Exhibit 10.1
INTEGRATED BIOPHARMA, INC.
9.5% PROMISSORY NOTE
THIS 9.5% PROMISSORY NOTE (THIS “NOTE”) DOES
NOT REQUIRE PHYSICAL SURRENDER HEREOF IN ORDER TO EFFECT A PARTIAL
PAYMENT HEREOF. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF
THIS NOTE MAY BE LESS THAN THE PRINCIPAL AMOUNT SHOWN
BELOW.
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Issue Date: February 5,
2009
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$250,000.00
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FOR VALUE RECEIVED, INTEGRATED BIOPHARMA, INC., a Delaware
corporation (the “ Company ”), hereby
promises to pay to the order of CD FINANCIAL, LLC, or its permitted
successors or assigns (the “ Holder ”),
the sum of TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000.00) in same
day funds, on or before February 28, 2010 (the “
Maturity Date ”).
Except as permitted or required under Sections 4 and
5 , the Company shall not have the right to prepay
any principal of this Note.
. The Company’s obligations under this Note, including,
without limitation, its obligation to make payments of principal
and interest hereon, are guaranteed by the Company’s
subsidiaries and secured by the assets and properties of the
Company and the Company’s subsidiaries.
The following terms shall apply to this Note:
1. DEFINITIONS .
(a) Defined Terms . When used
herein, the terms below shall have the respective meanings
indicated:
“ Acceleration Notice ” has the meaning
set forth in Section 4 of this Note.
“ Change of Control ” means the
existence, occurrence, public announcement or entering into an
agreement contemplating of any of the following: (a) the sale,
conveyance or disposition of all or substantially all of the assets
of the Company to any Person, (b) the sale, conveyance or
disposition of all or substantially all of the assets of any
Company Subsidiary to a Person other than the Company or another
Company Subsidiary that is a party to the Security Documents; (c)
the effectuation of a transaction or series of transactions in
which more than fifty percent (50%) of the equity or voting power
of the Company is disposed of; (d) the effectuation of a
transaction or series of transactions in which any of the equity or
voting power of any Company Subsidiary is disposed to a Person
other than the Company or another Company Subsidiary that is a
party to the Security Documents; (e) the consolidation, merger or
other business combination of the Company with or into any other
entity, immediately following which the prior stockholders of the
Company fail to own, directly or indirectly, at least fifty percent
(50%) of the surviving entity; (f) the consolidation, merger or
other business combination of any Company Subsidiary with or
into
any other entity other than the Company or another Company
Subsidiary that is a party to the Security Documents; (g) a
transaction or series of transactions in which any Person or group
(other than pursuant to an agreement between current affiliates of
the Company) acquires more than fifty percent (50%) of the equity
or voting power of the Company; (h) a transaction or series of
transactions in which any Person or group (other than the Company
or a Company Subsidiary that is a party to the Security Documents)
acquires any of the voting equity of a Company Subsidiary; and (i)
the Continuing Directors do not at any time constitute at least a
majority of the Board of Directors of the Company. Notwithstanding
the foregoing, the Biotech Spin-Off shall not constitute a Change
of Control.
“ Continuing Director ” means, at any
date, a member of the Board of Directors (i) who was a member of
such board on the Execution Date or (ii) who was nominated or
elected by at least a majority of the directors who were Continuing
Directors at the time of such nomination or election or whose
election to the Board of Directors was recommended or endorsed by
at least a majority of the directors who were Continuing Directors
at the time of such nomination or election or such lesser number
comprising a majority of a nominating committee if authority for
such nominations or elections has been delegated to a nominating
committee whose authority and composition have been approved by at
least a majority of the directors who were Continuing Directors at
the time such committee was formed.
“ Default Interest Rate ” means the lower
of eighteen (18%) per annum and the maximum rate permitted by
applicable Governmental Requirements.
“ Event of Default ” means the occurrence
of any of the following events:
(i) a Liquidation Event occurs or is
publicly announced;
(ii) the Company fails to make any
payment of principal or interest on this Note as and when due, and
such payment remains unpaid for two (2) Business Days following
such due date;
(iii) other than a breach described in
clause (ii) above, the Company or any Company
Subsidiary breaches or provides notice of its intent to breach any
material term or condition of this Note or any other Transaction
Document (including, without limitation, a Registration Default (as
defined in the Registration Rights Agreement)); and such breach
continues for a period of five (5) Business Days following written
notice thereof from the Holder; or
(iv) a default occurs or is declared,
or any amounts are accelerated, under or with respect to any
instrument that evidences Debt of the Company or any Company
Subsidiary in a principal amount exceeding $50,000.
“ Interest ” has the meaning set forth in
Section 2(a) of this Note.
“ Issue Date ” means the date of this
Note as set forth on the first page of this Note.
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“ Liquidation Event ” means where (i) the
Company or any Company Subsidiary shall make a general assignment
for the benefit of creditors or consent to the appointment of a
receiver, liquidator, custodian, or similar official of all or
substantially all of its properties, or any such official is placed
in control of such properties, or the Company or any Company
Subsidiary shall commence any action or proceeding or take
advantage of or file under any federal or stat
