates, manufactures,
stores or disposes of, on, under or about the mortgaged property ("Premises") or
transports to or from the Premises any flammable explosives, radioactive
materials, hazardous wastes, toxic substances, or related materials (hereinafter
"Hazardous Materials") it will do so only in full compliance with the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended (42 U.S.C. Section 9601 et seq.); the Hazardous Materials Transportation
Act (49 U.S.C. Section 1801, et seq.); the Resource Conservation and Recovery
Act (42 U.S.C. Section 6901 et seq.); and all other statutes and regulations
governing, defining or regulating the manner and method of storage,
transportation or disposition of Hazardous Materials. Mortgagor further agrees
to indemnify and hold harmless the Mortgagee, its directors, assigns, officers,
employees and agents, from and against any and all liability actually incurred
by Mortgagee (i) including foreseeable and unforeseeable consequential damages,
directly or indirectly arising out of use, generation, storage or disposition of
Hazardous Materials by the Mortgagor or any operator of the Premises during
Mortgagor's ownership thereof, and (ii) including, without limitation, the cost
of any required or necessary remediation, repair, cleanup or detoxification and
the preparation of any closure or other required plans, whether such action is
required or necessary prior to or following transfer of title attributable,
directly or indirectly, to the presence or use, generation, storage, release,
threatened release, or disposal of Hazardous Materials by any person on the
Premises during Mortgagor's ownership thereof, and the Mortgagor's obligations
pursuant to this indemnity shall survive satisfaction or discharge of this
Mortgage, and shall survive, except to the extent that the liability of the
Mortgagee shall be by reason of any exercise by it of control or dominion over
the Premises or the activities of the Mortgagor.
7. EVENTS OF DEFAULT: The Mortgagee may, upon ten (10) days prior
written notice to Mortgagor of its intent to do so, at its option, declare the
entire unmatured portion of all principal indebtedness secured hereby, together
with all interest accrued on the entire secured debt, to be immediately due and
payable, and the same shall forthwith become immediately due and payable,
provided Mortgagor has not cured such default within such ten (10) day period,
in the following events, referred to herein as "Events of Default":
(a) Upon the filing of a voluntary or involuntary
<PAGE>
petition to subject Mortgagor (or any party obligated as a maker,
endorser, surety or guarantor for the payment of the secured
indebtedness) to any bankruptcy arrangement, reorganization, debt
adjustment thereon, receivership or other insolvency proceeding,
provided however, that in the event of an involuntary petition or
action, Mortgagor shall have ninety (90) days in which to have such
petition or action dismissed.
(b) If default shall be made in the payment of any part of the
principal indebtedness evidenced by the Promissory Note and secured
hereby, or any interest accruing on such principal indebtedness, as
the same becomes due according to the terms of the Promissory Note, or
of any extension or renewal thereof.
(c) If Mortgagor shall fail to comply with any of the other
obligations or covenants contained herein and such failure shall
remain unremedied for thirty (30) days after written notice from
Mortgagee.
(d) If the holder of any lien or security interest on the mortgaged
property (without hereby implying Mortgagee's consent to the
existence, placing, creating or permitting of any lien or security
interest) institutes foreclosure or other proceedings for the
enforcement of its indebtedness and obligations thereunder.
(e) If any mechanics, materialmen or labor liens are filed on the
mortgaged property and not discharged, bonded or insured over by
Mortgagor within 30 days of the notice thereof by Mortgagor to
Mortgagee.
(f) Upon the occurrence of event of default (beyond applicable notice
and grace periods set forth therein) as identified in the Loan
Agreement by and between Mortgagee and Mortgagor.
The foregoing acceleration provisions will be applicable not only to the
maturities recited in the original Promissory Note but also to any substituted
maturities created by extension or renewal. The failure of the Mortgagee to
declare any acceleration of maturities when a ground therefor exists, even
though such forbearance may be repeated from time to time, will not constitute a
waiver of the right of such Mortgagee to accelerate maturities upon a
reoccurrence of the same ground therefor; nor will the act of Mortgagee in
remedying any condition resulting from Mortgagor's default bar Mortgagee from
declaring an acceleration of maturities by reason of such default.
<PAGE>
8. ACCELERATION: Upon the occurrence of any Event of Default, the
Mortgagee may declare the entire principal balance of the Promissory Note with
accrued interest thereon due and payable and Mortgagee shall be entitled to sue
for and to recover a judgment and foreclosure of this Mortgage for the amount so
due and unpaid together with all costs of foreclosure. The proceeds of the
foreclosure sale shall be applied, first, to the payment of all foreclosure
costs and expenses attending said sale; second to the payment of all
indebtedness secured hereby; and the remainder, if any, shall be paid to said
Mortgagor. All expenses of retaking, holding, preparing for sale, selling or
the like, as well as all reasonable attorney's fees (not to exceed 10% of the
secured indebtedness plus accrued interest) and lawful expenses incurred by said
Mortgagee in enforcing such remedies, including the cost of any supplemental
abstract, title insurance policy, expense for inspection or appraisal of the
mortgaged property, and expert witness fees, shall be payable to said Mortgagee
by Mortgagor and shall constitute a part of the secured indebtedness. Mortgagee
is entitled to pursue any and all other legal or equitable remedies allowed by
Arkansas law upon the occurrence of an Event of Default.
9. CONDEMNATION: Immediately upon Mortgagor's knowledge of the
institution of any proceeding for the condemnation of the mortgaged property,
Mortgagor shall immediately notify Mortgagee of such fact. Mortgagor shall
then, if requested by Mortgagee, file or defend its claim thereunder and
prosecute same with due diligence to its final disposition and, subject to the
rights of the Prior Mortgagee under the Prior Mortgage, shall cause any awards
or settlements to be paid over to Mortgagee for disposition pursuant to the
terms of the Mortgage. Mortgagor may be the nominal party in such proceeding
but Mortgagee, subject to the rights of the Prior Mortgagee under the Prior
Mortgage, shall be entitled to participate in and to control same and to be
represented therein by counsel of Mortgagee's own choice, and Mortgagor will
deliver or cause to be delivered, to Mortgagee such instruments as may be
requested by Mortgagee from time to time to permit such participation. If the
mortgaged property is taken or diminished in value, or if a consent settlement
is entered, by or under the threat of such proceeding, subject to the rights of
the Prior Mortgagee under the Prior Mortgage, the award or settlement payable to
Mortgagor by virtue of Mortgagor's interest in the mortgaged property shall be
assigned, transferred and set over unto Mortgagee to be applied to the principal
indebtedness and accrued interest secured hereby. Any balance remaining after
repayment of Mortgagor's obligations secured by this Mortgage, shall be returned
to the Mortgagor.
10. NOTICES: All notices or other communications required or permitted to
be given pursuant to this Mortgage shall be in writing and shall be considered
as properly given if mailed by first class United States mail, postage prepaid,
registered or certified with return receipt requested, or by delivering same in
person to the intended addressee, or deposited with a nationally recognized
overnight courier service. Notice so mailed shall be effective
<PAGE>
three (3) days after deposit of the notice within the United States mail and
one (1) day after deposit with such overnight courier service.
11. NO WAIVER: Any failure by Mortgagee to insist, or any election by
Mortgagee not to insist, upon strict performance by Mortgagor of any of the
terms, provisions or conditions of the Promissory Note or Mortgage shall not be
deemed to be a waiver of same or of any other term, provision or condition
thereof, and Mortgagee shall have the right at any time or times thereafter to
insist upon strict performance by Mortgagor of any and all of such terms,
provisions and conditions.
12. ADDITIONAL ADVANCES: This Mortgage shall secure, in addition to the
Promissory Note secured hereby, all funds hereafter advanced by Mortgagee to or
for the benefit of Mortgagor, as contemplated by any covenant or provision
herein contained, whether such indebtedness is advanced by note, endorsement,
surety, agreement, guaranty or otherwise, it being contemplated that Mortgagor
may hereafter become indebted to Mortgagee in such further sum or sums.
13. WAIVER OF HOMESTEAD, DOWER AND CURTESY: To the extent permitted by
law, Mortgagor waives all right of homestead exemption in the mortgaged property
and Mortgagor hereby relinquishes all rights of dower and curtesy in the
mortgaged property.
14. WAIVER OF STATUTORY AND COMMON LAW RIGHTS: Mortgagor agrees that it
will not apply for or avail itself of any appraisement, valuation, stay,
extension or exemption laws or so called "moratorium laws", now existing or
hereinafter enacted in order to prevent or hinder the enforcement or foreclosure
of this mortgage and the Mortgagor hereby expressly waives the benefit of such
laws, including, but not limited to, the Act approved May 8, 1899, the Acts
amendatory thereof, and the Mortgagor and each of them specifically waives all
rights of redemption, equitable or statutory, from any sale made by decree of
Court on foreclosure of this instrument.
15. ENTIRE AGREEMENT AND MODIFICATION: This Mortgage together with the
Loan Agreement, Guaranty Agreement, other security documents and the Promissory
Note secured hereby contain the entire agreement between the parties relating to
the subject matter hereof and thereof and all prior agreements relative thereto
which are not contained herein or therein are terminated. The Promissory Note
and Mortgage may be amended, revised, waived, discharged, released or terminated
only by a written instrument or instruments executed by the party against which
enforcement of the amendment, revision, waiver, discharge, release or
termination is asserted. An alleged amendment, revision, waiver, discharge,
release or termination which is not so documented shall not be effective as to
any party.
16. SEVERABILITY: If any provision of the Mortgage,
<PAGE>
Promissory Note or other loan documents shall, for any reason and to any
extent be adjudged invalid or unenforceable, the remaining provisions of the
Mortgage, Promissory Note and other loan documents shall not be affected
thereby but rather shall be enforced to the greatest extent permitted by law.
17. APPLICABLE LAW: This Agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas except insofar as federal law
may control any aspect of the limitation on interest rate or remedies.
18. HEADINGS: The Article, Paragraph and Subparagraph entitlements
hereof are inserted for convenience of reference only and shall in no way alter,
modify or define, or be used in construing the text of such articles, paragraphs
or subparagraphs.
19. SUCCESSORS AND ASSIGNS: All of the terms of the Promissory Note and
Mortgage shall apply to, be binding upon and inure to the benefit of the parties
hereto, their respective successors, assigns, heirs and legal representatives
and all other persons claiming by, through or under them.
20. LIMITATION OF INTEREST RATE: Conforming to the actual intention of
the parties hereto, it is agreed that in no instance shall any claim be made by
Mortgagor, or by the holder of this Mortgage or of any note or indebtedness
secured hereby, for any interest or any monies mentioned herein, or any money in
lieu of interest, which shall exceed the lawful rate of interest per annum; and
this paragraph shall take precedence and control, in the event of any conflict
between this provision and any other provision of the Promissory Note, Mortgage
or other document executed in connection herewith.
<PAGE>
21. GENDER: Whenever used, the singular shall include the plural and the
plural the singular, and the use of any gender shall be applicable to all
genders.
EXECUTED on this 22nd day of May, 1997.
TSI Redfield Laboratories, Inc.
By: /s/ John B. Green
---------------------
Title: Treasurer
---------------
<PAGE>
ACKNOWLEDGMENT
STATE OF Arkansas )
) ss:
COUNTY OF Pulaski )
BE IT REMEMBERED, that on this 22nd day of May, 1997, came before the
undersigned, a Notary Public within and for the County aforesaid, duly
commissioned and acting John B. Green to me well known as the Treasurer of TSI
Redfield Laboratories, Inc. the Mortgagor in the within and foregoing Mortgage,
and stated that he had executed the same for and on behalf of the Mortgagor for
the consideration and purposes therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public this day of May 22, 1997.
John Kooistra III
Notary Public
My Commission Expires:
09-30-01
<PAGE>
CERTIFICATE OF RECORD
STATE OF ARKANSAS )
) ss:
COUNTY OF )
I, , Circuit Clerk and Ex-Officio
Recorder for the County aforesaid, do hereby certify that the annexed and
foregoing instrument of writing was filed for record in my office on the
day of , A. D. 1997, at o'clock _.m., and the same is
now duly recorded, with the acknowledgment and certificate thereon in Record
Book Page .
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of
said Court, this day of , 1997.
Clerk and Ex-Officio Recorder
BY: D.C.
<PAGE>
EXHIBIT A
The East Half (E 1/2) of the Southwest Quarter (SW 1/4) of the
Northeast Quarter (NE 1/4) of Section 22, Township 3 South, Range 11
West of the 5th P. M.; AND ALSO,
That portion of Block Thirteen (13) of the Town of Redfield,
Arkansas, according to the plat thereof shown of record in the office
of the Circuit Clerk and Ex-Officio Recorder of Jefferson County,
Arkansas, in Plat Book 3 at page 28 specifically described as:
Beginning at the Easterly corner of Block Thirteen (13) of the
Town of Redfield and running thence in a Southwesterly direction 150
feet to the line dividing Block Thirteen (13) into two equal halves
and running thence Northwesterly along that line 300 feet to a point
on the Southeasterly line of Boone Street; thence Northeasterly 150
feet, more or less, to the Northerly corner of Block Thirteen (13);
and thence in a Southeasterly direction along the Northeasterly line
of Block Thirteen (13) 300 feet, more or less, to the point of
beginning; which is also described as Lots One (1), Two (2), Three
(3), Four (4), Five (5) and Six (6) in Block Thirteen (13) of the Town
of Redfield, Arkansas; AND ALSO,
The South Half (S 1/2) of the Northwest Quarter (NW 1/4) of the
Northeast Quarter (NE 1/4) of Section 22, Township 3 South, Range 11
West of the 5th P.M.;
LESS AND EXCEPT, a parcel of land lying in the Northwest Quarter
(NW 1/4) of the Northeast Quarter (NE 1/4) of Section 22, Township 3
South, Range 11 West of the 5th P.M., more particularly described as
follows:
Commencing at the Southwest corner of the Northwest Quarter (NW
1/4) of the Northeast Quarter (NE 1/4) of said Section 22, thence,
North 205 feet North 40 degrees West 150 feet; and thence South 195.2
feet to the point of beginning.
<PAGE>
EXHIBIT "B"
PERMITTED ENCUMBRANCES
1. Title to that portion of the Mortgaged Property lying within the
bounds of Boone Street as shown on the plat of survey by Michael D.
Granderson, dated December, 1981, and re-certified to November 28,
1990.
2. Right of Way Permit from D. P. Henry and M. G. Henry to Town of
Redfield, Arkansas, for a sewer line and access road, dated December
12, 1979, recorded January 4, 1980, in contract and Agreement book 36
at Page 799, in the office of the Circuit Clerk and Ex-officio
Recorder of Jefferson County, Arkansas.
3. Easement for sewer affecting the Mortgaged Property as shown on the
plat of survey by Michael D. Granderson, dated December, 1981, and
re-certified to November 28, 1990.
4. Title to that portion of the Mortgaged Property within the bounds of
Brodie Street as shown on the plat of survey by Michael D. Granderson,
dated December, 1981, and re-certified to November 28, 1990.
5. Title to that portion of the Mortgaged Property lying within the
bounds of the unnumbered block of land which overlaps with the
Southwest corner of the Mortgaged Property as shown on the plat of
survey of Michael D. Granderson dated December, 1981, and re-certified
to November 28, 1990.
6. Easement for power line affecting the Mortgaged Property as shown on
the plat of survey by Michael D. Granderson, dated December, 1981, and
re-certified to November 28, 1990.
7. Rights, if any, of property owners adjoining on the North, West and
South, respectively, in and to that portion of the Mortgaged Property
lying between the North, West and south property lines, respectively,
and the fence/tree lines, as shown on the plat of survey by Michael D.
Granderson, dated December, 1981, and re-certified to November 28,
1990.
8. Easement Deed from TSI Redfield Laboratories, Inc. to the City of
Redfield, Arkansas, dated June 4, 1992, and recorded July 20, 1992, in
Deed Record Book 623 at Page 443, the rights to which were assigned by
the city of Redfield, Arkansas, to the Arkansas Soil and Water
Conservation Commission dated July 21, 1992, and recorded July 23,
1992, in Deed Record Book 623 at Page 618.
9. Easement Deed from TSI Redfield Laboratories, Inc. to the City of
Redfield, Arkansas, dated June 4, 1992, and recorded July 20, 1992, in
Deed Record Book 623 at Page 445, the rights to which were assigned by
the City of Redfield, Arkansas, to the Arkansas Soil and Water
Conservation Commission dated July 21, 1992, and recorded
<PAGE>
July 23, 1992, in Deed Record Book 623 at Page 618.
10. Mortgage from TSI Redfield Laboratories, Inc. to Jefferson County,
Arkansas, dated November 29, 1990, and recorded November 29, 1990, at
1:40 P.M. in Mortgage Record Book 574 at Page 298, securing the
original principal sum of $500,000.00, which was assigned to Arkansas
Industrial Development Commission by Assignment dated November 29,
1990, and recorded January 11, 1991, in Mortgage Record Book 576 at
Page 33.
11. Mortgage and Security Agreement from TSI Redfield Laboratories, Inc.,
to Simmons First National Bank of Pine Bluff dated November 29, 1990,
and recorded November 29, 1990, at 1:39 P.M. in Mortgage Record Book
574 at Page 261, securing the original sum of $800,000.00, as amended
by the Modification Agreement dated December 20, 1993, and recorded
December 28, 1993, in Mortgage Record Book 632 at Page 64, as again
amended by the Modification Agreement dated December 23, 1993, and
recorded December 30, 1993, in Mortgage Record Book 632 at Page 316,
as further amended by the Modification Agreement dated July 8, 1994,
and recorded July 18, 1994, in Mortgage Record Book 645 at Page 783,
as still further amended by the Modification Agreement dated March 27,
1995, and recorded March 31, 1995, in Mortgage Record Book 659 at Page
497, as still further amended by the Modification and Extension
Agreement dated March 26, 1996, and recorded April 9, 1996, in
Mortgage Record Book 682 at Page 628.
<PAGE>
Exhibit 10.2.4
GUARANTY AGREEMENT
For the sum of $100.00 and other good and valuable consideration, the
receipt of which is hereby acknowledged, and in order to induce Jefferson
County, Arkansas (herein referred to as "LENDER") to loan TSI Redfield
Laboratories, Inc.("BORROWER"), Three Hundred Fifty Thousand and No/100 Dollars
($350,000.00), said loan being evidenced by the Borrower's Promissory Note of
even date herewith ("Note"), the undersigned hereby unconditionally guarantees
to Lender the prompt and punctual performance of each and every agreement,
covenant and condition contained in the Note, security documents, and the Loan
Agreement ("Agreement") provided, however, that except as otherwise provided
herein, this Guaranty and the liability assumed hereunder is limited in amount
to the unpaid principal and accrued interest and other costs and expenses
provided for in the Note and the Agreement, and that said amount will be
promptly paid in full when due in accordance with the provisions of the Note or
the Agreement whether at maturity, by acceleration or otherwise, all at the
times and places and at the rate and currency described in the Agreement and the
Note and otherwise in accordance therewith. This Guaranty shall terminate upon
payment of the amounts set forth above and the fulfillment of those terms,
covenants, and conditions contained within the documents evidencing and securing
this loan transaction which are referred to above, including, but not limited
to, those indemnification covenants dealing with the disposition, generation,
storage or usage of hazardous materials and any liability which
1
<PAGE>
arises therefrom contained within Paragraph 24 of the Loan Agreement.
This is an unconditional and absolute Guaranty, limited only in amount as
mentioned above, of payment and performance, and if for any reason, any duty,
agreement or obligation of the Borrower contained in the Note or the Agreement
shall not be performed or observed by the Borrower, or if any amount or any part
thereof payable under or in connection with the Note or the Agreement shall not
be paid promptly when due and payable, the undersigned will promptly perform or
cause to be performed each of such duties, agreements and obligations and will
forthwith pay such amounts to the Lender or any subsequent holder of the Note,
regardless of any defense or setoff or counterclaim which the Borrower may have
or assert, and regardless of whether any holder of the Note or anyone on behalf
of such holder shall have instituted any suit, action or proceeding or exhausted
its remedies or taken any steps to enforce any rights against the Borrower or
any other person to compel any such performance or to collect all or part of any
such amounts, either pursuant to the provisions of the Note and the Agreement or
at law or in equity, and regardless of any other condition or contingency.
The undersigned hereby: (i) waives any requirement that the Lender or any
subsequent holder of the Note, in the event of a default by the Borrower, first
make demand upon or seek to enforce remedies against the Borrower before
demanding payment under or
seeking to enforce the Guaranty; (ii) covenants that this Guaranty
2
<PAGE>
will not be discharged except by complete performance of the obligations
contained in the Note and the Agreement; (iii) agrees that this Guaranty
shall remain in full force and effect without regard to, and shall not be
affected or impaired, without limitation, by any invalidity, irregularity or
unenforceability in whole or in part of the Note or the Agreement or any
limitation on the liability of the Borrower thereunder or any limitation on
the method or terms of payment thereunder which may now or hereafter be
caused or imposed in any manner whatsoever; and (iv) consents and agrees that
Lender, or its successors and assigns, may at any time, either with or
without consideration, release and/or surrender any property or interest
therein or other security of any kind held by it or on its behalf securing
any indebtedness or liability covered hereby, or substitute for any
collateral so held by it any other collateral, or modify, renew, or extend
the terms of the Note or other Agreement without notice to or further consent
from undersigned, and such surrender, substitution, modification, renewal, or
extension shall not in any way affect the liability of the undersigned. The
undersigned hereby unconditionally waives diligence, presentment, protest,
and any notice of default in the payment of any amount at any time payable by
the Borrower under or in connection with the Note or the Agreement and notice
of the breach or nonperformance of any duty, agreement or obligation of the
Borrower contained in the Note or in the Agreement.
The obligations, covenants, agreements and duties of the undersigned under
this Guaranty shall not be affected or impaired
3
<PAGE>
by any assignment or transfer, in whole or in part, of the Note with or
without notice to the undersigned or any waiver by the holder or holders of
the Note of the performance or observance by the Borrower of any of the
agreements, covenants, terms or conditions contained in the Note or in the
Agreement; or any indulgence in or the extension of the time for the payment
by the Borrower of any amounts payable under or in connection with the Note
or Agreement; or of the time of performance by the Borrower of any other
obligation under or arising out of the Note or the Agreement; or the
extension or renewal thereof, or the modification or amendment of any duty,
agreement or obligation of the Borrower set forth in the Note or the
Agreement; or the voluntary or involuntary liquidation, sale, or other
disposition of all or substantially all of the assets of the Borrower, or
receivership insolvency, bankruptcy, reorganization or other similar
proceedings affecting the Borrower or any of its assets; or the release or
discharge of the Borrower from the performance or observance of any
agreement, covenant, term or condition contained in the Note or the Agreement
without the consent of the Lender or any such holder of the Note; or the
merger of the Borrower; or any other cause, whether similar or dissimilar to
the foregoing, including the release of any other guarantor of the Note and
Agreement; or the release of any other collateral securing said loan; nor
shall the Lender have any obligation to commence proceedings and enforce any
other guaranty of the Note prior to exercising its rights against the
undersigned.
This Guaranty may not be amended or modified except by written agreement
executed by the undersigned with the consent in writing of the Lender or any
subsequent holder of the Note.
All the covenants, agreements, terms and conditions in this Guaranty
contained herein shall bind and inure to the benefit of the undersigned, heirs,
administrators and assigns, and the respective holders of the Note.
This Guaranty shall, for all purposes, be construed in accordance with and
governed by the law of the State of Arkansas. Undersigned hereby waives any
defense arising from lack of and otherwise specifically consents to in personam
jurisdiction within any state or federal court sitting in the State of Arkansas
having subject matter jurisdiction over any cause of action arising under, as a
result of, or because of the loan referenced herein and/or this Guaranty
Agreement. Undersigned shall not, until the prior payment in full of the Note,
assert, enforce or otherwise exercise a) any right of subrogation to any of the
rights or liens of Lender, its successors or assigns, or any other beneficiary
against Borrower or any other obligor on the indebtedness or obligations covered
hereby or any collateral or other security, or b) any right of recourse,
reimbursement, contribution, indemnification, or similar right against Borrower
of any other obligor on all or any part of the indebtedness or obligations
covered hereby or any guarantor thereof, and, until the prior payment in full of
the Note, undersigned hereby irrevocably waives any and all of the foregoing
rights. Undersigned irrevocably waives the benefit of,
5
<PAGE>
and right to participate in, any collateral or other security given to
Lender, its successors and assigns or any other beneficiary to secure payment
of the indebtedness and other obligations hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Guaranty this 22nd
day of May, 1997.
GENZYME TRANSGENICS CORPORATION
By: /s/ John B. Green
------------------------
Title: Vice President
---------------------
ACKNOWLEDGMENT
STATE OF Arkansas )
) ss:
COUNTY OF Pulaski )
Before me, the undersigned Notary Public, duly qualified and commissioned
for the State and City/County aforesaid, appeared John B. Green the Vice
President of Genzyme Transgenics Corporation, who stated that he has executed
the foregoing for and on behalf of the corporation for the consideration, uses
and purposes therein stated and set forth.
DATED this 22nd day of May, 1997.
/s/ John Kooistra
-------------------
Notary Public
My Commission Expires:
09-30-01
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<PAGE>
Exhibit 10.3
1. Adopted by the Board of Directors on May 1, 1993; Approved by the
stockholders on June 25, 1993.
2. Amended by the Board of Directors on September 24, 1993 (No stockholder
approval required).
3. Amended by the Board of Directors on October 24, 1994, March 17, 1995 and
April 6, 1995; Approved by the stockholders on May 19, 1995.
4. Amended by the Board of Directors on March 13, 1996; Approved by the
stockholders on May 15, 1996.
5. Amended by the Board of Directors on March 3, 1997; Approved by the
stockholders on May 28, 1997.
GENZYME TRANSGENICS CORPORATION
1993 Equity Incentive Plan
Section 1. Purpose
The purpose of the Genzyme Transgenics Corporation 1993 Equity Incentive
Plan (the "Plan") is to attract and retain key employees and consultants to
provide an incentive for them to assist the Company to achieve long-range
performance goals, and to enable them to participate in the long-term growth
of the Company.
Section 2. Definitions
"Affiliate" means any business entity in which the Company owns directly
or indirectly 50% or more of the total combined voting power or has a
significant financial interest as determined by the Committee.
"Award" means any Option, Stock Appreciation Right, Performance Share,
Restricted Stock or Stock Unit awarded under the Plan.
"Board" means the Board of Directors of the Company.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Committee" means either any one of one or more committees of the Board
appointed by the Board to administer the Plan, the members of which are
"Non-Employee Directors" within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934, as amended, or any successor provision (the
"Rule") to the extent necessary to comply with the Rule.
"Common Stock" or "Stock" means the Common Stock, $0.01 par value, of the
Company.
"Company" means Genzyme Transgenics Corporation.
"Designated Beneficiary" means the beneficiary designated by a Participant,
in a manner determined by the Committee, to receive amounts due or exercise
rights of the
<PAGE>
Participant in the event of the Participant's death. In the absence of an
effective designation by a Participant, designated Beneficiary shall mean the
Participant's estate.
"Fair Market Value" means, with respect to Common Stock or any other
property, the fair market value of such property as determined by the
Committee in good faith or in the manner established by the Committee from
time to time.
"Incentive Stock Option" means an option to purchase shares of Common
Stock awarded to a Participant under Section 6 which is intended to meet the
requirements of Section 422 of the Code or any successor provision.
"Nonstatutory Stock Option" means an option to purchase shares of Common
Stock awarded to a Participant under Section 6 which is not intended to be an
Incentive Stock Option.
"Option" means an Incentive Stock Option or a Nonstatutory Stock Option.
"Participant" means a person selected by the Committee to receive an
Award under the Plan.
"Performance Cycle" or "Cycle" means the period of time selected by the
Committee during which performance is measured for the purpose of determining
the extent to which an award of Performance Shares has been earned.
"Performance Shares" mean shares of Common Stock which may be earned by
the achievement of performance goals awarded to a Participant under Section 8.
"Reporting Person" means a person subject to Section 16 of the Securities
Exchange Act of 1934 or any successor provision.
"Restricted Period" means the period of time selected by the Committee
during which an award of Restricted Stock may be forfeited to the Company.
"Restricted Stock" means shares of Common Stock subject to forfeiture
awarded to a Participant under Section 9.
"Stock Appreciation Right" or "SAR" means a right to receive any excess
in value of shares of Common Stock over the exercise price awarded to a
Participant under Section 7.
"Stock Unit" means an award of Common Stock or units that are valued in
whole or in part by reference to, or otherwise based on, the value of Common
Stock, awarded to a Participant under Section 10.
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Section 3. Administration
The Plan shall be administered by the Committee. The Committee shall
have authority to adopt, alter and repeal such administrative rules,
guidelines and practices governing the operation of the Plan as it shall from
time to time consider advisable, and to interpret the provisions of the Plan.
The Committee's decisions shall be final and binding. To the extent
permitted by applicable law, the Committee may delegate to one or more
executive officers of the Company the power to make Awards to Participants
who are not Reporting Persons and all determinations under the Plan with
respect thereto, provided that the Committee shall fix the maximum amount of
such Awards for the group and a maximum for any one Participant.
Section 4. Eligibility
All employees, and in the case of Awards other than Incentive Stock
Options, consultants of the Company or any Affiliate capable of contributing
significantly to the successful performance of the Company, other than a
person who has irrevocably elected not to be eligible, are eligible to be
Participants in the Plan.
Section 5. Stock Available for Awards
(a) Subject to adjustment under subsection (b), Awards may be made under
the Plan for up to 2,515,000(1) shares of Common Stock. If any Award in respect
of shares of Common Stock expires or is terminated unexercised or is
forfeited for any reason or settled in a manner that results in fewer shares
outstanding than were initially awarded, including without limitation the
surrender of shares in payment for the Award or any tax obligation thereon,
the shares subject to such Award or so surrendered, as the case may be, to
the extent of such expiration, termination, forfeiture or decrease, shall
again be available for award under the Plan, subject, however, in the case of
Incentive Stock Options, to any limitation required under the Code. Common
Stock issued through the assumption or substitution of outstanding grants
from an acquired company shall not reduce the shares available for Awards
under the Plan. Shares issued under the Plan may consist in whole or in part
of authorized but unissued shares or treasury shares.
(b) In the event that the Committee determines that any stock dividend,
extraordinary cash dividend, creation of a class of equity securities,
recapitalization, reorganization, merger, consolidation, split-up, spin-off,
combination, exchange of shares, warrants or rights offering to purchase
Common Stock at a price substantially below fair
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(1) This number includes 224,350 shares reserved for issuance upon the exercise
of outstanding options to purchase shares of common stock of TSI Corporation,
which options were assumed by the Company in October 1994 in connection with
the Company's acquisition of TSI Corporation.
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<PAGE>
market value, or other similar transaction affects the Common Stock such that
an adjustment is required in order to preserve the benefits or potential
benefits intended to be made available under the Plan, then the Committee,
subject, in the case of Incentive Stock Options, to any limitation required
under the Code, shall equitably adjust any or all of (i) the number and kind
of shares in respect of which Awards may be made under the Plan, (ii) the
number and kind of shares subject to outstanding Awards, and (iii) the award,
exercise or conversion price with respect to any of the foregoing, and if
considered appropriate, the Committee may make provision for a cash payment
with respect to an outstanding Award, provided that the number of shares
subject to any Award shall always be a whole number.
Section 6. Stock Options
(a) Subject to the provisions of the Plan, the Committee may award
Incentive Stock Options and Nonstatutory Stock Options and determine the
number of shares to be covered by each Option, the option price therefor and
the conditions and limitations applicable to the exercise of the Option. The
terms and conditions of Incentive Stock Options shall be subject to and
comply with Section 422 of the Code, or any successor provision, and any
regulations thereunder.
(b) The Committee shall establish the option price at the time each
Option is awarded, which price shall not be less than 100% of the Fair Market
Value of the Common Stock on the date of award.
(c) Each Option shall be exercisable at such times and subject to such
terms and conditions as the Committee may specify in the applicable Award or
thereafter. The Committee may impose such conditions with respect to the
exercise of Options, including conditions relating to applicable federal or
state securities laws, as it considers necessary or advisable.
(d) No shares shall be delivered pursuant to any exercise of an Option
until payment in full of the option price therefor is received by the
Company. Such payment may be made in whole or in part in cash or, to the
extent permitted by the Committee at or after the award of the Option, by
delivery of a note or shares of Common Stock owned by the optionee, including
Restricted Stock, valued at their Fair Market Value on the date of delivery,
or such other lawful consideration as the Committee may determine.
(e) The Committee may provide for the automatic award of an Option upon
the delivery of shares to the Company in payment of an Option for up to the
number of shares so delivered.
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<PAGE>
Section 7. Stock Appreciation Rights
(a) Subject to the provisions of the Plan, the Committee may award SARs
in tandem with an Option (at or after the award of the Option), or alone and
unrelated to an Option. SARs in tandem with an Option shall terminate to the
extent that the related Option is exercised, and the related Option shall
terminate to the extent that the tandem SARs are exercised. SARs shall have
an exercise price of not less than the Fair Market Value of the Common Stock
on the date of award, or in the case of SARs in tandem with Options, the
exercise price of the related Option.
(b) An SAR related to an Option which can only be exercised during
limited periods following a change in control of the Company, may entitle the
Participant to receive an amount based upon the highest price paid or offered
for Common Stock in any transaction relating to the change in control or paid
during the thirty-day period immediately preceding the occurrence of the
change in control in any transaction reported in the stock market in which
the Common Stock is normally traded.
Section 8. Performance Shares
(a) Subject to the provisions of the Plan, the Committee may award
Performance Shares and determine the number of such shares for each
Performance Cycle and the duration of each Performance Cycle. There may be
more than one Performance Cycle in existence at any one time, and the
duration of Performance Cycles may differ from each other. The payment value
of Performance Shares shall be equal to the Fair Market Value of the Common
Stock on the date the Performance Shares are earned or, in the discretion of
the Committee, on the date the Committee determines that the Performance
Shares have been earned.
(b) The Committee shall establish performance goals for each Cycle, for
the purpose of determining the extent to which Performance Shares awarded for
such Cycle are earned, on the basis of such criteria and to accomplish such
objectives as the Committee may from time to time select. During any Cycle,
the Committee may adjust the performance goals for such Cycle as it deems
equitable in recognition of unusual or non-recurring events affecting the
Company, changes in applicable tax laws or accounting principles, or such
other factors as the Committee may determine.
(c) As soon as practicable after the end of a Performance Cycle, the
Committee shall determine the number of Performance Shares which have been
earned on the basis of performance in relation to the established performance
goals. The payment values of earned Performance Shares shall be distributed
to the Participant or, if the Participant has died, to the Participant's
Designated Beneficiary, as soon as practicable thereafter. The Committee
shall determine, at or after the time of award, whether payment values will
be settled in whole or in part in cash or other property, including Common
Stock or Awards.
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Section 9. Restricted Stock
(a) Subject to the provisions of the Plan, the Committee may award
shares of Restricted Stock and determine the duration of the Restricted
Period during which, and the conditions under which, the shares may be
forfeited to the Company and the other terms and conditions of such Awards.
Shares of Restricted Stock shall be issued for no cash consideration or such
minimum consideration as may be required by applicable law.
(b) Shares of Restricted Stock may not be sold, assigned, transferred,
pledged or otherwise encumbered, except as permitted by the Committee, during
the Restricted Period. Shares of Restricted Stock shall be evidenced in such
manner as the Committee may determine. Any certificates issued in respect of
shares of Restricted Stock shall be registered in the name of the Participant
and unless otherwise determined by the Committee, deposited by the
Participant, together with a stock power endorsed in blank, with the Company.
At the expiration of the Restricted Period, the Company shall deliver such
certificates to the Participant or if the Participant has died, to the
Participant's Designated Beneficiary.
Section 10. Stock Units
(a) Subject to the provisions of the Plan, the Committee may award
Stock Units subject to such terms, restrictions, conditions, performance
criteria, vesting requirements and payment rules as the Committee shall
determine.
(b) Shares of Common Stock awarded in connection with a Stock Unit
Award shall be issued for no cash consideration or such minimum consideration
as may be required by applicable law.
Section 11. General Provisions Applicable to Awards
(a) Limitations on Transferability. Options shall not be transferable
by the recipient other than by will or the laws of descent and distribution
and are exercisable during such person's lifetime only by such person or by
such person's guardian or legal representative; provided that the Committee
may in its discretion waive such restriction in any case.
