Document:

Exhibit 10.33

 

AMENDED AND RESTATED EQUIPMENT LINE NOTE

(Non-Revolving Line With Conversion)

 

	
  Amount:
  $11,000,000.00

  	
   

  	
  Date:
  November 10, 2006

  
	
   

  	
   

  	
  Chicago,
  Illinois

  

 

                The undersigned, BRAD FOOTE GEAR
WORKS, INC., f/k/a BFG Acquisition Corp., an Illinois corporation (the “Borrower”),
with its chief executive office located at 1309 S. Cicero Avenue, Cicero,
Illinois 60650, for value received, hereby promises to pay to the order of
LASALLE BANK NATIONAL ASSOCIATION f/k/a LaSalle National Bank f/k/a LaSalle
Bank NI, a national banking association (collectively, together with any holder
hereof, the “Bank”), at the Bank’s main offices at 135 South LaSalle Street,
Chicago, Illinois 60603, or such other address hereafter designated by the Bank
in writing, the principal sum of Eleven Million and 00/100 ($11,000,000.00)
Dollars (U.S.) or if less, the aggregate unpaid principal amount of all
advances (“Advances”) made by the Bank to the Borrower under this Note, plus
all accrued and unpaid interest calculated and payable at the applicable rates
and in the manner described below. 
Amounts borrowed and repaid under this Note may not be reborrowed.

 

                The term “Conversion Date” shall
mean April 29, 2007.

 

                Prior to the Conversion Date,
interest shall be payable monthly on this Note, commencing on November 30,
2006 and continuing on the last Business Day of each month thereafter,
calculated on the unpaid principal balances hereof at a variable rate per annum
equal to the Prime Rate (as hereinafter defined) minus one percent (1.0%).  The term “Prime Rate” at any time means the
rate of interest then most recently announced or published by the Bank as its
prime rate.  Each change in the interest
rate on this Note shall take effect on the effective date of the change in the
Prime Rate.  It is expressly agreed that
the use of the term “Prime Rate” is not intended nor does it imply that said
rate of interest is a preferred rate of interest or one which is offered by the
Bank to its most creditworthy customers. 
Bank shall be under no obligation to notify Borrower of any change in
the Prime Rate.  Interest shall be
computed on the basis of a year consisting of 360 days and paid for actual days
elapsed.

 

                Upon the Conversion Date, the
outstanding principal balance of this Note will be repayable in fifty-nine (59)
successive monthly installments of principal (based on a sixty month
amortization), plus interest as hereinafter provided (except that if the Fixed
Interest Rate, as hereinafter defined, is selected by Borrower, this Note shall
be repayable in monthly installments of principal and interest (or principal
plus if Variable Interest Rate option chosen), as calculated by the Bank),
commencing on May 31, 2007, and payable on the last Business Day of each
month thereafter, followed by a final payment of the entire unpaid principal
balance and accrued interest due on April 30, 2012 (the “Maturity Date”).  Interest on this Note after the Conversion
Date shall be payable concurrently with each principal payment, and shall at
Borrower’s election (which shall be designated by Borrower in a writing
delivered to the Bank prior to the Conversion Date) be calculated at either (i) a
variable rate equal to the Prime Rate minus one percent (1.0%) (the “Variable
Interest Rate”), or (ii) a fixed rate equal to two percent (2.0%) above
the “Swap Rate” (as hereinafter defined) (such fixed rate, the “Fixed Interest
Rate”).

 

 

1

 

                Said election for either the
Variable Interest Rate or Fixed Interest Rate shall be made only once and shall
remain in effect for the balance of the term of this Note.  The term “Swap Rate” shall mean a rate of
interest equal to the per annum rate of interest at which the Bank determines
to be its cost of funds equal to the yield on United States Treasury Notes or
Securities having a maturity closest to the Maturity Date plus a corresponding
swap spread as published in “Bloomberg’s Financial Markets Commodities News”,
in effect on the Conversion Date, and in the absence of such publication, as
determined by the Bank in its sole discretion.

 

                Advances under this Note will be
made in accordance with the terms of Section 3C of the Loan Agreement (as
hereafter defined), the terms of which are incorporated herein by reference.

 

                Any amount of principal which is
not paid when due, whether at the stated maturity, by acceleration, or
otherwise, shall bear interest payable on demand at an interest rate per annum
equal at all times to the interest rate otherwise then prevailing on this Note
plus three percent (the “Default Rate”). 
In addition, a late charge equal to five percent (5%) of each late
payment may be charged on any payment not received by the Bank within five (5) calendar
days after the payment due date, but acceptance of payment of this charge shall
not waive any Default or Event of Default.

 

                Unless otherwise agreed, all
payments shall be first applied to accrued interest to the date of payment,
then to unpaid principal, and any remaining amount toward Bank’s costs and
expenses incurred in collecting or attempting to collect this Note or incurred
in any other matter or proceeding relating to this Note.

 

                All payments made on account of
the principal and interest hereof shall be evidenced by entries on the books
and records of the Bank and shall be rebuttable presumptive evidence of the
principal amount and interest owing hereon. 
The failure to so record any such amount or any error so recording any
such amount shall not, however, limit or otherwise affect the obligations of
the Borrower hereunder to repay the principal amount borrowed hereunder and all
interest accruing thereon.

