LOAN AGREEMENT

Exhibit 10.28

 

LOAN AGREEMENT

 

by and between

 

CONNECTICUT INNOVATIONS, INCORPORATED

 

and

 

ACHILLION PHARMACEUTICALS, INC.

 

March 30,2001

TABLE OF CONTENTS

 

 

-2-

 

-3-

 

-4-

LOAN AGREEMENT

 

This LOAN AGREEMENT (the “Agreement”) is made as of this 30 ^th day of March, 2001 by and between CONNECTICUT INNOVATIONS, INCORPORATED, with an office and place of business located at 999 West Street, Rocky Hill, Connecticut 06067 (“CII”) and ACHILLION PHARMACEUTICALS, INC., a Delaware Corporation, with its chief executive office located at 300 George Street, New Haven, Connecticut (the “Borrower”).

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS, Borrower has requested that CII guarantee certain obligations of Borrower under certain leases Borrower will assume with respect to certain suites located at the premises known as 300 George Street, New Haven, Connecticut; and

 

WHEREAS, Borrower has further requested that CII provide Borrower with certain credit facilities pursuant to which CII would make loans and advances and otherwise extend credit to Borrower; and

 

WHEREAS, CII is willing to provide such guarantee and such credit facilities; and

 

WHEREAS, CII and Borrower wish to document the terms and conditions on which CII will provide said guarantee and credit facilities;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, CII and Borrower hereby agree as follows:

 

SECTION 1. DEFINITIONS

 

All capitalized terms used in this Agreement, the Notes or the Other Documents, or in any certificate, report or other document, instrument or agreement executed or delivered pursuant hereto and thereto (unless otherwise indicated therein) shall have the meanings ascribed to such terms below.

 

Section 1.1. “Affiliate” means any Person (i) which directly or indirectly controls, or is controlled by, or is under common control with, such Person; (ii) which directly or indirectly beneficially owns or holds ten percent (10%) or more of any class of voting stock of such Person; or (iii) ten percent (10%) or more of the voting stock of which is directly or indirectly beneficially owned or held by such Person. The term “control” (and its correlative meanings “controlled by” and “under common control with”) as used in this Section 1.1. means the possession, directly or indirectly, of the power to direct, or cause the direction of, the management and policies of a Person, whether through ownership of voting stock, by contract or otherwise.

 

Section 1.2. “Agreement” means this Agreement, including all schedules and exhibits attached hereto, and any and all amendments, modifications and supplements hereto.

Section 1.3. “Assignment and Assumption Agreement” means that certain Assignment and Assumption Agreement dated the date hereof by and among Borrower, CII and Yale.

 

Section 1.4. “CII” has the meaning set forth in the Preamble hereof.

 

Section 1.5. “CII Affiliate” or “CII Affiliates” means any Affiliate of CII.

 

Section 1.6. “CII Agents” has the meaning set forth in Section 12.2.4. hereof.

 

Section 1.7. “Bankruptcy Code” means Title 11 of the United States Code, entitled “Bankruptcy”, as amended from time to time and all rules and regulations promulgated thereunder.

 

Section 1.8. “Borrower” has the meaning set forth in the Preamble hereof.

 

Section 1.9. “Business Day” means any day on which dealings and exchanges between banks may be carried on in Hartford, Connecticut.

 

Section 1.10. “Capital Lease” means any lease of any property (whether real, personal or mixed) that, in conformity with GAAP, should be accounted for as a capital lease.

 

Section 1.11. “Closing Date” means the date hereof.

 

Section 1.12. “Code” means the Internal Revenue Code of 1986 and the rules and regulations promulgated thereunder, collectively, as the same may from time to time be supplemented or amended and remain in effect.

 

Section 1.13. “Collateral” means all collateral received or delivered as security for the Obligations pursuant to, and as more particularly described herein.

 

Section 1.14. “Collateral Assignment of Lease” means the collateral assignment of Borrower’s right and interest in, to and under a lease, as lessee, for the Leased Premises.

 

Section 1.15. “Contractual Obligation” means, as applied to any Person, any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject.

 

Section 1.16. “Controlled Group” means all trades or businesses (whether or not incorporated) under common control that, together with Borrower, are treated as a single employer under Section 414(b) or 414(c) of the Code or Section 4001 of ERISA.

 

Section 1.17. “Credit Termination Date” means August 31, 2006.