(b) Documentation. Each Award under the Plan shall be evidenced by a
writing delivered to the Participant specifying the terms and conditions
thereof and containing such other terms and conditions not inconsistent with
the provisions of the Plan as the Committee considers necessary or advisable
to achieve the purposes of the Plan or comply with applicable tax and
regulatory laws and accounting principles.
(c) Committee Discretion. Each type of Award may be made alone, in
addition to or in relation to any other type of Award. The terms of each
type of Award need not be identical, and the Committee need not treat
Participants uniformly. Except as otherwise
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<PAGE>
provided by the Plan or a particular Award, any determination with respect to
an Award may be made by the Committee at the time of award or at any time
thereafter.
(d) Settlement. The Committee shall determine whether Awards are
settled in whole or in part in cash, Common Stock, other securities of the
Company, Awards or other property. The Committee may permit a Participant to
defer all or any portion of a payment under the Plan, including the crediting
of interest on deferred amounts denominated in cash and dividend equivalents
on amounts denominated in Common Stock.
(e) Dividends and Cash Awards In the discretion of the Committee, any
Award under the Plan may provide the Participant with (i) dividends or
dividend equivalents payable currently or deferred with or without interest,
and (ii) cash payments in lieu of or in addition to an Award.
(f) Termination of Employment. The Committee shall determine the
effect on an Award of the disability, death, retirement or other termination
of employment of a Participant and the extent to which, and the period during
which, the Participant's legal representative, guardian or Designated
Beneficiary may receive payment of an Award or exercise rights thereunder.
(g) Change in Control. In order to preserve a Participant's rights
under an Award in the event of a change in control of the Company, the
Committee in its discretion may, at the time an Award is made or at any time
thereafter, take one or more of the following actions: (i) provide for the
acceleration of any time period relating to the exercise or realization of
the Award, (ii) provide for the purchase of the Award upon the Participant's
request for an amount of cash or other property that could have been received
upon the exercise or realization of the Award had the Award been currently
exercisable or payable, (iii) adjust the terms of the Award in a manner
determined by the Committee to reflect the change in control, (iv) cause the
Award to be assumed, or new rights substituted therefor, by another entity,
or (v) make such other provision as the Committee may consider equitable and
in the best interests of the Company.
(h) Withholding. The Participant shall pay to the Company, or make
provision satisfactory to the Committee for payment of, any taxes required by
law to be withheld in respect of Options under the Plan no later than the
date of the event creating the tax liability. The Company and its Affiliates
may, to the extent permitted by law, deduct any such tax obligations from any
payment of any kind otherwise due to the Participant. In the Committee's
discretion, the Participant may pay any taxes due with respect to an Option
in whole or in part in shares of Common Stock, including shares retained from
the Option creating the tax obligation, valued at their Fair Market Value on
the date of retention or delivery.
(i) Foreign Nationals. Awards may be made to Participants who are
foreign nationals or employed outside the United States on such terms and
conditions different from those specified in the Plan as the Committee
considers necessary or advisable to achieve the purposes of the Plan or
comply with applicable laws.
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<PAGE>
(j) Amendment of Award. The Committee may amend, modify or terminate
any outstanding Award, including substituting therefor another Award of the
same or a different type, changing the date of exercise or realization and
converting an Incentive Stock Option to a Nonstatutory Stock Option, provided
that the Participant's consent to such action shall be required unless the
Committee determines that the action, taking into account any related action,
would not materially and adversely affect the Participant.
Section 12. Miscellaneous
(a) Limitation on Number of Shares Granted. Notwithstanding any other
provision of the Plan, the aggregate number of shares of Common Stock subject
to Options and SARs that may be granted within any fiscal year to any one
Eligible Person under the Plan shall not exceed that number of shares equal
to 20% of the total number of shares reserved for issuance under the Plan,
except for grants to new hires during the fiscal year of hiring which shall
not exceed that number of shares equal to 30% of the total number of shares
reserved for issuance under the Plan.
(b) No Right To Employment. No person shall have any claim or right to
be granted an Award, and the grant of an Award shall not be construed as
giving a Participant the right to continued employment. The Company
expressly reserves the right at any time to dismiss a Participant free from
any liability or claim under the Plan, except as expressly provided in the
applicable Award.
(c) No Rights As Shareholder. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have any
rights as a shareholder with respect to any shares of Common Stock to be
distributed under the Plan until he or she becomes the holder thereof. A
Participant to whom Common Stock is awarded shall be considered the holder of
the Stock at the time of the Award except as otherwise provided in the
applicable Award.
(d) Effective Date. Subject to the approval of the shareholders of the
Company, the Plan shall be effective on May 1, 1993. Prior to such approval,
Awards may be made under the Plan expressly subject to such approval.
(e) Amendment of Plan. The Board may amend, suspend or terminate the
Plan or any portion thereof at any time, provided that no amendment shall be
made without shareholder approval if such approval is necessary to comply
with any applicable tax or regulatory requirement.
(f) Governing Law. The provisions of the Plan shall be governed by and
interpreted in accordance with the laws of the Commonwealth of Massachusetts.
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EXHIBIT 10.4
1. Adopted by the Board of Directors on May 1, 1993; Approved by the
stockholders on June 25, 1993.
2. Amended by the Board of Directors on February 7, 1995; Approved by the
stockholders on May 19, 1995.
3. Amended by the Board of Directors on March 3, 1997; Approved by the
stockholders on May 28, 1997.
GENZYME TRANSGENICS CORPORATION
1993 Employee Stock Purchase Plan
l. Purpose.
The purpose of this 1993 Employee Stock Purchase Plan (the "Plan") is to
provide employees of Genzyme Transgenics Corporation (the "Company"), and its
subsidiaries, who wish to become shareholders of the Company an opportunity to
purchase Common Stock of the Company (the "Shares"). The Plan is intended to
qualify as an "employee stock purchase plan" within the meaning of Section 423
of the Internal Revenue Code of 1986, as amended (the "Code").
2. Eligible Employees.
Subject to the provisions of Sections 7, 8 and 9 below, any individual who
is a full-time employee (as defined below) of the Company, or any of its
subsidiaries (as defined in Section 424(f) of the Code) the employees of which
are designated by the Board of Directors as eligible to participate in the Plan,
is eligible to participate in any Offering of Shares (as defined in Section 3
below) made by the Company hereunder. Full-time employees shall include all
employees whose customary employment is:
(a) 20 hours or more per week and
(b) more than five months
in the calendar year during which said Offering Date occurs or in the calendar
year immediately preceding such year.
3. Offering Dates.
From time to time, the Company, by action of the Board of Directors, will
grant rights to purchase Shares to employees eligible to participate in the Plan
pursuant to one or more offerings (each of which is an "Offering" on a date or
series of dates (each of which is an "Offering Date") designated for this
purpose by the Board of Directors.
<PAGE>
4. Prices.
The price per share for each grant of rights hereunder shall be the lesser
of:
(a) eighty-five percent (85%) of the fair market value of a Share on
the Offering Date on which such right was granted; or
(b) eighty-five percent (85%) of the fair market value of a Share on
the date such right is exercised.
At its discretion, the Board of Directors may determine a higher price for a
grant of rights.
5. Exercise of Rights and Method of Payment.
(a) Rights granted under the Plan will be exercisable periodically on
specified dates as determined by the Board of Directors.
(b) The method of payment for Shares purchased upon exercise of rights
granted hereunder shall be through regular payroll deductions or by lump sum
cash payment or both, as determined by the Board of Directors. No interest
shall be paid upon payroll deductions unless specifically provided for by the
Board of Directors.
(c) Any payments received by the Company from a participating employee and
not utilized for the purchase of Shares upon exercise of a right granted
hereunder shall be promptly returned to such employee by the Company after
termination of the right to which the payment relates.
6. Term of Rights.
The total period from an Offering Date to the last date on which rights
granted on that Offering Date are exercisable (the "Offering Period") shall in
no event be longer than twenty-seven (27) months. The Board of Directors when
it authorizes an Offering may designate one or more exercise periods during the
Offering Period. Rights granted on an Offering Date shall be exercisable in
full on the Offering Date or in such proportion on the last day of each exercise
period as the Board of Directors determines.
7. Shares Subject to the Plan.
No more than Nine Hundred Thousand (900,000) Shares may be sold pursuant
to rights granted under the Plan. Appropriate adjustments in the above
figure, in the number of Shares covered by outstanding rights granted
hereunder, in the exercise price of the rights and in the maximum number of
Shares which an employee may purchase (pursuant to Section 9 below) shall be
made to give effect to any mergers, consolidations, reorganizations,
recapitalizations, stock splits, stock dividends or other relevant changes in
the capitalization of the Company occurring after the effective date of the
Plan, provided that no fractional Shares shall be subject to a right and each
right shall be adjusted downward to the nearest full Share. Any agreement of
merger or consolidation will include provisions for protection
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of the then existing rights of participating employees under the Plan.
Either authorized and unissued Shares or issued Shares heretofore or
hereafter reacquired by the Company may be made subject to rights under the
Plan. If for any reason any right under the Plan terminates in whole or in
part, Shares subject to such terminated right may again be subjected to a
right under the Plan.
8. Limitations on Grants.
(a) No employee shall be granted a right hereunder if such employee,
immediately after the right is granted, would own stock or rights to purchase
stock possessing five percent (5%) or more of the total combined voting power or
value of all classes of stock of the Company, or of any subsidiary, computed in
accordance with Section 423(b)(3) of the Code.
(b) No employee shall be granted a right which permits his right to
purchase shares under all employee stock purchase plans of the Company and its
subsidiaries to accrue at a rate which exceeds twenty-five thousand dollars
($25,000) (or such other maximum as may be prescribed from time to time by the
Code) of the fair market value of such Shares (determined at the time such right
is granted) for each calendar year in which such right is outstanding at any
time in accordance with the provisions of Section 423(b)(8) of the Code.
(c) No right granted to any participating employee under an Offering,
when aggregated with rights granted under any other Offering still exercisable
by the participating employee, shall cover more shares than may be purchased at
an exercise price equal to fifteen percent (15%) of the employee's annual rate
of compensation on the date the employee elects to participate in the Offering
or such lesser percentage as the Board of Directors may determine.
9. Limit on Participation.
Participation in an Offering shall be limited to eligible employees who
elect to participate in such Offering in the manner, and within the time
limitations, established by the Board of Directors when it authorizes the
Offering.
10. Cancellation of Election to Participate.
An employee who has elected to participate in an Offering may cancel such
election as to all (but not part) of the unexercised rights granted under such
Offering by giving written notice of such cancellation to the Company before the
expiration of any exercise period. Any amounts paid by the employee for the
Shares or withheld for the purchase of Shares from the employee's compensation
through payroll deductions shall be paid to the employee, without interest,
unless otherwise determined by the Board of Directors, upon such cancellation.
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11. Termination of Employment.
Upon the termination of employment for any reason, including the death of
the employee, before the date on which any rights granted under the Plan are
exercisable, all such rights shall immediately terminate and amounts paid by the
employee for the Shares or withheld for the purchase of Shares from the
employee's compensation through payroll deductions shall be paid to the employee
or to the employee's estate, without interest unless otherwise determined by the
Board of Directors.
12. Employees' Rights as Shareholders.
No participating employee shall have any rights as a shareholder in the
Shares covered by a right granted hereunder until such right has been exercised,
full payment has been made for the corresponding Shares and the Share
certificate is actually issued.
13. Rights Not Transferable.
Rights under the Plan are not assignable or transferable by a participating
employee and are exercisable only by the employee.
14. Amendments to or Discontinuation of the Plan.
The Board of Directors of the Company shall have the right to amend, modify
or terminate the Plan at any time without notice; provided, however, that the
then existing rights of all participating employees shall not be adversely
affected thereby, and provided further that, subject to the provisions of
Section 7 above, no such amendment to the Plan shall, without the approval of
the shareholders of the Company, increase the total number of Shares which may
be offered under the Plan.
15. Effective Date and Approvals.
This Plan became effective on May 1, 1993, the date it was adopted by the
Board of Directors. This Plan was approved by the shareholders of the Company
on June 25, 1993.
The Company's obligation to offer, sell and deliver its Shares under the
Plan is subject to (i) the approval of any governmental authority required in
connection with the authorized issuance or sale of such Shares, (ii)
satisfaction of the listing requirements of any national securities exchange on
which the Shares are then listed and (iii) compliance, in the opinion of the
Company's counsel with, all applicable federal and state securities and other
laws.
16. Term of Plan.
No rights shall be granted under the Plan after May 1, 2003.
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<PAGE>
17. Administration of the Plan.
The Board of Directors or any committee or person(s) to whom it delegates
its authority (the "Administrator") shall administer, interpret and apply all
provisions of the Plan as it deems necessary to meet special circumstances not
anticipated or covered expressly by the Plan. Nothing contained in this Section
shall be deemed to authorize the Administrator to alter or administer the
provisions of the Plan in a manner inconsistent with the provisions of Section
423 of the Code.
-5-
<PAGE>
EXHIBIT 10.5
1. As adopted by the Board of Directors on May 11, 1993 and approved by the
stockholders on June 25, 1993.
2. As amended by the Board of Directors on March 3, 1997, and approved by the
stockholders on May 28, 1997.
3. As amended by the Board of Directors on May 28, 1997 (no stockholder
approval required).
GENZYME TRANSGENICS CORPORATION
1993 Director Stock Option Plan
The purpose of this 1993 Director Stock Option Plan (the "Plan") of Genzyme
Transgenics Corporation (the "Company") is to attract and retain highly
qualified non-employee directors of the Company and to encourage ownership of
stock of the Company by such Directors so as to provide additional incentives to
promote the success of the Company.
1. Administration of the Plan.
Grants of stock options under the Plan shall be automatic as provided in
Section 6. However, all questions of interpretation with respect to the Plan
and options granted under it shall be determined by the Board of Directors of
the Company (the "Board") or by a committee consisting of one or more directors
appointed by the Board and such determination shall be final and binding upon
all persons having an interest in the Plan.
2. Persons Eligible to Participate in the Plan.
All directors of the Company who are not employees of the Company or of any
subsidiary of the Company shall be eligible to participate in the Plan, unless
such director irrevocably elects not to participate on or after May 29, 1997.
3. Shares Subject to the Plan.
(a) The aggregate number of shares of the Company's Common Stock which may
be optioned under this Plan is 100,000 shares. Shares issued under the Plan may
consist in whole or in part of authorized but unissued shares or treasury
shares.
(b) In the event of a stock dividend, split-up, combination or
reclassification of shares, recapitalization or other similar capital change
relating to the Company's Common Stock, the maximum aggregate number and kind of
shares or securities of the Company as to which options may be granted under
this Plan and as to which options then outstanding shall be exercisable, and the
option price of such options shall be appropriately adjusted so that the
proportionate number of shares or other securities as to which options may be
granted and the proportionate interest of holders of outstanding options shall
be maintained as before the occurrence of such event.
<PAGE>
(c) In the event of a consolidation or merger of the Company with another
corporation where the Company's stockholders do not own a majority in interest
of the surviving or resulting corporation, or the sale or exchange of all or
substantially all of the assets of the Company, or a reorganization or
liquidation of the Company, any deferred exercise period shall be automatically
accelerated and each holder of an outstanding option shall be entitled to
receive upon exercise and payment in accordance with the terms of the option the
same shares, securities or property as he would have been entitled to receive
upon the occurrence of such event if he had been, immediately prior to such
event, the holder of the number of shares of Common Stock purchasable under his
or her option; provided, however, that in lieu of the foregoing the Board may
upon written notice to each holder of an outstanding option or right under the
Plan, provide that such option or right shall terminate on a date not less than
20 days after the date of such notice unless theretofore exercised.
(d) Whenever options under this Plan lapse or terminate or otherwise
become unexercisable the shares of Common Stock which were subject to such
options may again be subjected to options under this Plan. The Company shall at
all times while this Plan is in force reserve such number of shares of Common
Stock as will be sufficient to satisfy the requirements of this Plan.
4. Non-Statutory Stock Options.
All options granted under this Plan shall be non-statutory options not
entitled to special tax treatment under Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code").
5. Form of Options.
Options granted hereunder shall be in such form as the Board or any
committee appointed pursuant to Section 1 above may from time to time determine.
6. Grant of Options and Option Terms.
(a) Automatic Grant of Options. Upon the adoption of this Plan and
upon each subsequent initial election of any eligible director to the Board
prior to the Company's 1994 annual meeting of its stockholders and upon the
election or re-election of any eligible director at each annual meeting of
the stockholders thereafter, (i) each such director other than any such
director who is Chairman of the Board of Directors shall automatically be
granted options to purchase 2,000 shares of Common Stock for each year of the
term of office to which he or she is elected and (ii) any such director who
is Chairman of the Board of Directors shall automatically be granted options
to purchase 5,000 shares of Common Stock for each year of the term of office
to which he or she is elected. In addition, upon the election of a director
who is eligible to receive options to purchase Common Stock under the Plan
other than at an annual meeting of stockholders (whether by the Board or the
stockholders and whether to fill a vacancy or otherwise), such director shall
automatically be
-2-
<PAGE>
granted options to purchase 2,000 shares of Common Stock for each year or
portion thereof of the term of office to which he or she is elected, provided
that if such director is the Chairman of the Board, he or she shall
automatically be granted options to purchase 5,000 shares of Common Stock for
each year or portion thereof of the term of office to which he or she is
elected. No options shall be granted hereunder after ten years from the date
on which this Plan was initially approved and adopted by the Board.
(b) Date of Grant. The "Date of Grant" for options granted under this Plan
shall be the date of election or re-election as a director, as the case may be.
(c) Option Price. The option price for each option granted under this Plan
shall be the current fair market value of a share of Common Stock of the Company
as determined (i) prior to date on which the Company becomes subject to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), by the Board
in good faith or in the manner established by the Board from time to time, and
(ii) on or after the date on which the Company is subject to the Exchange Act,
by the last sale price for the Company's Common Stock as reported by the
National Association of Securities Dealers Automated Quotations National Market
System for the business day immediately preceding the Date of Grant.
(d) Term of Option. The term of each option granted under this Plan shall
be ten years from the Date of Grant.
(e) Exercisability of Options. Options granted under this Plan shall
become exercisable with respect to 2,000 shares (or 5,000 shares in the case of
a grant to the Chairman of the Board) on the Date of Grant and on each annual
meeting of stockholders of the Company following the Date of Grant if and only
if the option holder is a member of the Board at the opening of business on that
date (i.e., options to purchase 6,000 shares of Common Stock granted at the 1994
annual meeting will become exercisable with respect to 2,000 shares at each of
the 1994, 1995 and 1996 annual meetings).
(f) General Exercise Terms. Directors holding exercisable options under
this Plan who cease to serve as members of the Board may, during their lifetime,
exercise the rights they had under such options at the time they ceased being a
director for the full unexpired term of such option. Any rights that have not
yet become exercisable shall terminate upon cessation of membership on the
Board. Upon the death of a director, those entitled to do so shall have the
right, at any time within twelve months after the date of death, to exercise in
whole or in part any rights which were available to the director at the time of
his or her death. The rights of the option holder may be exercised by the
holder's guardian or legal representative in the case of disability and by the
beneficiary designated by the holder in writing delivered to the Company or, if
none has been designated, by the holder's estate or his or her transferee on
death in accordance with this Plan, in the case of death. Options granted under
the Plan shall terminate, and no rights thereunder may be exercised, after the
expiration of the applicable exercise period. Notwithstanding the foregoing
provisions of this section, no rights under any options may be exercised after
the expiration of ten years from their Date of Grant.
-3-
<PAGE>
(g) Method of Exercise and Payment. Options may be exercised only by
written notice to the Company at its head office accompanied by payment of the
full option price for the shares of Common Stock as to which they are exercised.
The option price shall be paid in cash or by check or in shares of Common Stock
of the Company, or in any combination thereof. Shares of Common Stock
surrendered in payment of the option price shall have been held by the person
exercising the option for at least six months, unless otherwise permitted by the
Board. The value of shares delivered in payment of the option price shall be
their fair market value, as determined in accordance with Section 6(c) above, as
of the date of exercise. Upon receipt of such notice and payment, the Company
shall promptly issue and deliver to the optionee (or other person entitled to
exercise the option) a certificate or certificates for the number of shares as
to which the exercise is made.
(h) Limitations on Transferability. Options granted under this Plan shall
not be transferable by the recipient other than by will or the laws of descent
and distribution and are exercisable during such person's lifetime only by such
person or by such person's guardian or legal representative, provided the Board
or any committee appointed by the Board may in its discretion waive such
restriction in any case.
7. Limitation of Rights.
(a) No Right to Continue as a Director. Neither the Plan, nor the
granting of an option or any other action taken pursuant to the Plan, shall
constitute an agreement or understanding, express or implied, that the Company
will retain an option holder as a director for any period of time or at any
particular rate of compensation.
(b) No Stockholders' Rights for Options. A director shall have no rights
as a stockholder with respect to the shares covered by options until the date
the director exercises such options and pays the option price to the Company,
and no adjustment will be made for dividends or other rights for which the
record date is prior to the date such option is exercised and paid for.
8. Amendment or Termination.
The Board may amend or terminate this Plan at any time. The Board may
amend or modify any outstanding option in any respect, provided that the
optionee's consent to such action shall be required unless the Board determines
that the action, taking into account any relative action, would not materially
and adversely affect the optionee.
9. Stockholder Approval.
This Plan was approved by the Stockholders on June 25, 1993 and the
amendments approved by the Board of Directors on March 3, 1997 and any further
amendments hereto shall be subject to stockholder approval to the extent (i)
required by law, (ii) required by Nasdaq or stock exchange listing requirements,
as determined by the Board of Directors, or (iii) as desirable, as determined by
the Board of Directors, to comply with Rule 16b-3 under the Securities Exchange
Act of 1934, as amended. In the event any approval is not obtained,
-4-
<PAGE>
all options granted under this Plan after such further amendment shall be
void and without effect.
10. Governing Law.
This Plan shall be governed by and interpreted in accordance with the laws
of the Commonwealth of Massachusetts.
-5-
<PAGE>
Exhibit 10.6
FOURTH AMENDMENT TO
TERM LOAN AGREEMENT
THIS FOURTH AMENDMENT TO TERM LOAN AGREEMENT (this "Fourth Amendment")
is made and entered into as of the 17th day of June, 1997, by and between
GENZYME TRANSGENICS CORPORATION, a Massachusetts corporation having its
principal place of business at One Mountain Road, Framingham, Massachusetts
01701 (the "Borrower"), and THE FIRST NATIONAL BANK OF BOSTON (the "Bank"), a
national banking association with its head office at 100 Federal Street,
Boston, Massachusetts 02110.
WHEREAS, the Borrower and the Bank entered into a Term Loan Agreement
dated as of December 15, 1995, as amended by the First Amendment to Term Loan
Agreement dated as of March 29, 1996, the Second Amendment to Term Loan
Agreement dated as of October 1, 1996, and the Third Amendment to Term Loan
Agreement dated as of February 21, 1997 (as further amended and in effect
from time to time, the "Credit Agreement") pursuant to which the Bank
extended credit to the Borrower on the terms set forth therein;
WHEREAS, the Bank and the Borrower have agreed to amend the Credit
Agreement as hereinafter set forth;
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. DEFINITIONS. Capitalized terms used herein without definition have
the meanings ascribed to them in the Credit Agreement.
2. AMENDMENT TO Section 7.2(A) OF THE CREDIT AGREEMENT.
Section 7.2(a) of the Credit Agreement is hereby deleted in its entirety
and the following substituted in place thereof:
"(a) the Borrower will not create, incur or assume and will not
permit its Subsidiaries to create, incur, or assume, any
Indebtedness other than (i) Indebtedness to the Bank; (ii)
Indebtedness incurred after the date hereof in respect of the
acquisition of property or in respect of new capital leases which
does not exceed $500,000 in the aggregate; (iii) current
liabilities not incurred through the borrowing of money or the
obtaining of credit except credit on an open account customarily
extended; (iv) Indebtedness in respect of taxes or other
governmental charges contested in good faith and by appropriate
proceedings and for which adequate reserves have been taken; (v)
Indebtedness not included above and listed on Schedule 7.2(a)
hereto or on the Form 10-Q of the Borrower dated March 31, 1995;
(vi) Indebtedness consisting of intercompany loans among the
Borrower and its Subsidiaries (except such loans as would render
any of such entities insolvent); (vii) Indebtedness of
BioDevelopment Laboratories, Inc. outstanding at the time of
acquisition thereof with respect to a standby letter of credit
issued by Silicon Valley Bank or any replacement thereof in an
<PAGE>
aggregate amount not to exceed $157,500; (viii) Indebtedness to the
Guarantor arising under the Convertible Debt and Development
Funding Agreement dated as of March 29, 1996, as such agreement may
be amended, restated or supplemented from time to time, provided
that the principal amount of such Indebtedness shall not be
increased; and provided further that such Indebtedness is
subordinated to the Obligations on terms satisfactory to the Bank;
(ix) Indebtedness of (a) TSI Corporation to Finova Technology
Finance, Inc. (formerly Financing for Science International, Inc.
("Finova")) pursuant to the terms of the Master Equipment Lease
Agreement dated as of September 27, 1994 by and between TSI
Corporation and Financing for Science International, Inc., and of
the Borrower, Argus Research Laboratories, Inc., TSI Mason
Laboratories, Inc., TSI Redfield Laboratories, Inc., and TSI
Washington Laboratories, Inc. to Finova pursuant to guaranties of
such lease; and (b) the Borrower to Transamerica Business Credit
Corporation ("TBCC") pursuant to the terms of the Master Lease
Agreement dated as of December 30, 1996 by and between TBCC and the
Borrower, and of TSI Corporation, BioDevelopment Laboratories,
Inc., TSI Mason Laboratories, Inc., TSI Washington Laboratories,
Inc., TSI Redfield Laboratories, Inc., and Argus Research
Laboratories, Inc. to TBCC pursuant to guaranties of such lease,
provided that the aggregate outstanding amount of all such
Indebtedness shall not exceed $5,300,000; (x) Indebtedness of TSI
Redfield Laboratories, Inc. to Jefferson County, Arkansas in an
aggregate principal amount not to exceed $350,000, and Indebtedness
of the Borrower with respect to the guaranty thereof; (xi)
Indebtedness of TSI Redfield Laboratories, Inc. to Simmons First
National Bank in an aggregate principal amount not to exceed
$1,050,000, and Indebtedness of the Borrower and TSI Corporation
with respect to the guaranty thereof; (xii) Indebtedness of Argus
Research Laboratories, Inc. to Unisys Leasing Corporation in an
aggregate principal amount not to exceed $145,000 and Indebtedness
of the Borrower with respect to the guaranty thereof; and (xiii)
Indebtedness of TSI Mason Laboratories, Inc. to the Massachusetts
Development Finance Agency in an aggregate principal amount not to
exceed $5,000,000, and Indebtedness of the Borrower with respect to
the guaranty thereof."
3. AMENDMENT TO Section 7.2(B) OF THE CREDIT AGREEMENT.
Section 7.2(b) of the Credit Agreement is hereby deleted in its entirety
and the following substituted in place thereof:
"(b) the Borrower will not create or
incur, and will not permit its Subsidiaries to create or
incur, any Liens on any of .the property or assets of the
Borrower or any of its Subsidiaries except (i) Liens
securing taxes or other governmental charges not yet due;
(ii) deposits or pledges made in connection with social
security obligations; (iii) Liens of carriers,
warehousemen, mechanics and materialmen, less than 120
days old as to obligations not yet due; (iv) easements,
rights-of-way, zoning restrictions and similar minor
Liens which individually and in the aggregate do not have
a Materially Adverse Effect; (v) purchase money security
interests in or purchase money mortgages on real or
personal property securing purchase money Indebtedness
permitted by Section 7.2(a)(ii), covering only the
Property so acquired; (vi) other Liens existing on the
date hereof and listed on Schedule 7.2(b) hereto or
existing on the date
<PAGE>
hereof and securing Indebtedness not to exceed $500,000
in the aggregate; (vii) the rights of lessors under
capital leases permitted by Section 7.2(a) hereof; (viii)
subject to the terms and conditions of Section
7.2(a)(ii), purchase money liens on the assets of any
Subsidiary at the time such Subsidiary is acquired by the
Borrower pursuant to Section 7.2(f) hereof, provided that
such Liens may cover only the property so acquired; (ix)
mortgage Liens on the real property owned by TSI Redfield
Laboratories, Inc. in favor of Jefferson County, Arkansas
and Simmons First National Bank securing Indebtedness
permitted by Section 7.2(a)(x) and (xi) hereof; (x) Liens
on the personal property of TSI Redfield Laboratories,
Inc. securing the Indebtedness permitted by Section 7.2
(a)(xi) hereof; (xi) a mortgage Lien on the real property
located at 55 Union Street, Worcester, Massachusetts
owned by TSI Mason Laboratories, Inc. securing the
Indebtedness permitted by Section 7.2(a)(xiii) hereof;
and (xii) Liens on the personal property of TSI Mason
Laboratories, Inc. purchased with the proceeds of and
securing the Indebtedness permitted by Section
7.2(a)(xiii) hereof.
4. RATIFICATION, ETC.
Except as expressly amended hereby, the Credit Agreement, the other Loan
Documents and all documents, instruments and agreements related thereto are
hereby ratified and confirmed in all respects and shall continue in full
force and effect. This Fourth Amendment and the Credit Agreement shall
hereafter be read and construed together as a single document, and all
references in the Credit Agreement or any related agreement or instrument to
the Credit Agreement shall hereafter refer to the Credit Agreement as amended
by this Fourth Amendment. By executing this Fourth Amendment where indicated
below the Guarantor hereby ratifies and confirms its guaranty of the
Obligations pursuant to the terms of the Guaranty, as amended, and
acknowledges and consents to the terms of this Fourth Amendment.
5. GOVERNING LAW.
THIS FOURTH AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL TAKE EFFECT AS A
SEALED INSTRUMENT IN ACCORDANCE WITH SUCH LAWS.
6. COUNTERPARTS. This Fourth Amendment may be executed in any number
of counterparts and by different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which counterparts taken together shall be deemed to constitute one and the
same instrument. A complete set of counterparts shall be lodged with the
Bank.
7. EFFECTIVENESS. This Fourth Amendment shall become effective upon
its execution and delivery by the respective parties hereto.
8. ENTIRE AGREEMENT. THE CREDIT AGREEMENT AS AMENDED REPRESENTS THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR
<PAGE>
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
under seal as of the date first set forth above.
THE BORROWER:
GENZYME TRANSGENICS CORPORATION
By: /s/ John B. Green
-------------------------------
Name: John B. Green
Title: Vice President
Address of the Borrower:
One Mountain Road
Framingham, MA 01701
Tel: (508) 872-8400
Fax: (508) 872-0827
THE BANK:
BANKBOSTON, N.A. (formerly known
as The First National Bank of Boston)
By: /s/ Walter J. Marullo
-------------------------------
Name: Walter J. Marullo
Title: Vice President
Address:
100 Federal Street
Boston, MA 02110
Tel: 617-434-5462
Fax: 617-434-0819
<PAGE>
ACCEPTED AND AGREED TO BY:
The Guarantor:
- --------------
GENZYME CORPORATION
By: /s/ Evan Lebson
---------------------------------------
Title: Vice President and Treasurer
<PAGE>
Exhibit 10.7
SEVENTH AMENDMENT TO
REVOLVING CREDIT AGREEMENT
THIS SEVENTH AMENDMENT TO REVOLVING CREDIT AGREEMENT (this "Seventh
Amendment") is made and entered into as of the 17th day of June, 1997, by and
among GENZYME TRANSGENICS CORPORATION, a Massachusetts corporation having its
principal place of business at One Mountain Road, Framingham, Massachusetts
01701 (the "Parent") and its Subsidiaries listed on the signature pages hereto
(the Parent and each such Subsidiary is individually referred to herein as a
"Borrower," and collectively as the "Borrowers"), and BANKBOSTON, N.A. (formerly
known as The First National Bank of Boston) (the "Bank"), a national banking
association with its head office at 100 Federal Street, Boston, Massachusetts
02110.
WHEREAS, the Borrowers and the Bank entered into a Revolving Credit
Agreement dated as of July 3, 1995 as amended by the First Amendment to
Revolving Credit Agreement dated as of September 15, 1995, the Second Amendment
to Revolving Credit Agreement dated as of December 22, 1995, the Third Amendment
to Revolving Credit Agreement dated as of March 29, 1996, the Fourth Amendment
to Revolving Credit Agreement dated as of October 1, 1996, the Fifth Amendment
to Revolving Credit Agreement dated as of February 21, 1997, and the Sixth
Amendment to Revolving Credit Agreement dated as of March 17, 1997 (as further
amended and in effect from time to time, the "Credit Agreement") pursuant to
which the Bank extended credit to the Borrowers on the terms set forth therein;
WHEREAS, the Bank and the Borrowers have agreed to amend the Credit
Agreement as hereinafter set forth;
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Definitions. Capitalized terms used herein without definition have
the meanings ascribed to them in the Credit Agreement.
2. Amendment to Section 8.2(a) of the Credit Agreement.
Section 8.2(a) of the Credit Agreement is hereby deleted in its entirety
and the following substituted in place thereof:
"(a) the Borrowers will not create, incur or assume any Indebtedness
other than (i) Indebtedness to the Bank; (ii) Indebtedness incurred
after the date hereof in respect of the acquisition of property or in
respect of new capital leases which does not exceed $500,000 in the
aggregate; (iii) current liabilities of the Borrowers not incurred
through the borrowing of money or the obtaining of credit except
credit on an open account customarily extended; (iv) Indebtedness in
respect of taxes or other governmental charges contested in good faith
and by appropriate proceedings and for which adequate reserves have
been taken; (v)
<PAGE>
Indebtedness not included above and listed on Schedule 8.2(a) hereto
or on the Form 10-Q of the Parent dated March 31, 1995; (vi)
Indebtedness consisting of intercompany loans among the Borrowers
(except such loans as would render any of the Borrowers insolvent);
(vii) Indebtedness of BioDevelopment Laboratories, Inc. outstanding
at the time of acquisition thereof with respect to a standby letter
of credit issued by Silicon Valley Bank or any replacement thereof
in an aggregate amount not to exceed $157,500; (viii) Indebtedness
to the Guarantor arising under the Convertible Debt and Development
Funding Agreement dated as of March 29, 1996, as such agreement may
be amended, restated or supplemented from time to time, provided
that the principal amount of such Indebtedness shall not be
increased; and provided further that such Indebtedness is
subordinated to the Obligations on terms satisfactory to the Bank;
(ix) Indebtedness of (a) TSI Corporation to Finova Technology
Finance, Inc. (formerly Financing for Science International, Inc.
("Finova")) pursuant to the terms of the Master Equipment Lease
Agreement dated as of September 27, 1994 by and between TSI
Corporation and Financing for Science International, Inc., and of
the Parent, Argus Research Laboratories, Inc., TSI Mason
Laboratories, Inc., TSI Redfield Laboratories, Inc., and TSI
Washington Laboratories, Inc. to Finova pursuant to guaranties of
such lease; and (b) the Parent to Transamerica Business Credit
Corporation ("TBCC") pursuant to the terms of the Master Lease
Agreement dated as of December 30, 1996 by and between TBCC and the
Parent, and of TSI Corporation, BioDevelopment Laboratories, Inc.,
TSI Mason Laboratories, Inc., TSI Washington Laboratories, Inc., TSI
Redfield Laboratories, Inc., and Argus Research Laboratories, Inc.
to TBCC pursuant to guaranties of such lease, provided that the
aggregate outstanding amount of all such Indebtedness shall not
exceed $5,300,000; (x) Indebtedness of TSI Redfield Laboratories,
Inc. to Jefferson County, Arkansas in an aggregate principal amount
not to exceed $350,000, and Indebtedness of the Parent with respect
to the guaranty thereof; (xi) Indebtedness of TSI Redfield
Laboratories, Inc. to Simmons First National Bank in an aggregate
principal amount not to exceed $1,050,000, and Indebtedness of the
Parent and TSI Corporation with respect to the guaranty thereof;
(xii) Indebtedness of Argus Research Laboratories, Inc. to Unisys
Leasing Corporation in an aggregate principal amount not to exceed
$145,000 and Indebtedness of the Parent with respect to the guaranty
thereof; and (xiii) Indebtedness of TSI Mason Laboratories, Inc. to
the Massachusetts Development Finance Agency in an aggregate
principal amount not to exceed $5,000,000, and Indebtedness of the
Parent with respect to the guaranty thereof."
