SUBORDINATED TERM LOAN NOTE
West Berlin, New Jersey
September 30, 2008
$2,000,000
FOR VALUE RECEIVED, the undersigned, Dynasil Corporation of America, a
Delaware corporation having an address at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ ("Borrower"), promises to pay to the order of RMD Instruments,
LLC, a Massachusetts limited liability company having an address at ▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Lender"), the principal sum of two
million Dollars ($2,000,000) (the "Loan") or so much thereof as may be
outstanding from time to time on or before March 31, 2009 (the
"Maturity Date"), together with interest on the amount thereof
outstanding from time to time, from the date hereof until fully paid at
the fixed interest rate of eight percent (8%) per annum. All payments
under this Subordinated Term Loan Note shall be made at the Lender's
office set forth above, unless otherwise agreed in writing by ▇▇▇▇▇▇▇▇
and Lender.
Interest shall accrue on the outstanding principal balance of this
Subordinated Term Loan Note and be calculated as set forth in Section 1
of this Subordinated Term Loan Note. All interest, late fees, and all
other fees and charges payable under this Subordinated Term Loan Note
shall continue to be due and payable at such rates for so long as any
balance remains outstanding under this Subordinated Term Loan Note,
whether or not the Loan has matured or been accelerated. This provision
shall survive and apply following any default, maturity, acceleration,
recovery of judgment, judgment of foreclosure, bankruptcy, insolvency
proceedings of any kind, or the happening of any other event or
occurrence, similar or dissimilar.
1. Payments. The Note shall bear interest and be payable in accordance
with the terms and conditions, at the times, and in the manner set
forth herein. Commencing on the first day of the first full month after
the Closing Date and continuing on the first day of each succeeding
calendar month thereafter, to and including the first day of December,
Borrower shall pay Lender monthly installments of interest only on the
total outstanding principal balance beginning on the date of the first
advance. On the Maturity Date, Borrower shall pay Lender the
outstanding principal balance of this Subordinated Term Loan Note
together with all accrued interest and all other sums outstanding or
due and payable under this Subordinated Term Loan Note. All
computations of interest shall be made on the basis of a three hundred
sixty five (365) day year and the actual number of days elapsed. If the
entire amount of any required principal and/or interest is not paid in
full within ten (10) days after the same is due, Borrower shall pay to
Lender a late fee equal to five percent (5%) of the required payment
and the interest rate on any late amounts shall increase to 15%.
Borrower may prepay all or any part of the unpaid principal balance at
any time without premium or penalty.
2. Events of Default. The occurrence and continuance of any of the
following events or conditions shall constitute an "Event of Default"
hereunder: (a) failure by Borrower to pay Lender any sums on the date
such sums are due and payable, whether for principal, interest, fees,
costs, charges, or otherwise, and whether upon stated maturity,
acceleration, or otherwise, due under this Subordinated Term Loan Note;
(b) any action of Borrower in connection with or in contemplation of
its dissolution or liquidation; (c) the entry of any final judgment or
attachment or seizure of, or levy upon, any property of Borrower, and
not covered by insurance, removed, or bonded within sixty (60) days
after such attachment, seizure, or levy; (d) institution of any
proceedings by or against Borrower under any bankruptcy, insolvency,
debt adjustment, debtor rehabilitation, or similar statute, whether
state or federal, and such proceedings shall have continued
undischarged and unstayed for ninety (90) days after the commencement
thereof, or (e) the admission in writing by Borrower of any inability
to pay ▇▇▇▇▇▇▇▇'s, debts generally as they become due, the appointment
of a judicial officer or representative for Borrower or for Borrower's
property, including, without limitation, a receiver, trustee,
conservator, liquidator, sequestrator, custodian, or other similar or
dissimilar judicial officer or representative.
3. Remedies. After the occurrence of any one or more Events of Default,
or at any time thereafter, if such Event of Default is continuing ten
(10) days after written notice from Lender that an Event of Default has
occurred and has not been waived by ▇▇▇▇▇▇ and if the Borrower has not
cured or commenced commercially reasonable efforts to cure such Event
of Default, the Lender's obligations to make any further advances to
the Borrower shall immediately and automatically terminate; the
outstanding principal balance hereunder, all interest and fees accrued
and unpaid thereon, and all other amounts and obligations payable by
Borrower hereunder may, at the option of Lender, be accelerated and
become due and payable in full immediately, all without protest,
presentment, demand, or further notice of any kind to Borrower, all of
which are expressly waived by Borrower. Upon such acceleration, ▇▇▇▇▇▇
may proceed to protect, exercise, and enforce all of its rights,
powers, privileges, and remedies hereunder or otherwise at law or
equity. The rights, powers, privileges, and remedies set forth in this
Subordinated Term Loan Note shall not be deemed exclusive of any other
rights, powers, privileges, or remedies granted at law, in equity, or
otherwise; but rather shall be deemed additional rights, powers,
privileges, and remedies and shall be cumulative with the rights,
powers, privileges, and remedies granted herein and elsewhere. Without
limiting the generality of the foregoing, the rights, powers,
privileges, and remedies set forth herein shall be (a) enforceable
concurrently and successively and (b) in addition to, and not in
substitution for, the rights, powers, privileges, and remedies that
would otherwise be vested in Lender for the recovery of damages, or
otherwise, in the event of a breach of any of the undertakings of
Borrower hereunder. Any inaction or partial exercise by Lender of any
of its rights, powers, privileges or remedies hereunder shall neither
cure, waive or affect any Event of Default hereunder, nor shall the
same be construed as a waiver of any of ▇▇▇▇▇▇'s rights, powers,
privileges and remedies, No waiver by ▇▇▇▇▇▇ of any of Lender's rights,
powers, privileges and remedies hereunder shall be construed as a
waiver by Lender of any of Lender's other rights, powers, privileges
and remedies. No consent to or waiver of any departure by the Borrower
from its covenants or obligations hereunder shall be effective unless
the same shall be in writing and signed by a duly authorized officer of
the Lender and such waiver or consent shall be effective only in the
specific instance and for the purpose for which it is given. No failure
or delay on the part of Lender in exercising any right, power,
privilege or remedy hereunder shall operate as a waiver thereof, and no
single or partial exercise of any such right, power, privilege or
remedy shall preclude any other or further exercises thereof or the
exercise of any other right, power, privilege or remedy hereunder.
