Exhibit 10.2

   

THIS INSTRUMENT, AND THE RIGHTS AND OBLIGATIONS EVIDENCED HEREBY, ARE
SUBORDINATE IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN
SUBORDINATION AGREEMENT DATED MARCH 12, 2015 BETWEEN PNC BANK, NATIONAL
ASSOCIATION, AS AGENT, AND GILL FAMILY CAPITAL MANAGEMENT, INC., AND CONSENTED
TO BY THE BORROWERS DEFINED THEREIN.

 

 

 

PROMISSORY NOTE

 

 

$4,000,000.00 

 Louisville, Kentucky

 

 March 12, 2015

 

FOR VALUE RECEIVED, each of the undersigned, Sypris Solutions, Inc., a Delaware
corporation, Sypris Technologies, Inc., a Delaware corporation (“Technologies”),
Sypris Electronics, LLC, a Delaware limited liability company (“Electronics”),
SYPRIS DATA SYSTEMS, INC., a Delaware corporation, SYPRIS TECHNOLOGIES MARION,
LLC, a Delaware limited liability company, SYPRIS TECHNOLOGIES KENTON, INC., a
Delaware corporation, SYPRIS TECHNOLOGIES MEXICAN HOLDINGS, LLC, a Delaware
limited liability company, SYPRIS TECHNOLOGIES NORTHERN, INC., a Delaware
corporation, SYPRIS TECHNOLOGIES SOUTHERN, INC., a Delaware corporation, and
SYPRIS TECHNOLOGIES INTERNATIONAL, INC., a Delaware corporation (each a “Maker”
and collectively, the “Makers”), hereby jointly and severally promise and agree
to pay to the order of GILL FAMILY CAPITAL MANAGEMENT, INC., a Delaware
corporation with principal office and place of business at 101 Bullitt Lane,
Suite 450, Louisville, Kentucky 40222 (the “Lender”), the principal sum of up to
FOUR MILLON DOLLARS ($4,000,000.00) (the “Loan”), together with interest thereon
as provided below. The terms and provisions of this Promissory Note (this
“Note”) are as follows:

 

1.     Calculation of Interest. From the date hereof to and until April 12,
2016, which date shall be the maturity date of this Note (the “Maturity Date”),
the outstanding principal balance of this Note shall bear interest at the fixed
rate per annum equal to eight percent (8.00%).

 

2.     Payment of Principal and Interest. All principal and interest on this
Note shall be due and payable in full on the Maturity Date.

 

3.     Interest Calculated on 30-Day Month. All accrued interest on this Note
shall be calculated on the basis of the actual number of days elapsed over
twelve (12) assumed months consisting of thirty (30) days each.

 

4.     Default Rate. Commencing five (5) days after written notice from the
Lender (by facsimile transmission or otherwise) to the Makers to the effect that
any installment of principal of and/or accrued interest on this Note is overdue
(provided such notice shall be given no earlier than five (5) days after the due
date of any such installment), such overdue installment of principal and/or
accrued interest, provided it remains unpaid, shall commence to bear interest at
the ten percent (10%) per annum (the “Default Rate”), and such overdue
installment of principal and/or accrued interest together with all interest
accrued thereon at the rate set forth herein shall continue to be immediately
due and payable in full to the Lender. In the event the Lender accelerates the
maturity date of this Note due to the occurrence of any Event of Default
hereunder, the entire unpaid principal balance of this Note together with all
accrued and unpaid interest thereon shall, beginning five (5) days after notice
of acceleration of the maturity date of this Note has been given to the Makers,
commence to bear interest at the Default Rate, and all such unpaid principal
together with all interest accrued and unpaid thereon, including, without
limitation, all interest accrued and accruing thereon as provided in this
sentence, shall continue to be immediately due and payable in full to the
Lender.

 

 
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5.     Place of Payment. All payments of principal and interest on this Note
shall be made to the Lender in legal tender of the United States of America at
its offices located at 101 Bullitt Lane, Suite 450, Louisville, Kentucky 40222,
or to such other person or such other place as may be designated in writing by
the Lender.