3. Amendment to Section 8.2(b) of the Credit Agreement.
Section 8.2(b) of the Credit Agreement is hereby deleted in its entirety
and the following substituted in place thereof:
"(b) the Borrowers will not create or incur any Liens on any of the
property or assets of the Borrowers except (i) Liens securing taxes
or other governmental charges not yet due; (ii) deposits or pledges
made in connection with social
<PAGE>
security obligations; (iii) Liens of carriers, warehousemen,
mechanics and materialmen, less than 120 days old as to obligations
not yet due; (iv) easements, rights-of-way, zoning restrictions and
similar minor Liens which individually and in the aggregate do not
have a Materially Adverse Effect; (v) purchase money security
interests in or purchase money mortgages on real or personal
property securing purchase money Indebtedness permitted by Section
8.2(a)(ii), covering only the property so acquired; (vi) other Liens
existing on the date hereof and listed on Schedule 8.2(b) hereto or
existing on the date hereof and securing Indebtedness not to exceed
$500,000 in the aggregate; (vii) the rights of lessors under capital
leases permitted by Section 8.2(a) hereof; (viii) subject to the
terms and conditions of Section 8.2(a)(ii), purchase money liens on
the assets of any Subsidiary at the time such Subsidiary is acquired
by the Parent pursuant to Section 8.2(f) hereof, provided that such
Liens may cover only the property so acquired; (ix) mortgage Liens
on the real property owned by TSI Redfield Laboratories, Inc. in
favor of Jefferson County, Arkansas and Simmons First National Bank
securing Indebtedness permitted by Section 8.2(a)(x) and (xi)
hereof; (x) Liens on the personal property of TSI Redfield
Laboratories, Inc. securing the Indebtedness permitted by Section
8.2 (a)(xi) hereof; (xi) a mortgage Lien on the real property
located at 55 Union Street, Worcester, Massachusetts owned by TSI
Mason Laboratories, Inc. securing the Indebtedness permitted by
Section 8.2(a)(xiii) hereof; and (xii) Liens on the personal
property of TSI Mason Laboratories, Inc. purchased with the proceeds
of and securing the Indebtedness permitted by Section 8.2(a)(xiii)
hereof.
4. Ratification, etc.
Except as expressly amended hereby, the Credit Agreement, the other Loan
Documents and all documents, instruments and agreements related thereto are
hereby ratified and confirmed in all respects and shall continue in full force
and effect. This Seventh Amendment and the Credit Agreement shall hereafter be
read and construed together as a single document, and all references in the
Credit Agreement or any related agreement or instrument to the Credit Agreement
shall hereafter refer to the Credit Agreement as amended by this Seventh
Amendment. By executing this Seventh Amendment where indicated below, the
Guarantor hereby ratifies and confirms its guaranty of the Obligations pursuant
to the terms of the Guaranty, as amended, and acknowledges and consents to the
terms of this Seventh Amendment.
5. GOVERNING LAW.
THIS SEVENTH--AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL TAKE EFFECT AS A
SEALED INSTRUMENT IN ACCORDANCE WITH SUCH LAWS.
6. Counterparts. This Seventh Amendment may be executed in any number of
counterparts and by different parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
counterparts taken together shall
<PAGE>
be deemed to constitute one and the same instrument. A complete set of
counterparts shall be lodged with the Bank.
7. Effectiveness. This Seventh Amendment shall become effective upon its
execution and delivery by the respective parties hereto.
8. Entire Agreement. THE CREDIT AGREEMENT AS AMENDED REPRESENTS THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement under
seal as of the date first set forth above.
THE BORROWERS:
GENZYME TRANSGENICS
CORPORATION
By: /s/ John B. Green
Name: John B. Green
Title: Vice President
Address of the Parent:
One Mountain Road
Framingham, MA 01701
Tel: (508) 872-8400
Fax: (508) 872-0827
TSI CORPORATION
By: /s/ John B. Green
Title: Vice President
TSI MASON LABORATORIES INC.
By: /s/ John B. Green
Title: Vice President
<PAGE>
TSI WASHINGTON
LABORATORIES, INC.
By: /s/ John B. Green
Title: Vice President
TSI REDFIELD LABORATORIES, INC.
By: /s/ John B. Green
Title: Vice President
ARGUS RESEARCH LABORATORIES, INC.
By: /s/ John B. Green
Title: Vice President
TRANSGENIC INVESTMENTS, INC.
By: /s/ John B. Green
Title: Vice President
HEALTH AND SCIENCES
RESEARCH INCORPORATED
By: /s/ John B. Green
Title: Vice President
THE TSI CENTER FOR DIAGNOSTIC
PRODUCTS, INC.
By: /s/ John B. Green
Title: Vice President
BIODEVELOPMENT LABORATORIES, INC.
By: /s/ John B. Green
Title: Vice President
<PAGE>
THE BANK:
BANKBOSTON, N.A. (formerly known as The
First National Bank of Boston)
By: /s/ Walter J. Marullo
Name:Walter J. Marullo
Title: Vice President
Address:
100 Federal Street
Boston, MA 02110
Tel: 617-434-5462
Fax: 617-434-0819
ACCEPTED AND AGREED TO BY:
The Guarantor
GENZYME CORPORATION
By: /s/ Evan Lebson
Title: Vice President and Treasurer
<PAGE>
Exhibit 10.8.1
LOAN AGREEMENT
This Agreement is made as of this 26th day of June, 1997 by and between
the GTC MASON LABORATORIES, INC. a Massachusetts corporation (the
"Borrower"), having a place of business at 57 Union Street, Worcester,
Massachusetts 01608, and the EMERGING TECHNOLOGY FUND of the GOVERNMENT LAND
BANK, doing business as MASSDEVELOPMENT, a Massachusetts body politic and
corporate created by Chapter 212 of the Acts of 1975, as amended, (the
"Lender"), having offices at 75 Federal Street, Boston, Massachusetts 02110.
W I T N E S S E T H:
WHEREAS, the Borrower is the present owner of the land located at 55
Union Street, Worcester, Worcester County, Massachusetts, as more
particularly described in the Mortgage (as hereinafter defined) consisting of
land with the improvements thereon (the "Premises"); and
WHEREAS, the Borrower proposes to renovate the land and building located
at the Premises, in two phases, in accordance with plans and specifications
for each phase (the "Plans and Specifications"), which may be referred to
herein as the "Project"; and
WHEREAS, the Lender has reviewed and approved the Plans and
Specifications for Phase I of the Project which is now complete; and
WHEREAS, the Borrower will prepare Plans and Specifications for Phase II
of the Project (consisting of the renovation of the basement and first floor
of the Premises) for Lender's review and approval prior to its commencement
of Phase II; and
WHEREAS, in order to partially finance the construction of the Project,
the Borrower has applied to the Lender for a loan of up to Five Million and
No/100 ($5,000,000.00) Dollars (the "Loan"); and
WHEREAS, the Borrower has simultaneously herewith executed and delivered
to the Lender a Promissory Note of even date herewith in the principal amount
of Five Million and No/100 ($5,000,000.00) Dollars (the "Note") to evidence
the indebtedness of the Borrower for all money borrowed hereunder and, as
security therefor and for the performance of the Borrower's obligations under
this Agreement, has also delivered herewith to the Lender:
(a) A Mortgage and Security Agreement (the "Mortgage") granting to
the Lender a first lien on the Borrower's interest in the Premises, together
with a security interest from the Borrower as to certain items of tangible
and intangible, real and personal property;
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(b) A Collateral Assignment of Leases and Rents (the "Collateral
Assignment") with respect to all leases, rents, issues and profits from the
Property;
(c) An Assignment of Lease (the "Lease Assignment") with respect to
Borrower's interest in the property at 57 Union Street, Worcester, MA;
(d) Hazardous Materials Indemnity Agreement from the Borrower (the
"Environmental Indemnity Agreement");
(e) Uniform Commercial Code Financing Statements (the "Financing
Statements") evidencing the security interests created by the Mortgage; and
(f) The Loan Guaranty of Genzyme Transgenics Corporation (the
"Guaranty").
WHEREAS, Lender will, upon the satisfaction of the terms and conditions
of the Loan documents with respect to Phase I of the Project, disburse Three
Million Seven Hundred Eighty Eight Two Hundred Fifty Nine and 52/100 Dollars
($3,788,259.52) on the date of this Agreement, leaving a balance of
$1,211,740.48 to be disbursed in a single payment upon the completion of
Phase II in accordance with this Agreement.
NOW, THEREFORE, for good and valuable consideration paid by each of the
parties hereto to the other, the receipt and sufficiency of which is hereby
acknowledged, the Lender and the Borrower agree with each other as follows:
1. REPRESENTATIONS AND WARRANTIES: The Borrower hereby represent and
warrant to the Lender that, as of the date of this Agreement:
A. The following instruments (collectively, the "Basic Instruments"):
1. The Note;
2. The Mortgage;
3. The Collateral Assignment;
4. The Lease Assignment;
5. The Environmental Indemnity;
6. The Financing Statements; and
7. The Guaranty.
have been validly executed by the Borrower, are now in full force and effect
and, that the Borrower and, to the knowledge of Borrower, the other parties
to the foregoing instruments have faithfully performed all their obligations
thereunder to the extent accrued as of the date hereof, and none of said
other parties has asserted any claim of default on the part of either the
Borrower.
B. The Borrower has good right and lawful authority to enter into this
Agreement and the Basic Instruments, and to consummate the transactions
contemplated hereby and thereby.
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<PAGE>
C. The Borrower has duly executed and delivered this Agreement and all
documents referred to herein, including without limitation the Basic
Instruments, or delivered heretofore or herewith, in accordance with
authority duly conferred and exercised and such documents are the lawful,
valid and legally binding obligations of the Borrower, enforceable against
the Borrower in accordance with their respective terms.
D. The execution and performance of this Agreement and the Basic
Instruments, and the consummation of the transactions hereby and thereby
contemplated do not and will not result in any breach of, or constitute a
default under, any mortgage, lease, bank loan or credit agreement, trust
indenture, or other instrument or agreement to which the Borrower is a party
or by which the Borrower may be bound or affected; none of the Basic
Instruments and no other instrument or agreement to which the Borrower is a
party or by which the Borrower may be bound or affected imposes or will
impose on the Borrower any material obligations which are or will be
inconsistent with any other obligations imposed on the Borrower under any of
the Basic Instruments or any other instrument or agreement delivered by the
Borrower to the Lender, and there does not exist any undertaking made to any
party by the Borrower, nor any action or failure to act by either the
Borrower, which involves or will involve any breach of any material
obligation owed to any other party by the Borrower.
E. There are no actions, suits or proceedings (including, without
limitation, any bankruptcy, reorganization, insolvency or condemnation
proceedings) pending or threatened against the Borrower or materially
adversely affecting the Borrower or the Premises or the Project or which may
involve or affect the validity or enforceability of this Agreement or any of
the Basic Instruments, at law or in equity, or before or by any governmental
authority, except actions, suits and proceedings that have been disclosed to
Lender in writing and none of which, if adversely determined, would impair
the ability of the Borrower to pay when due any amount which may become
payable in respect of the Note and the Borrower is not in default with
respect to any order, injunction, decree or demand of any court or any
governmental authority.
F. A copy of the Plans and Specifications for Phase I of the Project
initialed for identification by the Borrower has been delivered to the Lender
prior to the date hereof and is true and correct, satisfactory to the
Borrower, approved by any governmental authority having or claiming
jurisdiction of the Premises, and has been approved in writing by Lender; no
violation of any applicable law, ordinance, order, rule or regulation exists,
and the use of the Premises for the Project does and will not constitute a
violation of any applicable laws, ordinances, orders, rules or regulations.
G. All statements, financial or otherwise, submitted by the Borrower to
the Lender in connection with this Agreement and the Basic Instruments, and
the transactions contemplated hereby are true and correct in all respects,
and with respect to any financial statements are in accordance with the books
and records of the Borrower and have been prepared in accordance with
generally accepted accounting principles consistently applied and fairly
present the financial condition of the Borrower, as of the dates thereof.
H. No person, firm or corporation has performed any construction work
or furnished services in connection with any construction carried on or to be
carried on at the
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<PAGE>
Premises who or which remains unpaid at the time of execution of this
Agreement, except as indicated in the requisitions submitted simultaneously
herewith or otherwise approved by the Lender.
I. The Plans and Specifications for Phases I and II of the Project will
provide for the construction of all buildings and related facilities required
by this Agreement and the Basic Instruments, or any of them, and will set
forth all obligations to be performed by the Borrower. Prior to the
disbursement of any Loan proceeds for Phase II, Borrower shall furnish Lender
with an initial schedule and such other construction information that Lender
may reasonably request.
J. All certifications, representations and warranties contained in any
certificate or other instrument or agreement delivered by or on behalf of the
Borrower pursuant to this Agreement are true, correct and complete, and shall
constitute representations and warranties made by the Borrower hereunder
continuing throughout the term of the Loan.
2. BORROWER'S AGREEMENT TO PERFORM CERTAIN OBLIGATIONS:
A. Performance of Obligations: The Borrower agrees faithfully to
perform, pay and observe all of its respective debts, obligations and
liabilities to the Lender, direct or indirect, absolute or contingent, due or
to become due, existing or hereafter arising, including, without limitation,
all obligations under this Agreement and the Basic Instruments, or any of
them, together with all other agreements of the Borrower relating to the
Premises or the Project, (collectively, the "Obligations"). Upon the
occurrence of a default in the payment or performance of the Obligations or
an Event of Default (as hereinafter defined), Borrower agrees promptly to
notify the Lender of the same in writing in the manner specified in Paragraph
16 below. The Borrower further agrees to enforce all of its respective
rights under agreement of any kind with respect to the Premises or Project,
including without limitation leases and rental arrangements, without in each
case first obtaining the prior written consent of the Lender.
B. Financial Reporting: During the period of the Loan, the Borrower
shall submit to Lender, the financial information specified at Section 10 of
the Mortgage.
C. Certification: The financial statements delivered to the Lender
pursuant to this section shall be accompanied by a certificate of the chief
financial officer of the Borrower, certifying that such financial statements
are true and complete and that they fairly represent the financial condition
and operations of the Borrower over the periods indicated, that such
financial statements have been prepared in accordance with GAAP consistent
with preparation of the financial statements previously delivered to the
Lender, and, that no Event of Default (as hereinafter defined) has occurred
as of such date and no event has occurred which would constitute an Event of
Default with the giving of notice or lapse of time or both, and, if so,
stating the facts with respect thereto.
Borrower shall provide the Lender with such additional information,
reports or statements regarding the operations, business, affairs and
financial condition of each of them
4
<PAGE>
as the Lender may from time to time reasonably request. All financial and
business reports provided to the Lender shall be in form and substance
satisfactory to the Lender.
D. Access to Records: The Borrower shall keep the Lender fully and
accurately informed as to the location of all of its books and records and
whenever reasonably requested by the Lender, shall provide and certify, at
its sole expense, such information concerning the Project, the Borrower,
finances and other topics as the Lender reasonably considers necessary to
enable it to keep itself informed of financial and any other matters
pertaining the Borrower and the Project. The Borrower shall permit the
Lender's agents to have access to, examine, audit and copy all such books and
records and any other records pertaining to the Borrower's business which the
Lender may reasonably request. The Borrower shall keep adequate records and
books of account with respect to the Loan and its business in accordance with
GAAP. If the Borrower should not make its books and records available to the
Lender as contemplated herein, the Lender may remove them from the Borrower's
place of business or any other place where the same may be found for the
purpose of examining, auditing and copying the same. Any of the Borrower's
books and records so removed by the Lender's agents shall be returned to the
Borrower by the Lender as soon as the examination, audit or copying of the
same has been completed. At the Lender's request, the Borrower shall
reimburse the Lender for all reasonable travel, lodging and similar expenses
incurred in connection with any examination, audit or copying of the
Borrower's books and records.
E. Copies of Communications: Borrower will transmit to Lender,
immediately upon receipt thereof, any communication which could affect
Lender's security, or have a material adverse effect on the financial
condition of Borrower, or which otherwise involves a claim against Borrower
and will promptly respond fully to any inquiry of Lender made with respect
thereto.
3. AGREEMENT TO ASSIGN: On the request of the Lender from time to
time, the Borrower agrees to assign to the Lender, in such form as the Lender
may reasonably require, as collateral security for the Borrower's obligations
under this Agreement, all contracts, agreements and leases of every kind
entered into by the Borrower with respect to the Premises or the Project and
all permits, plans and specifications relating to the Premises or the Project
(such assignments to provide that the Lender shall not be obligated thereby
to perform any of the Borrower's obligations thereunder, unless the Lender
elects so to do, and further to provide that the Lender shall not exercise
the Borrower's rights under the contracts, agreements or leases assigned or
enjoy the use of said permits, plans and specifications until the Lender in
good faith shall have determined a default to exist hereunder).
4. ADDITIONAL COVENANTS OF BORROWER: The Borrower covenants and agrees
as follows:
A. Construction: To diligently cause Phase II of the Project to be
constructed and completed and made ready for occupancy and use in accordance
with Plans and Specifications to be approved by the Lender all in a manner
satisfactory to the Lender on or before December 31, 1998 (the "Completion
Date").
5
<PAGE>
The materials used in the Project shall be of the quality called for
by the Plans and Specifications, and the workmanship shall be in conformity
with this Agreement, and both shall be satisfactory to the Lender. The
Borrower shall not make any changes in or additions to such materials or the
construction contract whether by change order or otherwise, without the prior
written consent of the Lender, provided, however, that such consent shall not
be required for any individual changes or additions which do not materially
affect the Project, and the cost of which do not exceed the lesser of (i)
$10,000.00 or (ii) a two percent (2%) of the amount of the contract or
subcontract, pursuant to which such work is being performed.
The Borrower agrees to cause its Contractor to compile and deliver
to Borrower and Lender a list of all subcontractors performing work on the
Project and to cause the Contractor to continually update said list as
construction progresses. The Borrower agrees to cause the Contractor to
furnish such statements as to progress and certificates of completion as the
Lender may from time to time during the term of this Agreement reasonably
require, and also agrees to promptly execute and cause the Contractor to
promptly execute a Notice of Substantial Completion in conformance with
M.G.L. c. 254, Section 2A, and to record such Notice in the appropriate
registry of deeds, all without expense to Lender. The Borrower agrees to
provide a copy of the Notice of Substantial Completion to the Lender and to
any subcontractors performing work on the Project.
The Borrower further agrees to pay the cost incurred by the Lender
to engage a consulting engineer and/or architect (collectively, the "Lender's
Consultants") to inspect the Premises and the Project and to perform such
other services as the Lender may reasonably require in connection with the
Loan.
The Borrower agrees to cause the Contractor to make available to the
Lender all the Plans and Specifications for Phase II and all of the foregoing
services, all without expense to the Lender and in the event that the Lender
shall take over the Project by reason of Borrower's default, the Lender shall
be entitled to use said Plans and Specifications without any compensation to
the Contractor.
The Borrower agrees to provide the Lender for its approval, a
complete, current, written and detailed estimate of all direct and indirect
costs which will be associated with the construction of Phase II of the
Project in conformity with the Sources and Uses of Funds Schedule prepared by
Borrower and reviewed by Lender. Any changes in such Schedule shall be
reviewed and approved by the Lender, in its sole and uncontrolled discretion.
The Borrower agrees to promptly pay the Contractor and all other
contractors and materialmen the amounts justly due to them.
Prior to the commencement of construction of Phase II of the Project
contemplated by this Agreement, the Borrower agrees to provide the Lender
with Plans and Specifications, contracts, a list of the major subcontractors
as to trade and amount and, if requested by Lender, copies of the major
subcontracts and such other construction information
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<PAGE>
that Lender may reasonably request. The Borrower further agrees to not permit
the major subcontractors working on the Project to change without the
Lender's written consent.
In the event the Construction Contract is terminated, the Borrower
agrees to notify the Lender and to promptly record the Notice of Termination
in the appropriate registry of deeds. The Borrower agrees to provide a copy
of the Notice to the Lender and any subcontractors which recorded a notice
pursuant to M.G.L. c. 254, Section 4.
B. Materials: The Borrower shall not suffer the use in connection with
the construction of the Project of any materials, fixtures or equipment
intended to become part of the Project which are purchased upon lease or
conditional bill of sale or to which the Borrower does not have absolute and
unencumbered title, and to cause to be paid punctually all sums becoming due
for labor, materials, fixtures or equipment used or purchased in connection
with such construction.
C. Insurance: The Borrower shall cause to be maintained in force
policies of insurance as set forth in the Mortgage.
D. Compliance With Government Regulations And Applicable Agreements:
The Borrower shall conform to and comply with all restrictions, building
laws, environmental laws and zoning laws relating to the Premises and Project
and with all other applicable statutes, laws, ordinances, codes, rules,
regulations and restrictions of the United States, the state and municipality
in which the Project is located and of any other governmental division, board
or officer having or claiming jurisdiction over the Premises, with the
requirements of the Board of Fire Underwriters or other insurance
underwriters or similar body, and with the provisions of the Basic
Instruments, and to insure that the Project will not encroach upon any public
or private way or any property belonging to third parties.
E. Priority Of Mortgage: The Borrower shall at all times keep the
Premises free from any attachment, encumbrance or lis pendens, from any
mechanics' or other liens or notices arising from the furnishing of materials
or labor and from all other liens and encumbrances of any kind whether such
lien or encumbrance shall be superior to or subordinate to the Mortgage and
real estate taxes not due and liens and encumbrances approved in writing by
the Lender.
F. Agreement Not Assignable: The Borrower shall not suffer any
attachment, whether by trustee process or otherwise, to be made or attempted
against the Borrower's interest in, to or under this Agreement or under the
Basic Instruments or in or to any payment, advance or other sums thereunder,
and shall not, without the prior written consent of the Lender, assign or
transfer any of the same, or any interest therein. Any such assignment or
transfer made without the Lender's consent shall be void and of no force or
effect. The Lender reserves the right to assign its rights hereunder and to
grant participation in the Loan to others.
G. Books And Records: The Borrower shall cause to be kept and
maintained, and shall permit the Lender and its representatives to inspect at
all reasonable times, accurate
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<PAGE>
books, records and accounts showing all materials ordered and received and
all disbursements and accounts payable in connection with the Project, and to
use any funds advanced for construction solely for the payment of obligations
and expenses properly incurred in connection with said construction.
H. Inspection Of Construction; Access: The Lender and its
representatives shall at all times have the right to enter the Premises for
the purpose of inspecting the state of the Premises and progress of work and
materials thereon and to enforce any remedies in the event of a default
hereunder. If any such inspection is not satisfactory, then the Lender shall
not be obligated to make any advances to the Borrower.
I. Fees And Other Payments: Whether or not the transactions
contemplated herein shall be consummated, the Borrower shall pay promptly,
when due, all reasonable fees and expenses of the Lender's attorneys and of
the Lender's Consultants and participants incurred in connection with the
borrowing referred to herein and the preparation, execution, delivery and
performance of this Agreement, the Basic Instruments and the enforcement and
preservation of all rights of the Lender against the Borrower. Such fees and
expenses shall include, without limitation, reasonable attorneys' fees and
expenses (which shall include all costs for administrative, paralegal and
other support staff), appraisal fees, survey fees, engineering fees, lien
certificate fees, consultants' fees and title examination, title insurance
and recording fees. If the Borrower fails to make such payments or any other
payments which, in the reasonable judgment of the Lender, it is necessary to
make to secure the priority of the Mortgage upon ten (10) days written notice
to the Borrower, the Lender may make such payment for the Borrower's account
and charge the same against any advance that may otherwise be due hereunder
to the Borrower or may otherwise collect said amount from the Borrower, and
the Borrower agrees to pay to the Lender any such amount not so charged
against advances due hereunder, notwithstanding that the aggregate
indebtedness of the Borrower to the Lender hereunder may exceed the aggregate
amount which the Lender is obligated to advance hereunder. Such amounts
shall accrue interest at the rate(s) from time to time applicable to
indebtedness under the Note, and shall be secured by the Mortgage and other
Basic Instruments securing the Note.
J. Restrictions on Transfers and Distributions: Except as expressly
and specifically permitted by this Agreement, the Borrower shall not without
the prior written approval of the Lender in each instance obtained:
(i) Convey, assign, transfer, dispose of or encumber, or permit the
conveyance, assignment, transfer, disposal or encumbrance of all or any part
of any legal or beneficial interest in the Premises or the Project or any of
the real estate, personal property or fixtures included therein or used in
connection therewith (including in such personal property, without
limitation, rents and other contractual claims);
(ii) Permit any change in the identity of the officers, directors
and equity holders of the Borrower other than in the ordinary course of
Borrower's business;
(iii) Dispose of or delegate any right to manage or receive any of
the rents and profits of the Project;
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<PAGE>
(iv) Make any distribution of assets or any income of any kind of
the Project;
(v) Permit the use of the Premises or the Project for any purpose
except the use which was proposed and disclosed to Lender; or
(vi) Repay sums borrowed (from anyone other than the Lender) for the
purpose of financing the cost of the Project except as approved by Lender,
but nothing herein contained shall restrict the payment of interest in
accordance with the applicable terms of such borrowings so long as the
Borrower is not in default hereunder.
K. Notice Of Delay: The Borrower shall give to the Lender prompt
written notice of any fire, explosion, accident, flood, storm, earthquake or
other casualty or strike, lock out, act of God or interruption of the
construction of Phase II of the Project which may interfere with the ability
of the Borrower to complete the Project by the Completion Date specified in
Paragraph 4(A) of this Agreement.
L. Bonds: At the option of the Lender, the Borrower shall furnish one
hundred percent (100%) performance, payment and lien bonds from all
contractors and subcontractors with the Lender to be named as co-obligee in
such amounts and in such form as shall be satisfactory to the Lender.
M. Use of Loan Proceeds: The Borrower shall utilize all Loan proceeds
only for items which are permitted under this Agreement. The Borrower agrees
to hold all advances by the Lender hereunder as a trust fund for the purpose
of payment of the costs and expenses permitted under this Agreement.
N. Additional Documentation: The Borrower shall promptly execute and
furnish such other documentation, agreements and assurances as the Lender
shall from time to time reasonably require.
O. Financing Sign on Property; Publicity: The Borrower authorizes the
Lender to prepare and furnish news releases to the news media or any other
publications selected by the Lender advertising the fact that financial
assistance for the Project has been obtained from the Lender.
P. Financial Covenants: The Borrower shall maintain net worth
(excluding intercompany receivables or payables) of at least Eight Million
Dollars ($8,000,000), measured on a quarterly basis. The Borrower shall
maintain, on an annual basis, local operating profit equal to at least twice
the debt service on the Loan.
5. AGREEMENT TO LEND AND BORROW: Subject to all of the terms and
conditions hereof, the Lender hereby agrees to lend to the Borrower, and the
Borrower hereby agrees to borrow from the Lender, the principal amount of the
Note in two installments pursuant to the terms of this Agreement and to pay
interest monthly on amounts so borrowed at the rate set forth in the Note, it
being understood that the Borrower shall be liable for the payment of
interest only on such sums as shall have been advanced from time to time
under this Agreement to the Borrower and which remain outstanding.
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<PAGE>
6. CONDITIONS PRECEDENT TO FIRST ADVANCE: Prior to the first advance,
for Phase I of the Project, and as a condition of the Borrower's right to
receive any of the proceeds of the loan contemplated by this Agreement, there
shall have been furnished to the Lender:
A. A mortgagee's title insurance policy in form and substance and
issued by a company or companies satisfactory to the Lender and insuring that
the Lender has a valid first mortgage of record on the fee simple title to
the Premises, subject only to those encumbrances specifically approved by the
Lender, in an amount not less than the principal amount of the Note;
B. Such evidence as the Lender may require that the use contemplated
for the Premises and the Project, and all of the improvements therein and
construction thereof, comply with all restrictions, statutes, laws,
ordinances, rules, codes, regulations, requirements and provisions of
Paragraph 4D hereof;
C. Policies or certificates of insurance required by Paragraph 4C
hereof;
D. Such evidence as the Lender may require that the Borrower's
representations and warranties of Borrower contained herein and in the Basic
instruments are true and correct;
E. A current survey, satisfactory in form and content to the Lender,
certified by a surveyor, registered as such in the Commonwealth of
Massachusetts to which is attached a certificate in the form hereto annexed
marked Exhibit A;
F. Such evidence as the Lender may require that the Premises and the
Project comply with applicable easements, restrictions and agreements of
record to the extent in force and applicable;
G. A certificate from a professional, registered as such in
Massachusetts, in the form hereto annexed marked Exhibit B, certifying
compliance with all applicable zoning, building, health, fire and safety
statutes, codes, by-laws and regulations and other governmental requirements,
the availability and adequacy of access/egress, sewer, drain, water, electric
and other utility services, to the lot line of the Premises, together with
such other assurances concerning the design of the Project as the Lender may
require;
H. Such evidence as the Lender may require that no flood insurance or
notices are required for the Premises or the Project under the so-called
Flood Disaster Protection Act of 1973 or, if such insurance or notices are
required, that such flood insurance coverage in form and substance and issued
by a company or companies satisfactory to the Lender is in force, or that
such notices have been given to the Borrower as the case may be;
I. The Lender's receipt of an opinion from counsel to the Borrower, in
form and substance satisfactory to the Lender's counsel, that the Premises
and the Project are in compliance with all applicable zoning codes, by-laws
and regulations and all environmental and other land use restrictions;
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<PAGE>
J. Evidence in form and substance satisfactory to the Lender from the
Executive Office of Environmental Affairs that the provisions on M.G.L.
Chapter 30, Section 62 have been complied with in all respects prior to the
Phase II final advance.
K. The Lender's receipt of an opinion from counsel to the Borrower, in
form and substance satisfactory to the Lender's counsel, stating, among other
opinions, that the loan documents executed by the Borrower have been validly
authorized, duly executed and constitute the valid, binding and enforceable
obligations of the Borrower and that there is no pending litigation that
might adversely affect the Borrower or the Project.
L. The Lender's receipt of a certification from an environmental
engineer that all hazardous or toxic substances on, under or within the
Premises, as so defined under state and federal law, on, under or within the
Premises have been removed in compliance with all state and federal laws or,
in the alternative, verification that no such hazardous or toxic substances
exist on the property, in form and substance satisfactory to Lender and its
counsel.
M. Such evidence that the Lender may require that all permits,
licenses, approvals, variances or other like zoning relief required to permit
the construction and intended use of the Premises and the construction and
use of the Project (including, without limitation, a building permit) have
been acquired for the Borrower and are in full force and effect, and that all
remaining permits necessary for construction of the Project can be obtained
in the ordinary course of business;
N. Such evidence as the Lender may require that there has been no
material adverse change in the business, assets, property, prospects or
condition (financial or other) of the Borrower, and that the Premises shall
have sustained no impairment, reduction, loss or damage which has not been
fully restored and repaired and are in good condition, and that no eminent
domain proceedings or other government action is or shall be pending against
or with respect thereto; and
O. Payment of all attorney's, consultant and other fees and expenses
incurred by the Lender in connection with the closing of the Loan.
7. SUBMISSION OF REQUEST FOR FINAL ADVANCE: The final advance against
the Note and this Agreement upon the completion of Phase II of the Project is
to be made by the Lender, in its sole and uncontrolled discretion, under the
following conditions:
A. A certificate executed by the Borrower in the form annexed hereto
marked Exhibit C. At the Lender's request, all requests for any payment on
account of construction shall also be accompanied by certificates executed by
the Lender's Consultants in such form as Lender may reasonably require.
B. An endorsement of the title insurance policy referred to in
Paragraph 6A hereof, satisfactory in form and substance to the Lender
redating the policy to the date of such request and subject to no additional
exceptions other than those approved by the Lender in writing;
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<PAGE>
C. (i) Delivery to Lender of a copy of the final certificate of use and
occupancy for the Project issued by the appropriate government authority; and
(ii) evidence that all utilities necessary for the Project are operational;
and (iii) upon the expiration of the period during which liens may be
perfected with respect to any improvements to the Project or Premises without
any lien having been perfected, or upon receipt of lien waivers satisfactory
to the Lender, or upon receipt of title insurance satisfactory to the Lender
insuring that there are and will be no mechanics' or materialmen's liens on
the Project to and including the point of final completion, except as may be
permitted pursuant to M.G.L. c. 254, Section 20; and (iv) the authorization
of Lender's construction consultant.
D. Without at any time waiving any of the Lender's rights under this
Agreement, the Lender shall always have the right to make an advance
hereunder without satisfaction of each and every condition upon the Lender's
obligation to make an advance under this Agreement; and the Borrower agrees
to accept any advance which the Lender may elect to make under this Agreement.
8. INTENTIONALLY DELETED:
9. LENDER'S RIGHT TO MAKE PAYMENTS AND TAKE OTHER ACTION: The Lender
may after ten (10) business days' prior notice to the Borrower of its
intention to do so, obtain and maintain all insurance coverage required by
the Lender in accordance with this Agreement, and may after five business
days' prior notice to the Borrower of its intention so to do (except in an
emergency when such shorter notice shall be given as is reasonable under the
circumstances), pay such amount as may be necessary to cause to be discharged
any encumbrances, any sums due or claimed to be due for labor or materials
furnished, and any other sums which in the reasonable opinion of the Lender,
or its attorneys, necessary to secure the priority of the Mortgage, and may
take such other and further action as it may deem advisable in order to
secure the completion of the Project in accordance herewith, the protection
of its secured positions and the performance of all obligations of the
Borrower hereunder. Any moneys so paid may be charged against sums due the
Borrower hereunder as the Lender may see fit and added to the indebtedness
under the Note, or may otherwise be collected from the Borrower, and the
Borrower agrees to repay to the Lender all such moneys, notwithstanding that
the aggregate indebtedness of the Borrower to the Lender hereunder may exceed
the aggregate amount which the Lender is obligated to advance hereunder.
Such amounts shall accrue interest at the rate(s) from time to time
applicable to indebtedness under the Note, and shall be secured by the
Mortgage and the other Basic Instruments securing the Note.
In addition, the Borrower hereby irrevocably authorizes the Lender at any
time and from time to time without further request from or notice to the
Borrower, to make advances which the Lender, in its reasonable discretion,
deems necessary or appropriate to protect the Lender's interest under this
Agreement, including, without limitation, advances made to cover debit
balances, principal of and/or interest on, any loans or any other
Obligations, any fees, and/or and enforcement costs, prior to, on or after
the termination of other advances under this Agreement, regardless of whether
the aggregate amount of the advances may exceed the amount of the Loan.
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<PAGE>
10. DEFAULT: The Borrower shall be deemed to be in default under this
Agreement upon the occurrence of any of the following events of default:
(i) failure of the Borrower to make, within ten (10) days of the
date when due, any payment of principal, interest or premium under the Note
or failure by the Borrower to pay within fifteen (15) business days of the
date due or demanded, as the case may be, any other amounts required to be
paid under this Agreement in the manner specified herein;
(ii) default by the Borrower under any of the provisions of this
Agreement continuing beyond fifteen (15) days after Lender's written notice
thereof and such additional time as shall be required to diligently cure any
defaults which cannot be cured within said fifteen (15) day period, as
reasonably determined by the Lender;
(iii) default under the Note or under any of the other Basic
Instruments or obligation by the Borrower beyond any applicable grace period
expressly set forth therein;
(iv) default by the Borrower in the payment or performance of any
other obligations of the Borrower with respect to the Project and the
continuance of such default for a period of fifteen (15) days after the
earlier of the date Borrower should have notified Lender thereof as set forth
hereunder or Lender's written notice thereof, or for any shorter period if
continuation of such default for such shorter period shall involve or result
in the taking of possession of the Project or any part thereof by any
creditor or obligee of the Borrower or shall involve or result in the
assertion of any other remedy by such creditor or obligee, which default, in
the Lender's opinion, may impair the Borrower's ability punctually to perform
all of its obligations under this Agreement or may threaten the Lender's
security;
(v) any representation or warranty made by or for the Borrower
herein or in any statement heretofore or hereafter furnished to the Lender by
or on behalf of the Borrower shall prove to have been incorrect, false or
misleading in any material respect when made or furnished;
(vi) insolvency, assignment for the benefit of creditors, or the
commencement of any proceedings under any bankruptcy or insolvency law or any
other laws relating to the relief of debtors, by, of or against the Borrower,
and such proceedings, if involuntary, shall not have been dismissed within
sixty (60) business days after commencement thereof;
(vii) any notice of contract, mechanic's lien, attachment, tax lien
of any kind or encumbrance (except as permitted pursuant to M.G.L. c. 254,
Section 2, or under the terms of the Mortgage) is filed against any
improvements to the Project or Premises, any materials, fixtures or other
items stored or to be stored thereon or therein or any personal property used
or to be used in connection with the operation thereof which is not withdrawn
or bonded or, with respect to which, Borrower has not escrowed sufficient
funds with Lender as security for such claims, to the satisfaction of the
Lender within thirty (30) days after filing;
(viii) condemnation or eminent domain taking of all or any part of
the Premises;
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<PAGE>
(ix) the entry of any judgment in excess of $25,000 against the
Borrower (not satisfied within sixty (60) days of entry);
(x) default by the Borrower under any other agreement made with the
Lender in connection with the Project;
(xi) failure of the Borrower to procure in a timely manner and
retain any of the federal, state, county, city, municipal or other permits,
licenses or approvals necessary to construct and operate the Project for its
intended purposes;
(xii) any change in control or the sale, transfer, assignment or
other disposition of any legal or beneficial interest of the Borrower without
the consent of the Lender which consent will not be unreasonably witheld or
delayed;
(xiii) failure of the Borrower to substantially complete Phase II
of the Project and to receive a permanent use and occupancy permit for Phase
II and the Project by the Completion Date;
(xiv) failure of the Borrower to continue its operations at the
Premises; or
(xv) failure of the Borrower to notify the Lender after the date
hereof of the discovery of any hazardous or toxic substances, as defined
under state or federal law, on the Premises or on any property adjacent
thereto or receipt of a Notice of Responsibility from the Department of
Environmental Protection by the Borrower or owner of any property adjacent to
the Premises.
