PROMISSORY NOTE
$50,000 Dated: October 25, 1999
Principal Amount State of New York
FOR VALUE RECEIVED, the undersigned hereby promise to pay to the order of Peter
B. Hirshfield, Trustee, Olive Cox-Sleeper Trust dated 10/3/58 f/b/o Bert L.
Atwater the sum of Fifty Thousand Dollars ($50,000), together with interest
thereon at the rate of 10% per annum on the unpaid balance. Said sum shall be
paid in the manner following:
DUE IN FULL DECEMBER 24, 1999
At the state maturity, this note shall bear interest at the rate of 14% per
annum on the unpaid balance. All payments shall be first applied to interest and
the balance to principal. This note may be prepaid, at any time, in whole or in
part, without penalty.
The maker of this note has entered into a security agreement of even date to
secure the repayment of principal and interest due under this note. Upon default
in the payment of any principal and/or interest due hereunder, the holder of
this note shall be entitled to exercise any and all rights under said security
agreement to satisfy maker's obligation to holder.
All payments hereunder shall be made to such address as may from time to time be
designated by any holder hereof.
The undersigned corporation agrees to remain fully bound hereunder until this
note shall be fully paid and waives demand, presentment and protest, and all
notices thereto, and further agrees to remain bound, notwithstanding any
extension, renewal, modification, waiver, or other indulgence by any holder. No
modification or indulgence by any holder hereof shall be binding unless in
writing; and any indulgence on any one occasion shall not be an indulgence for
any other or future occasion. Any modification or change of terms, hereunder
granted by any holder hereof, shall be valid and binding upon the undersigned
corporation, notwithstanding the acknowledgement of any of the undersigned. This
note shall take effect as a sealed instrument and shall be construed, governed,
and enforced in accordance with the laws of the State first appearing at the
head of this note.
Signed in the presence of:
/s/ TECH LABORATORIES, INC.
- ----------------------------------- ------------------------------
Witness Borrower
/s/ By: /s/ Bernard M. Ciongoli
- ----------------------------------- --------------------------
Witness Bernard M. Ciongoli, President
FOR TECH LABORATORIES, INC.
SECURITY AGREEMENT
THIS SECURITY AGREEMENT ("Agreement") is made this 25th day of October,
1999, between TECH LABORATORIES, INC. ("Borrower"), having an address at 955
Belmont Avenue, North Haledon, New Jersey 07508, and Peter B. Hirshfield,
Trustee, Olive Cox-Sleeper Trust dated 10/3/58 f/b/o Bert L. Atwater ("Secured
Party"), having an address at c/o Kirkpatrick & Lockhart, 1251 Avenue of the
Americas, New York, New York 10020.
W I T N E S S E T H:
-------------------
WHEREAS, in consideration for a certain loan made by Secured Party to
Borrower, Borrower desires to grant to Secured Party and Secured Party wishes to
take a security interest in, all of Borrower's right, title, and interest in and
to all of Borrower's now existing and hereafter arising accounts receivable
("Accounts") and/or general intangibles for monies due or to become due and
other rights to payment ("General Intangibles") arising from or in connection
with any purchase orders set forth on Schedule A for the sale of goods,
including, without limitation, the purchase orders listed on Schedule A attached
hereto ("Order(s)"), together with all rights and privileges incident thereto,
including, without limitation, the proceeds thereof;
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other valuable consideration, the receipt and sufficiency whereof is hereby
acknowledged, the parties hereto have agreed as follows:
1. Borrower hereby grants all of Borrower's right, title, and interest in
and to any and all Accounts and/or General Intangibles arising from or in
connection with the Order(s), and all monies and claims for monies due or to
become due to Borrower in connection therewith and the proceeds of any of the
foregoing up to the amount of a certain loan in the principal amount of Fifty
Thousand ($50,000) Dollars together with all accrued interest (the "Loan").
2. Attached hereto is (a) a true and complete copy of the existing Order(s)
listed on Schedule A, together with any amendments thereto; and (b) a true and
complete copy of a specimen invoice ("Invoice") to be used in connection with
billing for services rendered and goods sold pursuant to the Order(s). True and
complete copies of any hereafter arising Order(s) ("Future Order(s)") and
Invoices relating thereto shall be provided to Secured Party immediately
following receipt or delivery of same and Schedule A to this Agreement shall be
deemed to be amended to include such Future Order(s) which shall be subject to
the terms of this Agreement without any further action.