 

6.     Security Agreements; Mortgages; Security for Note; Subordination
Agreement. This Note is secured by, among other instruments, each of the
following: [i] that certain Security Agreement of even date herewith by and
between the Makers and the Lender (the “General Security Agreement”), [ii] that
certain Patent Security Agreement of even date herewith by and among
Technologies, Electronics, and the Lender (the “Patent Security Agreement”),
[iii] that certain Trademark Security Agreement of even date herewith by and
between Electronics and the Lender (the “Trademark Security Agreement”) (the
General Security Agreement, the Patent Security Agreement and the Trademark
Security Agreement are collectively referred to herein as the “Security
Agreements”), and [iv] one or more mortgage(s) and deed(s) of trust executed and
delivered by certain of the Makers to and for the benefit of the Lender with
respect to real property owned by such Makers (collectively, the
“Mortgages”)(the Security Agreements, Mortgages, and this Note may be referred
to individually as a “Loan Instrument” and collectively as the “Loan
Instruments”). This Note is subject to the terms and provisions of that certain
Subordination Agreement of even date herewith by and between the Lender and PNC
Bank, National Association (the “Senior Lender”), as consented to by the Makers
(the “Subordination Agreement”).

 

7.     Representations and Warranties. Each Maker hereby jointly and severally
represents and warrants to the Lender, as follows, which representations and
warranties shall survive the execution and delivery of this Note and the making
of the disbursement of Loan proceeds hereunder:

 

7.1     Maker’s Existence. Each Maker is a duly organized or incorporated and
validly existing corporation or limited liability company, as applicable, in
good standing under the laws of the State of Delaware and has all requisite
authority to own its property and to carry on its business as presently
conducted. Each Maker is duly qualified to transact business and is validly
existing and in good standing as a foreign entity in every foreign jurisdiction
where the failure to so qualify would materially and adversely affect such
Maker’s business or its properties.

 

7.2     Authority of Maker. The obtaining of the Loan by each Maker from the
Lender and the execution, delivery and performance by each Maker of this Note,
the Security Agreements, the Mortgages and the other Loan Instruments to which
it is a party are within the organizational powers of each Maker, have been duly
authorized by all of the Directors or Members of such Maker, are not in
contravention of the Certificate of Incorporation, Certificate of Formation,
Bylaws or Operating Agreement of such Maker, as applicable, or the terms of any
indenture, agreement or undertaking to which such Maker is a party or by which
it or any of its property is bound, and do not contravene the provisions of, or
constitute a default under, or result in the creation of any lien (except as
expressly contemplated herein) upon the property of such Maker under any
indenture, mortgage, contract or other agreement to which such Maker is a party
or by which it or any of its properties is bound. Each Maker is duly qualified
to do business as a foreign limited liability company in each state in which it
is so required to be qualified.

 

 
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7.3     Taxes. Each Maker has filed or caused to be filed all federal, state and
local tax returns which, to the knowledge of its Members or Directors, are
required to be filed, and each Maker has paid or caused to be paid all taxes as
shown on such returns, on any assessment received by such Maker. Each Maker has
established reserves which are believed to be adequate for the payment of
additional taxes for years that have not been audited by the respective tax
authorities.

 

7.4     Enforceability. This Note, the Security Agreements, the Mortgages and
the other Loan Instruments to which any Maker is a party constitute valid and
legally binding obligations of each such Maker, enforceable in accordance with
their respective terms, subject to applicable bankruptcy, insolvency or similar
laws affecting the rights of creditors generally and to general principles of
equity, whether asserted in an action at law or in equity.

 

8.     Affirmative Covenants. Each Maker hereby jointly and severally agrees
that until the Loan and other secured indebtedness has been paid in full to the
Lender and this Note has been terminated, each Maker, shall perform and observe
all of the following provisions:

 

8.1     Financial Statements. Each Maker shall furnish to the Lender all
financial statements and other financial information in form and at the times
required to be furnished to the Senior Lender under the Credit Agreement (as
defined in the Subordination Agreement).

 

8.2     Inspection. Each Maker covenants that it will permit the Lender and its
employees and agents, at the Lender’s expense (unless an Event of Default or
Unmatured Event of Default has occurred hereunder, in which event the same shall
be at the expense of said Maker) to examine corporate books and financial
records of said Maker, and to discuss the affairs, finances and accounts of the
Maker at such reasonable times and as often as the Lender may reasonably
request.