11. LENDER'S REMEDIES IN EVENT OF DEFAULT: The Lender shall not be
obligated to make any advance if there shall exist any event of default as
defined in Paragraph 10 hereof or if, in the reasonable opinion of the
Lender, the sums remaining to be advanced hereunder together with other funds
made available by the Borrower shall be insufficient for the payment of all
expenses incurred or which may be incurred for the completion of the Project,
or if there shall have been any material adverse change in the credit or
financial standing of the Borrower. The Lender may at any time or times,
after an event of default, declare the unpaid principal of and accrued
interest on the Note to be immediately due and payable, whereupon the same
shall become due and payable without any notice or demand. In addition to
all other rights it shall have, including, without limitation, any and all
rights under the Basic Instruments, the Lender may at any time or times
thereafter take immediate possession of the Premises and in its discretion
may thereupon proceed to complete the Project or to take any other actions
with respect thereto. All materials at that time on or near the Premises
which are the property of the Borrower shall become the property of the
Lender, without payment therefor, to be used in said completion, and the
Lender is authorized to charge all money expended for said completion against
any payments not already advanced; and the Borrower agrees to pay the Lender
all sums expended in good faith by the Lender in said completion, even if the
same shall be more than the amount agreed to be advanced, together with such
additional sums as shall reasonably compensate the Lender for the time and
effort the Lender and its employees shall have expended in connection
therewith. The foregoing shall be deemed to authorize, but not obligate in
any event, the Lender to do all
14
<PAGE>
such things in connection with the completion of the Project as it, in its
sole discretion, may deem advisable, including, without limitation, the right
to make any payments with respect to any obligation of the Borrower hereunder
to the Lender or any other person in connection with the construction to be
performed hereunder, to make additions and changes in the Plans and
Specifications, to employ contractors, subcontractors and agents and to take
any and all such action which is commercially reasonable with respect to the
completion of the Project, either in its own name or in the name of the
Borrower, and the Borrower hereby grants the Lender an irrevocable power of
attorney to act in its name in connection with the foregoing. In the event
that the Lender takes possession of the Premises and assumes control of the
Project as aforesaid, it shall not be obligated to continue the same longer
than it shall see fit in its sole discretion, and may thereafter at any time
abandon its efforts and refuse to make further payments for the account of
the Borrower, whether or not the Project has been completed.
In the event of the taking or condemnation of all or any portion of
the Premises, then such taking or condemnation shall constitute an event of
default hereunder, and the entire taking or condemnation award may be applied
by the Lender in reduction of the Note and all other amounts due the Lender
from the Borrower, or at the Lender's option any portion of said award may be
made available to the Borrower for the Project under such terms and
conditions as the Lender shall determine.
In addition to any rights available to the Lender under any of the
Basic Instruments, the Lender shall have the right, under this Agreement, to
participate in the settlement of any insured or condemnation claim, at the
Borrower's expense, and no insured loss or condemnation claim shall be
settled without the prior written approval of the Lender not to be
unreasonably withheld.
12. Commitment Fee: The Borrower has paid to the Lender the balance of
the Commitment Loan Fee of Forty Thousand ($40,000) Dollars prior to the date
hereof.
13. Public Purpose: It is the express intention of the Lender to
provide financing to projects that achieve public purposes as specified by
Chapter 212 of the Acts of 1975, as amended. The public purpose objectives
of the Project are to alleviate blighted conditions at the Premises,
encourage new and state-of-the-art technology based manufacturing and
research and development related thereto and to create employment
opportunities within the Commonwealth of Massachusetts. To ensure that these
public purpose objectives are being achieved, the Lender shall, at any time
and from time to time, have the right to examine the Premises and any and all
documents pertaining to the achievement of such objectives, and the Borrower
shall, as requested by the Lender, submit to the Lender evidence satisfactory
that such objectives are being adequately addressed in the implementation of
the Project.
14. Miscellaneous:
A. No suit at law or in equity shall be brought by the Borrower for any
alleged breach by Lender of the terms of this Agreement unless notice in
writing, particularly describing said alleged breach, shall have been given
to the Lender and the Lender shall have failed to commence to cure such
breach within sixty (60) days after such written notice.
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<PAGE>
B. Neither the approval by the Lender of the Plans and Specifications,
nor any subsequent inspections or approvals of the Project during
construction shall constitute a warranty or representation by the Lender or
any of its agents, representatives, or designees, as to the technical
sufficiency or adequacy or safety of the structure or any of its component
parts, including without limitation, its fixtures, equipment or furnishings,
nor shall such approvals or inspections constitute a warranty or
representation as to the sub-soil conditions involved in the Project or any
other physical condition or feature relating to this Project by any agent,
representative or designee of the Lender are performed solely for the benefit
of the Lender to assure repayment of the Loan and are not for the Borrower's
benefit or the benefit of any other person, including without limitation,
purchasers, tenants or other occupants.
C. The Borrower shall protect, indemnify and save harmless the Lender
and its officers, employees and agents against and from any and all
liabilities, suits, actions, claims, demands, losses, expenses and costs of
every kind and nature incurred by, or asserted or imposed against, the Lender
or its officers, agents or employees, or any of them, by reason of the
Lender's participation in the financing of the construction of the Project,
or by reason of any accident, injury (including death) or damage to any
person or property, howsoever caused, resulting from, connected with or
growing out of any act of commission or omission of the Borrower or any
partners, employees, agents, assignees, contractors or subcontractors of the
Borrower, or any use, nonuse, possession, occupation, condition, operation,
service, design, construction, acquisition, maintenance or management of, or
on, or in connection with, the Project or any part thereof, and regardless of
whether such liabilities, suits, actions, claims, demands, damages, losses,
expenses and costs be against or be suffered or sustained by the Lender or
any of its officers, agents or employees, or be against or sustained by other
persons, corporations or other legal entities to whom the Lender or any of
its officers, agents or employees may become liable therefor, except as the
same may be the direct result of acts of gross negligence or willful
misconduct on the part of the Lender. The Borrower may, and if so requested
by the Lender shall, undertake to defend, at their sole cost and expense, any
and all suits, actions or proceedings brought against the Lender in
connection with any of the matters mentioned in this Agreement provided that
the Lender shall give the Borrower timely notice of and shall forward to
Borrower documents, notices, summons or other process received with respect
to any claim or legal proceeding within the purview hereof. All of the
rights of the Lender set forth herein shall survive the termination of this
Agreement.
D. The parties agree that time is of the essence of this Agreement.
E. All decisions and determinations of the Lender made in good faith on
any question of fact or expediency hereunder shall bind the Borrower.
F. All rights and remedies hereunder provided in favor of the Lender
are intended to be cumulative and not exclusive of one another or exclusive
of any other remedy which the Lender might have at law or in equity,
including the right to enforce the payment of any amount due the Lender by
any proceeding at law or in equity.
G. No waiver at any time of any of the provisions or conditions of this
Agreement or of the Basic Instruments shall be construed as a waiver of any
other of such conditions or
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<PAGE>
provisions, nor shall such waiver in any instance be construed as a waiver of
the same provision or condition in other or subsequent instances.
H. This Agreement may not be waived, changed or discharged orally, but
only by an agreement in writing and signed by the party against whom
enforcement or any waiver, change or discharge is sought and any oral waiver,
change or discharge of any provision of this Agreement by any representative
of either party shall be without authority and of no force and effect.
I. This Agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Massachusetts.
J. The invalidity of any provision of this Agreement shall not affect
the validity of any other provision hereof, it being intended that all
provisions hereof shall be enforceable to the extent permitted by law.
K. The Borrower and Lender each hereby consent and irrevocably submit
to the non-exclusive jurisdiction of any state or federal court located in
any county in the Commonwealth of Massachusetts, as well as to the
jurisdiction of all courts to which an appeal may be taken from such courts,
for the purpose of any suit, action or other proceeding arising out of or in
connection with this Agreement (and, except as expressly set forth to the
contrary therein, the Basic Instruments) and hereby expressly waive any and
all objections to the venue in any such courts.
L. THE BORROWER AND THE LENDER EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT EITHER PARTY MAY HAVE OR HEREAFTER HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE. The Borrower hereby certifies that neither the
Lender, nor any of the Lender's representatives, agents or counsel has
represented, expressly or otherwise, that the Lender would not, in the event
of any such suit, action or proceeding, seek to enforce this waiver of right
to trial by jury. The Borrower acknowledges that the Lender has been induced
by this waiver (among other things) to enter into the loan transaction
evidenced by this Agreement.
M. All major public relations activity regarding the Project,
including, without limitation, all signage at the Premises, press releases,
ribbon cuttings, ground breaking or other similar activities, must by
reasonably approved by Lender.
15. PERFECTING OF SECURITY: The Borrower agrees to execute such
instruments as the Lender may from time to time reasonably request to perfect
and continue the security interest of the Lender in any and all rights under
this Agreement and any and all property of the Borrower which, under
applicable provisions of this Agreement, may or shall stand as security for
the Note.
16. NOTICES: Any notice, request, demand, statement or consent desired
or required to be given hereunder shall be in writing and shall be delivered
by hand, sent by certified mail, return receipt requested, sent by a
nationally recognized commercial overnight
17
<PAGE>
delivery service with provisions for a receipt, postage or delivery charges
prepaid, or sent by facsimile transmission, to the Borrower or Lender at
their respective addresses set forth below (or to such other address as
either party may elect, provided that notice of such address change has been
sent to the other party pursuant to the terms hereof), and shall be deemed
given (i) when actually delivered, if delivered by hand, (ii) upon receipt,
if sent by certified mail, (iii) the next business day after being placed in
the possession of an overnight delivery service, if sent by an overnight
delivery service or (iv) if sent by facsimile transmission, when electronic
indication of receipt is received. Notices shall be addressed, in the case
of the Borrower, to such parties at:
GTC Mason Laboratories, Inc.
57 Union Street
Worcester, MA 01608
Attn: Director of Finance
with a copy to:
John B. Green, Jr., CPA
Genzyme Transgenics Corporation
5 Mountain Road
Framingham, MA 01701
and in the case of the Lender, to it at:
Emerging Technology Fund of the Government Land Bank
d/b/a MassDevelopment
75 Federal Street
Boston, MA 02110
Attn: Portfolio Manager
with at copy to:
Managing Partner
Hutchins, Wheeler & Dittmar
101 Federal Street
Boston, MA 02110
or in the case of either party to such other address as shall be designated
by written notice given to the other party.
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<PAGE>
Witness the execution hereof under seal as of the day and year first
above mentioned.
Lender:
WITNESS: EMERGING TECHNOLOGY FUND OF THE
GOVERNMENT LAND BANK d/b/a
MASSDEVELOPMENT
/s/ David Slatery By: /s/ Michael P. Hogan
- ---------------------------------- -----------------------------------
Name: Michael P. Hogan
Its: Executive Director
Borrower:
WITNESS: GTC MASON LABORATORIES, INC.
/s/ Peter J. Dawson By: /s/ John B. Green, Jr.
- ---------------------------------- -----------------------------------
Peter J. Dawson
Name: John B. Green, Jr.
184393-2 Its: Vice President and Treasurer
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<PAGE>
EXHIBIT A
SURVEYOR'S CERTIFICATE
----------------------
Lender: THE EMERGING TECHNOLOGY FUND of
the GOVERNMENT LAND BANK d/ b/a
MASSDEVELOPMENT
Borrower: GTC MASON LABORATORIES, INC.
Loan Amount: $5,000,000
Premises: 55 Union Street
Worcester, MA
In connection with the above-described loan and intending that the Lender
may rely on this Certificate, I hereby certify to the Lender that the survey
entitled was actually made on the ground and is correct according to the
record description of the Premises; that the bounds and measurements shown on
the survey are correct; that the title lines and actual lines of possession
are the same; that no buildings or improvements on or relating to the
Premises encroach over any property of others or over any easements,
servitudes or rights-of-way (except as shown on the survey), and that no
buildings or improvements on property of others encroach on the Premises or
on any easements, servitudes or rights-of-way appurtenant thereto; and that
the survey shows: the location of all building(s) and other improvements now
existing; the location of all additional improvements to be constructed
contemplated by the plans and specifications approved by the Lender; the
location of all means of ingress and egress from the Premises; the location
of all utilities services from the Premises to the nearest public road or
right-of-way (and if from the Premises to the public right-of-way such
utilities pass over land owned by others, I hereby certify that said passage
is by means of valid, recorded easement(s); the bounds of any areas
constituting a flood hazard area or wetlands or aquifer protection area under
the Federal Flood Disaster Protection Act or under any state or local law,
ordinance or by-laws or regulations (including zoning) and any other area in
which the use of the Premises is restricted in any manner, and the location
of all easements affecting the Premises; whether encumbering the Premises or
appurtenant thereto.
Dated: June __, 1997 -----------------------------------
Registered Surveyor
Registration
No. ------------------------------
184393-2
20
<PAGE>
EXHIBIT B
ARCHITECT'S CERTIFICATE
-----------------------
Lender: THE EMERGING TECHNOLOGY FUND of
the GOVERNMENT LAND BANK d/b/a
MASSDEVELOPMENT
Borrower: GTC MASON LABORATORIES, INC.
Loan Amount: $500,000
Premises: 55 Union Street
Worcester, MA
In connection with the above-described loan and intending that the Lender
may rely on this Certificate, I hereby certify to the best of my belief,
information and knowledge to the Lender that:
1. Access to and egress from the Premises and the improvements
constructed, and to be constructed, and to be constructed, thereon (the
Project ) are in accordance with applicable governmental requirements and
will be provided via the means indicated on plans and specifications approved
by the Lender, and all necessary approvals therefor have been obtained.
2. Municipal water, municipal storm sewer and municipal sanitary sewer
facilities and telephone, gas and electric services of public utilities are
available at the Premises and are adequate to serve the Project. Connections
for the Project to said facilities and services have been obtained.
3. The Premises and the intended construction of the Project consistent
with the said plans and specifications comply with all applicable zoning,
building code, health, fire, safety, wetland and watershed protection and
environmental statutes, codes, by-laws and regulations.
Dated: -----------------------------------
Registered Professional Engineer
---------------------- Registration
No. -------------------------------
184393-3
21
<PAGE>
EXHIBIT C
CERTIFICATE OF BORROWER
-----------------------
APPLICATION FOR FINAL PAYMENT
-----------------------------
Lender: THE EMERGING TECHNOLOGY FUND of
the GOVERNMENT LAND BANK d/b/a
MASSDEVELOPMENT
Borrower: GTC MASON LABORATORIES, INC.
Loan Amount: $5,000,000
Premises: 55 Union Street
Worcester, MA
In connection with the above-described loan, and intending that the
Lender may rely on this Certificate, the Borrower hereby certifies to the
Lender that:
A. No changes have been made in any respect to the Plans and
Specifications except those which have had the prior approval of you or for
which approval is not required under the Loan Agreement;
B. All construction has in every material respect been performed in
accordance with the Plans and Specifications and with such approved changes;
C. The funds remaining unadvanced under the Loan Agreement, together
with the remaining equity funds to be contributed by the Borrower will be
sufficient for the payment of all related direct and indirect costs for the
completion of the Project in accordance with all of the terms and provisions
of the Loan Agreement;
D. All loan funds requisitioned by the Borrower and disbursed by the
Lender under previously approved requisitions have been expended for the
purpose for which they were requisitioned, and all equity funds heretofore
contributed have been likewise expended;
E. The representations and warranties made by the undersigned in the
Loan Agreement are true and correct as of the date hereof with the same
effect as if made on this date;
F. The undersigned represents and warrants that it is not in default of
any of its obligations to the Lender in connection with the Project; and
G. Full payment has been made of all obligations incurred by the
undersigned to subcontractors, workmen and materialmen for and with respect
to all work and materials supplied through and including the date of the
Borrower's last Application for Payment, except for the amount of any
holdback or retainage being withheld in accordance with the terms of such
obligations and full payment has been made by all subcontractors to their
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<PAGE>
subcontractors, workmen and materialmen for and with respect to all work and
materials supplied through and including the date of the Borrower's last
Application for Payment.
All capitalized terms herein shall bear the meanings ascribed to such
terms by that Loan Agreement between the Lender and the Borrower concerning
the Project.
Borrower:
GTC MASON LABORATORIES, INC.
By: ------------------------------
Name:
Its:
Dated:
184393-3
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<PAGE>
Exhibit 10.8.2
PROMISSORY NOTE
$5,000,000 Boston, Massachusetts
June 26, 1997
FOR VALUE RECEIVED, the undersigned, GTC MASON LABORATORIES, INC., a
Massachusetts corporation with a principal place of business at 57 Union Street,
Worcester, Massachusetts 01608 (the "maker"), promises to pay to the order of
the EMERGING TECHNOLOGY FUND of the GOVERNMENT LAND BANK, doing business as
MASSDEVELOPMENT a Massachusetts body politic and corporate created by Chapter
212 of the Acts of 1975, as amended (the "Lender") (the Lender and each
successor, owner, endorsee, bearer and holder of this Note being herein
generally called the "holder") at its offices located at 75 Federal Street,
Boston, Massachusetts 02110, or at such other place as the holder of this Note
may from time to time designate in writing, in lawful money of the United States
of America and in the manner hereinafter provided, the principal sum of FIVE
MILLION AND 00/100 DOLLARS ($5,000,000.00) or so much thereof as shall have been
advanced to the maker hereof, together with interest on the unpaid principal
amount from time to time outstanding prior to maturity. The interest rate shall
be based upon a 360-day year and 30-day months and shall accrue at a rate of
nine and one-quarter percent (9.25%) per annum for the first three years.
Thereafter, the interest rate will be adjusted annually, on each July 1
following the anniversary date of this Note, to a rate equal to the greater of
(i) nine and one-quarter percent (9.25%) per annum, or (ii) one point over the
Prime Rate as then published in the Wall Street Journal.
Interest only for the period from the date of this Note through June 30,
1997, shall be due on the date hereof. Principal and interest payments shall be
payable on the first day of each month commencing on August 1, 1997, in an
amount sufficient to fully amortize the loan within ten (10) years from the date
hereof. The entire balance of principal, accrued interest and other fees and
charges shall be due and payable on the earlier of an event of default under
this Note or June 30, 2007.
This Note is referred to in a certain Loan Agreement (the "Loan Agreement")
between maker and Lender of even date herewith, and is in all respects subject
to the provisions thereof. Terms not otherwise defined herein shall have the
meaning set forth in the Loan Agreement.
The maker may prepay without penalty, all or a portion of this Note at any
time in multiples of One Thousand ($1,000.00) Dollars. Once repaid, amounts
borrowed pursuant to this Note may not be reborrowed.
Any payments received by the holder on account of this Note prior to demand
or acceleration shall be applied first, to any costs, expenses, or charges then
owed the holder by the undersigned, second, to accrued and unpaid interest, and
third, to the unpaid principal balance hereof. Any payments so received after
demand or acceleration shall be applied in such manner as the holder may
determine.
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If there occurs any delinquency in the payment of any installment of
principal and/or interest hereunder or in the payment of any other monetary
obligations hereunder, or if any other default or breach of condition shall
occur, beyond the expiration of any applicable grace period, under the terms of
the Instruments (as hereinafter defined) or any other instrument securing the
indebtedness evidenced hereby, or any instrument evidencing any liability,
obligation or undertaking due to the Lender by the maker or by any endorser,
surety or guarantor hereof, or by any entity owned, legally or beneficially by
the maker or any endorser, surety or guarantor hereof, direct or indirect,
absolute or contingent, liquidated or unliquidated, due or to become due, joint,
several or joint and several, primary or secondary, now existing or hereafter
arising, then an event of default shall have occurred and the holder hereof
shall have the right to declare the entire indebtedness evidenced hereby
immediately due and payable. In the event of default as aforesaid, in addition
to all other rights and remedies available to the holder under the Instruments
(as hereinafter defined), the holder may charge interest at a default rate equal
to twelve percent (12%) per annum, compounded daily on a 360-day year The maker
shall be given fifteen (15) days' written notice before the default rate takes
effect.
The interest rate or rates required by this Note or the Instruments shall
not exceed the maximum rate permissible under applicable laws, and any amounts
paid in excess of such rate or rates shall be applied to reduce the unpaid
balance hereof or shall be refunded to the Borrower, at the option of the
Lender.
In addition, at the holder's option and without demand, notice or protest,
the occurrence of any such event of default shall also constitute a default
under all other agreements between the Lender and the maker.
Any and all deposits or other sums at any time or times credited by or due
from the holder to, and all securities or other property in the possession of
the holder for safekeeping or otherwise and belonging to, the maker or any
endorser, surety or guarantor of this Note or the obligations represented hereby
are and shall be subject to a security interest in favor of the holder to secure
payment of this Note. Upon the occurrence of any of the events of default
specified above and at any time or times thereafter, without any demand or
notice, except to such extent as notice may be required by applicable law, the
holder may sell or dispose of any or all of such securities or other property
and may exercise any and all of the rights accorded the holder by the Uniform
Commercial Code, as adopted by the Commonwealth of Massachusetts. The holder at
any time and from time to time may apply or set off such deposits or other sums
against the liability of the maker or any such endorser, surety or guarantor
whether or not such liability is then due. The provisions of this paragraph are
cumulative and are not exclusive of any other rights that the holder has with
respect to such deposits, sums, securities or other property under other
agreements or applicable principles of law. The holder shall have no duty to
take steps to preserve rights against prior parties as to such securities or
other property.
This Note is secured in part by: (i) a Mortgage and Security Agreement of
even date, from the maker hereof, as mortgagor, to the Lender, as mortgagee,
relating to certain premises located at 55 Union Street, Worcester, Worcester
County, Massachusetts, as more particularly described therein (the "Mortgage")
to be recorded with the Worcester County Registry of
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Deeds; (ii) the Loan Agreement; (iii) the Guaranty of Genzyme Transgenics
Corporation (the " Guaranty"); (iv) a Collateral Assignment of Leases and
Rents of even date, from the maker hereof, as assignor, to the Lender, as
assignee (the "Collateral Assignment"); and (v) a Hazardous Materials
Indemnification Agreement of even date, from the maker to the Lender (the
"Environmental Indemnity") (collectively such documents shall be referred to
as the "Instruments").
The maker hereof (and all endorsers, sureties and guarantors of this Note,
if any) hereby waives presentment for payment, protest and demand, suretyship
defenses and all other defenses in the nature thereof, notice of protest, demand
and of dishonor and non-payment of this Note and the maker's (and any
endorser's, surety's or guarantor's) liability hereunder shall remain
unimpaired, notwithstanding any extension of the time of payment, changes in
terms and conditions and all other indulgences granted by the holder hereof, or
the release, surrender, substitution or exchange of all or any part of such
security or the release from liability of any party which may assume the
obligation to make payment of the indebtedness evidenced hereby or the
performance of the obligations of the maker hereof.
The maker hereof and all endorsers, sureties and guarantors of this Note
now or at any time liable, whether primarily or secondarily, for payment or
performance of the obligations hereby evidenced, for themselves, their heirs,
legal representatives, successors and assigns respectively, agree to pay: (i)
all costs and expenses of the holder, including, without limitation, reasonable
attorneys' fees and expenses (which shall include all costs for administrative,
paralegal and other support staff) incurred in connection with or incidental to
the negotiation, closing and administration of the loan evidenced hereby; and
(ii) all costs and expenses of collection and enforcement of the obligations of
maker evidenced hereby and the rights of the holder under this Note or under any
other instrument now or hereafter executed in connection herewith, including,
without limitation, reasonable attorneys' fees and expenses (which shall include
all costs for administrative, paralegal and other support staff), incurred in
connection therewith whether or not suit is commenced.
The holder shall not, by any act, delay, omission or otherwise be deemed to
waive any of its rights or remedies hereunder unless such waiver be in writing
and signed by the holder, and then only to the extent expressly set forth
therein. A waiver on any such occasion shall not be construed as a bar to or
waiver of any such right or remedy on any future occasion.
Any notice, request, demand, statement or consent desired or required to be
given hereunder shall be in writing and shall be delivered by hand, sent by
certified mail, return receipt requested, sent by a nationally recognized
commercial overnight delivery service with provisions for a receipt, postage or
delivery charges prepaid, or sent by facsimile transmission, to the maker or
Lender at its respective address as set forth above (or to such other address as
either party may elect, provided that notice of such address change has been
sent to the other party hereto pursuant to the terms hereof), and shall be
deemed given (i) when actually delivered, if delivered by hand, (ii) upon
receipt, if sent by certified mail, (iii) the next business day after being
placed in the possession of an overnight delivery service, if sent by an
overnight delivery service or (iv) if sent by facsimile transmission, when
electronic indication of receipt is received.
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No person obligated on account of this Note may seek contribution from any
other person also obligated unless and until all liabilities, obligations and
indebtedness to the holder of the person from whom contribution is sought have
been satisfied in full.
The maker, and each endorser, surety and guarantor, if any, of this Note,
shall indemnify, defend, and hold the holder harmless against any claim brought
or threatened against the holder by the undersigned, by any endorser, surety or
guarantor, or by any other person (as well as from attorneys' fees and expenses
in connection therewith) on account of the holder's relationship with the
undersigned or any endorser, surety or guarantor hereof (each of which may be
defended, compromised, settled, or pursued by the holder with counsel of the
holder's selection, but at the expense of the undersigned and any endorser,
surety and/or guarantor).
This Note shall be governed and construed in accordance with the laws of
the Commonwealth of Massachusetts.
The maker and each endorser, surety and guarantor, if any, hereby consents
and irrevocably submits to the non-exclusive jurisdiction of any state or
federal court located in any county in the Commonwealth of Massachusetts, as
well as to the jurisdiction of all courts to which an appeal may be taken from
such courts, for the purpose of any suit, action or other proceeding arising out
of or in connection with this Note and hereby expressly waives any and all
objections to the venue in any such courts.
If any provision(s) hereof or the application thereof to any person or
circumstance shall, to any extent, be held invalid or unenforceable, at the
Lender's option, the remainder hereof, or the application of such provision(s)
to persons or circumstances other than those as to which such provision(s) is
(was) held invalid or unenforceable, shall not be affected thereby, and each
provision hereof shall be valid and in force to the fullest extent permitted by
law.
THE MAKER AND THE LENDER EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT EITHER PARTY MAY HAVE OR HEREAFTER HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE. The maker hereby certifies that neither the Lender, nor
any of the Lender's representatives, agents or counsel has represented,
expressly or otherwise, that the Lender would not, in the event of any such
suit, action or proceeding, seek to enforce this waiver of right to trial by
jury. The maker acknowledges that the Lender has been induced by this waiver
(among other things) to enter into the loan transaction evidenced by this Note.
The maker further acknowledges that the maker: (i) has read the provisions of
this Note and in particular, the paragraph containing this waiver; (ii) has
consulted legal counsel; (iii) understands the rights that the maker is granting
in this Note and the rights that the maker is waiving in this paragraph in
particular; and (iv) makes the waiver set forth herein knowingly, voluntarily
and intentionally.
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EXECUTED AS A SEALED INSTRUMENT, as of the day and year first above
written.
WITNESS: GTC MASON LABORATORIES, INC.
/s/ Peter J. Dawson By: /s/ John B. Green, Jr.
- --------------------------------- --------------------------------
Peter J. Dawson Name: John B. Green, Jr.
Its: Vice President and Treasurer
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Exhibit 10.8.3
MORTGAGE AND SECURITY AGREEMENT
This Mortgage and Security Agreement ("Mortgage") is made as of this 26th
day of June, 1997, by GTC MASON LABORATORIES, INC. ("Mortgagor"), a
Massachusetts corporation with a mailing address of 57 Union Street,
Worcester, MA 01608 to the EMERGING TECHNOLOGY FUND of the GOVERNMENT LAND
BANK, doing business as MASSDEVELOPMENT ("Lender"), a Massachusetts body
politic and corporate created by Chapter 212 of the Acts of 1975, as amended,
having offices at 75 Federal Street, Boston, Massachusetts 02110, as
Mortgagee.
In consideration for and to secure payment and performance to Lender of
all of the Obligations, as that term is defined in subparagraphs (a) through
(g) below, Mortgagor has granted, bargained and sold, conveyed, aliened,
released, assigned, transferred, mortgaged and confirmed, granted a security
interest in and set-over and by these presents does hereby grant, bargain and
sell, convey, release, assign, transfer, mortgage and confirm unto Lender,
its successors and assigns, forever WITH MORTGAGE COVENANTS:
ALL THAT CERTAIN real estate known and designated as 55 Union Street,
Worcester, County of Worcester, State of Massachusetts, all as more
particularly described on Exhibit "A" attached hereto, incorporated herein by
this reference and made a part hereof (hereinafter collectively referred to
as the "Premises");
TOGETHER WITH all right, title and interest of Mortgagor in and to all of
the following, whether now-owned or hereafter acquired (collectively, along
with the Premises, hereinafter referred to as the "Mortgaged Property"):
(i) present and future structures, buildings, improvements,
common areas, streets, lanes, sidewalks, alleys, passageways, passages, ways
and public places, open or proposed, on or adjoining the Premises,
rights-of-way, public or private, waters, watercourses, strips and gores of
land, estates, liberties, privileges, interests, hereditaments and
appurtenances whatsoever belonging to or in any way made appurtenant to the
Premises; all easements and covenants now existing or hereafter created for
the benefit of the Mortgagor or any subsequent owner or tenant of the
Premises or over ground adjoining the Premises and all rights to enforce the
maintenance thereof; all other rights, liberties and privileges of whatsoever
kind or character including, without limitation, any rights in and to any
land lying in the bed of any street, road or avenue, open or proposed, or in
front of or adjoining the Premises; and all reversions and remainders, claims
and demands whatsoever; the air space above and the right to use the air
space above the Premises, and the drainage, crops, timber, agricultural,
horticultural, mineral, water, oil and gas rights with respect thereto, at
law or in equity;
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(ii) All now existing or hereinafter issued licenses, permits
or agreements, with, from or of any and all governmental or other boards,
bureaus, or instrumentalities, public utilities, agencies or departments
relating to the Premises or any business conducted by Mortgagor thereon, or
the use or occupancy of all or any part thereof ("Licenses and Permits");
(iii) All tools, parts, fixtures, appliances, machinery, and
equipment of any nature whatsoever, and other articles of personal property
now or hereafter owned or acquired by Mortgagor which are now or at any time
hereafter installed in, attached to or situated in or upon the Premises or
in, on or in connection with any buildings and improvements now or hereafter
erected thereon, or used or intended to be used in connection with the
Premises or in the operation of any buildings and improvements now or
hereafter erected thereon, or in the operation or maintenance of any such
building and improvement situate thereon or any business of Mortgagor
conducted thereon, whether or not the personal property is or shall be
affixed thereto, including but not limited to all furniture, furnishings,
apparatus, trade fixtures, inventory, goods, appliances, screens, storm and
screen doors, awnings, window shades, venetian blinds, floor coverings,
carpeting and other furnishings and other personal property of every kind and
nature whatsoever; motors, elevators, escalators, fittings, radiators, gas
ranges, ice boxes, compressors, mechanical refrigerators, couplings,
communication equipment, computer facilities and equipment, storage tanks,
drums and containers (including all rights of Mortgagor as lessee of any of
the foregoing), plumbing, heating, lighting, cooking, laundry, ventilating,
air conditioning, air cooling and refrigerating equipment and systems,
furnaces, boilers, oil and gas burners, pipes, conduits, pipelines, engines,
sprinkler and security equipment and systems, incinerating equipment and
systems and fire fighting equipment and systems; and all renewals,
replacements or articles in substitution of any of the foregoing, whether or
not the same are or shall be attached to the Premises or any buildings or
improvements thereon in any manner, and all accessories, parts or accessions
thereto now or hereafter owned or acquired by Mortgagor or in which Mortgagor
has or may acquire an interest, and all products and proceeds thereof;
(iv) All building materials, building machinery and on building
equipment now or hereafter delivered on site to the Premises arising out of
or in connection with the construction of or reconstruction of, or
rehabilitation or remodeling to, any buildings or improvements now or
hereafter located on the Premises;
(v) All right, title and interest of Mortgagor in and to all
leases or subleases covering all or any part of the Premises and Mortgaged
Property or any portion thereof now or hereafter existing or entered into,
and all right, title and interest of Mortgagor thereunder including, without
limitation, all present and future rents, receipts, issues, and/or profits,
and all other existing and future accounts receivable or contract rights
(including any right to payment, thereunder, whether or not earned by
performance) of any nature arising out of the Premises and Mortgaged Property
or from the sale or lease of any property, goods or materials or from the
rendering of services including, but not limited to, the lease of all or a
portion of the Premises or the operation of any income producing facility on
the Premises (all of such proceeds, receipts and income are hereinafter
collectively referred to as the "Income and Rents" and all such rights are
hereinafter referred to individually as an "Account Receivable" and
collectively as "Accounts Receivable") and any other income of any and all
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kinds (including deposits) belong to or in any way pertaining to the Premises
or any income producing facility now or hereafter on the Premises (including
without limitation all Accounts and other amounts receivable in connection
with any income producing facility now located on the Premises); all rights
of payment, cash or security deposits, advance rentals, and deposits or
payment of similar nature;
(vi) All right, title and interest of Mortgagor in and to all
options to purchase or lease the Mortgaged Property or any portion thereof or
interest therein, and any greater estate in the Premises owned or hereafter
acquired by Mortgagor;
(vii) All awards and other compensation heretofore and hereafter
to be made to Mortgagor for any taking by eminent domain, either permanent or
temporary, of all or any part of the Premises or any easement or appurtenance
thereof or thereto including, without limitation, special and consequential
damages, which said awards and compensation are hereby assigned to Lender,
and Mortgagor does hereby appoint Lender, and any of Lender's officers, its
attorney-in-fact coupled with an interest and authority, and directs and
empowers such attorney effective following an Event of Default, at the option
of such attorney, on behalf of the Mortgagor, its successors and assigns,
following consultation with Mortgagor to adjust or compromise the claim for
any such award and to collect and receive the proceeds thereof;
(viii) All insurance policies covering the Premises and,
following an Event of Default, all proceeds of any unearned premiums on any
such insurance policies including, without limitation, the right to receive
and apply the proceeds of any insurance, judgments, or settlements made in
lieu thereof, for damage to the Mortgaged Property;
(ix) Any securities or guarantees held by Mortgagor with
respect to any of the Accounts Receivable, Licenses and Permits and leases
and subleases of the Premises, or any part thereof, and any notes, drafts,
acceptances, chattel paper, documents or other instruments evidencing the
same;
(x) The right, in the name and on behalf of itself or,
following consultation with Mortgagor, the Mortgagor, to appear in or defend
any action or proceeding brought with respect to the Premises (including,
without limitation, any condemnation or arbitration proceedings), and to
commence any action or proceeding to protect the interest of the Lender in
and to the Mortgaged Property; and
(xi) All personal property of Mortgagor now or hereafter
comprising or located in, on or about the Mortgaged Property or used or
useful in any business now or hereafter conducted thereon, including without
limitation, all goods, equipment, furniture, inventory, machinery, money,
accounts, contracts, contract rights, notes, general intangibles, fixtures,
instruments, documents and chattel paper, whether now owned or hereafter
acquired, together with all replacements and substitutions therefor, and
additions thereto and cash and non-cash proceeds (including insurance
proceeds and proceeds of proceeds) thereof.