3. Borrower agrees that it will at all times hereafter at the request of
Secured Party, make, do, and execute all such further acts, agreements,
assurances, and other documents and instruments as shall be reasonably required
to enable Secured Party to collect all sums due or to become due under or in
connection with the Order(s), according to the intent and purpose of this
Agreement.
4. If Borrower receives any payment with respect to any Order, the same
shall be held by Borrower in trust for Secured Party to the extent the Loan
remains unpaid.
5. Borrower represents and warrants to Secured Party that: (a) Borrower is
the owner of the right, title, and interest in and to the Accounts and the
General Intangibles arising from or in connection with the Order(s) and will be
the owner of the right, title, and interest in any future Accounts
and General Intangibles arising from Future Order(s), and is assigning same to
Secured Party free and clear of all security interests, liens, and other
encumbrances; (b) Borrower has the authority to sell, assign, or transfer the
Accounts and the General Intangibles arising from or in connection with the
Order(s); (c) Borrower has no tradenames or tradestyles other than Tech
Laboratories, Inc. or Tech Labs; (d) the Accounts and General Intangibles
arising from or in connection with the Order(s) and evidenced by each Invoice
rendered are, and Accounts and General Intangibles arising from or in connection
with Future Order(s) will be, genuine and enforceable in accordance with their
terms and represent an undisputed and bona fide indebtedness owing to Borrower
by the account debtor obligated thereon; (e) there are and will be no defenses,
setoffs, or counterclaims with respect to any Accounts or General Intangibles
arising from or in connection with the Order(s); (f) no payment has been
received by Borrower on any Accounts or General Intangibles arising from or in
connection with the Order(s), and no such Account or General Intangible is
subject to any credit or extension or agreements therefor; (g) all
representations made by Borrower, and all documents and schedules given by
Borrower to Secured Party, relating to any Future Order(s), Accounts, and
General Intangibles arising from or in connection with the Order(s) shall be
true and correct; (h) Borrower's offices and all of Borrower's books and records
are located only at the address of Borrower set forth at the beginning of this
Agreement; and (i) Borrower has no secured creditors except for one secured loan
which, as of June 30, 1999, had an outstanding principal balance of $11,500 with
accrued interest of approximately $4,604; provided, however, Secured Party
acknowledges and agrees that Borrower shall have the right to grant further
security interests with respect to the Order(s), and Future Order(s) and in and
to the Accounts and General Intangibles arising therefrom to secure loans up to
an aggregate additional principal amount of Two Hundred Thousand ($200,000)
Dollars plus interest.
6. The validity, interpretation, and enforcement of this Agreement shall be
governed by the laws of New York State, without regard to principles of
conflicts of law. The terms of this Agreement may not be amended, except by a
written agreement signed by the Borrower and the Secured Party. This Agreement
shall bind and benefit the parties and their respective successors and assigns.
The terms Borrower and Secured Party shall include the successors and assigns of
those parties, including, without limitation, a receiver, trustee, custodian, or
debtor in possession. There are no third party beneficiaries to this Agreement.
7. All notices to or upon the respective parties hereto to be effective
shall be in writing, and shall be deemed to have been given or made (a) when
delivered by hand, (b) three (3) business days after being delivered to a
courier for overnight delivery or (c) five (5) business days after being
deposited in the first class United States mail, certified, return receipt
requested, addressed as follows:
To the Secured Party: Peter B. Hirshfield, Trustee, Olive Cox-Sleeper Trust
dated 10/3/58 f/b/o Bert L. Atwater
c/o Kirkpatrick & Lockhart
1251 Avenue of the Americas
New York, New York 10020.
With a copy to: Peter B. Hirshfield, Esq.
Kirkpatrick & Lockhart
1251 Avenue of the Americas
New York, New York 10020.
-2-
To the Borrower: Tech Laboratories, Inc.
955 Belmont Avenue
North Haledon, New Jersey 07508
With a copy to: Stursberg & Veith
405 Lexington Avenue
Suite 4949
New York, New York 10174-4902
Attn: Walter Stursberg, Esq.
A party may change the address to which notices are to be sent for such party by
giving notice of such change to all other parties in accordance with the above
provisions.
8. This Agreement may be executed in any number of counterparts, and by the
parties hereto on separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused these presents to be
executed as of the 25th day of October, 1999.
TECH LABORATORIES, INC.
By: /s/ Bernard Ciongoli
-------------------------------------------
President (title)
PETER B. HIRSHFIELD, TRUSTEE, OLIVE COX-
SLEEPER TRUST DATED 10/3/58 F/B/O BERT L.