 

Section 1.18. “Default” means an event or condition that, but for the lapse of time, the giving of notice, or both, would constitute an Event of Default if that event or condition was not cured or removed within any applicable grace or cure period.

 

2

Section 1.19. “Default Rate” means the rate of interest determined by increasing the rate of interest otherwise chargeable under this Agreement to a rate which shall be the lower of (i) the highest rate allowed by law or (ii) five percentage points (5%) above the rate of interest which would otherwise be in effect under this Agreement.

 

Section 1.20. “Dividend” or “Dividends” means the payment of any dividend or other distribution in respect of the capital stock of a corporation in cash or other property (excepting distribution in the form of such stock) or the redemption or acquisition of any capital stock or security of a corporation.

 

Section 1.21. “Drawing” or “Drawings” means any payments) or disbursements) made by CII under the Assignment and Assumption Agreement.

 

Section 1.22. “Encumbrance or “Encumbrances” means any security interest, mortgage, pledge, lien, claim, charge, encumbrance, title retention agreement, lessor’s interest under a financing lease or any analogous arrangements in any of Borrower’s properties or assets, intended as, or having the effect of, security.

 

Section 1.23. “Environmental Certificate” has the meaning set forth in Section 5.2.9. hereof.

 

Section 1.24. “Event of Default” has the meaning set forth in Section 10. hereof.

 

Section 1.25. “Excess Reimbursement Costs” has the meaning set forth in the Lease.

 

Section 1.26. “Financial Statement” or “Financial Statements” means, as of any date, or with respect to any period, as applicable, a financial report or reports consisting of (i) a balance sheet; (ii) an income statement; (iii) a statement of cash flow; and (iv) a statement of changes in stockholders’ equity.

 

Section 1.27. “Fiscal Quarter” means a thirteen/fourteen week period ending on the Saturday closest to each of March 31, June 30, September 30 and December 31 in each Fiscal Year.

 

Section 1.28. “Fiscal Year” means a fifty-two/fifty-three week period ending on the Saturday closest to December 31 in each year; provided, however, that the first Fiscal Year hereunder shall commence on the Closing Date and end on the Saturday closest to December 31, 2001.

 

Section 1.29. “GAAP” means generally accepted accounting principles as set forth in Statement on Auditing Standards No. 69 entitled “The Meaning of “Present Fairly in Conformity with Generally Accepted Accounting Principles’ in the Independent Auditor’s Report” issued by the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board that are applicable to the circumstances as of the date of determination.

 

3

Section 1.30. “Governmental Authority” means any Federal, state, local or foreign court, commission or tribunal, or governmental, administrative or regulatory agency, department, authority, instrumentality or other body.

 

Section 1.31. “Guarantees” means, as applied to Borrower and its Subsidiaries, all guarantees, endorsements or other contingent or surety obligations with respect to obligations of any other Person, whether or not reflected on the consolidated balance sheet of Borrower and its Subsidiaries, including any obligation to furnish funds, directly or indirectly (whether by virtue of partnership arrangements, by agreement to keep-well or otherwise), through the purchase of goods, supplies or services, or by way of stock purchase, capital contribution, advance or loan, or to enter into a contract for any of the foregoing, for the purpose of payment of obligations of any other Person.

 

Section 1.32. “Indebtedness” means, as applied to any Person, without duplication: (a) all indebtedness for borrowed money; (b) that portion of obligations with respect to Capital Leases that is properly classified as a liability on a balance sheet in conformity with GAAP; (c) notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money; (d) any obligation owed for all or any part of the deferred purchase price of property or services if the purchase price is due more than six months from the date the obligation is incurred or is evidenced by a note or similar written instrument; and (e) all indebtedness secured by any Encumbrance on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is nonrecourse to the credit of that Person.

 

Section 1.33. “Lease” and “Leases” means those certain lease agreements by and between Yale and WE George Street, LLC with respect to Suite Nos. 802, 803 and 804 located at 300 George Street, New Haven, Connecticut (“Leased Premises”).

 

Section 1.34. “Lessor’s Consent” has the meaning set forth in Section 5.2.7. hereof.

 

Section 1.35. “Loan” means any Term Loan.

 

Section 1.36. “Loans” means collectively, the Term Loans.

 

Section 1.37. “Loan Amount” means up to ONE MILLION SIX HUNDRED THIRTY THOUSAND AND NO/100 DOLLARS ($1,630,000.00) or any lesser amount, including zero (0), resulting from a reduction or termination of such amount in accordance with Section 2.12.1. or Section 11.1 (a).