 

8.3     Maker’s Existence. Each Maker shall preserve its existence as a limited
liability company or corporation, as applicable, under the laws of the State of
Delaware.

 

8.4     Further Assurances. Each Maker shall execute and deliver to the Lender
all agreements, documents and instruments, shall pay all filing fees and taxes
in connection therewith and shall take such further actions as the Lender may
reasonably request or as may be necessary or appropriate to effectuate the
intent of this Note and the other Loan Instruments.

 

8.5     Notice of Default. The Makers shall promptly notify the Lender in
writing of the occurrence of any Event of Default, specifying in connection with
such notification all actions proposed to be taken to remedy such circumstance.

 

8.6     Notice of Legal Proceedings. The Makers shall, promptly upon becoming
aware of the existence thereof, notify the Lender in writing of the institution
of any litigation, legal proceeding, or dispute with any person or tribunal,
that might materially and adversely affect the condition, financial or
otherwise, or the earnings, affairs, business prospects or properties of any
Maker.

 

8.7     Maintenance of Qualification and Assets. Each Maker shall at all times
maintain: (i) its qualification to transact business and good standing as a
foreign entity in all jurisdictions where the failure to so qualify would
materially and adversely affect the nature of its properties or the conduct of
its businesses; and (ii) all franchises, licenses, rights and privileges
necessary for the proper conduct of its businesses.

 

 
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8.8     Payment of Taxes and Claims. Each Maker shall pay all taxes imposed upon
it or upon any of its properties or with respect to its franchises, business,
income or profits before any material penalty or interest accrues thereon. Each
Maker shall also pay all material claims (including without limitation claims
for labor, services, materials and supplies) for sums which have or shall become
due and payable and which by law have or might become a vendors lien or a
mechanics, laborers’, materialmen’s, statutory or other lien affecting any of
its properties; provided, however, that the respective Maker shall not be
required to pay any such taxes or claims if (i) the amount, applicability or
validity thereof is being contested in good faith by appropriate legal
proceedings promptly initiated and diligently conducted and (ii) each Maker
shall have set aside on its books reserves (segregated to the extent required by
generally accepted accounting principles) adequate with respect thereto.

 