TO HAVE AND TO HOLD the Mortgaged Property hereby conveyed or mentioned
and intended so to be, unto Lender, its successors and assigns, to its own
use, forever.
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PROVIDED, ALWAYS, that this instrument is upon the express condition that
if Mortgagor satisfies all of the Obligations, as hereinafter defined, in
accordance with the provisions of the Financing Agreements, as hereinafter
defined, and this Mortgage, at the times and in the manner specified, without
deduction, fraud or delay, and if all the agreements, conditions, covenants,
provisions and stipulations contained therein and in this Mortgage are fully
performed and complied with, then this Mortgage and the estate hereby granted
shall cease, determine and become void. This Mortgage covers, among other
things, all present and future advances made pursuant to this Mortgage and
the Financing Agreements which future advances shall relate back to the date
of this Mortgage.
As used in this Mortgage, "Obligations" means any or all of the following
indebtedness, liabilities and obligations of Mortgagor to Lender and any
replacements or substitutions thereof:
(a) The existing and future debts, liabilities and obligations of
Mortgagor to Lender including, without limitation, those evidenced by that
certain Promissory Note of even date herewith in the original principal sum
of Five Million ($5,000,000.00) Dollars executed and delivered by Mortgagor
to Lender and all interest and costs due thereon, payable as provided
therein, together with all amendments, extensions, renewals now or hereafter
made thereto and any amounts which may be recharged or reloaned from time to
time (all of which indebtedness shall be secured by this Mortgage with the
lien priority hereof to the full extent permitted by Massachusetts law
(hereinafter referred to as the "Note").
(b) The repayment of all sums now or hereafter advanced by Lender to or
for the benefit of Mortgagor including, without limitation any overdrafts
and/or overadvances now or hereafter made, together with applicable interest
thereon;
(c) Any and all existing and future indebtedness, liabilities and
obligations of Mortgagor to Lender whether incurred directly or indirectly or
absolutely or contingently, including those of surety, endorser, guarantor,
or otherwise, of any nature whatsoever and out of whatever transactions
arising;
(d) Performance by Mortgagor hereunder, under the Note and in any other
instruments, agreements and documents executed and/or delivered in connection
herewith and therewith, and any other existing or future instruments,
agreements or documents executed and/or delivered by and/or between Mortgagor
and Lender as now or hereafter amended (collectively, along with the Note
herein referred to as the "Financing Agreements");
(e) Performance by Mortgagor of all warranties, representations,
covenants and agreements set forth in this Mortgage;
(f) The costs of curing any Event of Default set forth in this Mortgage
or in the Financing Agreements which the Lender elects to cure; and
(g) The costs and expenses including, without limitation, reasonable
attorneys' fees and disbursements, incurred by Lender in enforcing any of the
Obligations.
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MORTGAGOR REPRESENTS, COVENANTS AND WARRANTS to and with Lender that,
until the Obligations secured hereby are fully performed and indefeasibly
paid in full in cash:
1. Payment and Performance. Mortgagor shall pay to Lender, in
accordance with the terms of the Note, the Financing Agreements and this
Mortgage, the principal, interest and other sums therein and herein set
forth; shall perform and comply with all the agreements, conditions,
covenants, provisions and stipulations of the Note, the Financing Agreements
and this Mortgage; and Mortgagor shall timely perform all obligations and
duties as landlord under any lease of all or any portion of the Mortgaged
Property now or hereafter in effect.
2. Warranty of Title. Mortgagor warrants that Mortgagor possesses good
and marketable fee simple title to the Mortgaged Property, subject to no
lien, charge or encumbrance of any nature except for those title exceptions
listed in the mortgage title insurance policy approved by and issued to
Lender insuring the priority of the lien of this Mortgage. Mortgagor shall
provide such title and all of its rights in and to the Mortgaged Property and
shall preserve such title and all of its rights in and to the Mortgaged
Property and shall forever warrant and defend the validity and priority of
the lien hereof against the claims of all persons or entities whatsoever.
Mortgagor further warrants that Mortgagor has all power and authority and
capacity to mortgage the Mortgaged Property to Lender and to grant a lien on
and security interest therein in the manner set forth herein.
3. Maintenance of Mortgaged Property. Mortgagor shall keep and
maintain or cause to be kept and maintained the Mortgaged Property including
all buildings and improvements now or at any time hereafter erected on the
Premises and the sidewalks and curbs abutting them, in good order and
condition and in a rentable and tenantable state of repair, and will promptly
make or cause to be made, as and when necessary, all repairs, renewals and
replacements, structural and nonstructural, exterior and interior, ordinary
and extraordinary, foreseen and unforeseen. Mortgagor shall abstain from and
shall not permit the commission of waste in or about the Mortgaged Property;
shall not cause or permit any building or improvement upon the Premises to be
removed or demolished or structurally altered without the prior written
consent of Lender; and shall not permit the Mortgaged Property to become
deserted or abandoned.
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4. Insurance.
(a) Mortgagor shall keep the Mortgaged Property continuously
insured to the extent of its full insurable value, but in any event not less
than that amount to which any co-insurance provisions would apply, and not
less than the full replacement amount of the building and any improvements
thereon, against loss or damage by fire, with extended coverage and coverage
against loss or damage by theft, vandalism, malicious mischief, sprinkler
leakage, earthquake, boiler, machinery and flood, unless Mortgagor can
demonstrate the property is located outside a flood hazard area, and against
other hazards as Lender may reasonably require from time to time. Mortgagor
shall keep the Boiler and Machinery insurance coverage with a limit equal to
the greater of $1,000,000.00 or twenty-five percent (25 percent) of the one
hundred percent (100 percent) replacement cost of the building and any
improvements unless Mortgagor can demonstrate that the property policy
carries coverage for a steam boiler explosion in which case Mortgagor must
carry coverage in the amount of the value of the steam objects. Mortgagor
shall also maintain comprehensive general liability insurance (including
products and completed operations and personal injury and property damage,
rental loss and workmen's compensation insurance in such total amounts as
Lender may reasonably require from time to time. In connection with any
construction, remodeling, and rehabilitation work now or hereafter on the
Mortgaged Property, Mortgagor shall keep applicable insurance in effect.
(b) All original policies, including policies for any amounts
carried in excess of the required minimum and policies not specifically
required by Lender, shall be in form and content satisfactory to Lender,
shall be issued by companies satisfactory to Lender, shall at all times be
maintained in full force and effect, shall be assigned to Lender, with
premiums prepaid, as additional collateral security for payment of the
Obligations, shall be endorsed with a standard mortgagee, loss payee or
additional insured clause, as applicable, in favor of Lender, shall not be
subject to contribution, and shall provide for at least sixty (60) days'
notice to Lender of cancellation or modification in coverage, and shall
insure Lender notwithstanding any act or negligence on the part of Mortgagor.
Mortgagor shall provide Lender with at least twenty (20) days' notice for
non-payment of any insurance premium. At least sixty (60) days prior to the
expiration date of any insurance policy Mortgagor shall deliver to Lender
satisfactory evidence of the renewal of all such insurance. In the event
Mortgagor employees a property management company, said property management
company shall be named as an additional insured.
(c) If the insurance, or any part thereof, shall expire, be
canceled, become void or voidable by reason of Mortgagor's breach of any
condition thereof, or if for any reason whatever the insurance shall be
unsatisfactory to Lender, Mortgagor shall within five (5) days of Lender's
notice to Mortgagor, place new insurance on the Mortgaged Property reasonably
satisfactory to Lender.
(d) In the event of loss, Mortgagor will give immediate notice
thereof to Lender, and Lender may make proof or proofs of loss on behalf of
Mortgagor and any adjustment of a proof of loss shall require the prior
written consent of Lender. Each insurance company concerned is hereby
authorized and directed to make payment under such insurance, including,
following an occurrence of an Event of Default, and return unearned
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premiums, directly to Lender instead of to Mortgagor and Lender jointly, and
Mortgagor hereby appoints Lender, irrevocably, as Mortgagor's
attorney-in-fact to endorse any draft therefor. After June 26, 2002, Lender
shall have the right in its sole and absolute discretion to retain and apply
the proceeds of any such insurance, at its election, to reduction of the
Obligations, or to restoration or repair of the property damaged. Prior to
June 26, 2002, and provided that: (1) Mortgagor shall not be in default
under this Mortgage or the Financing Agreements, and (2) the insurance
proceeds are sufficient to restore the damaged property, Lender shall apply
the proceeds of such insurance to the restoration or repair of the property
damaged. Such policies of insurance and all renewals thereof are hereby
assigned to Lender as additional security for payment of the Obligations and
Mortgagor hereby agrees that any values available thereunder upon
cancellation or termination of any of said policies or renewals, whether in
the form of return of premiums or otherwise, shall be payable to Lender as
assignee thereof. If Lender becomes the owner of the Mortgaged Property or
any part thereof by foreclosure or otherwise, such policies, including all
right, title and interest of Mortgagor thereunder, shall become the absolute
property of Lender.
5. Taxes and Other Charges.
(a) Mortgagor shall pay or cause to be paid when due and payable
and before interest or penalties are due thereon, without any deduction,
defalcation or abatement, all taxes of any kind whatsoever (including all
personal property, income, franchise, profits, sales, use, income, gross
receipts, withholding taxes and any payments in lieu of real estate taxes),
general and special assessments, water and sewer rents, levies, encumbrances,
permits, license and inspection fees, and all other charges or claims of
every nature and kind which may be assessed, levied, imposed, suffered,
placed or filed at any time against Mortgagor or the Mortgaged Property or
against the interests of Lender in the Mortgaged Property, (except, Mortgagor
shall not be responsible for any assessments made against or due from the
Mortgagee in the nature of income, franchise, profits or other taxes which
are attributable to the Mortgagee solely due to its status as a mortgagee)
which by any present or future law may have priority over the Obligations
either in lien or in distribution out of the proceeds of any judicial sale;
and Mortgagor shall produce to Lender, not later than such dates, copies of
receipts (or other evidence) for the payment thereof.
(b) Upon an Event of Default or failure to pay annual premiums for
insurance, the Lender may require that, on the first day of every month, an
amount equal to 1/12 of the annual premiums for such fire and extended
coverage insurance, as required by Lender, and such annual real estate taxes
or payments to be made in lieu of taxes which may be assessed, levied, or
imposed. Without limiting the foregoing, the Lender, upon an Event of
Default may require Mortgagor to pay to Lender an amount equal to 1/12 of the
annual amount due for water rents, sewer rents, special assessments, and any
other tax, assessment, claim, lien or encumbrance which may at any time be or
become a lien upon the Mortgaged Property prior to the lien of this Mortgage,
and on demand from time to time shall pay to Lender all additional sums as
Lender in its discretion may deem necessary to pay such premiums and other
payments, the amounts so paid to be security for such premiums and other
payments and to be used in payments thereof. No amount so paid shall be
deemed to be trust funds but may be commingled with general funds of Lender,
and no interest shall be payable thereon. If, pursuant to any provision of
this Mortgage, the whole amount of
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the Obligations becomes due and payable, Lender shall have the right at its
election to apply any amounts so held against the entire indebtedness secured
hereby.
6. Compliance with Law and Regulations. Mortgagor shall comply with
all laws, ordinances, regulations and orders now or hereafter in effect of
all federal, state, municipal and other governmental authorities relating to
the Mortgaged Property.
7. Inspection. Lender and any persons authorized by Lender shall have
the right at any time and from time to time, upon reasonable notice to
Mortgage to enter the Premises to inspect and photograph its condition and
state of repair and the Mortgaged Property and the records of Mortgagor with
respect thereto.
8. Declaration of No Set-Off. Within one (1) week after requested to
do so by Lender, Mortgagor shall certify to Lender or to any assignee or
proposed assignee of this Mortgage, in writing duly acknowledged, the amount
of principal, interest and other charges then owing on the Obligations and on
any obligations secured by prior liens upon the Mortgaged Property, if any,
and whether there are any set-offs or defenses against them.
9. Security Agreement. This Mortgage constitutes a security agreement
under the Uniform Commercial Code and Mortgagor hereby grants Lender a lien
on and a security interest in all personal property of Mortgagor now or
hereafter comprising or located in, on or about the Mortgaged Property or
used or useful in any business now or hereafter conducted thereon, including
without limitation, all goods, equipment, furniture, inventory, machinery,
money, accounts, contracts, contract rights, notes, general intangibles,
fixtures, instruments, documents and chattel paper, whether now owned or
hereafter acquired, together with all replacements and substitutions
therefor, and additions thereto and cash and non-cash proceeds (including
insurance proceeds and proceeds of proceeds) thereof. Mortgagor shall
execute, deliver, file and refile any financing statement, continuation
statements, or other security agreements Lender may require from time to time
to confirm the lien of this Mortgage with respect to such property. Without
limiting the foregoing, after an event of default hereunder, Mortgagor hereby
irrevocably appoints Lender attorney-in-fact for Mortgagor to execute,
deliver and file such instruments for and on behalf of Mortgagor. Mortgage
shall not change its chief executive office without giving Lender at least
sixty (60) days prior written notice thereof, which notice shall be
accompanied by new financing statements executed by Mortgagor in the same
form as the financing statements delivered to Lender on the date hereof
except for the change of address. Upon any default or Event of Default
hereunder or under any of the Financing Agreements, Lender shall have, in
addition to any other rights and remedies hereunder or under said Financing
Agreements, all of the rights and remedies granted a secured party under the
Uniform Commercial Code with respect to all personal property.
Notwithstanding any release of any or all of the property included in the
Mortgaged Property which is deemed "real property", any proceedings to
foreclose this Mortgage or its satisfaction of record, the terms hereof shall
survive as a security agreement with respect to the security interest created
hereby and referred to above until the indefeasible repayment or satisfaction
in full in cash of the Obligations of Mortgagor.
10. Financial Statements.
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Mortgagor shall submit to Lender, the following statements relating
to Borrower in a format which includes comparisons with the prior
corresponding time period: (i) within 60 days after the end of each
quarterly fiscal period, quarterly balance sheets and income statements
certified as to correctness by Borrower's chief financial officer, and (ii)
within 120 days after the end of Borrower's fiscal year, annual balance
sheets, profit and loss statements, income statements, reconciliations of
capital accounts, statements of changes in financial position and, when
required by the Lender, a statement itemizing fixed asset acquisition and
disposition, and an aging of Borrower's accounts payable and receivable, all
of which shall be certified as to correctness by Borrower's chief financial
officer for the fiscal year, without restriction as to scope. With each
submission of financial statements as required under (i) and (ii) the Lender
shall also certify that there are no Defaults existing under the Loan
Documents. In addition, Mortgagor shall furnish to Lender such data and
information (financial and otherwise) as may be required pursuant to the
terms and conditions of the Financing Agreements.
11. Required Notices. Mortgagor shall notify Lender promptly of the
occurrence of any of the following:
(a) a fire or other material casualty causing damage to all or any
part of the Mortgaged Property;
(b) receipt of notice of eminent domain proceedings or condemnation
of all or any part of the Mortgaged Property;
(c) receipt of any notice of violation, cancellation, expiration or
non-renewal from any governmental authority relating to the structure, use or
occupancy of the Mortgaged Property;
(d) receipt of any notice from any tenant of all or any portion of
the Mortgaged Property or any lessee of any of the Mortgaged Property
relating to occupancy or the payment of rent or any breach of a lease for the
Mortgaged Property;
(e) a change in the occupancy of the Mortgaged Property; or
(f) commencement of any material (i.e., more than $25,000 in
damages) litigation affecting the Mortgaged Property.
12. Condemnation.
(a) In the event of any condemnation or taking of any part of the
Mortgaged Property by eminent domain, alteration of the grade of any street,
or other injury to or decrease in the value of the Mortgaged Property by any
public or quasi-public authority or corporation, exercising the power of
eminent domain or otherwise, all proceeds (that is, the award or agreed
compensation for the damages sustained) allocable to Mortgagor, after
deducting therefrom all costs and expenses (regardless of the particular
nature thereof and whether incurred with or without suit) including
attorney's fees incurred by Lender in connection with the collection of such
proceeds, shall be paid over to Lender and applied first
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to payment of the Obligations. No settlement for damages sustained shall be
made by Mortgagor without Lender's prior written approval, which approval
shall not be unreasonably withheld. Receipt by Lender of any proceeds less
than the full amount of the then outstanding balance of the Obligations shall
not alter or modify Mortgagor's obligations for the installments of
principal, interest and other charges specified in the Note and the Financing
Agreements. All proceeds so paid to or received by Lender shall be applied in
the order and in the amounts that Lender, in Lender's sole discretion, may
elect, to the payment of principal (whether or not then due and payable),
interest, any sums secured by this Mortgage, or toward payment, after the
aforesaid deductions, to Mortgagor, on such terms as Lender may specify, to
be used for the sole purpose of altering, restoring or rebuilding any part of
the Mortgaged Property which may have been altered, damaged or destroyed as a
result of the taking, alteration of grade or other injury to the Mortgaged
Property.
(b) If prior to the receipt of the proceeds by Lender the Mortgaged
Property shall have been sold on foreclosure of this Mortgage, Lender shall
have the right to receive the proceeds to the extent of:
(i) the full amount of all such proceeds if Lender
is the successful purchaser at the foreclosure sale; or
(ii) if anyone other than Lender is the successful
purchaser at the foreclosure sale, any deficiency (as hereinafter defined)
due to Lender in connection with the foreclosure sale, with interest thereon
at the highest rate then payable on the Note, and reasonable counsel fees,
costs and disbursements incurred by Lender in connection with collection of
such proceeds of foreclosure sale and the establishment of such deficiency.
For purposes of this subparagraph, the word "deficiency" shall be deemed to
mean the difference between (A) the net sale proceeds actually received by
Lender as a result of such foreclosure sale less any costs and expenses
(including attorneys' fees) incurred by Lender in connection with enforcement
of its rights under the Note, the Financing Agreements and this Mortgage and
(B) the aggregate amount of all sums which Lender is entitled to collect
under the Note, the Financing Agreements and this Mortgage.
(c) Lender shall have the right to prosecute to final determination
or settlement an appeal or other appropriate proceedings in the name of
Lender or Mortgagor, for which Lender is hereby appointed irrevocably as
attorney-in-fact for Mortgagor, which appointment, being for security, is
irrevocable. In such event, the expenses of the proceedings, including
reasonable counsel fees, shall be paid first out of the proceeds, and only
the excess, if any, paid to Lender shall be credited against the amounts due
under the Mortgage.
(d) Nothing herein shall limit the rights otherwise available to Lender,
at law or in equity, including the right to intervene as a party to any
condemnation proceeding.
13. Mortgages and Liens.
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(a) Without the prior written consent of Lender, Mortgagor will
not voluntarily create or permit to be created or filed against the Premises,
any mortgage lien or other lien or security interest inferior or superior to
the lien of this Mortgage.
(b) Mortgagor will keep and maintain the Mortgaged Property free
from the claims of all persons erecting, altering, repairing buildings,
structure or other improvements to the real estate or for furnishing material
or rental equipment, appliances or tools in connection with the construction,
reconstruction, rehabilitation or alteration of any or all buildings and
improvements which are now or hereafter may be erected upon the Mortgaged
Property, notwithstanding by whom such labor or materials may have been
contracted except as may be expressly permitted pursuant to M.G.L. Ch. 254,
- -Section Symbol-2. Lender reserves the right to refuse to advance additional
funds upon the recording of a Notice of Contract or other lien other than
Pursuant to M.G.L. Ch. 254, -Section Symbol-2.
(c) Mortgagor will pay promptly all requisitions for payment
submitted by Mortgagor's general contractor(s), but if said general
contractor has filed a Notice of Intent in no event shall any such payment be
made later than twenty-five (25) days after the last day of the period stated
in the General Contractors' only executed partial waiver and subordination of
lien.
14. Leases.
(a) Mortgagor hereby represents that there are no leases, subleases
or agreements to lease all or any part of Mortgaged Property now in effect
except as set forth on Exhibit "B" hereto incorporated herein by this
reference and made a part hereof. Mortgagor agrees not to enter into any
leases or agreements to lease all or any part of the Mortgaged Property
without the prior written consent of Lender.
(b) Mortgagor hereby assigns to Lender and grants Lender a lien on
and security interest in and to all present and future leases and all of
Mortgagor's right to receive payments under any existing and future leases of
the Mortgaged Property or any portion thereof including the rents, receipts,
issues, profits and other income of any and all kinds (including deposits)
received or receivable by Mortgagor due or to become due from the sale or
lease of any property, goods or materials or from the rendering of services
of any nature including, without limitation the occupancy, license, rental or
lease of any part of the Mortgaged Property or the operation of any income
facility on Mortgaged Property, as further security for the payment of the
Obligations. Mortgagor grants to Lender the right to enter upon and take
possession of the Mortgaged Property for the purpose of collecting the same
and to let or relet the Mortgaged Property or any part thereof, and to apply
the rents, issues, receipts, profits and other income of any and all kinds
(including deposits) or any other amounts received or receivable by
Mortgagor, due or to become due from the sale or lease of any property, goods
or materials or from the rendering of services of any nature including,
without limitation, the occupancy, license, rental or lease of any part of
the Mortgaged Property or the operation of any income facility on the
Mortgaged Property, or after payment of all necessary charges and expenses,
on account of the Obligations. This assignment and grant shall continue in
effect until all the Obligations are paid and performed in full.
Notwithstanding the foregoing, so long as no Event of Default has occurred,
Mortgagor is
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authorized to collect and receive said rents, receipts, issues, profits and
other income which authorization shall cease immediately upon the occurrence
of the Event of Default. Mortgagor agrees to use such rents, receipts,
issues, profits and other income in payment of the Obligations and in payment
of taxes, assessments, sewer and water rents, and carrying charges coming due
against the Mortgaged Property. Even prior to the occurrence of an Event of
Default, Mortgagor will not, without the written consent of the Lender,
receive or collect rent or other amounts from any tenant of the Mortgaged
Property or any part thereof for a period of more than one month in advance.
15. Modification of Mortgage. Lender may, at any time and from time to
time: renew or extend this Mortgage; waive any of the terms, covenants or
conditions hereof, of the Note, or of the Financing Agreements; in whole or
in part; release any portion of the Mortgaged Property or any other security;
release, substitute or add any other party liable hereunder or under the
Note, or the Financing Agreements, and grant such extensions and indulgences
in relation to the Obligations secured hereby as Lender may determine, all
without the consent of Mortgagor and without any obligation to give notice of
any kind thereto to Mortgagor or others and without, in any manner, affecting
the liabilities and obligations of Mortgagor on the Obligations, and the
priority of the lien hereof on all or any part of the Mortgaged Property.
16. No Transfer. Without the prior written consent of Lender, Mortgagor
will abstain from and will not cause or permit, to the extent it may do so,
any transfer of legal or equitable title to, beneficial interest in, or any
estate or interest in the Mortgaged Property or any part thereof, or of other
interests in the Mortgaged Property, voluntarily or by operation of law
(other than by death or by execution or foreclosure under this Mortgage or by
exercise of the power of eminent domain), whether by sale, exchange, lease,
conveyance, merger, consolidation or the granting of any lien or security
interest or otherwise, or any agreement to do any of the foregoing. In the
event that an attempt to do or consent to any of the foregoing with respect
to all or any portion of the Mortgaged Property occurs, the Obligations shall
immediately become due and payable.
17. Lender's Right to Remedy Defaults. Mortgagor shall pay or cause to
be paid, from time to time as and when the same shall become due, all claims
and demands of any persons or entities which, if unpaid, might result in or
permit the creation of a lien on the Mortgaged Property or any part thereof,
and shall do or cause to be done any and all things which may be necessary so
that the lien of this Mortgage shall be fully preserved and so that there
shall not be created, permitted or suffered to exist any lien, encumbrance or
charge affecting the Mortgaged Property other than those approved in writing
by Lender, all at the sole cost of Mortgagor. If Mortgagor should fail to
pay real estate or other taxes, assessments, water and sewer rents, charges
and claims, sums due under any prior lien, or insurance premiums, or fail to
make necessary repairs, or permit waste, or fail to cure any default under
any prior lien, Lender, at its election, on such notice to Mortgagor as may
be reasonable under then-extent circumstances, shall have the right but not
the obligation to make any payment or expenditure and to take any act, which
Mortgagor should have made or taken, or which Lender deems necessary or
advisable to protect the security of this Mortgage and the Mortgaged
Property, without prejudice to any of Lender's rights or remedies available
hereunder or otherwise, at law or in equity. All such sums, as well as
costs, advanced by
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Lender pursuant to this Mortgage shall be due immediately from Mortgagor to
Lender, shall be added to the Obligations secured hereby and the lien
therefor shall relate back to the date of this Mortgage, and shall bear
interest at a rate which shall be twelve percent (12 percent) per annum from
the date of payment by Lender until the date of repayment. Mortgagor shall be
given fifteen (15) days notice that said default rate is in effect and shall
thereafter have the right to cure promptly the default.
18. Environmental Representations Warranties and Covenants.
(a) Compliance with Law.
(i) To the best of Mortgagor's knowledge (after due
inquiry and investigation), Mortgagor represents and warrants that there is
no activity at the Premises which has been conducted by Mortgagor or any
predecessor-in-interest to Mortgagor, or is being conducted, except in
compliance with (or which has been remediated in accordance with) all
statutes, ordinances, regulations, orders and requirements of common law
concerning (A) those activities, (B) repairs or construction of any
improvements, (C) handling of any materials, (D) discharges to the air, soil,
surface water or ground water and (E) storage, treatment or disposal of any
waste at or connected with any activity at the Premises ("Environmental
Statutes").
(ii) Mortgagor shall cause all activities at the
Premises to be conducted in compliance with all Environmental Statutes.
Mortgagor shall cause all permits, licenses or approvals to be obtained, and
shall cause all notifications to be made, as required by Environmental
Statutes. Mortgagor shall, at all times, cause compliance with the terms and
conditions of any such approvals or notifications.
(iii) Mortgagor shall, upon receipt thereof, provide
to Lender copies of:
(A) applications or other materials submitted to
any governmental agency in compliance with Environmental Statutes;
(B) any notifications submitted to any person
pursuant to Environmental Statutes;
(C) any permit, license, approval, amendment or
modification thereto granted pursuant to Environmental Statutes;
(D) any record or manifest required to be
maintained pursuant to Environmental Statutes; and
(E) any correspondence, notice of violation,
summons, order, complaint or other document received by Mortgagor, its
lessees, sublessees or assigns, pertaining to compliance with any
Environmental Statutes.
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(b) Site Contamination.
(i) To the best of Mortgagor's knowledge (after due
inquiry and investigation), except as disclosed in writing to Lender
concurrently herewith, Mortgagor represents and warrants the absence of
contamination on or in the Mortgaged Property. Mortgagor shall not permit
contamination of Mortgaged Property by hazardous substances. Mortgagor shall,
at all times cause hazardous substances to be handled on the Premises in a
manner which will not cause an undue risk of contamination of the Mortgaged
Property.
(ii) For purposes of this section, the term
"contamination" shall mean the uncontained presence of hazardous substances
at the Premises, or arising from the Premises, which may require remediation
under any applicable law.
(iii) For purposes of this section, "hazardous
substances" shall mean "hazardous substances" as defined pursuant to the
Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. Sections 9601-9657, as amended by the Superfund Amendments and
Reauthorization Act of 1986, Pub. L. No. 99-499, 100 State. 1613 (Oct. 17,
1986), "regulated substances" within the meaning of subtitle I of the
Resource Conservation and Recovery Act, 42 U.S.C. Sections 6991-6991i, as
amended by the Superfund Amendments and Reauthorization Act of 1986, Pub. L.
No. 99-499, 100 Stat. 1613 (Oct. 17, 1986).
(c) Other Hazardous or Toxic Materials.
To the best of Mortgagor's knowledge (after due inquiry and
investigation), Mortgagor represents and warrants that there are no:
(i) polychlorinated biphenyls or substances
containing polychlorinated biphenyls present on or in the Premises in
concentrations in excess of legal limits;
(ii) asbestos or materials containing asbestos
present on or in the Premises; or
(iii) urea formaldehyde foam insulation on or in the
Premises.
(d) Environmentally Sensitive Areas.
To the best of Mortgagor's knowledge (after due inquiry and
investigation), Mortgagor represents and warrants that no portion of the
Premises constitutes any of the following "Environmentally Sensitive Areas":
(i) a wetland or other "water of the United States"
for purposes of Section 404 of the federal Clean Water Act, 33 U.S.C. Section
1344, or any similar area regulated under any state law;
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<PAGE>
(ii) a portion of the coastal zone for purposes of
the federal Coastal Zone Management Act, 16 U.S.C. Sections 1451-1464; or
(iii) any other area, development of which is
specifically restricted under applicable law by reason of its physical
characteristics or prior use.
(e) Radon.
(i) To the best of Mortgagor's knowledge (after due
inquiry and investigation), Mortgagor represents and warrants that there is
no investigation of the Premises being conducted for the presence of radon
gas or the presence of the radioactive decay products of radon.
(ii) Mortgagor shall cause all construction of new
structures on the Premises to use design features which safeguard against or
mitigate the accumulation of radon or radon-products in concentrations
exceeding an acceptable level in any such new structure. At the earliest
feasible time during or after construction of any new structure on the
Premises, Mortgagor shall commission an investigation of such new structure
for the presence of radon or radon-products and shall provide a report of
such investigation to Lender.
(iii) For purposes of this paragraph, "acceptable
level" shall mean the lowest applicable maximum concentration established by
any governmental agency with jurisdiction over the Premises. In the absence
of a legally binding maximum concentration, the "acceptable level" shall be
an air concentration of 4 picocuries/liter.
(f) Tanks.
(i) To the best of Mortgagor's knowledge (after due
inquiry and investigation), Mortgagor represents and warrants that there are
no tanks presently or formerly used for the storage of any liquid or gas
above or below ground present on the Premises except as disclosed in writing
to the Lender.
(ii) Mortgagor shall neither install nor permit to be
installed any temporary or permanent tanks for the storage of any liquid or
gas above or below ground except as in compliance with the other provisions
of this section and after obtaining written permission to do so from Lender.
19. Environmental Investigations.
(a) Lender may at any time and from time to time, at its
discretion, commission investigations at Mortgagor's expense of (i)
compliance at the Premises with Environmental Statutes, (ii) the presence of
hazardous substances or contamination in the Mortgaged Property, (iii) the
presence in the Mortgaged Property of materials which are the subject of
Paragraph 18(c), (iv) the presence at the Premises of Environmentally
Sensitive Areas which are the subject of Paragraph 18(d), (v) the presence at
the Premises of radon-products, or (vi) the presence on the Premises of tanks
which are the subject of Paragraph 18(f).
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(b) In connection with any investigation pursuant to Subparagraph
(a) of this Paragraph 19, Mortgagor, its lessees, sublessees and assigns,
shall comply with any reasonable request for information made by Lender or
its agents in connection with any such investigation. Mortgagor represents
and warrants that any response to any such request for information will be
full and complete.
(c) Mortgagor will assist Lender and its agents in obtaining any
records pertaining to the Mortgaged Property or to Mortgagor and the lessees,
sublessees or assigns of Mortgagor in connection with an investigation
pursuant to Subparagraph (a) of this Paragraph 19.
(d) Mortgagor will accord Lender and its agents access to all areas
of the Mortgaged Property at reasonable times and in reasonable manners in
connection with any investigation pursuant to Subparagraph (a) of this
Paragraph 19.
(e) No investigation commissioned pursuant to this paragraph shall
have any effect upon the representations or warranties made by Mortgagor to
Lender in this Mortgage.
20. Indemnification. Mortgagor hereby agrees to indemnify and to hold
harmless Lender of, from and against any and all expenses, loss or liability
suffered by Lender by reason of Mortgagor's breach of any of the provisions
of this Mortgage including, without limitation:
(a) Any and all expenses that Lender may incur in complying with
any Environmental Statutes;
(b) Any and all costs that Lender may incur in studying or
remedying any contamination of the Mortgaged Property;
(c) Any and all fines, penalties or other sanctions (including a
voiding of any transfer of the Mortgaged Property) resulting from the failure
of Mortgagor to have complied with Environmental Statutes; and
(d) Any and all legal and professional fees and costs incurred by
Lender in connection with the foregoing. This indemnification shall survive
payment of the Note and shall be in addition to, and not in limitation of,
that certain Hazardous Materials Indemnification Agreement of even date from
the Mortgagor to the Lender.
21. Events of Default. Any one or more of the following events shall
constitute an Event of Default hereunder:
(a) Failure of Mortgagor to make, within ten (10) days of the date
when due, any payment of principal interest or premium under the Note or
failure by the Mortgagor to pay within fifteen (15) business days of the date
due or demanded, any other sum in accordance with the terms of the Note or
the other Financing Agreements;
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(b) Mortgagor's nonperformance of or noncompliance in any material
respect with any other agreements, conditions, covenants, provisions or
stipulations contained in the Note or the Financing Agreements, not cured
after any applicable notices and within applicable grace periods, if any, or
Mortgagor's nonperformance or noncompliance with any of the agreements,
conditions, covenants, provisions or stipulations contained in this Mortgage
or any other agreement between Mortgagor and Lender not cured within fifteen
(15) days after the earlier of the date Mortgagor should have notified Lender
thereof as set forth hereunder or Lender's written notice thereof;
(c) Any signature, statement, representation or warranty made in
the Note, the Financing Agreements or this Mortgage, or in any financial
statement, certificate, application, request or other document furnished to
Lender by Mortgagor at any time prior to, now or hereafter, is not true and
correct in any material respect when made or delivered;
(d) The occurrence of any Event of Default under any of the
Financing Agreements; or
(e) The transfer or sale (except in the ordinary course of
business) of any part of the Mortgaged Property or any interest therein,
including, without limitation, the acts of transfer described in Paragraph 16
above, without the Lender's prior written consent.
22. Remedies of Lender.
(a) Upon the happening of any Event of Default, the entire unpaid
balance of the Obligations, including interest as has accrued thereon, and
all other sums secured by this Mortgage shall become immediately due and
payable, at the option of Lender, without notice to or demand upon Mortgagor
or any other person.
(b) When the Obligations shall become due and payable, either
because of maturity or because of acceleration upon the occurrence of any
Event of Default, or otherwise, then forthwith in addition to all other
rights or remedies available under the Financing Agreements, at law or in
equity:
(i) Foreclosure. Lender may institute an action to
foreclose upon this Mortgage by issuance of a complaint, or may take such
other action at law or in equity for the enforcement of this Mortgage and
realization on the mortgage security or any other security herein or
elsewhere provided for, as the law may allow, and may proceed therein to
final judgment, execution and sale for the collection of the entire unpaid
balance of the Obligations, with interest thereon at the then applicable rate
stipulated in the Note to the date of default, and thereafter until payment
in full is received by Lender at a rate which shall be twelve percent (12%)
per annum, which Obligations shall include all other sums due from Mortgagor
to Lender in accordance with the provisions of the Note, the Financing
Agreements and this Mortgage, including all sums which may have been advanced
by Lender to Mortgagor after the date of this Mortgage, and all sums which
may have been advanced by Lender for taxes, water or sewer rents, charges or
claims, payments on prior liens, insurance or repairs to the Premises, all
costs of suit, and together with Lender's reasonable attorney's collection
fee; and
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(ii) Possession. Lender may peaceably and quietly
enter upon, have, hold, use, occupy, possess, rent and otherwise enjoy the
Mortgaged Property, with or without legal action and by force if necessary;
collect therefrom all rents, issues and profits thereof (which term shall
also include sums payable for use and occupation (of other than Mortgagor)
and whether or not Lender takes possession of the Mortgaged Property) and,
after deducting all costs of collection and administration, apply the net
rentals, issues and profits to any or all of the following in such order and
amounts as Lender, in Lender's sole discretion, may elect: the payment of any
sums due under any prior lien(s), taxes, water and sewer rents, charges,
collection fees and expenses, and to the maintenance, repair or restoration
of the Mortgaged Property; and on account of and in reduction of the
Obligations hereby secured. Lender shall be liable to account only for rents,
profits, royalties and other amounts actually received by Lender. In and for
that purpose Mortgagor hereby assigns to Lender all rentals, profits,
royalties and other amounts receivable due and to become due under any lease
or leases, or license or licenses, or rights to use and occupy the Mortgaged
Property now existing or hereafter created, as well as all rights and
remedies provided in such lease or leases or license or licenses or at law or
in equity for the collection of rentals and royalties. Lender shall have the
absolute right to the appointment of a receiver for the rents, issues and
profits of the Mortgaged Property with power to take possession of the
Mortgaged Property including possession from the Mortgagor, if in possession
of and occupying any portion of the Mortgaged Property, and power to lease
and repair the Mortgaged Property and such other power as may be deemed
necessary, without any consideration of and for the value of the Mortgaged
Property, or its depreciation in value from any cause whatsoever, or the
solvency of Mortgagor or of any person or persons liable for on the payment
of the Note or other sums due hereunder or thereunder or any default under
the terms of the Note, the Financing Agreements or this Mortgage.