 

Section 1.38. “Material Adverse Effect” means (i) a material adverse effect upon the business, operations, properties, assets or condition (financial or otherwise) of Borrower and its Subsidiaries, taken as a whole, or (ii) a material adverse effect on the ability of Borrower to perform its obligations under this Agreement, the Note or the Other Documents or the ability of CII to enforce or collect any of the Obligations. In determining whether any individual event would result in a Material Adverse Effect, notwithstanding that such event does not of itself have such an effect, a Material Adverse Effect shall be deemed to have occurred if the cumulative effect of such event and all other then existing events would result in a Material Adverse Effect.

 

4

Section 1.39. “Note” means a Term Note.

 

Section 1.40. “Notes” means collectively, each of the Term Notes.

 

Section 1.41. “Obligations” means any and all loans, advances, indebtedness, liabilities, obligations, covenants or duties of Borrower to CII of any kind or nature, including obligations to pay money and to perform acts or refrain from taking action, whether arising under a loan, lease, credit card, line of credit, letter of credit, guaranty, indemnity, confirmation, acceptance, currency exchange, interest rate protection arrangement, overdraft or other type of financing arrangement, and any and all extensions and renewals thereof, and modifications and amendments thereto, whether in whole or in part, whether created directly by CII or acquired by assignment, purchase, discount or otherwise, whether any of the foregoing are direct or indirect, joint or several, absolute or contingent under, due or to become due, now existing or hereafter arising, whether any present or future agreement or instrument, and whether or not evidenced by a writing and specifically including but not being limited to (i) the unpaid principal amount outstanding at any time under the Notes, plus all accrued and unpaid interest thereon, together with all fees, expenses, including attorneys’ fees, penalties, and other amounts owing by or chargeable to by Borrower under this Agreement, the Notes or the Other Documents, and (ii) unpaid Reimbursement Obligations.

 

Section 1.42. “Other Documents” means the Assignment and Assumption Agreement, Collateral Assignment of Lease, the Lessor’s Consent, Environmental Indemnity and any other document, agreement or instrument executed by Borrower in connection with any Term Loan or in connection with this Agreement and any and all amendments, modifications and supplements thereto.

 

Section 1.43. “Person” means an individual, partnership, corporation, business trust, joint stock company, trust, unincorporated association, joint venture or other entity of whatever nature, whether public or private.

 

Section 1.44. “Reimbursement Obligations” means, as of any date as of which the amount thereof shall be determined, the aggregate obligation of Borrower, as of such date, to reimburse CII in respect of the Assignment and Assumption Agreement in accordance with Section 2.1.2. hereof.

 

Section 1.45. “Release” means any release, emission, disposal, leaching, or migration into the environment, (including, without limitation, the abandonment or disposal of any barrels, containers, or other closed receptacles containing any Hazardous Materials), or into or out of any property owned, occupied or used by Borrower.

 

Section 1.46. “Reportable Event” means any of the events described in Section 4043(b) of ERISA.

 

Section 1.47. “Solvent” means, when used with respect to any Person, that as of the date as to which the Person’s solvency is to be determined:

 

(a) the fair saleable value of such Person’s properties and assets is in excess of the total amount of its liabilities (including contingent liabilities) as they become absolute and matured;

 

5

(b) it has sufficient capital to conduct its business; and

 

(c) it is able to meet its debts as they mature.

 

Section 1.48. “Subsidiary” means any Person of which fifty percent (50%) or more of the ordinary voting power for the election of a majority of the members of the board of directors or other governing body of such Person is held or controlled by Borrower or a Subsidiary of Borrower; or any other such organization the management of which is directly or indirectly controlled by Borrower or Subsidiary of Borrower through the exercise of voting power or otherwise; or any joint venture, whether incorporated or not, in which Borrower has a fifty percent (50%) or more ownership interest. The term “control” (and its correlative meanings “controlled by” and “under common control with”) as used in this Section 1.48. means the possession, directly or indirectly, of the power to direct, or cause the direction of, the management and policies of a Person, whether through ownership of voting stock, by contract or otherwise.

 

Section 1.49. “Term Note” has the meaning set forth in Section 2.2.2. hereof.

 

Section 1.50. “Term Loan” has the meaning set forth in Section 2.2.1. hereof.

 

Section 1.51. “Yale” means Yale University.

 

Section 1.52. “Warrant” means the Stock Subscription Warrant to be given by Borrower to CII in connection herewith.