ATWATER
By: /s/ B. Peter Hirshfield
-------------------------------------------
Trustee (title)
-3-
Schedule "A"
to
Security Agreement
Purchase Orders
1. Purchase Order No. P-99-0712 dated 9/30/99 from Synergy Networks, Inc.,
8474 Tyco Road, Vienna, Virginia 22182; Tech Laboratories, Inc., 955
Belmont Avenue, North Haledon, New Jersey 07508 (copy attached).
2. Blanket Order M695 TASS (Requisition Number 002718) PO date 9/28/99 from
EER Systems Inc., 10289 Aerospace Road, Seabrook, Maryland 20706 (copy
attached).
-4-
Schedule A
====================================================================================================================================
EER SYSTEMS INC. EER BKKT REL. CHANGE PAGE
10289 Aerospace Road SYSTEMS ----------------------------------------
Seabrook, Maryland 20708 M696 TASS 1 of 3
(301) 577-8900 ========================================
FAX (301) 577-7483
S EER Systems Inc
H 10289 Aerospace Road
I Seabrook, MD 20706
P
BLANKET ORDER
T
O Natasa Janaldreman
TEC955 SAME AS "SHIP TO" ABOVE
V Tech Laboratories, Inc. B
E Tech Logistics Division I
N 955 Belmont Avenue L
D North Haledon, NJ 07508 L
O
R Bernard Ciongoli T
Phone: 973 427 5333 Fax: 973 427 5455 O
====================================================================================================================================
REQUISITION NUMBER CHARGE/ACCOUNT PO DATE DATE REQUIRED
0002718 TASS/INV 09/28/1999 09/29/2000
====================================================================================================================================
CONTRACT NUMBER JOB NUMBER PROJECT NUMBER
====================================================================================================================================
SHIP VIA FOB/FREIGHT TERMS TERMS OF SALE
Truck Shipping Point/Prepay & Add Net 30 Days
====================================================================================================================================
Item Quantity U/M Description Unit Price Extended Price
====================================================================================================================================
Product shall meet specifications of
SCD 1-760-TASS-1204-1.
- Change TASS part number to "-1"
- Delete Alignment Telescope, Flash
Light and Flash Light Batteries
from configuration (they are now
part of "-2" Optional Alignment
Kit)
- Correct Sensor Part Numbers
- Adjust total number of items
ordered to reflect 8 systems ordered
under separate PO
- Changes apply only to remaining
items on this order.
1 43 SET IDS2 2,800.00 120,400.00
2 Beam Unit AIR sensor (A,B)
Consisting of:
P/N: ISD2RX 2 Beam A/R Sensor Receiver (RX)
P/N: ISD2TX 2 Beam AIR Sensor Transmitter (TX)
Date Required: 09/29/2000
2 43 SET IDS4 3,700.00 158,100.00
4 Beam Unit AIR sensor (C,D)
Consisting of:
P/N: ISD4RX 4 Beam A/R Sensor Receiver (RX)
P/N: ISD4TX 4 Beam AIR Sensor Transmitter (TX)
Date Required: 09/29/2000
3 43 SET D0980002-2 905.00 38,940.00
Part of
Kit, Multisensor table and Alignment tools
====================================================================================================================================
- --------------------------------------------------------------------------------
This order is subject to the Terms and Conditions of Purchase, a copy
which can be provided upon request. Commencement of any work pursuant to this 322,362.40
order shall be deemed to be acceptance of the Terms and Conditions of ============
Purchase.
- --------------------------------------------------------------------------------
By: /s/ [ILLEGIBLE]
-------------------------------------
Authorized Signature
1. Supplier Copy
Synergy Networks, Inc. Purchase Order No. P-99-0712
8474 Tyco Road
Vienna, VA 22182
(703) 893-3300 fax (703) 893-3536
=============================================== PURCHASE ORDER =================
Vendor Ship To
Name Tech Labs Name Dorsey Road Warehouse
Address 955 Belmont Avenue Address 1472 Dorsey Road Doors 1-3
City North Haledon St NJ ZIP 07502 City Hanover St MD ZIP 21076
Phone Phone
- --------------------------------------------------------------------------------
Qty Units Description Unit Price TOTAL
- --------------------------------------------------------------------------------
3360 each STP-C5E-PL-10 $16.31 $54,801.60
10 FT STP CAT5E PATCH CABLE-PLENUM
5040 each STP-C5E-PL-15 $21.81 $109,922.40
15 FT STP CAT5E PATCH CABLE-PLENUM
1680 each STP-C5E-PL-20 $27.38 $45,998.40
20 FT STP CAT5E PATCH CABLE-PLENUM
10 each STP-C5E-PL-1K $1,025.00 $10,250.00
1000 FT STP CAT5E PLENUM-SPOOL
600 each SH-CON-C5E $1.09 $654.00
CAT5E SHIELDED CONNECTORS
- --------------------------------------------------------------------------------
Sub Total $221,626.40
Payment Details Shipping & Handling
X Check
|_| Cash Taxes State
|_| Account No.