(c) Lender shall have the right, at any time and from time to time,
to bring an appropriate action to recover any sums required to be paid by
Mortgagor under the terms of this Mortgage, as the same shall become due,
without regard to whether or not any other sums secured by this Mortgage
shall then be due, and without prejudice to the right of Lender thereafter to
bring an action to foreclose on this Mortgage, or any other action for any
other default by Mortgagor existing at the time the earlier action was
commenced.
(d) Upon the occurrence of an Event of Default (or, in the case of
an emergency threatening the Mortgaged Property or Lender's rights therein,
the occurrence of an event which if uncured will constitute an Event of
Default with the passage of time), Lender may (but is not obligated to) pay
any sum or perform any other obligation for the account of Mortgagor which
Mortgagor has failed to pay or perform, and sums so spent by Lender shall be
added to the principal sum secured by this Mortgage and be repayable by
Mortgagor on demand, and shall bear interest from the date of advance by
Lender at a rate which shall be twelve percent (12 percent) per annum until
paid.
(e) Any real estate sold hereunder or under the Financing
Agreements or other judicial proceedings may be sold in one parcel as an
entity or in such parcels and in such order and manner as Lender, in its sole
discretion may elect.
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(f) All deposits held in connection with the rental, lease, license
or use of space or other facilities on the Mortgaged Property at the time of
the occurrence of such Event of Default, all interest of Mortgagor in all
premiums for, or dividends upon, any insurance for the Mortgaged Property,
and all refunds or rebates of taxes and assessments upon the Mortgaged
Property, are hereby assigned to Lender as further security for the payment
of the Obligations during the continuance of any such Event of Default.
This Mortgage is upon the STATUTORY CONDITION, for any breach of which
constituting an Event of Default the Lender shall have the STATUTORY POWER OF
SALE, and any other remedies provided by applicable law including, without
limitation, the right to pursue a judicial sale of all right, title and
interest of the Mortgagor in the Mortgaged Property or any portion thereof by
deed, assignment, or otherwise. The Mortgagor agrees and acknowledges that
the acceptance by the Lender of any payments from the Mortgagor after the
occurrence of any Event of Default, the exercise by Lender of any remedies
set forth in this Paragraph 22, or the commencement of foreclosure
proceedings against the Mortgaged Property shall not waive the Lender's right
to foreclose or operate as a bar or estoppel to the exercise of any other
rights or remedies of the Lender provided for in this Mortgage.
23. Writ of Ejectment. In the event of the occurrence of an Event of
Default, and Lender's Commencement of foreclosure proceedings under this
Agreement, Mortgagor hereby authorizes and empowers the Clerk of Court or any
attorney of any court of record in the Commonwealth of Massachusetts or
elsewhere, as attorney for the Mortgagor and all persons claiming under or
through the Mortgagor to sign an agreement for entering in any competent
court an amicable action in ejectment for possession of the Mortgaged
Property which is the subject of this Mortgage and to appear for and confess
judgment against the Mortgagor, and against all persons claiming under or
through the Mortgagor, for the recovery by the Lender of possession of the
same, without any stay of execution, for which this Mortgage or a copy
thereof verified by affidavit, shall be sufficient warrant; and thereupon a
writ of possession may be issued forthwith, without any prior writ or
proceeding whatsoever. The Mortgagor hereby releases the Lender from all
errors and defects whatsoever in entering such action and judgment and in
causing such writ or writs to be issued and hereby agrees that no writ or
error, appeal, petition to open strike-off judgment, or other objection shall
be filed or made with respect thereto. If, for any reason after such action
has been commenced, the same shall be discontinued or possession of the
Mortgaged Property which is the subject of this Mortgage shall remain in or
be restored to the Mortgagor, the Lender shall have the right for the same
default or any subsequent default to bring one or more further amicable
actions as above provided to recover possession of the Mortgaged Property
which is the subject of this Mortgage. The Lender may bring such amicable
action in ejectment before or after the institution of foreclosure
proceedings upon this Mortgage, or after judgment thereon, or after sale of
the Mortgaged Property which is the subject of this Mortgage by the Sheriff.
24. Rights and Remedies Cumulative.
(a) The rights and remedies of Lender as provided in this Mortgage,
in the Note, and in the Financing Agreements shall be cumulative and
concurrent; may be pursued separately, successively or together against
Mortgagor, against the Mortgaged Property, or any
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other person liable hereunder or thereunder, at the sole discretion of
Lender; and may be exercised as often as occasion thereof shall arise. The
failure by Lender to exercise any such right or remedy on one or more
occasions shall in no event be construed as a waiver or release thereof.
(b) Any failure by Lender to insist upon strict performance by
Mortgagor of any of the terms and provisions of this Mortgage, the Note or
the other Financing Agreements shall not be deemed to be a waiver of any of
the terms or provisions of this Mortgage, the Note or the other Financing
Agreements, and Lender shall have the right thereafter to insist upon strict
performance by Mortgagor of any and all of them.
(c) Neither Mortgagor nor any other person now or hereafter
obligated for payment of all or any part of the Obligations shall be relieved
of such obligation by reason of the failure of Lender to comply with any
request of Mortgagor or of any other person so obligated to take action to
foreclose on this Mortgage or to otherwise enforce any provision of the
Mortgage, the Note, or the Financing Agreements, or by reason of the release,
regardless of consideration, of all or any part of the security held for the
Obligations secured by this Mortgage, or by reason of any agreement or
stipulation between any subsequent owner of the Mortgaged Property and Lender
extending the time of payment or modifying the terms of the Mortgage, the
Note or the Financing Agreements without first having obtained the consent of
Mortgagor or such other person; and in the latter event Mortgagor and all
such other persons shall continue to be liable to make payments according to
the terms of any such extension or modification agreement, unless expressly
released and discharged in writing by Lender.
(d) Lender may release, regardless of consideration, any part of
the security held for the Obligations without, as to the remainder of the
security, in any way impairing or affecting the lien of this Mortgage or its
priority over any subordinate lien.
(e) For payment of the Obligations Lender may resort to any other
security therefor held by Lender in such order and manner as Lender may elect.
(f) The receipt by Lender of any sums from Mortgagor after the date
on which Lender, by reason of default and the expiration of all applicable
notice and grace periods, elects to accelerate the Obligations secured hereby
under the Note, or the Financing Agreements, shall not constitute a cure or
waiver of such default or a reinstatement of the Note or Mortgage unless
Lender expressly agrees, by written notice to Mortgagor, that such payment
shall be accepted as a cure or waiver of the default.
25. Mortgagor's Waivers. Mortgagor hereby waives and releases:
(a) All benefits that might accrue to Mortgagor by virtue of any
present or future law exempting the Mortgaged Property, or any part of the
proceeds arising from any sale thereof, from attachment, levy or sale on
execution, or providing for any stay of execution, exemption from civil
process or extension of time for payment; and
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(b) Unless specifically required herein or in the Financing
Agreements or by law, all notices of Mortgagor's default or of Lender's
election to exercise, or Lender's actual exercise of any option under the
Note or this Mortgage.
26. Counsel Fees. If Lender becomes a party to any suit or proceeding
(including, without limitation, appellate and bankruptcy or other insolvency
proceedings) affecting the Mortgaged Property, title thereto, the lien
created by this Mortgage, or Lender's interest therein, or if Lender engages
counsel to collect any of the Obligations or to enforce performance of the
agreements, conditions, warranties, covenants, provisions or stipulations of
this Mortgage, the Note or the Financing Agreements, Lender's costs, expenses
and reasonable counsel fees, whether or not suit is instituted, shall be paid
to Lender by Mortgagor, on demand, with interest at the then effective rate
set forth in the Note, and until paid shall be deemed to be part of the
Obligations set forth in the Note and secured by this Mortgage.
27. Future Advances. Without limiting any other provisions of this
Mortgage, this Mortgage secures present and future loans, advances and
extensions of credit made by Lender to or for the benefit of Mortgagor and
the lien of such future advances shall relate back to the date of this
Mortgage. This Mortgage shall also secure additional loans hereafter made by
Lender to Mortgagor. Nothing contained herein shall impose any obligation on
the part of Lender to make any such additional loans, advances and extensions
of credit to or for the benefit of Mortgagor.
28. Communications. Any notice, request, demand, statement or consent
desired or required to be given hereunder shall be in writing and shall be
delivered by hand, sent by certified mail, return receipt requested, sent by
a nationally recognized commercial overnight delivery service with provisions
for a receipt, postage or delivery charges prepaid, or sent by facsimile
transmission, to the Mortgagor or Lender at its respective address set forth
below (or to such other address as either party may elect, provided that
notice of such address change has been sent to the other party hereto
pursuant to the terms hereof), and shall be deemed given (i) when actually
delivered, if delivered by hand, (ii) upon receipt, if sent by certified
mail, (iii) the next business day after being placed in the possession of an
overnight delivery service, if sent by an overnight delivery service or (iv)
if sent by facsimile transmission, when electronic indication of receipt is
received. Notices shall be addressed, in the case of the Mortgagor to such
party at:
GTC Mason Laboratories, Inc.
57 Union Street
Worcester, MA 01608
Attn: Controller
with a copy to:
John B. Green, Jr., CPA
Genzyme Transgenics Corporation
5 Mountain Road
Framingham, MA 01701
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and in the case of the Lender, to it at:
Emerging Technology Fund of the Government
Land Bank d/b/a MassDevelopment
75 Federal Street
Boston, MA 02110
Attn: Portfolio Manager
with a copy to:
Managing Partner
Hutchins, Wheeler and Dittmar
101 Federal Street
Boston, MA 02110
29. Covenant Running with the Land. Any act or agreement to be done or
performed by Mortgagor shall be construed as covenant running with the land.
30. Entire Agreement. This Mortgage and the exhibit and documents
delivered pursuant hereto and in connection herewith constitute the entire
understanding of the parties to this Mortgage with respect to its subject
matter, and supersede and replace all other prior or contemporaneous
agreements. Mortgagor acknowledges that there are no understandings or
agreements with respect to the matters set forth herein and the financing
agreements that are not specifically set forth in this Mortgage and such
exhibits are documents. If any provision of this Mortgage shall be held to
be invalid, illegal or unenforceable, such provisions shall nevertheless
remain valid, legal and enforceable in all other respects to the extent
permissible; and any such invalidity, illegality or unenforceability shall
not affect any other provisions of this Mortgage, but this Mortgage shall be
construed as if such invalid, illegal or unenforceable provision had never
been contained in this Mortgage,
31. Binding Effect - Amendment. This Mortgage is binding upon and
inures to the benefit of Mortgagor and Lender and their respective successors
and assigns. This Mortgage cannot be changed or amended except by agreement
in writing signed by the party against whom enforcement of the change or
amendment is sought.
32. Applicable Law. Notwithstanding the state and/or federal law which
may apply to the rights and obligations of the parties to the Note and other
Financing Agreements, this Mortgage shall be governed by and construed
according to the laws of The Commonwealth of Massachusetts.
33. Jurisdiction. The Mortgagor hereby consents and irrevocably submits
to the non-exclusive jurisdiction of any state or federal court located in
any county in The Commonwealth of Massachusetts, as well as to the
jurisdiction of all courts to which an appeal may be taken from such courts,
for the purpose of any suit, action or other proceeding
23
<PAGE>
arising out of or in connection with this Agreement and hereby expressly
waives any and all objections to the venue in any such courts.
34. Waiver of Jury Trial. THE MORTGAGOR AND LENDER EACH HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EITHER PARTY MAY
HAVE OR HEREAFTER HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE. The Mortgagor hereby
certifies that neither the Lender, nor any of the Lender's representatives,
agents or counsel has represented, expressly or otherwise, that the Lender
would not, in the event of any such suit, action or proceeding, seek to
enforce this waiver of right to trial by jury. The Mortgagor acknowledges
that the Lender has been induced by this waiver (among other things) to enter
into the loan transaction evidenced in part by this Mortgage.
35. Captions. The captions preceding the text of the paragraphs or
subparagraphs of this Mortgage are inserted only for convenience or reference
and shall not constitute a part of the Mortgage, nor shall they in any way
affect its meaning construction or effect.
IN WITNESS WHEREOF, Mortgagor has executed and delivered this instrument
the day and year first above written. This instrument is intended to
constitute an instrument under seal.
WITNESS: GTC MASON LABORATORIES, INC.
a Massachusetts Corporation
/s/ Peter J. Dawson By: John B. Green, Jr.
- ------------------------------- --------------------------
Peter J. Dawson Name: John B. Green, Jr.
Its: Vice President and Treasurer
COMMONWEALTH OF MASSACHUSETTS
Worcester County, ss June 26, 1997
Then personally appeared the above-named John B. Green, Jr., V.P. and
Treasurer of GTC Mason Laboratories, Inc. and acknowledged the foregoing
instrument to be his free act and deed, before me,
/s/ Todd Rodman
---------------------------------
Notary Public: Todd Rodman
My Commission Expires: 7/27/01
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EXHIBIT A
PARCEL I
The land in Worcester, Massachusetts with the buildings thereon, and all the
privileges and appurtenances thereto belonging, bounded and described as
follows:
BEGINNING at the intersection of the easterly line of Union Street and the
southerly line of Market Street;
THENCE S. 75-Registered Trademark- 46' E., by said Market Street, one hundred
forty-three and 6/10 (143.6) feet to land now or formerly of Worcester &
Nashua Railroad Corporation;
THENCE S. 10-Registered Trademark- 58' E., by said Railroad Corporation land
sixty-seven and 8/10 (67.8) feet to land now or formerly of the Geo. C.
Whitney Company;
THENCE N. 80-Registered Trademark- 21' W., by said Geo C. Whitney Company
land one hundred fifty and 38/100 (150.38) feet to the easterly line of Union
Street;
THENCE N. 2-Registered Trademark- 51 ' W., by said Union Street, seventy-six
and 83/100 (76.83) feet to the point of beginning.
Included in the foregoing description and hereby conveying that portion of the
premises registered in land Court Case No. 181 and shown on certificate of title
registered in Book 23, Page 4472, No. 4472 in Worcester Registry District of
Worcester County, bounded and described as follows:
Northerly by Market Street seven and 4/10 (7.4) feet;
Easterly by land formerly of Arthur M. Taft, now or formerly of George L.
Brownell, sixty-six and 42/100 (66.42) feet;
Southerly by land formerly of George S. Paine, now or formerly of the Geo. C.
Whitney co. six and 35/100 (6.35) feet;
Westerly by land formerly of Rose H. Mahan et al, now or formerly of said George
L. Brownell, thirty-one and 31/100 (31.31) feet;
Southerly again by land now or formerly of said Brownell, one and 61/100 (1.61)
feet; and
Westerly again by land formerly of Mary E. Erwin et al, now of said George L.
Brownell, thirty five and 41/100 (35.41) feet.
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All of said boundaries are determined by the Land Court to be located as
shown on a subdivision plan drawn by O. Willis Rugg, C.E. dated May,1910, as
approved by said Court, and filed with Land Registration Certificate number
232. Being Lot A on said plan.
Being the same premises conveyed to the Mortgagor by deed dated May 30, 1997 and
recorded with the Worcester District Registry of Deeds in Book, Page and
registered as Document No. 65140.
Parcel I is conveyed subject to the following:
Party Wall Agreement recorded with the Worcester District Registry of Deeds in
Book 1931, Page 21;
Notice of Special Permit recorded with the Worcester District Registry of Deeds
in Book 12931, Page 177 and registered as Document No.50859;
Special Permit recorded with the Worcester District Registry of Deeds in Book
13378, Page 126;
Reservation, easements, covenants, agreements, restrictions, provisions and
limitations recorded with the Worcester District Registry of Deeds in Book
10094, Page 27 and registered as Document No.50858;
Rights, reservations and restrictions as referred to in a deed recorded with the
Worcester District Registry of Deeds in Book 3467? Page 334;
Notice of Special Permit recorded with the Worcester District Registry of Deeds
in Book 18126, Page 206 and registered as Document No.
PARCEL II
A parcel of land situated on the northerly side of Market Street in
Worcester, Massachusetts and shown as Parcel No.21A on a plan entitled
"Worcester Redevelopment Authority, City of Worcester, Massachusetts, East
Central Urban Renewal Area, Disposition Parcels No. 21 A and 21B", dated
August, 1976, prepared by Fay, Spofford and Thorndike, Inc., Engineers,
Boston, Massachusetts, recorded in Worcester District Registry of Deeds, Plan
Book 437, Plan 22, and bounded and described as follows:
BEGINNING at a point being the intersection of the westerly line of Summer
Street and the northerly line of Market Street;
THENCE North 82-Registered Trademark- 24' 40" West, by the northerly line of
Market Street, sixty-two and 94/100 (62.94) feet to a point;
THENCE North 16-Registered Trademark- 55' 15" West, by land now or formerly
of Massachusetts Electric Company, one hundred ten and 24/100 (110.24) feet
to a point;
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THENCE South 74-Registered Trademark- 44' 28" East, by land now or formerly
of Worcester Redevelopment Authority (Parcel No. 21B), forty-seven and 78/100
(47.78) feet to a point;
THENCE South 28-Registered Trademark- 29' 58" East, by land now or formerly
of Worcester Redevelopment Authority (Parcel No. 21B), one hundred four and
04/100 (104.04) feet to a point;
THENCE South 07-Registered Trademark- 22' 57" West, by the westerly line of
Summer Street, nine and 85/100 (9.85) feet to the point of beginning.
Containing about 5,485 square feet as shown on said Plan.
Being the same premises conveyed to the Mortgagor by deed dated May 30,1997 and
recorded with the Worcester District Registry of Deeds in Book _____, Page
________.
Parcel II is conveyed subject to the following:
Notice of Special Permit recorded with the Worcester District Registry of Deeds
in Book 12931, Page 177 and registered as Document No.50859;
Special Permit recorded with the Worcester District Registry of Deeds in Book
13378, Page 126;
Reservation, easements, covenants, agreements, restrictions, provisions and
limitations recorded with the Worcester District Registry of Deeds in Book
10094, Page 27 and registered as Document No. 50858;
Notice of Special Permit recorded with the Worcester District Registry of Deeds
in Book 18126, Page 206 and registered as Document No.
27
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EXHIBIT B
LEASES
None
28
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Exhibit 10.8.4
GUARANTY
For valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and in consideration of the Emerging Technology Fund of
the Government Land Bank d/b/a MassDevelopment (hereinafter called the
"Bank") having made, or now or in the future making, advances or otherwise
giving credit to GTC Mason Laboratories, Inc. (hereinafter called the
"Borrower"), however such advances or credit may be made or evidenced, the
undersigned does hereby unconditionally guarantee to Bank, its successors and
assigns, full and prompt payment and performance of all present and future
obligations of Borrower to Bank, including all renewals and extensions
thereof or substitutions therefor. The undersigned also agrees to pay in
addition thereto all costs, expenses and reasonable attorney's fees at any
time paid or incurred by the Bank in endeavoring to enforce this Guaranty.
Notice of acceptance of and action taken by Bank from time to time under
this Guaranty are hereby waived, and this Guaranty shall operate as
continuing, absolute and irrevocable Guaranty covering all obligations of
Borrower to Bank (and renewals and extensions thereof or substitutions
therefor) now existing or hereafter arising.
Upon any default by Borrower with respect to any of the obligations
herein guaranteed, the liability of the undersigned hereunder shall be deemed
to have become immediately due and payable, without demand, presentment,
protest or notice of any kind, all of which are hereby waived, and without
any suit or action against Borrower or any other Guarantor and without
further steps to be taken or further conditions to be performed by Bank or
anyone. Failure of Bank to make any demand or otherwise to proceed against
the
1
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undersigned in respect to any default by Borrower or the undersigned, or
Bank's delay in doing so, shall not constitute a waiver of Bank's right to
proceed in respect to any or all other defaults by Borrower or the
undersigned.
The liability of the undersigned is primary and shall not be terminated
or otherwise affected or impaired by, and the undersigned waives notice of:
Bank's granting time to Borrower (regardless of the number or length of such
grants of time) or any other indulgence or indulgences granted by Bank to
Borrower; Bank's heretofore, now or hereafter acquiring, releasing or in any
way modifying any guaranty from any other person or persons or any collateral
or other security in whatever form for any of the obligations hereby
guaranteed, whether or not notice thereof shall have been or be given to the
undersigned; any failure on Bank's part to take any action with respect to,
or to realize upon any security, rights, endorsements or guaranties which
Bank may now or hereafter hold with respect to any obligation hereby
guaranteed, including without limitation rights against the Borrower; any
alterations, waivers, extensions, renewals or modifications of any such
obligation to which Bank may agree from time to time; any invalidity or
unenforceability of any of the obligations guaranteed hereby; any change in
the membership of any partnership which shall be the Borrower; any fraud,
illegal or improper acts of Borrower; any relief of Borrower's with respect
to its obligations to Bank because of any right of set-off, deduction or
defense of any kind or otherwise; any other defenses which might constitute a
legal or equitable discharge of a surety or guarantor; Bank's failure to
perfect any lien securing the Borrower's obligations or the obligations of
other parties, including any other guarantors; voluntary or involuntary
bankruptcy (including a reorganization in bankruptcy) of Borrower
2
<PAGE>
or entry of an order for relief against or with respect to the Borrower under
Title 11 of the United States Code; composition, extension, moratoria or
other forms of debtor relief granted to Borrower pursuant to law presently in
force or hereafter enacted; payment of any or all obligations and
indebtedness of Borrower in the event such payment is invalidated or avoided
by a trustee, custodian or receiver of Borrower; the dissolution of Borrower;
or the reorganization, merger or consolidation of Borrower into or with
another entity, corporate or otherwise, or the sale or disposition of all or
substantially all of the capital stock, business or assets of Borrower to any
other person or party. The undersigned further waives all suretyship
defenses and defenses in the nature thereof; any right or claim to right to
cause a marshaling of the assets of the Borrower or any collateral; any right
to require the Bank to proceed against security or other guarantors before
enforcing this Guaranty; any right of subrogation to Bank's rights against
Borrower and any right of reimbursement, indemnity, contribution, exoneration
and the like now or hereafter accorded by law to indemnitors, guarantors,
sureties or accommodation parties, provided that such waiver shall not be
effective to the extent that by virtue of such waiver the liability of
Guarantor is rendered invalid, avoidable or unenforceable under any
applicable law dealing with the recovery or avoidance of so-called fraudulent
conveyances or otherwise.
Guarantor further warrants and represents to Bank that:
(a) Guarantor is a duly organized, validly existing corporation in
good standing under the laws of its state of incorporation, is duly qualified to
do business as a foreign corporation and in good standing in each jurisdiction
in which the character of its properties or the transaction of its business
makes such qualification necessary and has full
3
<PAGE>
corporate power to own its properties, to carry on its business as now
conducted and to execute, deliver and perform this Guaranty;
(b) the execution, delivery and performance of this Guaranty (i)
have been duly authorized by all requisite corporate action on its part, (ii)
do not require the consent of any party (including, without limitation,
Guarantor's stockholders and creditors) which consent has not been obtained,
(iii) will not (A) violate any law or regulation or its Articles of
Organization or By-Laws, (B) violate any order of any court, tribunal or
governmental agency binding on it or any of its properties, (C) violate or
constitute (after due notice or lapse of time or both) a default under any
indenture, agreement, license or other instrument or contract to which it is
a party or by which it or any of its properties is bound or (D) result in the
creation or imposition of any lien of any nature whatsoever on any of its
assets (except any liens as are created hereby) and (iv) require any filing
or registration with, or any permit, license, consent or approval of, any
governmental agency or regulatory authority;
(c) this Guaranty has been duly executed and delivered by the
Guarantor and is a legal, valid and binding obligation, enforceable against
the Guarantor in accordance with its terms;
(d) there are no actions, suits, proceedings or claims pending or,
to the Guarantor's knowledge, threatened against or affecting the Guarantor
that relate to the transactions contemplated by this Guaranty, or which
materially adversely affect the business or condition (financial or
otherwise) of the Guarantor.
The Guarantor further affirms that neither this Guaranty, nor the
performance or consummation of any transactions or matters contemplated
thereby shall limit, restrict,
4
<PAGE>
extinguish, or otherwise impair Guarantor's obligations to Bank under any and
all guaranties previously given to Bank of Borrower's obligations to Bank, if
any, and Guarantor reaffirms any and all such previous guaranties, if any.
The Guarantor further affirms that it shall, at all times, maintain net
assets at least twenty million dollars ($20 million) measured on a quarterly
basis.
For the purposes of this Guaranty, the term "obligations" shall mean and
include, without limitation, the payment and performance of all loans,
indebtedness, notes, liabilities (including, without limitation, Borrower's
written agreements with Bank) and amounts, liquidated or unliquidated, owing
by Borrower to Bank at any time, each of every kind, nature and description,
and whether secured or unsecured, direct or indirect (that is, whether the
same are due directly by Borrower to Bank; or are due indirectly by Borrower
to Bank as endorser or guarantor, or as obligor of obligations due to third
persons, firms, or corporations which have been endorsed or assigned to Bank;
or otherwise), absolute or contingent, due or to become due, now existing or
hereafter contracted. Said term shall also include all interests, charges,
costs and expenses (including reasonable attorneys' fees) now due or that may
hereafter become due from Borrower to Bank from time to time.
As security for the payment and performance of Guarantor's obligations
hereunder, Bank is hereby granted a lien and security interest in and to any
and all deposits or other sums at any time credited by or due from Bank to
Guarantor whether in regular or special depository accounts or otherwise, and
all moneys, securities and other property and the proceeds thereof, now or
hereafter held or received by Bank, whether for safekeeping, custody, pledge,
collection or otherwise. Upon the occurrence of a default hereunder, and in
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addition to and not in limitation of any and all rights and remedies of the
Bank hereunder or otherwise, all of such rights and remedies being
cumulative, Bank may set off any such deposits, other sums, moneys,
securities and other property and the proceeds thereof against any or all of
the obligations of Guarantor, without prior notice or demand, and regardless
of whether or not such obligations are secured by any other collateral, and
regardless of the adequacy of any such other collateral.
This Guaranty shall be binding upon the successors and assigns of the
Guarantor.
For purposes of any action or proceeding involving this Guaranty or any
other agreement or document referred to therein, Guarantor hereby expressly
submits to the jurisdiction of all federal and state courts located in the
Commonwealth of Massachusetts and consents that any order, process, notice of
motion or other application to or by any of said courts or a judge thereof
may be served within or without such court's jurisdiction by registered mail
or by personal service, provided a reasonable time for appearance is allowed
(but not less than the time otherwise afforded by any law or rule) and waives
any right to contest the appropriateness of any action brought in any such
court based upon lack of personal jurisdiction, improper venue or forum non
conveniens.
GUARANTOR AND BANK EACH HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS GUARANTY OR
THE AGREEMENTS AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE
SITTING WITHOUT A JURY.
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This instrument is intended to take effect as a sealed instrument and
this instrument and all rights, duties and remedies of the parties shall be
governed as to interpretation, validity, effect and enforcement, and in all
other respects of the same or different nature, by the domestic law of
Massachusetts. The invalidity or unenforceability of any provision hereof
shall not limit the validity or enforceability of any other provision hereof.
This Guaranty may not be amended except by an instrument in writing signed
by the party to be charged.
Dated June 26, 1997
WITNESS: GUARANTOR:
GENZYME TRANSGENICS CORPORATION
/s/ Peter J. Dunn By: /s/ John B. Green
- ---------------------- ---------------------------
Peter J. Dunn Name: John B. Green
Title: Vice President and C.F.O
Address: 5 Mountain Road
Framingham, MA
192077-1
<PAGE>
Exhibit 10.8.5
HAZARDOUS MATERIALS INDEMNIFICATION AGREEMENT
This Hazardous Materials Guaranty and Indemnification Agreement
("Agreement") is given pursuant to the terms and conditions of the "Loan
Agreement" of even date by and between GTC MASON LABORATORIES, INC., a
Massachusetts corporation, having a place of business at 57 Union Street,
Worcester, Massachusetts 01608, as "Borrower", and the EMERGING TECHNOLOGY
FUND of the GOVERNMENT LAND BANK, doing business as MASSDEVELOPMENT, a
Massachusetts body politic and corporate created by Chapter 212 of the Acts
of 1975, as amended, having offices at 75 Federal Street, Boston,
Massachusetts 02110 as "Lender".
As used herein:
A. The term "Hazardous Materials" shall mean and include asbestos,
flammable materials, explosives, radioactive substances, polychlorinated
biphenyls, other carcinogens, oil and other petroleum products, pollutants or
contaminants that could be a detriment to the environment, and any other
hazardous or toxic materials, wastes and substances which are defined,
determined or identified as such in any past, present or future federal,
state or local laws, by-laws, rules, regulations, codes or ordinances or any
judicial or administrative interpretation thereof;
B. The term "Hazardous Materials Legal Requirements" shall mean all
past, present or future federal, state or local laws, by-laws, rules,
regulations, codes or ordinances or any judicial or administrative
interpretation thereof, including, without limitation, all orders, decrees,
judgments and rulings imposed through any public or private enforcement
proceedings, relating to Hazardous Materials or the existence, use,
discharge, release, containment, transportation or disposal thereof, or
otherwise regulating or providing for the protection of the environment
applicable to the Property and relating to Hazardous Materials or the
existence, use, discharge, release or disposal thereof;
C. The term "Property" shall mean and shall also include any other
tangible property in which the Lender now or hereafter receives a mortgage or
security interest in connection with the Borrower's present and future
obligations to the Lender (all such mortgages and security interests,
collectively, the "Mortgage");
D. The term "Indemnitors" shall mean the Borrower and Guarantor, if
any, and
E. The term "Indemnified Party" shall mean the Lender and all those
claiming by, through or under the Lender, including any subsequent holder of
the obligations evidenced by the Loan Agreement and any present or future
owner of a participation interest therein, and any subsequent owner or tenant
of all or any portion of the Property following the exercise by Lender of its
rights under the Loan Agreement, and any and all instruments and documents
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executed in connection therewith (together with the Loan Agreement, the "Loan
Documents") including, but not limited to, a foreclosure sale or deed in lieu
thereof.
F. The term "Hazardous Uses" shall mean any use of the Property by the
Borrower, a tenant of Borrower, or any other person or entity present at the
Property with Borrower's consent, which may be reasonably expected to involve
the storage, handling, treatment, processing or disposal of Hazardous
Materials on a regular basis (for example, pesticide or chemical
manufacturing or biological or chemical research), but not including any
occasional uses incident to the operation of business now conducted or
hereafter intended to be conducted on the Property (for example, the use of
office supplies or the use of oil for heating purposes).
G. The term "Hazardous Users" shall mean a tenant under a lease with
the Borrower or a permitted subtenant under a sublease consented to by the
Borrower, occupying all or any portion of the Property where:
(i) Such tenant or subtenant had a prior publicly available
regulatory record of repeated or serious material failures to
comply with orders for remedial action from governmental
agencies or entities, and the Borrower, or any other
Indemnitor, either had actual knowledge of such record at the
time Borrower entered into the lease with such tenant, or
consented to such sublease, or would have had such actual
knowledge but for the negligence of Borrower, or of any other
Indemnitor, in investigating such tenant or subtenant prior to
entering into such lease or consenting to such sublease; or
(ii) After obtaining knowledge of such a repeated or serious
violation Borrower, or any other Indemnitor, either failed to
properly make reasonable investigation and inquiry as to the
nature and extent of such violation or failed to use reasonable
efforts, based upon the state of the actual knowledge of
Borrower, or such other Indemnitor, following such reasonable
investigation and inquiry, to cause such tenant or subtenant to
curtail such violation within a reasonable period of time.
H. The term "Tenant Indemnities" shall mean any liability to a tenant
under a space lease of the Property for any matter related to Hazardous
Materials or violations of Hazardous Materials Legal Requirements where the
Borrower has given an indemnity therefor.
I. The term "Known Matters" shall mean those matters disclosed in that
certain Phase I Environmental Site Assessment performed by Gulf of Maine
Research Center, Inc. in its report dated September 26, 1996.
J. The term "Special Matters" shall mean Hazardous Uses, Hazardous
Users, Tenant Indemnities and Known Matters.
K. All other capitalized terms used in this Agreement which are not
otherwise specifically defined herein shall have the same meaning herein as
in the Loan Agreement.
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FOR VALUE RECEIVED, and to induce Lender to extend credit to Borrower as
provided for in the Loan Agreement and the other Loan Documents, the
Indemnitors hereby unconditionally agree as follows:
1. Compliance with Hazardous Materials Legal Requirements. Until such
time as all obligations of the Borrower to the Lender, now existing or
hereafter arising, under the Loan Agreement or otherwise (the "Obligations")
have been paid in full, the Indemnitors guaranty and agree that the Borrower,
or the other Indemnitors on behalf of the Borrower, shall comply with all
Hazardous Materials Legal Requirements applicable to the Property and that
the Borrower, or the other Indemnitors on behalf of the Borrower, shall take
all remedial action necessary to avoid any liability of the Borrower, the
Lender, or any subsequent owner of the Property, and to avoid the imposition
of, or to discharge, any liens on the Property, as a result of any failure to
comply with Hazardous Materials Legal Requirements with respect to the
Property.
2. Indemnification. At all times, both before and after the repayment
of the Obligations, the Indemnitors shall at their sole cost and expense
indemnify, exonerate, protect and save harmless each Indemnified Party
against and from any and all damages, losses, liabilities, obligations,
penalties, claims, litigation, demands, defenses, judgment, suits,
proceedings, costs, disbursements or expenses of any kind or nature
whatsoever, including, without limitation, attorneys' and experts' fees and
disbursements, which may at any time be imposed upon, incurred by or asserted
or awarded against Lender and arising from or out of:
A. Any Hazardous Materials on, in, under or affecting, all or any
portion of the Property or any area surrounding the same on the date hereof,
or which may hereafter affect all or any portion of the Property or any such
area surrounding the same, whenever discovered; provided, however, except as
to Special Matters (as to which there shall be no time limitation), the
Indemnitors shall have no liability hereunder with respect to Hazardous
Materials which first affect the property or any areas surrounding the same
after the discharge of the Mortgage or the foreclosure thereof, or the
acceptance of a deed in lieu of foreclosure;
B. The violation of any Hazardous Materials Legal Requirements by the
Borrower, or with respect to the Property, or any such violation by the
Borrower, affecting any area surrounding the same, existing on the date
hereof or which may so exist in the future, whenever discovered; provided,
however, except as to Special Matters (as to which no time limitation shall
apply), the Indemnitors shall have no liability hereunder with respect to the
violation of any Hazardous Materials Legal Requirements which first occur
after the discharge of the Mortgage or a foreclosure thereof or the
acceptance of a deed in lieu of foreclosure;
C. The existence of any Hazardous Materials on, in, under or affecting
all or any portion of the Property, or any areas surrounding the same, or the
violation of any Hazardous Materials Legal Requirements with respect to the
Property, or any areas surrounding the same, which arise out of Special
Matters, even though the specific matter(s) giving rise to liability or claim
of liability do(es) not occur until after the discharge of the Mortgage, or a
foreclosure thereof, or the acceptance of a deed in lieu of foreclosure;
D. The enforcement of this Agreement or the assertion by any Indemnitor
of any
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defense to the obligations of an Indemnitor hereunder, whether any of such
matters arise before or after foreclosure of the Mortgage or other taking of
title to or possession of all or any portion of the Property by the Lender,
and specifically including therein, without limitation, the following:
(i) costs of removal of any and all Hazardous Materials from all or
any portion of the Property or any areas surrounding the same;
(ii) additional costs required to take necessary precautions to
protect against the release of Hazardous Materials on, in,
under, or affecting, the Property or into the air, any body of
water or wetland, any other public domain, or any surrounding
areas;
(iii)costs incurred to avoid the imposition of, or to discharge, any
lien on the Property arising from any failure to comply with
Hazardous Materials Legal Requirements;
(iv) costs incurred to comply with all Hazardous Materials Legal
Requirements relating to the Property or the other collateral
held for the Obligations, including, without limitation, fines,
penalties or other charges imposed by any lawful authority; and
(v) costs and expenses incurred in ascertaining the existence or
extent of any asserted violation of any Hazardous Materials
Legal Requirements relating to the Property and any remedial
action taken on account thereof including, without limitation,
the costs, fees and expenses of engineers, geologists,
chemists, other scientists, attorneys, surveyors, and other
professionals, or testing and analyses performed in connection
therewith.