 

SECTION 2. THE CREDIT FACILITIES

 

Section 2.1. Guaranty and Reimbursement Obligations.

 

Section 2.1.1. Issuance. Upon the execution of this agreement, CII hereby agrees to guaranty the obligations of Borrower to Yale under and pursuant to the terms of the Assignment and Assumption Agreement up to a maximum of $1,630,000.00.

 

Section 2.1.2. Reimbursement. Borrower hereby acknowledges and agrees that it shall be obligated to reimburse CII in respect of obligations required to be paid by CII to Yale pursuant to the Assignment and Assumption Agreement: on each date that any Drawing is honored by CII or a CII Affiliate, or CII or a CII Affiliate otherwise makes a payment with respect thereto, and only to the extent that such Drawing is not deemed to be a Term Loan under Section 2.2.1. hereof, (i) the amount paid by CII or a CII Affiliate under or with respect to such Drawing, and (ii) the amount of any taxes, fees, charges or other reasonable costs and expenses whatsoever incurred by CII or any CII Affiliate in connection with any payment made by CII or CII Affiliate under, or with respect to, such payment;

 

6

Borrower shall pay interest on any amounts due and payable under this Section 2.1.2. from the date such amounts are payable (whether at maturity, by acceleration or otherwise) until paid in full at the rate of interest applicable to Term Loans for three (3) days and, thereafter, at the Default Rate applicable to the Term Loans.

 

Section 2.1.3. Obligations Absolute. The obligations of Borrower with respect to the guaranty obligations of CII under the Assignment and Assumption Agreement shall be unconditional and irrevocable, shall be paid strictly in accordance with the terms of this Agreement under all circumstances and shall not be reduced by: (a) any lack of validity or enforceability of any document executed between Borrower and Yale or the Landlord; (b) the existence of any claim, set-off, defense or other right which Borrower may have at any time against Yale, the transactions contemplated herein or any unrelated transaction; and (c) any statement or any other document presented under the Assignment and Assumption Agreement or the Lease or any Other Document proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect, unless CII had actual knowledge (without any investigation having been made) that such statement or other document was forged, fraudulent, invalid or insufficient.

 

Section 2.1.4. Indemnification. Borrower hereby indemnifies and holds CII, and its directors, officers, employees and agents (collectively, the “CII Agents”), harmless from and against any and all claims, damages, losses, liabilities, costs or expenses (including reasonable legal fees and expenses) which CII or any CII Agents may incur or which may be claimed against CII by any Person by reason of or in connection with the execution and delivery or transfer of, or payment or failure to make lawful payment under, the Assignment and Assumption Agreement; provided, however, that Borrower shall not be required to indemnify CII or any CII Agents for any claims, damages, losses, liabilities, costs or expenses to the extent, but only to the extent, caused by CII’s (i) failure to act in good faith and in conformity with such laws or regulations, or (ii) honoring a Drawing under the Assignment and Assumption Agreement when at the time of such honoring CII had actual knowledge (without any investigation having been made) that such Drawing was forged, fraudulent, invalid or insufficient. Nothing in this Section 2.1.4. is intended to limit Borrower’s obligations hereunder. Without prejudice to the survival of any other obligation of Borrower hereunder, the indemnities and obligations of Borrower contained in this Section 2.1.4. shall survive the payment in full of the Obligations. In case any claim is asserted or any action or proceeding is brought against CII or any CII Agents, CII or any such CII Agents shall promptly notify Borrower of such claim, action or proceeding and Borrower shall resist, settle or defend with counsel reasonably acceptable to CII, such claim, action or proceeding. If, within ten (10) days of Borrower’s receipt of such notice, Borrower does not commence and continue to prosecute the defense of such claim, action or proceeding, CII, or any such CII Agents, may retain legal counsel to represent it in such defense and Borrower shall indemnify CII, or any such CII Agents, for the reasonable fees and expenses of such legal counsel. Subject to the foregoing, CII shall cooperate and join with Borrower, at the expense of Borrower, as may be required in connection with any action taken or defended by Borrower.

