Exhibit 10.1

 

SECURED PROMISSORY NOTE

 

IGI, INC.

 

$100,000

No. N-2

October 9, 2006

 

IGI, INC., a corporation organized under the laws of the State of Delaware (the
“Company”), for value received, hereby promises to pay to Pharmachem
Laboratories, Inc., or its registered assigns (the “Payee” or “Holder”), upon
due presentation and surrender of this Secured Promissory Note (this “Note”), on
the Maturity Date, the principal amount of One Hundred Thousand Dollars
($100,000) and all accrued but unpaid interest thereon as hereinafter provided.
As used herein, the “Maturity Date” means December 31, 2006.

 

ARTICLE I

 

PAYMENT OF PRINCIPAL AND INTEREST; METHOD OF PAYMENT

 

1.1.    Payment, if any, of the principal and accrued interest on this Note
shall be made in cash, in immediately available funds, in such coin or currency
of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts. Interest (computed on the basis of
a 360-day year of twelve 30-day months) shall accrue on the unpaid portion of
said principal amount from time to time outstanding at the Stated Interest Rate
(as defined below), and shall be paid by the Company to the Payee in arrears on
the Maturity Date. Both principal hereof and interest hereon are payable at such
address as the Holder shall designate from time to time by written notice to the
Company. The Company will pay or cause to be paid all sums becoming due hereon
for principal and interest by check or wire transfer, at the Holder’s election,
and, without any requirement for the presentation of this Note or making any
notation thereon, except that the Holder hereof agrees that payment of the
amount due shall be made only upon surrender of this Note to the Company for
cancellation. Prior to any sale or other disposition of this instrument, the
Holder hereof agrees to endorse hereon the amount of principal paid hereon and
the last date to which interest has been paid hereon and to notify the Company
of the name and address of the transferee. As used herein, the “Stated Interest
Rate” means the rate of ten percent (10%) per annum, subject to the limitations
of applicable law.

 

1.2.    If this Note or any portion hereof becomes due and payable on a
Saturday, Sunday or public holiday under the laws of the State of New Jersey,
the due date hereof shall be extended to the next succeeding full business day
and interest shall be payable at the Stated Interest Rate per annum during such
extension. All payments received by the Holder shall be applied first to the
payment of all accrued interest payable hereunder.

 

1.3.    The Company shall have the right to prepay the principal amount of this
Note, in whole or in part, at any time without penalty or premium. Any
prepayment of principal shall be accompanied by a payment of all interest
accrued and unpaid on the portion of the principal amount being prepaid.

1.4.    The Company shall pay all fees of the Holder in association with the
provision of this Note.

 

ARTICLE II

 

SECURITY

 

2.1.    The obligations of the Company under this Note are secured by a Mortgage
of even date herewith on real property owned by the Company.

 

ARTICLE III

 

MISCELLANEOUS

 

3.1.    Default.   Non-payment of the Note within fifteen (15) days after the
Maturity Date shall be deemed an “Event of Default”. Upon the occurrence of an
Event of Default, all amounts then remaining unpaid on this Note may be declared
to be, or automatically become, immediately due and payable.

 

3.2.    Collection Costs.   In the event that this Note shall be placed in the
hands of an attorney for collection by reason of an Event of Default hereunder,
the undersigned agrees to pay reasonable attorney’s fees and disbursements and
other reasonable expenses incurred by the Holder or its agent in connection with
the collection of this Note.

 

3.3.    Rights Cumulative; Specific Performances.   The rights, powers and
remedies given to the Payee under this Note shall be in addition to all rights,
powers and remedies given to it by virtue of the any document or instrument
executed in connection therewith, or any statute or rule of law.

 

3.4.    No Waivers.   Any forbearance, failure or delay by the Payee in
exercising any right, power or remedy under this Note, any documents or
instruments executed in connection therewith or otherwise available to the Payee
shall not be deemed to be a waiver of such right, power or remedy, nor shall any
single or partial exercise of any right, power or remedy preclude the further
exercise thereof.

 

3.5.    Amendments in Writing.   No amendment, modification or waiver of any
provision of this Note shall be effective unless it shall be in writing and
signed by the Holder, and any such amendment, modification or waiver shall apply
only in the specific instance for which given.

 

3.6.    Governing Law; Jurisdiction.   (a)  This Note and the rights of the
holders hereof shall be governed by, and construed in accordance with, the laws
of the State of New Jersey wherein the terms of this Note were negotiated,
excluding to the greatest extent permitted by law any rule of law that would
cause the application of the laws of any jurisdiction other than the State of
New Jersey.

 

(b)    The undersigned hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New Jersey
court or United States Federal court sitting in Newark, New Jersey, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Note or for recognition or enforcement of any judgment, and
each of the parties hereto irrevocably and unconditionally agrees that all

claims in respect of any such action or proceeding may be heard and determined
in any such New Jersey court or, to the fullest extent permitted by law, in such
United States Federal court. The undersigned agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or any other manner provided by law.
Nothing in this Note or any other transaction document shall affect any right
that any party may otherwise have to bring any action or proceeding relating to
this Note or any other transaction document in the courts of any jurisdiction.

 

The Company irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection that it may now or hereafter have
to the laying of venue of any suit, action or proceeding arising out of or in
relation to this Note or any other transaction document to which it is a party
in any such New Jersey or United States Federal Court. The Company hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

 

3.7.    No Counterclaims.   The Company waives the right to interpose
counterclaims or set-offs of any kind and description in any litigation arising
hereunder (whether or not arising out of or relating to this Note).

 

3.8.    Successors.   The term “Payee” and “Holder” as used herein shall be
deemed to include the Holder and its successors, endorsees and assigns.

 

3.9.    Certain Waivers.   The Company hereby waives presentment, demand for
payment, protest, notice of protest and notice of non-payment hereof.

 

3.10.    Mutilated, Lost, Stolen or Destroyed Notes.   In case this Note shall
be mutilated, lost, stolen or destroyed, the Company shall issue and deliver in
exchange and substitution for and upon cancellation of the mutilated Note, or in
lieu of and substitution for the Note, mutilated, lost, stolen or destroyed, a
new Note of like tenor and representing an equivalent right or interest, but
only upon receipt of evidence reasonably satisfactory to the Company of such
loss, theft or destruction and an indemnity, if requested, also reasonably
satisfactory to it (but without requirement of posting any bond).

 

3.11.    Maintenance of Office.   The Company covenants and agrees that so long
as this Note shall be outstanding, it will maintain an office or agency in New
Jersey (or such other place as the Company may designate in writing to the
holder of this Note) where notices, presentations and demands to or upon the
Company in respect of this Note may be given or made.

 

3.12.    WAIVER OF JURY TRIAL.   THE COMPANY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS DEBENTURE OR ANY
OTHER TRANSACTION DOCUMENT TO WHICH IT IS A PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

IN WITNESS WHEREOF, IGI, Inc. has caused this Note to be signed by its
authorized officer and to be dated the day and year first above written.

 

ATTEST [SEAL]

 

IGI, INC.

 

 

 

/s/ Lisa Pagliughi

 

By:

/s/ Carlene A. Lloyd

 

 

 

Name: Carlene A. Lloyd

 

 

 

Title: VP of Finance