|_| Credit Card TOTAL $221,626.40
-----------
Name ____________________
CC # ____________________
Exp Date __________
Shipping Date
================================================================================
Approval
/s/ [ILLEGIBLE] Date 9/30/99
controller Order No
Sales Rep Kieran McKenna
Ship Via Drop Ground
Notes/Remarks
INVOICE
INVOICE NO.
CUSTOMER NO.
TECH LABORATORIES, INC.
955 BELMONT AVE.
NORTH HALEDON, NJ 07508
TEL.: 973-427-5333 FAX: 973-427-5455
BILL TO: SHIP TO:
- --------------------------------------------------------------------------------
DATE SHIP VIA F.O.B. TERMS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PURCHASE ORDER NUMBER ORDER DATE SALESPERSON OUR ORDER NUMBER
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
QUANTITY
- ----------------------------- UNIT
REQUIRED SHIPPED B.O ITEM NUMBER DESCRIPTION PRICE AMOUNT
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Thank You
STANDARD FORM UNIFORM COMMERCIAL CODE
STATEMENTS OF CONTINUATION PARTIAL RELEASE, ASSIGNMENT, ETC. FORM UCC-3
INSTRUCTIONS.
1. PLEASE TYPE this form. Fold only along perforation for mailing.
2. Remove Secured Party and Debtor copies and send other 2 copies with
interleaved carbon paper to the Filing Officer.
3. Enclose Filing Fee(s), and fill in original Financing Statement and date
filed.
4. If the space provided for any item(s) on the foprm is inadequate the
item(s) should be continued on additional sheets, preferably 5" x 8" or 8"
x 10". Only one copy of such additional sheets need be presented to the
filing officer with a set of three- copies of Form URC-3. Long schedules of
collated, etc. may be on any size paper that is convenient for the secured
party. Indicate the number of additional sheets attached.
5. If the space provided for any item(s) on the form is inadequate the item(s)
should be continued on additional sheets, preferably 5' x 8' or 8' x 10'.
6. At the time of filing, filing officer will return third copy as an
acknowledgement.
This STATEMENT is presented to a filing officer for filing pursuant to the
Uniform Commercial Code
- --------------------------------------------------------------------------------
1. Debtor(s)(Last Name First) and address(es) 2. Secured Party(ies) and address(es) 3. Maturity date (if any):
For Filing Officer (Date, Time
and Filing Office)
Tech Laboratories, Inc. Peter B. Hirshfield, Trustee, Olive
955 Bemont Avenue Cox-Sleeper Trust dated 10/3/58f/b/o
North Haledon, NJ 07508 Bert L. Atwater
c/o Kirkpatrick & Lockhart
1251 Avenue of the Americas
New York, NY 10020
- --------------------------------------------------------------------------------
4. This statement referes to original Financing Statement bearing File No. __
Filed with Secretary ofd State Date Filed ______________________ 19__
- --------------------------------------------------------------------------------
5. |_| Continuation
The original financing statement between the foregoing Debtor and Secured
Party, bearing file number shown above, is still effective.
6. |_| Termination
Secured party no longer claims a security interest under the financing
statement bearing file number shown above.
7. |_| Assignment
The secured party's right under the financing statement bearing file
numbers shown above to the property described in Item 10 have been assigned
to the asignee whose name and address appears in Item 10.
8. |_| Amendment
Financing Statement bearing file number shown above is amended as set forth
in Item 10.
9. |X| Release
Secured Party releases the collateral described in Item 10 from the
financing statement bears no file number shown above.
- --------------------------------------------------------------------------------
10. See exhibit A annexed hereto and made a part hereof
Exhibit A to UCC-3
Collateral Description:
All of Debtor's now existing and hereinafter arising accounts receivable and/or
general intangibles for money due or to become due and other rights to payment
arising from or in connection with any purchase orders set forth below, together
with all rights and privileges incident thereto, including, without limitation,
the proceeds thereof.