 

Section 2.1.5. Liability of CII. Any action, inaction or omission on the part of CII under or in connection with the Assignment and Assumption Agreement or related instruments or documents, if in good faith and in conformity with such laws, regulations or

 

7

commercial or customs as CII may reasonably deem to be applicable, shall be binding upon Borrower, shall not place CII under any liability to Borrower, shall not affect, impair or prevent the vesting of any of CII’s rights or powers hereunder or Borrower’s obligation to make full reimbursement to CII. Borrower assumes all risks of the acts or omissions of Yale, Landlord or any transferee. CII shall not have any liability for and that Borrower assumes all responsibility for: (a) the genuineness of any signature; (b) the form, correctness, validity, sufficiency, genuineness, falsification and legal effect of any draft, certification or other document and the authority of the person signing the same; (c) the good faith or acts of any person other than CII and its agents and employees; (d) the existence, form, sufficiency or breach of or default under any other agreement or instrument of any nature whatsoever; (e) any delay in giving or failure to give any notice, demand or protest; and (f) any error, omission, delay in or nondelivery of any notice or other communication, however sent.

 

Section 2.2. Term Loan.

 

Section 2.2.1. Amount of Loan. Upon the execution of this Agreement and up to the Credit Termination Date, Borrower may borrow from CII, and CII agrees to lend to Borrower subject to the terms and conditions of this Agreement on any Early Possession Date (as such term is defined in the Assignment and Assumption Agreement) or the Effective Date (as such term is defined in the Assignment and Assumption Agreement), an amount equal to the Excess Cost Reimbursement (as such term is defined in the Assignment and Assumption Agreement) obligations of Achillion that would have been due with respect to any Lease assumed on the Effective Date up to ONE MILLION SEX HUNDRED THIRTY THOUSAND AND NO/100 DOLLARS ($1,630,000.00) (the “Term Loan”). Any amount that CII lends to Borrower shall be reduced from the amount guaranteed by CII to Yale under the Assignment and Assumption Agreement. Borrower shall deliver ninety (90) days advance notice to CII of its intent to Borrower a Term Loan.

 

Section 2.2.2. Term Note. The Term Loan shall be evidenced by one or more promissory notes executed by Borrower in substantially the form attached hereto as Exhibit A (the “Term Note”), with all blanks therein appropriately completed and payable to the order of CII, which Term Note is hereby incorporated by reference and made a part hereof.

 

Section 2.2.3. Payment of Principal. Commencing on the first day of the first month following the making of the Term Loan, and continuing on the first day of each succeeding month thereafter, the principal amount of the Term Note shall be payable in consecutive monthly installments, a final installment in the then unpaid principal amount of the Term Loan, together with all other amounts due and owing under the Term Note, shall be due and payable on the last day of the Lease being assumed by Borrower for which the proceeds of this Term Loan will be used to pay the Excess Reimbursement Costs (“Assumed Lease”). Each Term Note shall be based on an amortization schedule equal to the number of years remaining in the Assumed Lease.

 

Section 2.2.4. Interest. The unpaid principal amount of the Term Loan, as evidenced by the Term Note, shall bear interest at equal to seven and one half percentage points (7.5%). Interest on the unpaid principal amount of the Term Note in arrears shall be due and payable commencing on the first day of the month following the making of the Term Loan and continuing on the first day of each succeeding calendar month thereafter until the entire outstanding principal amount of the Term Loan shall be paid in full.

 

8

Section 2.2.5. Optional Prepayments of Principal.

 

Section 2.2.5.1. The Borrower may, on any Business Day, make full or partial prepayments of principal amounts due on the Loan, and such prepayments may be made without premium or penalty, provided that: (i) the Borrower gives CII at least ten (10) Business Days’ prior written notice; and (ii) each prepayment is accompanied by payment of accrued interest to the date of prepayment on the principal amount prepaid.

 

Section 2.2.5.2. All prepayments shall be applied first to all fees, costs, expenses incurred by CII pursuant to this Agreement, the Notes and the Other Documents, then to any late charges, then accrued and unpaid interest as of the date of such prepayment and the remainder to installments of principal due hereunder in inverse order of maturity. No amount prepaid by the Borrower may be reborrowed.

 

Section 2.2.6. Use of Proceeds. The proceeds of any Term Loan shall be used to pay Yale for any Excess Reimbursement Costs on either (a) an Early Possession Date or (b) the Effective Date, as applicable.

 

Section 2.2.7. Commitment Fee. Borrower agrees to pay to CII on the Closing Date, a non-refundable commitment fee in the amount of $16,300.00; $5,000 of which was due prior to the date hereof and the balance of which is payable at Closing.

 

Section 2.3. General Terms Applicable to Any Term Loan.