4. Subordination. Lender hereby subordinates its right to payment
hereunder and all claims now or hereafter owing to it by the Borrower
to payments that are owed to and all other claims of Susquehanna Patriot
Bank (including its other banking affiliates, if any, the "Bank").
Without limiting the generality of the foregoing, but in furtherance
thereof, ▇▇▇▇▇▇ acknowledges and agrees that the Borrower must be current
on all payments then owing by the Borrower to the Bank before any
payments may be made hereunder, whether of principal, interest or
other charges. Further, ▇▇▇▇▇▇ agrees to execute and deliver to the
Bank any other agreement, instrument or document that the Bank shall
reasonably request to evidence or fulfill the full purpose and intent
of this Section 4.
5. Jurisdiction and Venue. Each of Borrower and Lender irrevocably and
unconditionally waives any defense of improper venue or inconvenience
of forum in any actions under this Subordinated Term Loan Note, and any
rights to claim immunity in respect of itself or any of its property or
assets, including immunity from jurisdiction, immunity from attachment
prior to entry of judgment, immunity from attachment in aid of
execution of judgment, and immunity from execution or judgment, all in
respect of any legal suit, action, or proceeding arising out of, or
relating to, this Subordinated Term Loan Note. Each of Borrower and
Lender irrevocably consents to the exclusive personal and subject
matter jurisdiction of the Camden County, New Jersey Superior Court
and/or the United States District Court for the District of New Jersey
in any actions, suits or proceedings hereunder, and each of them
irrevocably consents to service of process by certified mail, return
receipt requested, to the addresses set forth above. Further, neither
Borrower nor Lender shall object that any of the foregoing venues for
any action, suit or proceeding between them is inconvenient.
6. Miscellaneous. This Subordinated Term Loan Note is the final,
complete and exclusive statement of the agreement and understanding of
the parties with respect to the subject matter hereof. All prior or
contemporaneous promises, agreements and understandings, whether oral
or written, are incorporated herein and superseded by this Subordinated
Term Loan Note. This Subordinated Term Loan Note may not be amended or
modified except by a written instrument executed by ▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇. Neither this Subordinated Term Loan Note nor any uncertainty or
ambiguity herein shall be construed or resolved against Lender or
Borrower, whether under any rule of construction or otherwise. This
Subordinated Term Loan Note has been reviewed by each of the parties
and its counsel and shall be construed and interpreted according to the
ordinary meaning of the words used so as to fairly accomplish the
purposes and intentions of all parties. Unless the context clearly
requires otherwise, the plural includes the singular, the singular
includes the plural, the part includes the whole, the use of any gender
shall be applicable to all genders; "including" is not limiting, and
"or" has the inclusive meaning of the phrase "and/or". Unless other
expressly stated, the words "hereof", "herein", "hereby", "hereunder"
and other similar terms in this Subordinated Term Loan Note refer to
this Subordinated Term Loan Note as a whole and not exclusively to any
particular provision of this Subordinated Term Loan Note. All rights of
▇▇▇▇▇▇ and Borrower under this Subordinated Term Loan Note shall inure
to the benefit of their respective successors and assigns and this
Subordinated Term Loan Note and all the provisions hereof shall be
binding upon ▇▇▇▇▇▇ and Borrower and their respective successors and
assigns. Notwithstanding anything herein to the contrary, Borrower may
not assign or transfer any of its rights under this Subordinated Term
Loan Note without the prior written consent of Lender, which shall not
unreasonably be withheld. The headings herein are inserted solely for
convenience of reference only and shall not affect its meaning,
construction, or effect. Wherever possible each provision of this
Subordinated Term Loan Note shall be interpreted in such manner as to
be effective and valid under applicable law, but, if any provision
hereof shall be found to be illegal, invalid, prohibited, or
unenforceable for any reason, such provision shall be ineffective to
the extent of such illegality, invalidity, prohibition, or
unenforceability without invalidating any of the remainder of this
Subordinated Term Loan Note. This Subordinated Term Loan Note and the
rights and obligations of the parties hereunder shall be construed and
interpreted in accordance with laws of the State of New Jersey
(excluding the laws applicable to conflicts or choice of law). This
Subordinated Term Loan Note may be executed in one or more
counterparts, each of which shall be deemed an original, and each of
which when taken together shall constitute but one and the same
instrument and shall be binding upon each of the undersigned as fully
and completely as if all had signed the same instrument.
IN WITNESS WHEREOF, intending to be legally bound, ▇▇▇▇▇▇▇▇ has
executed this Subordinated Term Loan Note.
DYNASIL CORPORATION OF AMERICA
By:________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
Attest:
By:_______________________________
Name:
Title:
(Corporate Seal)
