EXHIBIT 10.14
PROMISSORY NOTE
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SECURED BY STOCK PLEDGE/SECURITY AGREEMENT
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$80,001.60 July 3, 1992
Monrovia, California
FOR VALUE RECEIVED, the receipt and sufficiency of which is acknowledged,
William C. Huddleston ("Maker"), hereby promises to pay to Staar Surgical
Company, a Delaware corporation, or order ("Holder"), at the address designated
on the signature page of this Note, or at such other place as Holder may
designate by written notice to Maker, the principal sum hereinbelow described
("Principal Amount"), together with interest thereon, in the manner and at the
times provided and subject to the terms and conditions described herein.
1. Principal Amount.
The Principal Amount means the sum of Eighty Thousand One Dollars and Sixty
Cents ($80,001.60).
2. Interest.
Interest on the Principal Amount from time-to-time remaining unpaid
shall accrue from the date of this Note at the rate of nine percent (9%) per
annum, compounded annually. Interest shall be computed on the basis of a three
hundred sixty (360) day year and a thirty (30) day month.
3. Payment of Principal and Interest.
Subject to Paragraph 10, the Principal Amount and accrued and unpaid
interest on the Principal Amount and all other indebtedness under this Note
shall be all due and payable on March 29, 1993.
MAKER ACKNOWLEDGES AND AGREES THAT THE ENTIRE PRINCIPAL AMOUNT SHALL BE DUE
AND PAYABLE ON THE LAST PAYMENT DATE OF THIS NOTE, UNLESS MAKER PREPAYS ANY
PORTION OF THE PRINCIPAL AMOUNT PURSUANT TO PARAGRAPH 4 BELOW.
4. Prepayments.
Maker shall have the right to prepay any portion of the Principal Amount
without prepayment penalty or premium or discount.
5. Manner of Payments/Crediting of Payments.
Payments of any amount required hereunder shall be made solely in lawful
money of the United States, without deduction or offset, and shall be credited
first against accrued but unpaid late
charges, if any, thereafter against accrued but unpaid interest, if any, and
thereafter against the unpaid balance of the Principal Amount.
6. Maker Waivers.
Maker waives notice of acceptance hereof, presentment and demand for
payment, protest and notice of dishonor or default, trial by jury, and the right
to interpose any set-off or counterclaim of any return or description. No delay
or omission on the part of Holder in exercising any rights under this Note or
under any instrument given to secure this Note, on default by Maker, including,
without limitation, Holder's right to accelerate, nor reinstatement of this Note
by Holder after such exercise, shall operate as a waiver of Maker's right to
exercise such right or of any other right under this Note or the instruments
given to secure this Note, for the same default or any other default. Maker
consents to all extensions without notice for any period or periods of time and
to the acceptance of partial payments before or after maturity, and to the
acceptance, release, and substitution of security, all without prejudice to
Holder. The pleading of any statute of limitations as a defense to the
obligations evidenced by this Note is waived by Maker to the fullest extent
permissible by law.
7. Late Charge.
If any payment of the Principal Amount and/or interest thereon shall not be
received by Holder within ten (10) days after the date due, unless excused by
written notice from Holder, a late charge equal to five percent (5%) of the
overdue amount may be charged by Holder for the purpose of defraying expenses
incurred by Holder incident to handling such delinquent payments, provided,
however, Maker shall have given five (5) days prior written notice of such
delinquency. Considering all of the circumstances existing on the date of this
Note, such late charge represents, in the opinion of both Maker and Holder, a
fair and reasonable estimate of the costs that will be sustained by Holder due
to the failure of Maker to make timely payments. The parties further agree that
the amount of actual damages would be costly, inconvenient and extremely
difficult and impractical to prove. Holder's acceptance of any late payment
and/or late charge shall not constitute a waiver of the rights of Holder to (1)
collect any other amounts due under this Note, (2) declare a default under this
Note or any agreement securing payment of this Note, or (3) exercise any of the
other rights and remedies available to Holder.
8. Interest on Delinquent Payments.
Any payment under this Note not paid when due shall bear interest at the
same rate and method as interest is charged on the Principal Amount from the due
date until paid.
9. Security.
The payment of this Note is secured by a Stock Pledge/Security Agreement
(the "Security Agreement") executed by Maker in favor of Holder of even date
herewith with respect to certain common stock of Staar Surgical Company, a
Delaware corporation, owned by Maker. The Security Agreement contains
provisions for acceleration of the maturity of this Note on the occurrence of
certain described events.
