Exhibit 10.3

 

PROMISSORY NOTE

 

$1,250,000.00

October 20, 2008

 

FOR VALUE RECEIVED, the undersigned (the “Borrower”), promises to pay to the
order of Silicon Valley Bank (“Bank”), at such place as the holder hereof may
designate, in lawful money of the United States of America, the aggregate unpaid
principal amount of all advances (“Advances”) made by Bank to Borrower, up to a
maximum principal amount of One Million Two Hundred Fifty Thousand Dollars
($1,250,000.00), plus interest, fees and finance charges on the aggregate unpaid
principal amount of such Advances, at the rates and in accordance with the terms
of the Amended and Restated Export-Import Bank Loan and Security Agreement
between Borrower and Bank of even date herewith, as amended from time to time
(the “Loan Agreement”).  The entire principal amount and all accrued interest
shall be due and payable on October 19, 2009, or on such earlier date, as
provided for in the Loan Agreement.

 

Borrower irrevocably waives the right to direct the application of any and all
payments at any time hereafter received by Bank from or on behalf of Borrower,
and Borrower irrevocably agrees that Bank shall have the continuing exclusive
right to apply any and all such payments against the then due and owing
obligations of Borrower as Bank may deem advisable.  In the absence of a
specific determination by Bank with respect thereto, all payments shall be
applied in the following order: (a) then due and payable fees and expenses;
(b) then due and payable interest payments and mandatory prepayments; and
(c) then due and payable principal payments and optional prepayments.

 

Bank is hereby authorized by Borrower to endorse on Bank’s books and records
each Advance made by Bank under this Promissory Note and the amount of each
payment or prepayment of principal of each such Advance received by Bank; it
being understood, however, that failure to make any such endorsement (or any
errors in notation) shall not affect the obligations of Borrower with respect to
Advances made hereunder, and payments of principal by Borrower shall be credited
to Borrower notwithstanding the failure to make a notation (or any errors in
notation) thereof on such books and records.

 

Borrower promises to pay Bank all reasonable costs and reasonable expenses
including all reasonable attorneys’ fees, incurred in such collection or in any
suit or action to collect this Promissory Note or in any appeal thereof, unless
a final court of competent jurisdiction finds that the Bank acted with gross
negligence or willful misconduct.  Borrower waives presentment, demand, protest,
notice of protest, notice of dishonor, notice of nonpayment, and any and all
other notices and demands in connection with the delivery, acceptance,
performance, default or enforcement of this Promissory Note, as well as any
applicable statute of limitations.  No delay by Bank in exercising any power or
right hereunder shall operate as a waiver of any power or right.  Time is of the
essence as to all obligations hereunder.

 

This Promissory Note is issued pursuant to the Loan Agreement, which shall
govern the rights and obligations of Borrower with respect to all obligations
hereunder.

 

The law of the Commonwealth of Massachusetts shall apply to this Agreement. 
BORROWER ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES,
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN THE COMMONWEALTH OF MASSACHUSETTS IN ANY ACTION, SUIT,
OR PROCEEDING OF ANY KIND, AGAINST IT WHICH ARISES OUT OF OR BY REASON OF THIS
NOTE OR THE LOAN AGREEMENT; PROVIDED, HOWEVER, THAT IF FOR ANY REASON BANK
CANNOT AVAIL ITSELF OF THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS, BORROWER
ACCEPTS JURISDICTION OF THE COURTS AND VENUE IN SANTA CLARA COUNTY, CALIFORNIA.

 

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BORROWER WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF ANY OF THE EXIM LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS.  BORROWER RECOGNIZES AND
AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO
ENTER INTO THIS AGREEMENT.  BORROWER REPRESENTS AND WARRANTS THAT IT HAS
REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND
VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL.

 

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MICROFLUIDICS INTERNATIONAL
CORPORATION

 

 

 

 

By:

/s/ Brian E. LeClair

 

 

 

 

Name:

Brian E. LeClair

 

 

 

 

Title:

Exec. VP and CFO

 

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