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Exhibit 1059
PROMISSORY NOTE
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(Vienna Term Loan)
$1,500,000.00 Canton, Ohio
March 14, 1996
FOR VALUE RECEIVED, LEXINGTON COMPONENTS, INC., a corporation organized
under the laws of the State of Delaware (hereinafter referred to as the
"Company"), promises to pay to the order of BANK ONE, AKRON, NA (hereinafter
referred to as the "Bank"), the principal amount of ONE MILLION FIVE HUNDRED
THOUSAND AND NO/100 DOLLARS ($1,500,000.00), on April 1, 2001, or sooner as
hereinafter provided, with interest on the unpaid balance of said principal
amount from the date hereof at a rate per annum equal to eight and thirty-seven
one-hundredths percent (8.37%). If any installment of principal, interest or
other amounts due and payable hereunder are not paid when due, or within any
applicable grace periods set forth in the Agreement, the Company shall pay
interest thereon at the rate of three percent (3.0%) per annum in excess of the
Base Rate (as defined in the Agreement) as the same may from time to time be
established but not to exceed the maximum rate allowed by law. Bank shall have
the right to assess a late payment processing fee in the amount of the greater
of FIFTY AND NO/100 DOLLARS ($50.00) or five percent (5%) of the scheduled
payment in the event of a default in payment that remains uncured for a period
of at least ten (10) days.
The Company agrees to pay the principal amount of this Note in fifty-nine
(59) consecutive equal installments of EIGHT THOUSAND THREE HUNDRED
THIRTY-THREE DOLLARS THIRTY-THREE CENTS ($8,333.33) each, together with all
accrued interest due at the time of payment of each such installment of
principal, commencing on May 1, 1996, and continuing on the first day of each
month thereafter and a final installment of ONE MILLION EIGHT THOUSAND THREE
HUNDRED THIRTY-THREE DOLLARS FIFTY-THREE CENTS ($1,008,333.53), together with
all accrued interest due at the time of payment of such installment, on April
1, 2001. Monthly payments hereunder shall be applied first to interest due and
the balance to reduction of the principalamount outstanding.
Payments of both principal of and interest on this Note shall be made in
lawful money of the United States of America, at 50 South Main Street, Akron,
Ohio 44308-1888, or at such other place as the Bank or any subsequent holder
hereof shall have designated to the Company in writing. Interest payable on
this Note shall be computed on a three hundred sixty (360) day per year basis
counting the actual number of days elapsed. If any payment under this Note
becomes due and payable on a day which is not a Business Day (as defined in
this Agreement), payment thereof shall be made on the immediately succeeding
Business Day.
This Note is issued pursuant to and is entitled to the benefits of a Credit
Facility and Security Agreement dated March 14, 1996, by and among the Company,
Lexington Precision Corporation ("LPC"), and the Bank (the "Agreement"), to
which Agreement reference is hereby made for a statement of the rights and
obligations of the Bank and the duties and obligations of the Company and LPC
in relation thereto; but neither this reference to said Agreement nor any
provisions thereof shall affect or impair the absolute and unconditional
obligation of the Company to pay the principal of or interest on this Note when
due.
The Company may prepay all or any portion of this Note at any time and in
any amount without penalty or premium, provided that all prepayments shall be
applied to installments of principal in the inverse order of their maturities.
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If an Event of Default (as defined in the Agreement), shall occur and shall
be continuing, the principal of this Note may be declared immediately due and
payable at the option of the Bank.
In the event that the Company fails to pay any regularly scheduled principal
or interest payment on the Demand Note, the Equipment Term Note, or the North
Canton Term Note (the "Notes") when due (other than as a result of acceleration
thereof based on a default or event of default other than the failure to make
any such regularly scheduled payments of principal or interest on the Notes
when due) which failure is not cured within the ten (10)-day cure period
provided in Section 6A of the Agreement (a "Payment Default"), or if an Event
of Default occurs and is continuing, which arises from fraudulent act(s) or
practice(s) of the Company which Event of Default is not cured within three (3)
Business Days after the Company's receipt of written notice thereof from the
Bank (a "Fraud Default"), the Company hereby authorizes any attorney-at-law to
appear in any court of record in the State of Ohio, or in any other state or
territory of the United States, at any time or times after the above sum
becomes due, and waives the issuance and service of process and confesses
judgment against it, in favor of any holder of this Note, for the amount then
appearing due, together with the costs of suit, and thereupon to release all
errors and waive all rights of appeal and stay of execution. The foregoing
warrant of attorney shall survive any judgment, it being understood that should
any judgment be vacated for any reason, the foregoing warrant of attorney
nevertheless may thereafter be used for obtaining an additional judgment or
judgments. To the extent that the provisions of the cognovit warning set forth
above the Company's signature specifically contradict the provisions of this
paragraph regarding the requirement of a Payment Default or a Fraud Default to
take a cognovit judgment, the provisions of this paragraph control.
No delay on the part of any holder hereof in exercising any power or rights
hereunder shall operate as a waiver of any power or rights. Any demand or
notice hereunder to the Company shall be deemed duly given or made when sent,
if given by telecopier, when delivered, if given by personal delivery or
overnight commercial carrier, or the fifth calendar day after deposit in the
United States mail, certified mail, return receipt requested, addressed to the
Company at its address (or telecopier number) set forth in Rider A of the
Agreement or such other address or telecopier number as may be hereafter
designated in writing by the Company to the Bank.
This note is executed at Canton, Stark County, Ohio.
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WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR,
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT, OR ANY OTHER CAUSE.
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LEXINGTON COMPONENTS, INC.
By Dennis J. Welhouse
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Dennis J. Welhouse
Vice Chairman and Assistant Secretary