10. Acceleration Upon Default.
At the option of Holder, all or any part of the indebtedness of Maker
hereunder shall immediately become due, and payable, irrespective of any agreed
maturity date, upon the happening of any of the following events of default
("Event of Default"):
(a) If any part of the Principal Amount and/or interest thereon and/or late
charges under this Note are not paid when due, provided, however, Maker shall be
entitled to a grace period of thirty (30) days following written notice of such
event of default to cure said event of default;
(b) Upon the occurrence of any event of default described under the
Security Agreement;
(c) If any of the following events constituting default occurs, provided,
however, that if any such event of default is reasonably susceptible of being
cured, Maker shall be entitled to a grace period of thirty (30) days following
written notice of such event of default to cure such event of default, and
further provided, that if such event of default is of such character as to
reasonably require more than thirty (30) days to cure, Maker has promptly
commenced to cure said event of default within the thirty (30) day period and
uses reasonable diligence thereafter in curing such event of default, the thirty
(30) day period shall be reasonably extended:
(i) If Maker shall breach any non-monetary condition or obligation
imposed on Maker pursuant to the terms of this Note;
(ii) If Maker shall make an assignment for the benefit of creditors;
(iii) If a custodian, trustee, receiver, or agent is appointed or takes
possession of substantially all of the property of Maker;
(iv) If Maker shall be adjudicated bankrupt or insolvent or admit in
writing Maker's inability to
pay Maker's debts as they become due;
(v) If Maker shall apply for or consent to the appointment of a
custodian, trustee, receiver, intervenor, liquidator or agent of Maker, or
commence any proceeding related to Maker under any bankruptcy or
reorganization statute, or under any arrangement, insolvency, readjustment
of debt, dissolution, or liquidation law of any jurisdiction, whether now
or hereafter in effect;
(vi) If any petition is filed against Maker under the Bankruptcy Code
and either (A) the Bankruptcy Court orders relief against Maker, or (B)
such petition is not dismissed by the Bankruptcy Court within thirty (30)
days of the date of filing; or
(vii) If any attachment, execution, or other writ is levied on
substantially all of the assets of Maker and remains in effect for more
than fifteen (15) days;
11. Collection Costs and Attorneys' Fees.
Maker agrees to pay Holder all costs and expenses, including actual
attorneys' fees, paid or incurred by Holder in connection with the collection or
enforcement of the Note or any instrument securing payment of the Note,
including without limitation, defending the priority of such instrument or
conducting a trustee sale thereunder. In the event any litigation is initiated
concerning the enforcement, interpretation or collection of this Note, (or any
instrument securing payment of this Note), the prevailing party in any
proceeding shall be entitled to receive from the non-prevailing party all costs
and expenses including, without limitation, reasonable attorneys' and other fees
incurred by the prevailing party in connection with such action or proceeding.
12. Notice.
Any notice to either party under this Note shall be given by personal
delivery or by express mail, Federal Express, DHL or similar airborne/overnight
delivery service, or by mailing such notice by first class or certified mail,
return receipt requested, addressed to such party at the address set forth
below, or to such other address as either party from time to time may designate
by written notice to Holder. Notices delivered by overnight delivery service
shall be deemed delivered the next business day following consignment for such
delivery service. Mailed notices shall be deemed delivered and received in
accordance with this provision three (3) days after deposit in the United States
mail.
13. Usury Compliance.
All agreements between Maker and Holder are expressly limited, so that in
no event or contingency whatsoever, whether by reason of the consideration given
with respect to this Note, the acceleration of maturity of the unpaid Principal
Amount and interest thereon, or otherwise, shall the amount paid or agreed to be
paid to Holder for the use, forbearance, or detention of the indebtedness which
is the subject of this Note exceed the highest lawful rate permissible under the
applicable usury laws. If, under any circumstances whatsoever, Holder shall
ever receive as interest an amount that exceeds the highest lawful rate, the
amount that would be excessive interest shall be applied to the reduction of the
unpaid Principal Amount and/or late charges under this Note and not to the
payment of interest, or, if such excessive interest exceeds the unpaid balance
of the Principal Amount and/or late charges under this Note, such excess shall
be refunded to Maker. This provision shall control every other provision of all
agreements between Maker and Holder.
14. Jurisdiction and Venue.
This Note shall be governed by, interpreted under and construed and
enforced in accordance with the laws of the State of California. Any action to
enforce payment of this Note shall be filed and heard solely in the Municipal or
Superior Court of Los Angeles County, California.
MAKER:
/s/ William C. Huddleston
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WILLIAM C. HUDDLESTON
MAKER'S ADDRESS:
6497 Camino Grande
Anaheim, California 92807
HOLDER'S ADDRESS:
STAAR SURGICAL COMPANY
1911 Walker Avenue
Monrovia, California 91016
Attn: Mr. John Wolf
DO NOT DESTROY THIS NOTE; WHEN PAID, THIS NOTE
MUST BE SURRENDERED TO MAKER FOR CANCELLATION