 

Section 2.3.1. Interest. Interest shall accrue on the basis of a three hundred sixty (360) day year, and shall be calculated according to the actual number of days elapsed during each accrual period.

 

Section 2.3.2. Late Payment. Any payment of principal or interest due under this Agreement which is not made within ten (10) days of the date specified for payment shall bear a late fee equal to five percent (5%) of the amount of the payment then due to compensate CII for the costs incurred in processing the late payment. The imposition or collection of a late fee shall not affect CII’s right to exercise any of its rights and remedies upon the occurrence of an Event of Default.

 

Section 2.3.3. Method of Payment. All payments and prepayments of principal and all payments of interest shall be made by Borrower to CII at 999 West Street, Rocky Hill, Connecticut 06067 in immediately available funds, on the due date thereof, free and clear of, and without any deduction or withholding for, any taxes or other payments.

 

Section 2.3.4. Default Rate. Overdue principal (whether at maturity, by reason of acceleration or otherwise) and, to the extent permitted by applicable law, overdue interest and fees or any other amounts payable under this Agreement shall bear interest from and including the due date thereof until paid, at the Default Rate, which interest shall be compounded daily and payable on demand.

 

9

SECTION 3. SECURITY FOR THE OBLIGATIONS

 

The Obligations shall be secured by: (1) the Collateral Assignment of Lease, (2) the Lessor’s Consent, (3) the Warrant, and (4) as to Term Loans only, a first priority security interest in furniture, fixtures and equipment located in the Leased Premises and acquired with the proceeds of the Loan, and other furniture, fixtures and equipment located in the Leased Premises not otherwise subject to a security interest at the time of the Term Loan or a purchase money security interest.

 

SECTION 4. REPRESENTATIONS AND WARRANTIES

 

In order to induce CII to enter into this Agreement and to make any Term Loan, Borrower makes the following representations and warranties to CII, which shall be deemed made as of the date hereof and, except as otherwise provided in this Section 4., the date of each Term Loan. Any knowledge acquired by CII shall not diminish its rights to rely upon such representations and warranties.

 

Section 4.1. Corporate Existence and Good Standing.

 

(a) The Borrower is a corporation validly existing and in good standing under the laws of the State of Delaware; and has the corporate power to own its property and conduct its business substantially as presently conducted by the Borrower;

 

(b) The Borrower has the power and authority to enter into and to perform its obligations under this Agreement, the Note and the Other Documents, and to carry out the transactions contemplated hereby and thereby;

 

(c) The Borrower is qualified to do business in every jurisdiction in which its property or business as presently owned, conducted, or contemplated makes such qualification necessary.

 

Section 4.2. Corporate Power, Consents; Absence of Conflict with Other Agreement, Etc. The execution, delivery and performance of this Agreement, the Notes and the Other Documents, by the Borrower, and the transactions contemplated hereby,

 

(a) are within the corporate powers of, and have been duly authorized by the Board of Directors of, and, to the extent required, by the stockholders, of the Borrower;

 

(b) do not require any approval or consent of, or filing with, any governmental agency or authority bearing on the validity of such instruments and transactions which is required by law or the regulations of any agency or authority and which has not been obtained or made, and are not in contravention of law or the terms of the charter documents, by-laws, or any amendment thereof, of the Borrower;

 

(c) will not conflict with or result in any breach or contravention of or the creation of any lien under, any indenture, agreement, promissory note, lease, contract, instrument or undertaking to which the Borrower is a party or by which it or any of its properties is bound; and

 

10

(d) are and will be the valid and legally binding obligations of the Borrower and enforceable in accordance with their respective terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or affecting generally the enforcement of creditors’ rights, and except that the availability of specific performance, injunctive relief or any other equitable remedy may be subject to the discretion of the court before which any proceedings for such remedy may be brought.

 

Section 4.3. Binding Obligations. This Agreement, the Notes and the Other Documents constitute the legal, valid and binding obligations of Borrower, enforceable against it in accordance with their respective terms.

 

Section 4.4. Noncontravention. The execution, delivery and performance by Borrower of this Agreement, the Notes and the Other Documents will not violate any existing law, ordinance, rule, regulation or order of any Governmental Authority or result in a breach of any of the terms of, or constitute a default under, any contractual obligation to which Borrower is a party or by which it or any of its properties or assets are bound or result in or require the imposition of any Encumbrances on any of Borrower’s properties or assets.

 

Section 4.5. Permits. Borrower possesses all material permits, authorizations, licenses, approvals, waivers and consents, without