Purchase Orders
1. Purchase Order NO. P-99-0712 dated 9/30/99 from Synergy Networks, Inc., 8474
Tyco Road, Vienna, Virginia 22182; Tech Laboratories, Inc., 955 Belmont Avenue,
North Haledon, New Jersey 07508.
2. Blanket Order M695 TASS (Requisition Number 002718) PO date 9/28/99 from EER
Systems Inc., 10289 Aerospace Road, Seabrook, Maryland 20706.
UNIFORM COMMERCIAL CODE -- FINANCING STATEMENT -- FORM UCC-1
INSTRUCTIONS.
1. PLEASE TYPE all the information required on this form: Leave "File No." and
"Date & Hour" blank.
2. Remove Secured Party and Debtor copies and send other 2 copies with
interleaved carbon paper to the Filing Officer. ENCLOSE FILING FEE of
$25.00. Check or money order for fee should be made payable to "N.J.
Secretary of State."
3. If the space provided for any item(s) on the form is inadequate the item(s)
should be continued on additional sheets 8 1/2" x 11". Only one copy of
such additional sheets need be presented to the Filing Officer with a set
of 2 copies of the Financial Statement. Long schedules of collateral,
indentures, etc. should be submitted on sheets which are 8 1/2" x 11".
4. If collateral is crops or goods which are or are to become fixtures,
describe the real estate and give name and address of record owner.
5. At the time of filing, Filing Officer will return second copy as an
acknowledgement. At a later time, secured party may date and sign
Termination Legend and use second copy as a Termination Statement.
This FINANCING STATEMENT is presented to a Filing Officer for filing pursuant to
the Uniform Commercial Code
- --------------------------------------------------------------------------------
FOR OFFICE USE ONLY Debtor(s)(Last Name, Maturity date
First) Complete Address (if any):
Tech Laboratories, Inc.
955 Bemont Avenue FOR OFFICE USE ONLY
North Haledon, NJ 07508
- --------------------------------------------------------------------------------
Secured Party(ies) and
Complete Address
Peter B. Hirshfield, Trustee
Olive Cox-Sleeper Trust dated 10/3/58
f/b/o Bert L. Atwater
c/o Kirkpatrick & Lockhart
1251 Avenue of the Americas
New York, NY 10020
- --------------------------------------------------------------------------------
Assignee(s) of Secured Party
and Complete Address
- --------------------------------------------------------------------------------
The financing statement covers the following types (or items) of property:
See exhibit A annexed hereto and made a part hereof
- --------------------------------------------------------------------------------
When collateral is crops or fixtures complete this portion of form.
a. Description of real estate (Sufficient to identify the property).
b. Name and complete address of record owner.
- --------------------------------------------------------------------------------
a. (x) Proceeds of Collateral are also covered.
b. ( ) Products of Collateral are also covered.
No. of additonal sheets presented. ( )
- --------------------------------------------------------------------------------
( ) Filed with Register of Deeds and
Mortgages of County. (X) Secretary of State
( ) Filed with County Clerk of County,
- --------------------------------------------------------------------------------
Signature(s) of Debtor(s) Signature(s) of Secured Party(ies)
or Assignee(s)
/s/ Bernard M. Ciongoli /s/ Peter B. Hirshfield
- ---------------------------------------- -----------------------------------
Bernard M. Ciongoli Peter B. Hirshfield, Trustee
- --------------------------------------------------------------------------------
FILING OFFICER COPY -- This form of statement is spproved by the Secretary of
State of New Jersey.
STANDARD FORM -- UNIFORM COMMERCIAL CODE -- FORM UCC-1. (Rev. 9/81)
1
Exhibit A to UCC-1
Collateral Description:
All of Debtor's now existing and hereinafter arising accounts receivable and/or
general intangibles for money due or to become due and other rights to payment
arising from or in connection with any purchase orders set forth below, together
with all rights and privileges incident thereto, including, without limitation,
the proceeds thereof.
Purchase Orders
1. Purchase Order NO. P-99-0712 dated 9/30/99 from Synergy Networks, Inc., 8474
Tyco Road, Vienna, Virginia 22182; Tech Laboratories, Inc., 955 Belmont Avenue,
North Haledon, New Jersey 07508.
2. Blanket Order M695 TASS (Requisition Number 002718) PO date 9/28/99 from EER
Systems Inc., 10289 Aerospace Road, Seabrook, Maryland 20706.