9.     Acceleration; Offset; Special Rights Relating to Collateral. Each of the
following events shall constitute an “Event of Default” under this Note: (a) the
Makers shall fail to pay the principal of and/or any accrued interest on this
Note when due and such failure shall continue for more than five (5) days after
such due date; (b) a representation contained herein or in any of the Security
Agreements, Mortgages or other Loan Instruments shall be untrue or any Maker
shall violate any of the other terms or covenants contained in this Note or in
any of the Security Agreements, Mortgages or other Loan Instruments and such
failure shall continue for a period of thirty (30) days after receipt by such
Maker of notice thereof from the Lender; (c) any Maker shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title 11 of
the United States Code or any other federal, state or foreign bankruptcy,
insolvency, receivership, liquidation or similar law, (ii) consent to the
institution of, or fail to contravene in a timely and appropriate manner, in any
such proceeding or the filing of any such petition, (iii) apply for or consent
to the appointment of a receiver, trustee, custodian, sequestrator or similar
official for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding, (v)
make a general assignment for the benefit of creditors, (vi) become unable,
admit in writing its inability or fail generally, to pay its debts as they
become due, or (vii) take any action for the purpose of effecting any of the
foregoing; (d) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of said Maker or of a substantial part of the property or assets of
said Maker under Title 11 of the United States Code or any other federal, state
or foreign bankruptcy, insolvency, receivership, liquidation or similar, law or
(ii) the appointment of a receiver, trustee, custodian, sequestrator or similar
official of said Maker, or of a substantial part of the property or assets of
said Maker; and any such proceeding or petition shall continue undismissed for
sixty (60) consecutive days or an order or decree approving or ordering any of
the foregoing shall continue unstayed and in effect for sixty (60) consecutive
days; then, and in each such event (other than an event described in subsections
(c) or (d) above); or (e) if there occurs any other “Event of Default” as
defined in the Security Agreements, the Mortgages, any of the other Loan
Instruments or in the Credit Agreement (as defined in the Subordination
Agreement) or any of the other agreements or documents executed in connection
with the Senior Debt (as defined in the Subordination Agreement) and the same
continues past any applicable grace period. After the occurrence and
continuation of any Event of Default, the Lender shall have full power and
authority at any time or times to exercise, at its sole option, all or any one
or more of the rights and remedies of a secured party under the Uniform
Commercial Code of the Commonwealth of Kentucky (the “Kentucky UCC”), the
Uniform Commercial Code of the State of Delaware (the “Delaware UCC”) and/or all
other applicable laws, including without limitation, declare the entire unpaid
principal balance of and all accrued and unpaid interest on this Note to be,
whereupon the same shall be, immediately due and payable in full to the Lender
(unless the Event of Default is of the type referred to in subsection (c) or (d)
above, in which event the entire unpaid principal balance of and all accrued and
unpaid interest on this Note shall automatically be due and payable in full to
the Lender without notice or demand). If any Event of Default shall occur and be
continuing, the Lender shall have the right then, or at any time thereafter, to
set off against, and appropriate and apply toward the payment of the unpaid
principal of and/or accrued and unpaid interest on this Note in such order as
the Lender may select in its sole and absolute discretion, whether or not this
Note shall then have matured or be due and payable and whether or not the Lender
has declared this Note to be in default and immediately due and payable, any and
all deposit balances and other sums and indebtedness and other property then
held or owed by the Lender to or for the credit or account of the Makers, and in
and on all of which the Makers hereby grant the Lender a first priority security
interest in and lien on to secure the payment of this Note, all without prior
notice to or demand upon the Makers or any other Person, all such prior notices
and demands being hereby expressly waived by the Makers. Any requirement of the
Kentucky UCC or the Delaware UCC for reasonable notice shall be met if such
notice is mailed, postage pre-paid, to the Makers at least five (5) days prior
to the time of the event given rise to the requirement of notice. Notice shall
be mailed to the address of the Makers as shown on the records of the Lender
maintained with respect to the Loan. The Lender shall have no responsibility for
the collection or protection of the Collateral or any part thereof or to
exercise (or give notice to the Makers of) any option, privilege or right with
respect to the Collateral, all of which are waived by the Makers. The Lender, at
its option, may transfer or register all or any part of the Collateral into its
or its nominee’s name without any indication of security interest, without
notice in either before or after the maturity of this Note. The Lender may
transfer this Note, and deliver the Collateral to the transferee, and the
transferee shall become vested with all powers and rights given to the Lender
with respect to the Collateral.

 

 
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10.     Rights Under Security Instruments; Cumulative Rights. Upon the
occurrence of any Event of Default, the Lender shall have all of the rights and
remedies under this Note, the Mortgages, the Security Agreements, the other Loan
Instruments and at law or in equity. All of the rights and remedies of the
Lender upon the occurrence of an Event of Default hereunder shall be cumulative
to the greatest extent permitted by law.

 

11.     Indemnity. The Makers shall jointly and severally indemnify and hold
harmless the Lender, its successors, assigns, agents and employees, from and
against any and all claims, actions, suits, proceedings, costs, expenses,
damages, fines, penalties and liabilities, including, without limitation,
reasonable attorneys’ fees and costs, arising out of, connected with or
resulting from (a) this Note or any of the other Loan Instruments, (b) the
Lender’s preservation or attempted preservation of any of the collateral taken
pursuant to any of the Loan Instruments, and/or (c) any failure of the security
interests and liens granted to the Lender pursuant to the Loan Instruments to be
or to remain perfected or to have the priority as contemplated herein and in the
Loan Instrument; provided, however, the Makers shall not have any obligation to
indemnify the Lender for any such claims, actions, suits, proceedings, costs,
expenses, damages, fines, penalties and/or liabilities to the extent the same
have been caused by or have arisen solely and completely from any gross
negligence or willful misconduct committed by the Lender. At the Lender’s
request, the Makers shall, at their own cost and expense, defend or cause to be
defended any and all such actions or suits that may be brought against the
Lender and, in any event, shall satisfy, pay and discharge any and all
judgments, awards, penalties, costs and fines that may be recovered against the
Lender in any such action, plus all attorneys’ fees and costs related thereto to
the extent permitted by applicable law; provided, however, that the Lender shall
give the Makers (to the extent the Lender seeks indemnification from the Makers
under this section) prompt written notice of any such claim, demand or suit
after the Lender has received written notice thereof, and the Lender shall not
settle any such claim, demand or suit, if the Lender seeks indemnification
therefor from the Makers, without first giving notice to the Makers of the
Lender’s desire to settle and obtaining the consent of the Makers to the same,
which consent the Makers hereby agree not to unreasonably withhold. All
obligations of the Makers under this section shall survive the payment of the
Note.