3. Right to Contest. The Borrower, or any other Indemnitor, may
contest in good faith any claim, demand, levy or assessment under any
Hazardous Materials Legal Requirements or any other claim with respect to
Hazardous Materials by any person or entity if:
A. the contest is based upon a material question of law or fact raised
by the Borrower or such other Indemnitor in good faith;
B. Borrower or such other Indemnitor properly commences and thereafter
diligently pursues the contest;
C. the contest will not materially impair the taking of any required
remedial action with respect to such claim, demand, levy or assessment; and
D. Borrower, or such other Indemnitor, demonstrates to Lender's
reasonable satisfaction that Borrower, or such other Indemnitor, has the
financial capability to undertake and pay for such contest and any remedial
action then or thereafter necessary.
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4. Waivers. The Indemnitors hereby waive and relinquish to the fullest
extent now or hereafter permitted by law:
A. all suretyship defenses and defenses in the nature thereof;
B. any right or claim of right to cause a marshaling of Borrower's
assets or of any security or to cause Lender to proceed against any of the
collateral for the Obligations before proceeding under this Agreement against
any Indemnitor or to require Lender to proceed against the Indemnitors in any
particular order;
C. all rights and remedies, including, but not limited to, any rights
of subrogation, contribution, reimbursement, exoneration or indemnification
pursuant to any express or implied agreement, or now or hereafter accorded by
applicable law to indemnitors, guarantors, sureties or accommodation parties;
D. notice of the acceptance hereof, presentment, demand for payment,
protest, notice of protest, or any and all notice of nonpayment,
nonperformance or nonobservance or other proof or notice of demand whereby to
charge the Indemnitors therefor; and
E. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO
A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT OR
THE LOAN AGREEMENT AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED BEFORE A
JUDGE SITTING WITHOUT A JURY; and
F. the pleading of any Statute of Limitations as a defense to his or
their obligations hereunder.
5. Cumulative Rights. Lender's rights under this Agreement shall be in
addition to and not in limitation of all of the rights and remedies of Lender
under the other Loan Documents. All rights and remedies of the Lender shall
be cumulative and may be exercised in such manner and combination as Lender
may determine.
6. No Impairment. The liability of the Indemnitors hereunder shall in
no way be limited or impaired by, and each Indemnitor hereby assents to and
agrees to be bound by, any amendment or modification of the provisions of the
Loan Documents to or with Lender by Borrower or any Indemnitor or any person
who succeeds Borrower as owner of the Property. In addition, the liability
of the Indemnitors under this Agreement shall in no way be limited or
impaired by:
A. any extensions of time for performance required by any of the Loan
Documents;
B. any sale, assignment or foreclosure of the Loan Agreement, the
Mortgage or any other Loan Documents, or any sale, transfer or all or part of
the Property;
C. any exculpatory or nonrecourse or limited recourse provision in any
of the Loan Documents limiting Lender's recourse to the Property encumbered
by the Mortgage or to any
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other Property or limiting Lender's rights to a deficiency judgment against
Borrower or any other party;
D. the accuracy or inaccuracy of any of the representations or
warranties made by the Borrower or any guarantor under the Loan Documents or
otherwise;
E. the release of Borrower or any other person from performance or
observance of any of the agreements, covenants, terms or conditions contained
in any of the Loan Documents by operation of law, Lender's voluntary act or
otherwise;
F. the release or substitution in whole or part of any collateral or
security for the Obligations;
G. Lender's failure to record the Mortgage or file any UCC financing
statements (or Lender's improper recording or filing of any thereof) or to
otherwise perfect, protect, secure, or insure any security interest or lien
given as security for the Obligations;
H. the release of any one or more of the Indemnitors or any other party
now or hereafter liable upon or in respect to this Agreement or the
Obligations; or
I. the invalidity or unenforceability of all or any portions of any of
the Loan Documents as to the Borrower or to any other person or entity.
Any of the foregoing may be accomplished with or without notice to
Borrower or any Indemnitor or with or without consideration.
7. Delay Not Waiver. No delay on Lender's part in exercising any
right, power or privilege hereunder or under any of the Loan Documents shall
operate as a waiver of any such privilege, power or right. No waiver by
Lender in any instance shall constitute a waiver in any other instance.
8. Warranties and Representations. The Indemnitors warrant and
represent that:
A. This Agreement constitutes the legal valid and binding obligation of
the Indemnitors in accordance with the respective terms hereof;
B. That each Indemnitor (other than one who is a natural person) is a
duly organized validly existing entity in good standing under the laws of its
organization (and if not organized and existing under the laws of
Massachusetts, is duly qualified to transact business therein) and has all
requisite power and authority to conduct its business and to own its
properties as now conducted or owned;
C. The performance of the obligations evidenced hereby will not
constitute a violation of any law, order, regulation, contract or agreement
to which the Indemnitors or any of them is a party or by which any one or
more of them or their property is or may be bound;
D. There is no material litigation or administrative proceeding now
pending or
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threatened against the Indemnitors or any of them which if adversely decided
could materially impair the ability of any one or more of the Indemnitors to
pay or perform their respective obligations hereunder;
E. True and complete financial statements of the Indemnitors have been
delivered to the Lender and each fairly presents the respective financial
condition of the Indemnitor to which it relates as of the dates thereof and
no material and adverse change has occurred in the respective financial
condition of each Indemnitor since the date thereof;
F. The granting of the loan(s) evidenced by the Loan Agreement to the
Borrower will constitute a material economic benefit to each Indemnitor; and
G. Except for Known Matters, no Indemnitor has any knowledge or belief
of the existence of any Hazardous Materials affecting the Property or of any
violation or asserted violation of Hazardous Materials Legal Requirements
with respect to the Property.
9. Multiple Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original. Each of the
counterparts shall constitute but one in the same instrument and shall be
binding upon each of the parties individually as fully and completely as if
all had signed but one instrument so that the joint and several liability of
each of the Indemnitors hereunder shall be unaffected by the failure of any
of the undersigned to execute any or all of said counterparts.
10. Notices. Any notice or other communication in connection with this
Agreement shall be in writing, or in the form of a telegram, addressed as
provided on the first page or the signature page hereof and (i) sent by
telegram or deposited in the United States mail, postage prepaid, by
registered or certified mail, or (ii) delivered by any commercially
recognized courier or overnight delivery service, such as Federal Express.
Any such address may be changed to any other address within the United States
by written notice given in the aforesaid manner by the party desiring to
effect the change. Any notice given in the aforesaid manner shall be deemed
to have been duly sworn and received when so delivered or tendered for
delivery during usual business hours at the specified address.
11. No Oral Change. No provision of this Agreement may be changed,
waived, discharged, or terminated orally by telephone or by any other means
except by an instrument in writing signed by the party against whom
enforcement of the change, waiver or discharge or termination is sought.
12. Parties Bound; Benefit. This Agreement shall be binding upon the
Indemnitors and their respective successors, assigns, heirs and personal
representatives and shall be for the benefit of the Lender, and of any
subsequent holder of the Obligations and of any owner of a participation
interest therein. In the event the Obligations are sold or transferred, then
the liability of the Indemnitors to the Lender shall then be in favor of both
the Lender originally named herein and each subsequent holder of the
Obligations and any of interest therein.
13. Joint and Several. The obligations of each of the Indemnitors and
their respective successors, assigns, heirs and personal representatives
shall be joint and several.
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14. Partial Invalidity. Each of the provisions hereof shall be
enforceable against each Indemnitor to the fullest extent now or hereafter
permitted by law. The invalidity or unenforceability of any provision hereof
shall not limit the validity or enforceability of each other provision hereof.
15. Governing Law and Consent to Jurisdiction. This Agreement and the
rights and obligations of the parties hereunder shall in all respects be
governed by and construed and enforced in accordance with the Laws of the
Commonwealth of Massachusetts, without giving effect to Massachusetts
principles of conflicts of law, and insofar as Hazardous Materials Legal
Requirements are concerned, in accordance with applicable Federal Law and
Massachusetts law as well. Notwithstanding the foregoing, for the purpose of
defining Hazardous Materials and for the purpose of determining the nature
and extent of Hazardous Materials Legal Requirements, applicable federal law
shall govern and the internal laws of the Commonwealth of Massachusetts shall
have no effect. The parties further agree that Lender may enforce its rights
under this Agreement and the other Loan Documents including, but not limited
to, the rights to sue any Indemnitor in accordance with applicable law. The
Indemnitors hereby irrevocably submit to the nonexclusive jurisdiction of any
Massachusetts State or any Federal Court sitting in Massachusetts over any
suit, action or proceeding arising out of or relating to this Agreement and
the Indemnitors hereby agree and consent that in addition to any methods of
service of process provided for under applicable law, all service of process
in any such suit, action or proceeding in any Massachusetts State or Federal
Court sitting in Massachusetts may be made by certified or registered mail,
return receipt requested, directed to the Indemnitors at the address
indicated in Section 9 above and service so made shall be completed five (5)
days after the same shall have been so mailed.
Witness the execution and delivery hereof as an instrument under seal as
of the 26th day of June, 1997.
GTC MASON LABORATORIES, INC.
By: /s/ John B. Green
----------------------------
Vice President and Treasurer
Witness
/s/ Peter J. Dunn
- -------------------------
Peter J. Dunn
191577-2
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Exhibit 10.9.1
LOAN AGREEMENT
THIS AGREEMENT made and entered into by and between TSI Redfield
Laboratories, Inc., an Arkansas corporation, ("Borrower"), and Simmons First
National Bank, a national banking association ("Lender"), WITNESSETH:
WHEREAS, Borrower has applied to Lender for a loan ("Loan") in the amount
of $1,050,000.00, to re-finance certain existing indebtedness and to provide
permanent financing for certain recently constructed improvements toBorrower's
operating facility in Redfield, Arkansas, and Lender has agreed to extend the
loan to Borrower upon certain conditions set forth herein.
NOW, THEREFORE, for and in consideration of the premises and other valuable
considerations, the receipt and sufficiency of which is hereby acknowledged, it
is hereby agreed by and between the parties hereto as follows, to-wit:
l. Loan. Lender agrees to lend to Borrower up to the total sum of
$1,050,000.00 upon the conditions set forth herein.
2. Promissory Notes. Borrower will execute two (2) promissory notes to
evidence the indebtedness in the amount of $700,000.00 ("Note I") and
$350,000.00 ("Note II"). Note I shall bear interest at the rate of ten percent
(10%) per annum, be payable in twelve (12) monthly installments, the first
eleven (11) of which shall be in the amount of $9,250.55 each and the twelfth
(12th) and final installment in the amount of the outstanding principal and
accrued interest and shall contain Lender's customary terms and provisions.
Note II shall bear interest at the rate of ten percent (10%) per annum, be
payable in one hundred twenty (120) monthly installments, the first one hundred
nineteen (119) of which shall be in the amount of $4,625.28 each and the
one-hundred twentieth (120th) and final installment in the amount of the
outstanding principal and accrued interest and shall contain Lender's customary
terms and provisions.
3. Security. This indebtedness shall be secured by a mortgage
("Mortgage") on certain real property owned by the Borrower in Jefferson County,
Arkansas and a security interest in personal property belonging to Borrower as
described in that certain Security Agreement of even date here with. In
addition, Genzyme Transgenics Corporation ("GTC") and TSI Corporation,
affiliates of the Borrower, shall unconditionally guarantee all obligations of
the Borrower under all indebtedness of the Borrower to the Lender, including but
not limited to the Loan.
4. Financial Information. Borrower shall cause GTC to deliver to Lender
copies of its 10-Q and 10-K reports filed with the Securities and Exchange
Commission at the time such reports are so filed. Additionally, Borrower shall
furnish to Lender, from time to time, such financial information regarding the
operations and conditions of Borrower as may be reasonably requested by Lender.
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5. Warranties, Representations and Covenants. Borrower warrants,
represents and covenants with and unto Lender that commencing upon the date
hereof and continuing until the repayment in full of all indebtedness evidenced
by Note I and Note II:
(a) Borrower shall remain in existence and in good standing with the State
of Arkansas.
(b) Borrower warrants and represents that there has been no material
adverse change in its financial condition since the date of the most recent
financial statements delivered to Lender.
(c) Borrower represents that on the date hereof and continuing through the
term of Note I and Note II, that the Borrower shall not: (i) have a receiver
appointed for all or any part of its assets; (ii) assign any of its properties
for the benefit of creditors; (iii) file any voluntary bankruptcy proceeding or
have been the object of any involuntary bankruptcy proceeding; and (iv) have
encountered any material adverse change in its financial condition or property
ownership.
(d) Borrower covenants, represents and warrants that to the extent it uses,
generates, manufactures, stores or disposes of, on, under or about the property
described in the Mortgage ("Property") or transports to or from the Property any
flammable explosives, radioactive materials, hazardous wastes, toxic substances,
or related materials (hereinafter "Hazardous Materials"), it will do so only in
full compliance with the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. Section 9601 et seq.); the
Hazardous Materials Transportation Act (49 U.S.C. Section 1801, et seq.); the
Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.); and all
other statutes and regulations governing, defining or regulating the manner and
method of storage, transportation or disposition of Hazardous Materials.
Borrower further agrees to indemnify and hold harmless Lender, its directors,
officers, employees and agents, from and against any and all liability (i)
including foreseeable and unforeseeable consequential damages, directly or
indirectly arising out of use, generation, storage or disposition of Hazardous
Materials by the Borrower or any operator of the Property during Borrower's
ownership thereof, and (ii) including, without limitation, the cost of any
required or necessary remediation, repair, cleanup or detoxification and the
preparation of any closure or other required plans, whether such action is
required or necessary prior to or following transfer of title to the Property,
to the full extent that such action is attributable, directly or indirectly, to
the presence or use, generation, storage, release, threatened release, or
disposal of Hazardous Materials by any person on the Property during Borrower's
ownership thereof, and the Borrower's obligations pursuant to this indemnity
shall survive satisfaction or discharge of this Loan and the Mortgage, and shall
survive, notwithstanding that the alleged liability of the Borrower shall be by
reason of any exercise by it of control or dominion over the Property or the
activities of the Borrower.
(f) Neither the Borrower nor any of the guarantors shall engage in or be
involved in any transaction, in which the majority ownership of the stock of
Borrower or TSI Corporation is acquired by any person, other than any person
which owned majority interest in such entity on the date of execution of this
Note, without the prior written consent of Lender.
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6. Default. A default by Borrower under the terms of this Agreement shall
constitute a default with regard to any and all indebtedness outstanding
hereunder and Lender may, at its option, thereupon immediately declare all such
indebtedness immediately due and payable, without notice, and may proceed to
enforce its rights and exercise its remedies under the Notes and under the
security therefor, together with any other rights and remedies Lender may have
at law or in equity.
7. Continuing Agreement. This Loan Agreement shall remain in effect
throughout the term of this loan and any promissory note or notes executed
pursuant hereto, and any extensions or renewals of this loan and shall apply
to all indebtedness of Borrower to Lender arising under this loan, even if in
excess of $1,050,000.00, the original principal amount.
IN WITNESS WHEREOF, the parties have hereunto placed their hands and seals
and caused this instrument to be executed this 27th day of June, 1997.
TSI REDFIELD LABORATORIES, INC..
By /s/ John B. Green
---------------------------------
John B. Green, Treasurer
SIMMONS FIRST NATIONAL BANK
By: /s/ John W. Kelly
---------------------------------
Title: Vice President
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Exhibit 10.9.2
PROMISSORY NOTE
$700,000.00 Pine Bluff, Arkansas
June 27, 1997
For Value Received, the undersigned promise to pay to the order of Simmons
First National Bank, 501 Main Street, Pine Bluff, Arkansas, 71601, or at such
other address as the holder hereof may from time to time designate, the sum of
$700,000.00 bearing interest at the rate of ten percent (10%) per annum, to be
payable in thirteen (13) monthly installments of principal plus accrued interest
beginning on July 1, 1997, the first twelve (12) of which shall be in the amount
of $9,250.55 each, with the outstanding principal balance plus accrued interest
becoming due with the 13th and final installment. All installments shall be
applied first against accrued interest through the date of payment and the
balance of such installment shall be applied to reduce the outstanding principal
balance hereunder.
If any payment due hereunder is received ten (10) or more days after the
due date of such payment, the undersigned agrees to pay a late fee equal to the
lesser of $25.00 or 10% of the late payment. The maker herein, at his option,
may prepay the whole or any part of this note and on the part so paid the
running of interest shall stop at the date of such payment.
This note is secured by a Mortgage on certain real property in Jefferson
County, Arkansas, as more particularly described therein and a security
agreement on certain personal property, both of even date herewith, is
guaranteed by Genzyme Transgenics Corporation and TSI Corporation and is subject
to the terms of a Loan Agreement of even date herewith. If there shall be a
default in the payment of the indebtedness as aforesaid, or a default in the
provisions of the Mortgage or Security Agreement securing this note, the entire
unpaid indebtedness then due hereunder shall, at the option of the holder of
this note, become immediately due and payable without notice.
This note shall be governed by the terms of Article 3 of the Uniform
Commercial Code in effect in the State of Arkansas (A.C.A. Section 4-3-1 et
seq.), regardless of whether this instrument constitutes a negotiable instrument
thereunder.
The maker and endorser, if any, of this note hereby severally waive
presentment for payment, notice of nonpayment and protest and consent that the
time for payment of the above indebtedness or of any installment thereof may be
extended without notice and further, agree to pay a reasonable attorney's fee if
this note is placed in the hands of an attorney for collection.
TSI REDFIELD LABORATORIES, INC.
By /s/ John B. Green
------------------------------
John B. Green, Treasurer
<PAGE>
Exhibit 10.9.3
PROMISSORY NOTE
$350,000.00 Pine Bluff, Arkansas
, 1997
For Value Received, the undersigned promise to pay to the order of Simmons
First National Bank, 501 Main Street, Pine Bluff, Arkansas, 71601, or at such
other address as the holder hereof may from time to time designate, the sum of
$350,000.00 bearing interest at the rate of ten percent (10%) per annum, to be
payable in one hundred twenty (120) monthly installments of principal plus
accrued interest beginning on July 1, 1997, the first one hundred nineteen (119)
of which shall be in the amount of $4,625.28 each, with the outstanding
principal balance plus accrued interest becoming due with the 120th and final
installment. All installments shall be applied first against accrued interest
through the date of payment and the balance of such installment shall be applied
to reduce the outstanding principal balance hereunder.
If any payment due hereunder is received ten (10) or more days after the
due date of such payment, the undersigned agrees to pay a late fee equal to the
lesser of $25.00 or 10% of the late payment. The maker herein, at his option,
may prepay the whole or any part of this note and on the part so paid the
running of interest shall stop at the date of such payment.
This note is secured by a Mortgage on certain real property in Jefferson
County, Arkansas, as more particularly described therein and a security
agreement on certain personal property, both of even date herewith, is
guaranteed by Genzyme Transgenics Corporation and TSI Corporation and is subject
to the terms of a Loan Agreement of even date herewith. If there shall be a
default in the payment of the indebtedness as aforesaid, or a default in the
provisions of the Mortgage or Security Agreement securing this note, the entire
unpaid indebtedness then due hereunder shall, at the option of the holder of
this note, become immediately due and payable without notice.
This note shall be governed by the terms of Article 3 of the Uniform
Commercial Code in effect in the State of Arkansas (A.C.A. Section 4-3-1 et
seq.), regardless of whether this instrument constitutes a negotiable instrument
thereunder.
The maker and endorser, if any, of this note hereby severally waive
presentment for payment, notice of nonpayment and protest and consent that the
time for payment of the above indebtedness or of any installment thereof may be
extended without notice and further, agree to pay a reasonable attorney's fee if
this note is placed in the hands of an attorney for collection.
TSI REDFIELD LABORATORIES, INC.
By /s/ John B. Green
-------------------------------
John B. Green, Treasurer
<PAGE>
Exhibit 10.9.4
MORTGAGE
KNOW ALL MEN BY THESE PRESENTS:
That for and in consideration of the sum of One Dollar cash in hand paid,
the receipt of which is hereby acknowledged, and the premises hereinafter set
forth, TSI Redfield Laboratories, Inc., ("Mortgagor"), does hereby grant,
bargain, sell and convey unto Simmons First National Bank, ("Mortgagee"), and
unto its successors and assigns forever, certain lands situated in Jefferson
County, Arkansas, as more particularly described on Appendix A Attached
hereto (hereinafter "Property").
Together with all buildings and other improvements now or hereafter
constructed on the Property and all and singular the tenements, hereditaments
and appurtenances thereunto belonging and all of the apparatus and fixtures
of every kind placed thereon for the purpose of supplying or distributing
heat, light, water, gas, power or air conditioning, including among other
things but without limitation, central heating and air conditioning systems,
electric wiring, electric light fixtures, hot water tanks, wash basins, water
closets, bath tubs, faucets, gas pipes, gas fixtures, window screens, door
screens, any shades, awnings, ornamental plants, shrubs and wall to wall
carpeting and also including built in dishwashers, cook tops and ovens
together with all similar apparatus or fixtures of any kind, similar or
dissimilar, in any building now or hereafter constructed upon the Property.
TO HAVE AND TO HOLD the same unto said Mortgagee, and unto its successors
and assigns forever, together with all improvements and all rights,
privileges and appurtenances thereunto belonging.
And Mortgagor does hereby covenant unto and with Mortgagee, its
successors and assigns, that Mortgagor is seized in fee simple of the said
real property included in this mortgage; that there are no liens or
encumbrances on the Property, other than as listed on Appendix B and that
Mortgagor will forever warrant and defend the title to the property hereby
mortgaged against the lawful claims of all persons whomsoever.
This conveyance, however, is made upon the following conditions, to-wit:
WHEREAS, this mortgage is given as security for an indebtedness, due
Mortgagee as is evidenced by two (2) promissory notes ("Notes") of Mortgagor
payable to Mortgagee of even date herewith, in the original principal amount
of $700,000 and $350,000, respectively, each bearing interest at the rate of
10% per annum, with interest and principal payable as set forth therein.
This conveyance is made to secure the prompt payment of the Notes, as and
when they become due, together with any and all renewals or extensions
thereof, and any other indebtedness which Mortgagor may come to owe Mortgagee
prior to the satisfaction or foreclosure of this mortgage, whether evidenced
by a note of the Mortgagor or by the records of the Mortgagee; and,
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WHEREAS, it is necessary to provide for the security of this mortgage and
to set forth certain understandings and conditions between Mortgagor and
Mortgagee with respect thereto, Mortgagor hereby covenants and agrees with
Mortgagee as follows:
1. Maintenance, Repair and Restoration of Improvements and Payment of
Prior Liens. Mortgagor shall (a) promptly repair, restore or rebuild any
buildings or improvements now or hereafter on the Property which may become
damaged or destroyed, except to the extent that such damage or destruction
shall be covered by insurance, in which event, the Mortgagee shall determine
whether the proceeds of such insurance coverage shall be used for repairs or
replacement or whether the same shall be applied against the outstanding
balance of one or both of the Notes hereby secured; (b) keep the Property in
good repair and condition, without waste committed thereon, and free from
liens of materialmen or mechanics or any other liens, except taxes not yet
due, not expressly subordinated to the lien hereof; (c) pay when due any
indebtedness which may be secured by a lien or charge on the Property which
is or might become superior to the lien hereof and upon request exhibit
satisfactory evidence of the discharge of such lien to the Mortgagee; and (d)
pay each item of indebtedness secured by this mortgage when due according to
the terms hereof.
2. Payment of Taxes. Mortgagor shall pay before penalty or default all
general taxes and any special assessments, water charges, sewer service
charges and other charges which accrue against the Property when due, and
shall, upon written request of the Mortgagee, furnish to the Mortgagee
duplicate receipts therefor. To prevent further default, the Mortgagor shall
pay in full and if necessary, under protest, any tax or assessment which the
Mortgagor may desire to contest.
In order to satisfy such obligation, the Mortgagor covenants and agrees
to deposit at a place to be designated by the Mortgagee, from time to time,
and in the absence of any specification, at the offices of the Mortgagee,
beginning on July 1, 1997, and on the first day of each month thereafter
until full payment of the indebtedness secured by this mortgage, a sum equal
to one-twelfth (1/12th) of the last total annual real property taxes and
special assessments on the Property or upon the anticipated taxes for the
next succeeding year to the extent that previous taxes have not included
improvements now or hereafter constructed upon the Property but based upon a
reasonable estimate as to the amount thereof (currently $2,433.51 per month).
In addition, Mortgagor upon execution of the Mortgage has deposited an
amount equal to six (6) monthly escrow payments, as necessary to cause the
escrow fund to contain a pro-rated current balance for 1997. Such deposits
shall be held, without interest, for the purpose of making payment, when due
and before default, of real property taxes and assessments on the mortgaged
premises. If the funds so deposited are insufficient to pay any such taxes
or assessments for any year when the same become due and payable, the
Mortgagor shall within ten (10) days after receipt of demand therefor deposit
such additional funds as may be necessary to pay such taxes or assessments in
full. If the funds so deposited shall exceed the amount required to pay real
property taxes or assessments for any years, such excess may be applied
toward subsequent payments on such future obligations.
3. Insurance. Mortgagor shall keep all buildings and improvements, now
or hereafter situated on the Property, insured against loss or damage by fire
and such other hazards as may
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reasonably be required by the Mortgagee, with standard mortgagee clauses
therein making the losses, if any, payable to the Mortgagee as its interest
may appear. All such insurance policies shall be in form, amount and issued
by companies satisfactory to the Mortgagee, and shall provide that the
coverage evidenced thereby shall not be terminated or modified materially
without ten (10) days prior written notice to the Mortgagee. Renewal
policies of insurance shall be delivered to the Mortgagee not less than ten
(10) days prior to the expiration date of the prior policies.
4. Adjustment of Losses and Application of Insurance Proceeds. In the
event of a loss by reason of an insured hazard to the improvements upon the
Property, the Mortgagee (or after entry of a decree of foreclosure, any
purchaser at the sale, or the decree creditor, as the case may be) is hereby
authorized either (a) to settle and adjust any claim under such insurance
policies without the Mortgagor's consent or joinder, or (b) to allow
Mortgagor to agree with the insurance company or companies on the amount to
be paid upon the loss. In either case, the Mortgagee is hereby fully
authorized and empowered to collect and receipt for any such insurance
proceeds. At the Mortgagee's option, insurance proceeds may either be
applied to the reduction of the indebtedness hereby secured, whether or not
due, or may be held by the Mortgagee and used to reimburse the Mortgagor for
the costs of rebuilding or restoring the buildings and improvements on the
Property.
In case of loss after foreclosure proceedings have been instituted, the
proceeds of any such insurance policy or policies, if not applied in
rebuilding or restoring the buildings or improvements upon the Property,
shall be used to pay the amount due in accordance with any decree of
foreclosure that may be entered in any such proceedings, and the balance, if
any, shall be paid to the owner of the equity of redemption, if such owner
shall then be entitled to the same or as the court may direct.
5. Effect of Extensions of Time. If the payment of said indebtedness or
any part thereof be extended or varied or if any part of the security is
released, all persons now or at any time hereafter liable therefor, or
interested in the Property, shall be held to agree to such extension,
variation or release, and their liability under the Notes, the lien created
hereunder and all provisions hereof shall continue in force, the right of
recourse against all such persons being expressly reserved by the Mortgagee,
notwithstanding such extension, variation or release.
6. Effect of Changes in Laws Regarding Taxation. In the event of the
enactment, after the date hereof, of any law of the State of Arkansas
deducting from the value of land, for the purpose of taxation, any
improvements thereon, or imposing upon the Mortgagee the obligation for the
payment of the whole or any part of the taxes, assessments, charges or liens
herein required to be paid by the Mortgagor, or imposing any taxation of
mortgages or debts secured by mortgages or any interest of the Mortgagee in
the Property, or in the manner of collection of taxes so as to affect this
mortgage or the debt secured hereby or the holder hereof, then in such event,
the Mortgagor, upon demand by the Mortgagee, shall pay such taxes or
assessments, or reimburse the Mortgagee therefor; provided, however, that if
in the opinion of counsel for the Mortgagee (a) it might be unlawful to
require Mortgagor to make such payment or (b) the making of any such payment
might result in the imposition of interest beyond the maximum amounts
permitted by law, then and in such event, the Mortgagee may elect, by notice
in writing, given to the Mortgagor, to declare all of the indebtedness
secured hereby to be due and payable sixty (60) days from and after the date
notice was given.
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7. Mortgagee's Performance of Defaulted Acts. In case of a default
herein by Mortgagor, the Mortgagee may, at its option, make any payment or
perform any act herein required of the Mortgagor in any form and in any
manner which it deems expedient, including the making of any full or partial
payments of principal and interest on prior encumbrances, if any, and may
purchase, discharge, compromise or settle any tax lien or other prior liens
or title or claim thereof, or redeem from any tax sale or forfeiture
affecting the Property or contest any tax or assessment, but all without any
obligation to do so. All moneys paid for any of the purposes herein
authorized and all expenses paid or incurred in connection therewith by the
Mortgagee, including attorneys fees, and any other moneys advanced by the
Mortgagee to protect the Property and the lien hereof, shall be additional
indebtedness secured hereby, and shall become immediately due and payable
without notice and with interest thereon at the highest legal rate of
interest per annum from the date of payment until repaid. Any inaction by the
Mortgagee shall not be construed as a waiver of any right granted hereunder
upon any default by Mortgagor.
8. Mortgagee's Reliance on Tax Bills. The Mortgagee in making any
payment hereby authorized: (a) relating to taxes and assessments, may do so
according to any bill, statement or estimate procured from the appropriate
public office without inquiry into the accuracy of such bill, statement or
estimate or into the validity of any tax, assessment, sale, forfeiture, tax
lien or title or claim thereof; or (b) for the purchase, discharge,
compromise or settlement of any other prior lien, may do so without inquiry
as to the validity or amount of any claim for lien which may be asserted.
9. Acceleration of Indebtedness in Case of Default. If (a) default be
made for thirty (30) days in the due and prompt payment of one or both of the
Notes secured hereby, or any installment due in accordance with the terms
thereof, either of principal or interest, or any part thereof; or (b) the
Mortgagor shall file a petition under any bankruptcy law or have such a
petition filed against it, shall have a receiver appointed for any of its
assets, shall file any answer or responsive pleadings admitting insolvency or
inability to pay any of its indebtedness, or fail to obtain a vacation or
stay of any involuntary proceedings in solvency or bankruptcy against it
within thirty (30) days, as herein provided; or (c) all or any part of its
property shall be taken by execution, levy or any other involuntary
proceedings, or any court shall have taken jurisdiction of the property of
the Mortgagor or the major part thereof for reorganization, dissolution,
liquidation or winding up of its affairs, and such trustee or receiver shall
not be discharged or such jurisdiction relinquished or vacated or stayed on
appeal or otherwise stayed within thirty (30) days; or (d) the Mortgagor
shall make any assignment for the benefit of its creditors or shall admit in
writing its inability to pay its debts generally as they become due, or shall
consent to the appointment of a receiver or trustee or liquidator of all of
its property or the major part thereof; or (e) default shall be made in due
observance or performance of any other of the covenants, agreements, or
conditions, herein contained, required to be kept or performed or observed by
the Mortgagor and the same shall continue for thirty (30) days, then the
entire indebtedness hereby secured shall, at the option of the Mortgagee,
immediately become due and payable together with the accrued interest thereon
without notice to the Mortgagor, provided, however, that with respect to (c),
(d), and (e) notice of the claimed default has been given to the Mortgagor by
the Mortgagee within the time specified and the default has not been cured.
10. Foreclosure and Expense of Litigation. When the indebtedness hereby
secured, or any part thereof, shall become due, whether by acceleration or
otherwise, Mortgagee shall have the right
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to foreclose the lien hereof for such indebtedness or part thereof. In any
suit to foreclose the lien hereof, there shall be allowed and included an
additional indebtedness in the decree for sale all expenditures and expenses
which may be paid or incurred by or on behalf of the Mortgagee for attorneys
fees, appraisal charges, documentary and expert evidence, stenographer
charges, publication costs, and any costs, which may be estimated, for
procuring abstracts of title, title searches and examinations, title
insurance policies, and similar data and assurances with respect to title, as
the Mortgagee may deem reasonably necessary, either to prosecute such suit or
to evidence to bidders at any sale which may be made pursuant to such decree
the true condition of the title to or the value of the premises. All
expenditures and expenses of the nature set forth in this paragraph, and such
expenses and fees as may be incurred in the protection of the Property and
the maintenance of the lien of this mortgage, including the fees of any
attorney employed by the Mortgagee in any litigation or proceeding affecting
this mortgage, the Notes or the Property, including bankruptcy proceedings,
or in preparations for the commencement or defense of any proceedings or
threatened suit or proceeding, shall be immediately due and payable by the
Mortgagor, with interest thereon at the highest legal rate of interest per
annum, from the date expended until repaid and shall be secured by this
mortgage.
11. Application of Proceeds of Foreclosure Sale. The proceeds of any
sale at foreclosure of the Property shall be distributed and applied in the
following order of priority, subject to the decree of a court of competent
jurisdiction. First, for all costs and expenses incident to the foreclosure
proceedings, including all items as are mentioned in Paragraph 10 hereof;
second, all other items which under the terms hereof constitute secured
indebtedness additional to that evidenced by the Notes, with interest thereon
as herein provided; third, all principal and interest remaining unpaid on the
Notes with equal priority; fourth, any surplus to Mortgagor, its successors
or assigns, as its rights may appear.
12. Appointment of a Receiver. Upon, or at any time after, the filing
of a complaint to foreclose this mortgage, the court may appoint a receiver
of the Property. Such appointment may be made either before or after sale,
with or without notice, and without regard to the insolvency or solvency of
the Mortgagor at the time of the application for such receiver and without
regard to the then value of the Property. Such receiver shall have the power
to collect the rents, issues and profits of the Property during the pendency
of any such foreclosure suit and, in case of a sale and a deficiency, up to
time when possession shall be given to the purchaser at such foreclosure
sale, and all other powers which may be necessary or are usual in such cases
for the protection, possession, control, management and operation of the
Property during the whole of said period. The court from time to time may
authorize the receiver to apply the net income in its hands in payment in
whole or in part to (a) the indebtedness secured hereby, or by any decree
foreclosing this mortgage, or any tax, special assessment or other lien which
may be or become superior to the lien hereof or of such decree, provided such
application is made prior to foreclosure sale; and (b) the payment of the
deficiency in case of a sale under foreclosure and a deficiency judgment.
13. Assignment of Rents. To further secure the indebtedness secured
hereby, the Mortgagor does hereby sell, assign and transfer unto the
Mortgagee all of the rents, issues and profits, now due and which may
hereafter become due, under or by virtue of any lease, whether written or
oral, or any letting of, or of any agreement for the use or occupancy of the
premises or any part thereof, which may have been heretofore or may be
hereafter made or agreed
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to or which may be made or agreed to by the Mortgagee under the powers herein
granted, it being the intention hereby to establish an absolute transfer and
assignment of all of such leases and agreements, and all the avails
thereunder, unto the Mortgagee, and the Mortgagor does hereby irrevocably
appoint the Mortgagee as its true and lawful attorney and agent in its name
and stead (with or without the taking of possession of the Property as
authorized under Paragraph 14 hereof) to rent, lease and let all or any
portion of the Property to any party or parties at such rent and upon such
terms as the Mortgagee shall, in its discretion, determine, and to collect
all rents, issues and profits arising from or accruing hereafter, and all now
due or that may hereafter become due under each of the leases and agreements,
written or oral, or other tenancy existing, or which may hereafter exist on
the Property, with the same rights and powers and subject to the same
immunities, exoneration of liability and rights of recourse and indemnity set
forth in the provisions of Paragraph 14 hereof.