 

 
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12     Invalidity. If any part of this Note shall be adjudged invalid or
unenforceable, whether in general or in any particular circumstance, then such
partial invalidity or enforcement shall not cause the remainder of this Note to
be or to become invalid or unenforceable, and if a provision hereof is held
invalid or unenforceable, and if a provision hereof is held invalid or
unenforceable in one or more of its applications, the Lender and the Makers
hereby agree that said provision shall remain in effect in all valid
applications that are severable from the invalid or unenforceable application or
applications.

 

13.     Assignment. This Note may not be assigned by any or all of the Makers.
This Note and the other Loan Instruments may be assigned by the Lender. All
rights of the Lender hereunder shall inure to the benefit of its successors and
assigns, and all obligations, covenants and agreements of the Makers shall bind
its successors and assigns, if any.

 

14.     Entire Agreement. This Note and the other Loan Instruments constitute
the entire agreement between the Lender and the Makers with respect to the
subject matter hereof.

 

15.     Costs and Expenses. The Makers jointly and severally agree to pay: (a)
the reasonable fees of Lender’s counsel, including all out-of-pocket expenses
incurred by such counsel, including costs incurred on behalf of the Lender in
the negotiation, preparation, printing, documentation, review and execution of
this Note and other Loan Instruments, and (b) all other charges, out-of-pocket
costs and expenses incurred by the Lender or Lender’s counsel including, without
limitation, including all documentary stamp or other tax liabilities, recording
fees and costs of lien searches, certified documents and flood zone
verifications. All obligations of the Makers under this section shall survive
the termination or cancellation of this Note for any reason whatsoever.

 

16.     No Third Party Beneficiaries. All conditions of the obligations of the
Lender to disburse the proceeds of the Loan hereunder are imposed solely and
exclusively for the benefit of the Lender and its successors and assigns and the
Makers, and no other Person shall have standing to require satisfaction of such
conditions in accordance with their terms or be entitled to assume that the
Lender will refuse to disburse proceeds of the Loan in the absence of strict
compliance with any or all of such conditions, and no other Person shall, under
any circumstances, be deemed to be beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by the Lender at any time in its
sole and absolute discretion.

 

17.      Amendments. No amendment, modification, or supplement to this Note or
the other Loan Instruments, or to any other document or instrument executed or
issued by any of the parties hereto in connection with the transactions
contemplated herein, shall be binding unless executed in writing by all parties
hereto or thereto; and this provisions of this Note and the other Loan
Instruments shall not be subject to waiver by any party and shall be strictly
enforced.

 

18.      Role of the Lender. Notwithstanding any of the terms or conditions
hereof or of the other Loan Instruments to the contrary, the Lender shall not
have, and by its execution and acceptance of this Note hereby expressly
disclaims, any obligation or responsibility for the management, conduct or
operation of the business and affairs of any of the Makers. Any term or
condition hereof, or of any of the other Loan Instruments, permitting the Lender
to take or refrain from taking any action with respect to the Makers or the
collateral shall be deemed solely to permit the Lender to audit and review the
management, operation and conduct of the business and affairs of the Makers and
to maintain and preserve the security given by the Makers to the Lender, for the
secured obligations, and may not be relied upon by any other Person. Further,
the Lender shall not have, has not assumed, and by its execution and acceptance
of this Note and the other Loan Instruments hereby expressly disclaims, any
liability or responsibility for the payment or performance of any indebtedness
or obligation of the Makers, and no term or condition hereof, or of any of the
other Loan Instruments, shall be construed otherwise.

 

 
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19.     No Implied Waivers; Time is of the Essence. The failure of the Lender to
exercise any of its rights, powers and/or remedies shall not constitute a waiver
of the right to exercise the same at that or any other time. All rights and
remedies of the Lender for an Event of Default hereunder and/or under the other
Loan Instruments, shall be cumulative to the greatest extent permitted by law.
Time shall be of the essence in (i) the payment of all installments of principal
of and accrued interest on this Note, and (ii) the performance of the Makers’
other obligations hereunder and under the Security Agreements, Mortgages and the
other Loan Instruments.

 

20.     Attorneys’ Fees. If there is any Event of Default under this Note, the
Security Agreements, the Mortgages and/or the other Loan Instruments which is
not timely cured, and this Note is placed in the hands of any attorney for
collection, or is collected through any court, including any bankruptcy court,
the Makers promise and agree to pay to the Lender its reasonable attorneys’
fees, court costs and other expenses incurred in collecting or attempting to
collect or securing or attempting to secure this Note or enforcing the Lender’s
rights hereunder and under the Security Agreements, Mortgages and the other Loan
Instruments.

 

21.     Prepayment. This Note may be prepaid at any time, in whole or in part,
without penalty or premium.

 

22.     Governing Law; Jurisdiction. This Note and all of the rights and
remedies of the holder hereof shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Kentucky without regard to conflicts of
law principles. THE MAKERS SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF KENTUCKY AND OF ANY KENTUCKY
STATE COURT SETTING IN JEFFERSON COUNTY, KENTUCKY FOR PURPOSES OF ALL LEGAL
PROCEEDINGS ARISING OUT OF OR RELATING TO THIS NOTE, THE SECURITY AGREEMENTS,
MORTGAGES OR ANY OF THE OTHER LOAN INSTRUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.

 

23.     Waivers. The Makers hereby waive presentment, demand, notice of
dishonor, protest, notice of protest and nonpayment, and further waives all
exemptions to which it may now or hereafter be entitled to under the laws of
this or any other state or of the United States. The Lender shall have the right
to grant the Makers any extension of time for payment of this Note or any other
indulgence or forbearance whatsoever, and may release any security for the
payment of this Note if any, as applicable, in every instance without the
consent of the Makers and without in any way affecting the liability of the
Makers hereunder and without waiving any rights the Lender may have hereunder or
by virtue of the laws of the Commonwealth of Kentucky or any other state or of
the United States.

 

 
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24.     Legal Rate of Interest. Nothing herein contained shall be construed or
so operate as to require payment of interest at a rate greater than the highest
permitted contract rate under applicable law, or to make any payment or to do
any act contrary to applicable law. To this end, if during the course of any
litigation involving the enforceability of the obligations represented by this
Note, a court having jurisdiction of the subject matter or of the parties to
said litigation shall determine that either the interest rate as set forth
herein, or the effect of said rate in relation to the particular circumstances
of default resulting in said litigation, are separately or collectively
usurious, then the interest rate set forth herein shall be reduced, or the
operation and effect thereof ameliorated, to achieve the highest interest rate
or charge which shall not be usurious. As an example of such an amelioration, in
the event the indebtedness represented by this Note is declared due by the
Lender prior to maturity, and the total amount of interest paid causes interest
to exceed the highest rate permitted by law, such interest rate shall be
recalculated at the highest rate which shall not be usurious and any excess paid
over such recalculated interest rate shall be credited to the unpaid principal
of this Note.

 

25.     Captions. The section headings of this Note are inserted herein solely
for convenience of reference and shall not affect the construction or
interpretation of the provisions hereof.

 

26.     WAIVER OF JURY TRIAL. THE MAKERS HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY (AFTER ACTUAL CONSULTATION OR THE OPPORTUNITY TO HAVE CONSULTATION
WITH LEGAL COUNSEL) WAIVE THE RIGHT EACH MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED ON THIS NOTE, THE SECURITY AGREEMENTS, MORTGAGES OR ANY
OF THE OTHER LOAN INSTRUMENTS, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THE NOTE, THE LOAN OR ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION
THEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE LENDER IN MAKING THE LOAN TO THE MAKERS. THE PROVISIONS OF
THIS SECTION MAY ONLY BE MODIFIED BY A WRITTEN INSTRUMENT EXECUTED BY THE MAKERS
AND THE LENDER.