The Mortgagor represents and agrees that no rent has been or will be paid
by any person in possession of any portion of the Property for more than one
installment in advance and that the payment of none of the rents to accrue
for any portion of the Property has been or will be waived, released,
reduced, discounted or otherwise discharged or compromised by the Mortgagor.
The Mortgagor waives any right of set-off against any person in possession of
any portion of the Property. If any lease provides for the abatement of
rentals during repairs of the premises demised thereunder by reason of fire
or other casualty, the Mortgagor shall furnish to the Mortgagee rental
insurance, the policies to be in amounts and forms and written by such
insurance companies as shall be satisfactory to the Mortgagee. The Mortgagor
agrees that it will not assign any of the rents or profits of the Property,
except to a purchaser or grantee of premises.
Nothing herein contained shall be construed as constituting the Mortgagee
a Mortgagee in possession in the absence of the actual taking of possession
of the Property by the Mortgagee pursuant to Paragraph 14 hereof. In the
exercise of the powers herein granted to the Mortgagee, no liability shall be
asserted or enforced against the Mortgagee, all such liability being
expressly waived and released by the Mortgagor.
The Mortgagor further agrees to assign and transfer to the Mortgagee all
future leases upon all or any part of the Property and to execute and
deliver, at the request of the Mortgagee, all such further assurances and
assignments in the premises as the Mortgagee shall from time to time require.
Although it is the intention of the parties that the assignment contained
in this Paragraph 13 shall be a present assignment, it is expressly
understood and agreed anything herein contained to the contrary
notwithstanding, that the Mortgagee shall not exercise any of the rights or
powers conferred upon it by this Paragraph 13 until a default shall exist
hereunder.
So long as any part of the obligation hereby secured remains unpaid, the
Mortgagor, with respect to each such lease assigned hereunder, will not
modify nor in any way alter the terms of the lease; will not terminate the
term of the lease nor accept a surrender thereof unless required to do so by
the terms of the lease; will not waive nor release the lessee from any
obligations or conditions to be performed, and will, as lessor, fulfill or
perform each and every condition and covenant in the lease by the lessor to
be fulfilled or performed and to take every action required on its part to
preserve and continue the lease in force.
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14. Mortgagee's Right of Possession in Event of Default. In any case in
which under the provisions of this mortgage, the Mortgagee has a right to
institute foreclosure proceedings, whether before or after acceleration of
the entire balance of the principal secured hereby in accordance with its
option so to do, or whether before or after the institution of legal
proceedings to foreclose the lien hereof or before or after sale thereunder,
forthwith, upon demand of the Mortgagee, the Mortgagor shall surrender to the
Mortgagee and Mortgagee shall be entitled to take actual possession of the
Property or any part thereof personally, or by its agents or attorneys, as
for a condition broken, and the Mortgagee, in its discretion may, with or
without force and with or without process of law, enter upon and take and
maintain possession of all or any part of the Property, together with all
documents, books, records, papers and accounts of the Mortgagor or the then
owner of the premises relating thereto, and may exclude the Mortgagor, its
agents or servants wholly therefrom and may as attorney-in-fact or agent of
the Mortgagor, or in its own name as Mortgagee and under the powers herein
granted, hold, operate, manage, and control the Property and conduct the
business, if any, thereof, either personally or by its agents, and with full
power to use such measures, legal or equitable, as in its discretion or in
the proper discretion of its successors or assigns may be deemed proper or
necessary to enforce the payment or security of the rents, issues and profits
of the Property, including action for the recovery of rents, action in
unlawful detainer and actions in distress for rent, hereby granting full
power and authority to exercise each and every of the rights, privileges and
powers herein granted at any and all times hereafter, without notice to the
Mortgagor, and with full power to cancel or terminate any lease or sublease
for any cause on any ground which would entitle the Mortgagor to cancel the
same, to elect to disaffirm any lease or sublease made subsequent to this
mortgage or subordinated to the lien hereof, to make all necessary or proper
repairs, decorating, renewals, replacements, alterations, additions and
improvements to the Property as it may deem judicious, insure and reinsure
the same and all risks incident to Mortgagee's possession, operation and
management thereof and to receive all of such rents, issues and profits.
The Mortgagee shall not be obligated to perform or discharge, nor does it
hereby undertake to perform or discharge, any obligation, duty or liability
under any lease, and the Mortgagor shall and does hereby agree to indemnify
and hold the Mortgagee harmless of and from any and all liability, loss or
damage which it may incur under any such leases or by reason of the
assignment thereof and from any and all claims and demands whatsoever which
may be asserted against it by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms, covenants
or agreements contained in the leases. Should the Mortgagee incur any such
liability, loss or damage, under the leases or under or by reason of the
assignment thereof, or in the defense of any claims or demands, the amount
thereof including costs, expenses and reasonable attorneys fees, shall be
hereby secured, and the Mortgagor shall reimburse the Mortgagee therefor
immediately upon demand.
15. Application of Income Received by Mortgagee. The Mortgagee in the
exercise of the rights and powers hereinabove conferred upon it by Paragraph
13 and 14 hereof shall have full power to use and apply the rents, issues and
profits of the premises to the payment of or on account of the following, in
such order as the Mortgagee may determine: (a) to the payment of the
operating expenses of Property, including the cost of management and leasing
thereof (which shall include reasonable compensation to the Mortgagee and its
agents or agent, if management be delegated to an agent or agents, and shall
also include lease commissions and other compensations and expenses of
seeking and procuring tenants and entering into leases), established claims
for damages, if any,
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and premiums on insurance hereinabove authorized; (b) to the payment of taxes
and special assessments now due or which may hereafter become due on the
Property; (c) to the payment of all repairs, decorating, renewals,
replacements, alterations, additions, betterments and improvements on the
Property, including the cost of installing or replacing air conditioning or
heating units therein, and of placing said property in such condition as
will, in the judgment of the Mortgagee, make it readily rentable; (d) to the
payment of any indebtedness secured hereby or any deficiency which may result
from a foreclosure sale.
16. Environmental and Industrial Hygiene Compliance. Mortgagor
covenants, represents and warrants that to the extent it uses, generates,
manufactures, stores or disposes of, on, under or about the Property or
transports to or from the Property any flammable explosives, radioactive
materials, hazardous wastes, toxic substances, or related materials
(hereinafter "Hazardous Materials"), it will do so only in full compliance
with the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended (42 U.S.C. Section 9601 et seq.); the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801, et seq.); the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.); and all other
statutes and regulations governing, defining or regulating the manner and
method of storage, transportation or disposition of Hazardous Materials.
Mortgagor further agrees to indemnify and hold harmless the Mortgagee, its
directors, officers, employees and agents, from and against any and all
liability (i) including foreseeable and unforeseeable consequential damages,
directly or indirectly arising out of use, generation, storage or disposition
of Hazardous Materials by the Mortgagor or any operator of the Property
during Mortgagor's ownership thereof, and (ii) including, without limitation,
the cost of any required or necessary remediation, repair, cleanup or
detoxification and the preparation of any closure or other required plans,
whether such action is required or necessary prior to or following transfer
of title to the Premises, to the full extent that such action is
attributable, directly or indirectly, to the presence or use, generation,
storage, release, threatened release, or disposal of Hazardous Materials by
any person on the Property during Mortgagor's ownership thereof, and the
Mortgagor's obligations pursuant to this indemnity shall survive satisfaction
or discharge of this Mortgage, and shall survive, notwithstanding that the
alleged liability of the Mortgagee shall be by reason of any exercise by it
of control or dominion over the Property or the activities of the Mortgagor.
17. Mortgagee's Right of Inspection. The Mortgagee shall have the right
to inspect the mortgaged property at all reasonable times and access thereto
shall be permitted for that purpose.
18. Release. The Mortgagee shall release this instrument and the lien
hereof by proper instrument upon payment and discharge of all indebtedness
hereby secured and the payment of all costs to the Mortgagee for the
execution and recording of any such release.
19. Condemnation. Mortgagor hereby assigns, transfers and sets over
unto Mortgagee the entire proceeds of any award or any claim for damages for
any of the Property taken or damaged under the power of eminent domain or by
condemnation. Mortgagee may elect to apply the proceeds of the award upon or
in reduction of the indebtedness secured hereby, whether or not due, or to
require Mortgagor restore or rebuild, in which event the proceeds shall be
held the Mortgagee and used by it to reimburse the Mortgagor for the costs of
rebuilding or restoring of buildings or improvements on the Property, in
accordance with plans and specifications to be submitted to and approved, in
advance, by the Mortgagee. If the Mortgagor is obligated to restore or
replace the damaged or destroyed buildings or improvements under the terms of
any lease or leases which are or may be prior to the lien of this mortgage
and if such taking does not result in cancellation or
8
<PAGE>
termination of such lease, the award shall be used to reimburse the Mortgagor
for the cost of rebuilding or restoring of buildings or improvements on the
Property, provided the Mortgagor is not then in default under this mortgage.
In the event the Mortgagor is required or authorized, either by Mortgagee's
election, or by virtue of any such lease, to rebuild or restore, the proceeds
of the award shall be paid out in the same manner as provided in Paragraph 4
hereof for the payment of insurance proceeds toward the cost of rebuilding or
restoration. If the amount of such award is insufficient to cover the cost
of rebuilding or restoration, the Mortgagor shall pay such cost in excess of
the award before being entitled to reimbursement out of the award. Any
surplus which may remain out of rebuilding or restoration shall, at the
option of the Mortgagee, be applied to the indebtedness hereby secured or be
paid to any other party entitled hereto.
20. Giving of Notice. Any notice which either party may desire or be
required to give to the other party shall be in writing and the mailing
thereof by certified mail addressed to the Mortgagor at its telephone book
address or to the Mortgagee at its principal place of business or at such
other place as either party may by notice in writing designate as a place for
service of notice.
21. Waiver of Defenses and Statutory Rights. No action for the
enforcement of the lien or of any provision hereof shall be subject to any
defense which would not be available to the party interposing the same in an
action at law upon one or both of the Notes hereby secured. Mortgagor agrees
that it will not apply for or avail itself of any appraisement, stay,
valuation, extension or exemption laws or so-called "moratorium laws", now
existing or hereafter enacted, in order to prevent or hinder the enforcement
or foreclosure of this mortgage, and hereby waives the benefit of such laws,
and the Mortgagor specifically waives all rights of appraisement and
redemption and particularly all rights of redemption from any sale made by
decree of court upon foreclosure.
22. Successive Effect of the Obligations of this Mortgage. This
mortgage and all provisions hereof shall extend to and be binding upon the
Mortgagor and all persons claiming by, through or under the Mortgagor, and
the word "Mortgagor" when used herein shall include all persons liable for
the payment of the indebtedness secured hereby or any part thereof, whether
or not such persons shall have executed the Notes or this mortgage. The word
"Mortgagee" when used herein shall include the successors and assigns of the
Mortgagee named herein, and the holder or holders, from time to time, of
either or both of the Notes secured hereby.
23. Nonassumibility. Upon the sale or transfer of the Property, or any
part thereof, the entire outstanding principal balance and accrued interest
under the Notes shall, at the option of the Mortgagee, become immediately due
and payable.
24. Captions. The captions and headings of various paragraphs of this
mortgage are for convenience only and are not to be construed as defining or
limiting in any way, the scope or intent of the provisions hereof.
9
<PAGE>
IN WITNESS WHEREOF, Mortgagor has caused this Mortgage to be executed
this 27th day of June, 1997.
TSI REDFIELD LABORATORIES, INC.
By /s/ John B. Green
----------------------------------
John B. Green, Treasurer
ACKNOWLEDGEMENT
STATE OF ARKANSAS )
COUNTY OF Jefferson ) SS
BE IT REMEMBERED, that on this day appeared in person before me, the
undersigned, a Notary Public within and for the county and state aforesaid,
duly commissioned, qualified and acting, the within named John B. Green, to
me well known, who stated that he was the Treasurer of TSI Redfield
Laboratories, Inc., and that he was duly authorized in that capacity to
execute the foregoing instrument and that he had so executed the same for the
consideration and purposes therein mentioned and set forth, and I do hereby
so certify.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal as
such Notary Public this 22nd day of May 1997.
Alicia J. Kitchens
---------------------------------
Notary Public
My commission expires:
7-01-04
- ----------------------
10
<PAGE>
APPENDIX A
The East Half (E 1/2) of the Southwest Quarter (SW 1/4) of the Northeast
Quarter (NE 1/4) of Section 22, Township 3 South, Range 11 West of the 5th
P.M.; AND ALSO,
That portion of Block Thirteen (13) of the Town of Redfield, Arkansas,
according to the plat thereof shown of record in the office of the Circuit Clerk
and Ex-Officio Recorder of Jefferson County, Arkansas, in Plat Book 3 at page 28
specifically described as:
Beginning at the Easterly corner of Block Thirteen (13) of the Town of
Redfield and running thence in a Southwesterly direction 150 feet to the line
dividing Block Thirteen (13) into two equal halves and running thence
Northwesterly along that line 300 feet to a point on the Southeasterly line of
Boone Street; thence Northeasterly 150 feet, more or less, to the Northerly
corner of Block Thirteen (13); and thence in a Southeasterly direction along the
Northeasterly line of Block Thirteen (13) 300 feet, more or less, to the point
of beginning; which is also described as Lots One (1), Two (2), Three (3), Four
(4), Five (5) and Six (6) in Block Thirteen (13) of the Town of Redfield,
Arkansas; AND ALSO,
The South Half (S 1/2) of the Northwest Quarter (NW 1/4) of the Northeast
Quarter (NE 1/4) of Section 22, Township 3 South, Range 11 West of the 5th
P.M.;
LESS AND EXCEPT, a parcel of land lying in the Northwest Quarter (NW 1/4)
of the Northeast Quarter (NE 1/4) of Section 22, Township 3 South, Range 11
West of the 5th P.M., more particularly described as follows:
Commencing at the Southwest corner of the Northwest Quarter (NW 1/4) of
the Northeast Quarter (NE 1/4) of said Section 22, thence, North 205 feet
North 40 degrees West 150 feet; and thence South 195.2 feet to the point of
beginning.
11
<PAGE>
APPENDIX B
1. A mortgage from TSI Redfield Laboratories, Inc. to Jefferson County,
Arkansas dated November 29, 1990 and recorded in the records of Jefferson
County, Arkansas in Mortgage Book 574 at page 298, and assigned to the
Arkansas Industrial Development Corporation by assignment of record in
Mortgage Book 576 at page 33.
12
<PAGE>
Exhibit 10.9.5
SECURITY AGREEMENT
KNOW ALL MEN BY THESE PRESENTS:
In consideration of a loan extended by Simmons First National Bank
("Secured Party"), to TSI Redfield Laboratories, Inc. ("Debtor"), Debtor hereby
grants to Secured Party a security interest in the property described on Exhibit
"A" attached hereto ("Collateral"), and any proceeds of the future sale thereof.
The security interest herein granted is given for the purpose of providing
security for two (2) promissory notes ("Notes") in the original principal amount
of $700,000.00 and $350,000.00, respectively, bearing interest and becoming due
and payable as set forth therein, and any other indebtedness of whatsoever kind
or nature which is currently or may hereafter be due and owing from the Debtor
to the Secured Party.
In order to provide better security and protection for the Secured Party,
Debtor hereby warrants and covenants that:
1. LOCATION OF COLLATERAL. The Collateral will be kept and maintained at
its place of business, in Redfield, Arkansas, subject to the Debtor's right to
move and use the Collateral in the ordinary course of its business within the
State of Arkansas and that the Debtor will promptly notify Secured Party of any
permanent change in the location of the Collateral within the State of Arkansas
and will not permanently remove the Collateral from the State of Arkansas
without the written consent of the Secured Party.
2. PROHIBITION OF SALE OF COLLATERAL. The Debtor will not sell, offer for
sale, or transfer the Collateral or any interest therein, without the consent in
writing of the Secured Party.
3. INSURANCE. Debtor will have and maintain hazard insurance at all times
with respect to the insurable Collateral against all usual and ordinary risks,
including fire, theft, storm, collision and any other risks as the Secured Party
may require, pursuant to policies containing such terms, in such form, for such
periods, and by such companies as may be satisfactory to the Secured Party. The
proceeds of such insurance shall be payable to the Secured Party and the Debtor
as their respective interests may appear, and all policies of insurance shall
provide for a minimum of ten (10) days written notice to the Secured Party of
cancellation. Debtor shall furnish Secured Party with certificates or other
evidence satisfactory to Secured Party of compliance with the foregoing
insurance requirements and Secured Party is hereby authorized to act as
attorney-in-fact for and on behalf of Debtor in obtaining, adjusting, settling,
canceling, and releasing such insurance or any claims in connection therewith
and to endorse any check or draft in connection therewith for and on behalf of
the Debtor.
4. PROHIBITION OF ADVERSE LIENS. Except for liens in existence on the
date hereof, Debtor will keep the Collateral free from any additional adverse
lien, security
<PAGE>
interest, or encumbrance and in good condition and repair, and will not cause
or permit waste or destruction of the Collateral or any part thereof. Debtor
will not use the Collateral in violation of any statute or ordinance.
Secured Party may examine and inspect the Collateral at any time and wherever
located.
5. TAXES. Debtor will promptly pay when due all taxes and licenses upon
the Collateral or for its use or operation. Provided, Secured Party may, at its
option, discharge any taxes, liens, security interests, or other encumbrances at
any time placed or levied on the Collateral, may pay for insurance thereon, and
may pay for the maintenance and preservation of the Collateral. Debtor agrees
to reimburse Secured Party on demand for any such payments made or expenses
incurred by Secured Party pursuant to this authorization and to pay the cost of
collection hereof, including a reasonable attorney's fee for Secured Party's
attorneys.
6. POSSESSION OF COLLATERAL. Until a default hereunder, Debtor may have
possession of the Collateral subject hereto and use same in any lawful manner
not inconsistent with this agreement and not inconsistent with any policy of
insurance thereon.
7. DEFAULT. Debtor shall be in default under this agreement and the Notes
which it secures, upon the happening of any of the following events or
conditions:
(a) Default in payment or performance of any obligation, covenant or
liability contained or referred to in the Loan Agreement, Mortgage, Notes
or herein.
(b) Any warranty, representation, or statement made to Secured Party by or
on behalf of Debtor proves to have been false in any material respect when
made.
(c) Any event which results in the acceleration of the maturity of the
indebtedness of Debtor to others under any note, agreement, or undertaking
in excess of $100,000.
(d) Loss, theft, damage, destruction, sale, or encumbrance to or of any of
the Collateral, except as herein specifically authorized, or the making or
occurrence of any levy, seizure, or attachment thereof or thereon.
(e) Death, dissolution, termination of existence, insolvency, business
failure, appointment of receiver for any part of the property of the
Debtor, assignment for the benefit of creditors by, or the commencement of
any proceedings under any bankruptcy or insolvency laws by or against
Debtor, or any guarantor or surety for the Debtor.
Upon the occurrence of any such event of default and at any time
thereafter, Secured Party may, in addition to acceleration of the
indebtedness hereby secured, proceed with any of the remedies of a secured
party as provided in the Uniform Commercial Code of the State of Arkansas.
Secured Party may require the Debtor to assemble the Collateral and make it
available to the Secured Party at a place designated by the Secured Party
which is reasonably convenient to both parties. If the Collateral is
perishable or threaten to decline speedily in
<PAGE>
value or is of a type customarily sold on a recognized market, no notice of
such sale shall be given by the Secured Party to the Debtor. Otherwise,
Secured Party will give Debtor reasonable notice of the time and place of any
public sale or of the time after which any private sale or other intended
disposition is to be made. The requirements of a reasonable notice hereunder
shall be met if such notice is mailed by ordinary mail, postage prepaid,
addressed to the Debtor at its telephone book address or business address
first shown herein at least five (5) days before the time of such sale or
disposition. The expenses of taking, holding, preparing and selling the
Collateral shall include Secured Party's reasonable attorney's fees and legal
expenses.
8. WAIVER. No waiver by the Secured Party of any default shall operate as
a waiver of any other default or of the same default on a future occasion.
9. ASSIGNMENT. All rights of the Secured Party in, to and under this
agreement, the Notes and the Collateral shall pass to and may be exercised by
any assignee of one or both of the Notes and this agreement. Debtor agrees
that, in the event of an assignment of the Notes and this agreement and upon
receipt by the Debtor of notice of such assignment, the liability of the Debtor
to a holder for value of either or both of the Notes shall be immediate and
absolute and not affected by any default of the Secured Party. Debtor further
warrants that it will not set up any claim against the assigned party as a
defense, counterclaim, or set-off to any action for the unpaid balance owed
under the Notes or for possession brought by any such holder. All obligations
of the Debtor shall bind its successors or assigns.
IN WITNESS WHEREOF, the Debtor has executed this Security Agreement on this
27th day of June, 1997.
TSI REDFIELD LABORATORIES, INC.
By /s/ John B. Green, Treasurer
----------------------------
John B. Green, Treasurer
<PAGE>
EXHIBIT A
The East Half (E 1/2) of the Southwest Quarter (SW 1/4) of the Northeast
Quarter (NE 1/4) of Section 22, Township 3 South, Range 11 West of the 5th
P.M.; AND ALSO,
That portion of Block Thirteen (13) of the Town of Redfield, Arkansas,
according to the plat thereof shown of record in the office of the Circuit Clerk
and Ex-Officio Recorder of Jefferson County, Arkansas, in Plat Book 3 at page 28
specifically described as:
Beginning at the Easterly corner of Block Thirteen (13) of the Town of
Redfield and running thence in a Southwesterly direction 150 feet to the line
dividing Block Thirteen (13) into two equal halves and running thence
Northwesterly along that line 300 feet to a point on the Southeasterly line of
Boone Street; thence Northeasterly 150 feet, more or less, to the Northerly
corner of Block Thirteen (13); and thence in a Southeasterly direction along the
Northeasterly line of Block Thirteen (13) 300 feet, more or less, to the point
of beginning; which is also described as Lots One (1), Two (2), Three (3), Four
(4), Five (5) and Six (6) in Block Thirteen (13) of the Town of Redfield,
Arkansas; AND ALSO,
The South Half (S 1/2) of the Northwest Quarter (NW 1/4) of the Northeast
Quarter (NE 1/4) of Section 22, Township 3 South, Range 11 West of the 5th
P.M.;
LESS AND EXCEPT, a parcel of land lying in the Northwest Quarter (NW 1/4)
of the Northeast Quarter (NE 1/4) of Section 22, Township 3 South, Range 11
West of the 5th P.M., more particularly described as follows:
Commencing at the Southwest corner of the Northwest Quarter (NW 1/4) of
the Northeast Quarter (NE 1/4) of said Section 22, thence, North 205 feet
North 40 degrees West 150 feet; and thence South 195.2 feet to the point of
beginning.
<PAGE>
Exhibit 10.9.6
UNCONDITIONAL GUARANTY
KNOW ALL MEN BY THESE PRESENTS:
For a valuable consideration and specifically for the purpose of inducing
Simmons First National Bank, a national banking institution, ("Lender") to loan
and to continue to loan funds to TSI Redfield Laboratories, Inc., an Arkansas
corporation ("Borrower"), the undersigned ("Guarantor"), does hereby agree for
itself, its successors and assigns with and unto the Lender as follows:
1. Guarantee of Payment. The Guarantor hereby unconditionally guarantees
the full and timely payment of all indebtedness of every kind and nature of the
Borrower to the Lender, direct or indirect, without limit as to the amount of
such indebtedness, whether now existing or hereinafter incurred, whether or not
such indebtedness shall be similar or dissimilar, related or unrelated to any
existing indebtedness, including but not limited to an indebtedness evidenced by
two promissory notes in the amount of $700,000.00 and $350,000.00, of even date
herewith (collectively "Indebtedness").
2. Guarantee of Performance. The Guarantor further unconditionally
guarantees prompt, timely, and complete performance of and compliance by
Borrower of all the terms and conditions contained in any of the instruments and
documents, including but not limited to promissory notes, mortgages, security
agreements, pledges and collateral assignments ("Loan Documents"), given in
connection with the origination, extension or collection of the Indebtedness;
the timely payment of all real and personal property taxes, special assessments,
and premiums for insurance of every kind required under the terms of any of the
Loan Documents; and generally, the performance of each and every other covenant
and condition set forth and contained in the Loan Documents.
3. Waivers of Notice and Additional Authority. The Guarantor waives
notice of any default by Borrower upon the Indebtedness or of any transfer of
the title to any property securing any of the Indebtedness pursuant to any Loan
Document, and the Lender, or the holder of any note evidencing any of the
Indebtedness, shall not be required to resort to any collateral other than this
guaranty or attempt to recover upon the liability of Borrower in any way as a
condition prerequisite to recovering upon this Guaranty. The Lender and any
subsequent holder of any note evidencing any of the the Indebtedness, may,
without notice to the Guarantor, deal with the Borrower, or any one on its
behalf or if title to any property shall have been transferred, the owner
thereof, from time to time with respect to any of the Indebtedness and the
security therefor in any manner whatsoever, including the release of any obligor
or of any of the collateral, and Guarantor hereby specifically waives each and
every defense predicable upon such dealing including, without limitation, the
release of any part of the security for any of the Indebtedness or any of the
obligors thereon, except the defense of actual payment in cash on the
Indebtedness.
4. Continuation of the Guaranty. This Guaranty shall continue with
respect to the Indebtedness, and all continuations, extensions or renewals
thereof, in favor of the Lender and all subsequent holders of any note
evidencing any of the Indebtedness, notwithstanding that the
<PAGE>
Borrower shall have conveyed its title and notwithstanding that other obligors
may have assumed or guaranteed payment. It is understood and agreed that this
Guaranty shall, in all respects, run in favor of the holders of any note
evidencing any of the Indebtedness and notice to the Guarantor of any transfer,
endorsement or assignment of any such note shall not be required.
5. Waiver of Acceptance. The Guarantor further waives notice of the
acceptance of this Guaranty by the Lender and presentment, demand, notice of
nonpayment, notice of extension of the time of payment or of any dealings with
any obligor or any collateral.
6. Additional Covenants of Guarantor. The Guarantor agrees that the
liability of the Guarantor hereunder shall not in anyway be released,
diminished, impaired, reduced, or affected by:
(a) The taking or accepting of any other security or guaranty for any or
all of the Indebtedness;
(b) Any release, withdrawal, surrender, exchange, substitution,
subordination, or loss of any security or other guaranty at any time existing in
connection with any or all of the Indebtedness; any partial release of the
liability of any other Guarantor hereunder or under any of the Loan Documents
had, or to be had, in connection with, or as security for, any of the
Indebtedness, or the corporate dissolution, insolvency, bankruptcy, disability,
or lack of authority of Borrower, Guarantor, or any other guarantor or any party
at any time liable for the payment of any or all of the Indebtedness, whether
now existing or hereafter occurring;
(c) Any renewal, extension, modification, or rearrangement of the payment
of any or all of the Indebtedness, or the performance of any covenant contained
in any Loan Document had, or to be had, in connection with, or as security for,
the Indebtedness, either with or without notice to, or consent of, such
Guarantor or any adjustment, indulgence, forbearance, or compromise that may be
granted or given by Lender to any party; or
(d) Any neglect, delay, omission, failure, or refusal of Lender to take or
prosecute any action for the collection of any of the Indebtedness or to
foreclose or take or prosecute any action in connection with any lien, right, or
security existing or to exist in connection with, or as security for, any of the
Indebtedness; or to take any action hereunder; it being the intention hereof
that Guarantor shall remain liable as principal until the full amount of the
Indebtedness, together with interest, and any other sums due or to become due
upon or in connection with any of the same, shall have been fully paid,
performed and observed by Borrower.
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed this 27th day of June, 1997.
TSI CORPORATION, INC.
By /s/ John B. Green, Treasurer
-----------------------------
John B. Green, Treasurer
<PAGE>
Exhibit 10.9.7
UNCONDITIONAL GUARANTY
KNOW ALL MEN BY THESE PRESENTS:
For a valuable consideration and specifically for the purpose of inducing
Simmons First National Bank, a national banking institution, ("Lender") to
loan and to continue to loan funds to TSI Redfield Laboratories, Inc., an
Arkansas corporation ("Borrower"), the undersigned ("Guarantor"), does hereby
agree for itself, its successors and assigns with and unto the Lender as
follows:
1. Guarantee of Payment. The Guarantor hereby unconditionally
guarantees the full and timely payment of all indebtedness of every kind and
nature of the Borrower to the Lender, direct or indirect, without limit as to
the amount of such indebtedness, whether now existing or hereinafter
incurred, whether or not such indebtedness shall be similar or dissimilar,
related or unrelated to any existing indebtedness, including but not limited
to an indebtedness evidenced by two promissory notes in the amount of
$700,000.00 and $350,000.00, of even date herewith (collectively
"Indebtedness").
2. Guarantee of Performance. The Guarantor further unconditionally
guarantees prompt, timely, and complete performance of and compliance by
Borrower of all the terms and conditions contained in any of the instruments
and documents, including but not limited to promissory notes, mortgages,
security agreements, pledges and collateral assignments ("Loan Documents"),
given in connection with the origination, extension or collection of the
Indebtedness; the timely payment of all real and personal property taxes,
special assessments, and premiums for insurance of every kind required under
the terms of any of the Loan Documents; and generally, the performance of
each and every other covenant and condition set forth and contained in the
Loan Documents.
3. Waivers of Notice and Additional Authority. The Guarantor waives
notice of any default by Borrower upon the Indebtedness or of any transfer of
the title to any property securing any of the Indebtedness pursuant to any
Loan Document, and the Lender, or the holder of any note evidencing any of
the Indebtedness, shall not be required to resort to any collateral other
than this guaranty or attempt to recover upon the liability of Borrower in
any way as a condition prerequisite to recovering upon this Guaranty. The
Lender and any subsequent holder of any note evidencing any of the the
Indebtedness, may, without notice to the Guarantor, deal with the Borrower,
or any one on its behalf or if title to any property shall have been
transferred, the owner thereof, from time to time with respect to any of the
Indebtedness and the security therefor in any manner whatsoever, including
the release of any obligor or of any of the collateral, and Guarantor hereby
specifically waives each and every defense predicable upon such dealing
including, without limitation, the release of any part of the security for
any of the Indebtedness or any of the obligors thereon, except the defense of
actual payment in cash on the Indebtedness.
4. Continuation of the Guaranty. This Guaranty shall continue with
respect to the Indebtedness, and all continuations, extensions or renewals
thereof, in favor of the Lender and all subsequent holders of any note
evidencing any of the Indebtedness, notwithstanding that the
<PAGE>
Borrower shall have conveyed its title and notwithstanding that other
obligors may have assumed or guaranteed payment. It is understood and agreed
that this Guaranty shall, in all respects, run in favor of the holders of any
note evidencing any of the Indebtedness and notice to the Guarantor of any
transfer, endorsement or assignment of any such note shall not be required.
5. Waiver of Acceptance. The Guarantor further waives notice of the
acceptance of this Guaranty by the Lender and presentment, demand, notice of
nonpayment, notice of extension of the time of payment or of any dealings
with any obligor or any collateral.
6. Additional Covenants of Guarantor. The Guarantor agrees that the
liability of the Guarantor hereunder shall not in anyway be released,
diminished, impaired, reduced, or affected by:
(a) The taking or accepting of any other security or guaranty for any or
all of the Indebtedness;
(b) Any release, withdrawal, surrender, exchange, substitution,
subordination, or loss of any security or other guaranty at any time existing
in connection with any or all of the Indebtedness; any partial release of the
liability of any other Guarantor hereunder or under any of the Loan Documents
had, or to be had, in connection with, or as security for, any of the
Indebtedness, or the corporate dissolution, insolvency, bankruptcy,
disability, or lack of authority of Borrower, Guarantor, or any other
guarantor or any party at any time liable for the payment of any or all of
the Indebtedness, whether now existing or hereafter occurring;
(c) Any renewal, extension, modification, or rearrangement of the
payment of any or all of the Indebtedness, or the performance of any covenant
contained in any Loan Document had, or to be had, in connection with, or as
security for, the Indebtedness, either with or without notice to, or consent
of, such Guarantor or any adjustment, indulgence, forbearance, or compromise
that may be granted or given by Lender to any party; or
(d) Any neglect, delay, omission, failure, or refusal of Lender to take
or prosecute any action for the collection of any of the Indebtedness or to
foreclose or take or prosecute any action in connection with any lien, right,
or security existing or to exist in connection with, or as security for, any
of the Indebtedness; or to take any action hereunder; it being the intention
hereof that Guarantor shall remain liable as principal until the full amount
of the Indebtedness, together with interest, and any other sums due or to
become due upon or in connection with any of the same, shall have been fully
paid, performed and observed by Borrower.
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed this 27th day of June, 1997.
GENZYME TRANSGENICS CORPORATION
By /s/ John B. Green, Vice President
------------------------------------
John B. Green, Vice President
<PAGE>
Exhibit 10.10.2
AMENDMENT NO. 3
Effective March 29, 1996, Genzyme Transgenics Corporation ("GTC") and
Genzyme Corporation ("Genzyme") entered into a Convertible Debt and Development
Funding Agreement (the "Agreement"), which Agreement continues in full force and
effect.
RECITALS
A. Pursuant to Section 2.1 of the Agreement, GTC granted to Genzyme
certain Co- Marketing Rights related to AT-III as defined therein.
B. Pursuant to Section 2.3(b) of the Agreement, such Co-Marketing Rights
shall terminate upon failure of Genzyme to enter into a Supply Agreement with
GTC by March 31, 1997.
C. Pursuant to Amendment No. 2 to the Agreement, entered into by the
parties on March 31, 1997, GTC and Genzyme extended the period during which the
parties must enter into a Supply Agreement or other business relationship for
three months to and including June 30, 1997.
D. The parties have been negotiating the terms of a business relationship
between GTC and Genzyme relating to AT-III, which negotiations are continuing.
E. To permit further negotiation without terminating such Co-Marketing
Rights, the parties wish to further amend the Agreement to extend the period
during which the parties must enter into a Supply Agreement or other business
relationship for six months to and including December 31, 1997.
NOW, THEREFORE, in view of the above recitals and in consideration of the
mutual covenants set forth herein, the parties hereby agree as follows:
1. Sections 1.10, 1.11(a), 2.3(b), 2.3(c), 2.3(d) and 2.6, as amended,
are each individually further amended to change the date June 30, 1997
to December 31, 1997.
2. Section 2.4 of the Agreement, as amended, is deleted in its entirety,
and in place thereof the following new Section 2.4 is added:
2.4. Development and Supply Agreement. Subject to Section 2.3
above, prior to and including December 31, 1997, GTC and Genzyme shall
negotiate in good faith to enter into an exclusive development and
supply agreement pursuant to which GTC may become the exclusive
manufacturing source of transgenic AT-III to be sold by Genzyme
pursuant to its Co-Marketing Rights (the "Supply Agreement"). The
Supply Agreement shall be on substantially the terms set forth in a
letter dated February 27, 1997 from Jan van Heek to James A. Geraghty,
including the "Summary of proposed terms"
<PAGE>
attached thereto (the "Letter"). The Supply Agreement agreed upon by
GTC and Genzyme shall be subject to the prior review and approval of a
committee of the Board of Directors of GTC, which committee shall not
include any officers or directors of Genzyme.
3. All other terms and conditions of the Agreement, as amended, remain
unmodified and in full force and effect; provided, however,
notwithstanding such terms and conditions, for the period commencing
July 1, 1997 and ending December 31, 1997, Genzyme's funding of the
AT-III development program shall be Seven Million Dollars ($7,000,000)
less AT-III development program funding paid by Genzyme for the period
commencing January 1, 1997 and ending June 30, 1997.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 3 to
be executed as an instrument under seal in their respective corporate names by
their respective authorized representatives on a date no later than June 30,
1997.
GENZYME CORPORATION GENZYME TRANSGENICS
CORPORATION
By: /s/ Gregory D. Phelps By: /s/ John B. Green
------------------------------- -------------------------------
Print Name: Gregory D. Phelps Print Name: John B. Green
---------------------- ----------------------
Title: Executive Vice President Title: Vice President and CFO
--------------------------- ---------------------------
Date: June 30, 1997 Date: June 30, 1997
----------------------------- ----------------------------
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