 

 

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IN WITNESS WHEREOF, the Makers agree to each of the terms set forth above and
has executed this Loan Note as of the 12th day of March, 2015.

 

 

Sypris Solutions, Inc.,

a Delaware corporation

 

By: John R.
McGeeney                                                                                     

 

Title: General
Counsel                                                                         
             

   

Sypris Technologies, Inc.,

a Delaware corporation

 

By: John R.
McGeeney                                                                  
                  

 

Title: General
Counsel                                                                               
       

 

Sypris Electronics, LLC,

a Delaware limited liability company

 

By: John R.
McGeeney                                                                          
          

 

Title: General
Counsel                                                                                  
    

   

SYPRIS DATA SYSTEMS, INC.,

a Delaware corporation

 

By: John R.
McGeeney                                                             
                       

 

Title: General
Counsel                                                                       
               

   

SYPRIS TECHNOLOGIES MARION, LLC,

a Delaware limited liability company

 

By: John R.
McGeeney                                                                                     

 

Title: General
Counsel                                                                                   
   

 

 
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SYPRIS TECHNOLOGIES KENTON, INC.,

a Delaware corporation

 

By: John R.
McGeeney                                                                         
           

 

Title: General
Counsel                                                                         
             

   

SYPRIS TECHNOLOGIES MEXICAN

HOLDINGS, LLC, a Delaware limited liability

company

 

By: John R.
McGeeney                                                                    
                

 

Title: General
Counsel                                                                       
               

   

SYPRIS TECHNOLOGIES NORTHERN, INC.,

a Delaware corporation

 

By: John R.
McGeeney                                                                 
                   

 

Title: General
Counsel                                                                        
              

   

SYPRIS TECHNOLOGIES SOUTHERN, INC.,

a Delaware corporation

 

By: John R.
McGeeney                                                                      
              

 

Title: General
Counsel                                                                            
          

     

SYPRIS TECHNOLOGIES INTERNATIONAL,

INC., a Delaware corporation

 

By: John R.
McGeeney                                                                     
               

 

Title: General
Counsel                                                                      
                

 

(the “Makers”)

 

 
10

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COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
Sypris Solutions, Inc., a Delaware corporation, to be his free act and voluntary
deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

       

 

 

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
Sypris Technologies, Inc., a Delaware corporation, to be his free act and
voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 
11

--------------------------------------------------------------------------------

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by _John R. McGeeney, as the General Counsel of
Sypris Electronics, LLC, a Delaware limited liability company, to be his free
act and voluntary deed and the free act and voluntary deed of such company.

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by __John R. McGeeney , as the General Counsel of
SYPRIS DATA SYSTEMS, INC., a Delaware corporation, to be his free act and
voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
SYPRIS TECHNOLOGIES MARION, LLC, a Delaware limited liability company, to be his
free act and voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

  

 
12

--------------------------------------------------------------------------------

 

 

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney     , as the General Counsel
of SYPRIS TECHNOLOGIES KENTON, INC., a Delaware corporation, to be his free act
and voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

   

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
SYPRIS TECHNOLOGIES MEXICAN HOLDINGS, LLC, a Delaware limited liability company,
to be his free act and voluntary deed and the free act and voluntary deed of
such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
SYPRIS TECHNOLOGIES NORTHERN, INC., a Delaware corporation, to be his free act
and voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 
13

--------------------------------------------------------------------------------

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
SYPRIS TECHNOLOGIES SOUTHERN, INC., a Delaware corporation, to be his free act
and voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 

 

COMMONWEALTH OF KENTUCKY

)

  ) SS: COUNTY OF JEFFERSON )

 

The foregoing instrument was subscribed, sworn to and acknowledged before me
this 12th day of March, 2015, by John R. McGeeney, as the General Counsel of
SYPRIS TECHNOLOGIES INTERNATIONAL, INC., a Delaware corporation, to be his free
act and voluntary deed and the free act and voluntary deed of such company.

 

 

 

/s/ Andrea Luescher

 

 

NOTARY PUBLIC

  [SEAL]    

 

My Commission Expires: July 20, 2015

 

 

 

14