 

                If Borrower prepays this Note
while its bears interest at a variable rate, no prepayment penalty shall be
charged Borrower for any such prepayment. 
If Borrower prepays this Note while it bears interest at the Fixed
Interest Rate, such prepayment of the principal balance of this Note, whether
in whole or in part, shall be subject to the following conditions:

 

(i)    Not less than five (5) days prior to the date upon which
Borrower desires to make such prepayment, Borrower shall deliver to the Bank
written notice of its intention to prepay, which notice shall be irrevocable
and state the prepayment amount and the prepayment date;

 

(ii)   Borrower shall pay to the Bank, concurrently with such prepayment,
a prepayment premium calculated in accordance with the following paragraph.

 

(iii)  Borrower shall pay to the Bank all accrued and unpaid interest
through the date of such prepayment on the principal balance being prepaid; and

 

 

2

 

(iv)  Borrower shall pay to the Bank any other obligations of Borrower to
the Bank then due with respect to this Note which remain unpaid.

 

                Concurrently with any prepayment
on this Note, the Borrower shall pay Bank a prepayment premium calculated as
follows:  (i) an amount equal to
five percent (5%) of the principal amount prepaid if paid in the first (1st)
loan year, (ii) four percent (4%) of the principal amount prepaid if paid
in the second (2nd) loan year, (iii) three percent (3%) of the principal
amount prepaid if paid in the third (3rd) loan year, (iv) two percent (2%)
of the principal amount prepaid if paid in the fourth (4th) loan year, and (v) one
percent (1%) if paid in the fifth (5th) loan year.  For purposes of this Note, a “loan year”
shall mean each 12 month period following the Conversion Date.  Borrower acknowledges that the loan evidenced
hereby was made on the basis and assumption that the Bank would receive the
payments of principal and interest set forth herein for the full term
hereof.  Therefore, whenever the maturity
hereof has been accelerated by the Bank by reason of the occurrence of an Event
of Default or for any other reason, while this Note bears interest at the Fixed
Interest Rate, there shall be due, in addition to the outstanding principal
balance, accrued interest and other sums due hereunder, a premium equal to the
prepayment premium that would be payable pursuant to the preceding paragraph if
such principal balance had voluntarily been prepaid by Borrower.

 

                This Note is issued pursuant to
and entitled to the benefits of, and is secured by, the Loan and Security
Agreement dated as of January 17, 1997 between the Borrower and the Bank
(such agreement, as the same may be amended, restated, supplemented or
otherwise modified from time to time hereafter, the “Loan Agreement”) and the
other Loan Documents (as such terms are defined in the Loan Agreement), to
which reference is hereby made for a more complete statement of the terms and
conditions under which the loan evidenced hereby is made, and the terms and
conditions governing the collateral security for the obligations of the
Borrower hereunder.  Capitalized terms
used herein without definition shall have the meaning set forth in the Loan
Agreement.

 

                This Note evidences an amendment
and restatement of, increase to, and replacement and substitution for, that
certain $7,100,000.00 equipment line loan extended by the Bank to Borrower
previously evidenced by Borrower’s Equipment Line Note dated February 1,
2006 in the principal sum of $7,100,000.00 (the “Prior Note”).  The indebtedness evidenced by the Prior Note
is continuing indebtedness evidenced hereby, and nothing herein shall be deemed
to constitute a payment, settlement or novation of the Prior Note, or to
release or otherwise adversely affect any lien, mortgage or security interest
securing such indebtedness or any rights of the Bank against any guarantor,
surety or other party primarily or secondarily liable for such indebtedness.

 

                If any Event of Default shall
occur, then this Note and all other Indebtedness, at the option of the Bank,
shall immediately become due and payable, without notice or demand on the
Borrower, together with all expenses, costs and attorneys’ fees incurred or
expended by the Bank in enforcing its rights hereunder which shall become
additional indebtedness immediately due and payable hereon, and the Bank may
exercise any of the remedies provided by the Loan Agreement, or any other
document securing this Note, or under the UCC or other applicable law.

 

 

3

 

                The Bank may, at any time or
times hereafter, after an Event of Default shall occur, appropriate and apply
toward the payment of this Note any moneys, credits, deposits, checks,
accounts, drafts, securities, certificates of deposit or other property
belonging to the Borrower (or any of them), in the possession of or under the
control of the Bank, as well as any indebtedness of the Bank to the Borrower, then
due or to become due.

 

                Borrower hereby waives
presentment, demand, notice of dishonor and all other notices and demands in
connection with the enforcement of the Bank’s rights hereunder.  Any failure of the Bank to exercise any right
hereunder shall not be construed as a waiver of the right to exercise the same
or any other right at any other time.

 

                Borrower agrees to reimburse the
holder or owner of this Note upon demand for any and all costs and expenses
(including, without limit, court costs, legal expenses and reasonable attorney’s
fees, whether inside or outside counsel is used, whether or not suit is
instituted, and, if suit is instituted, whether at the trial court level,
appellate level, in a bankruptcy, probate or administrative proceeding or otherwise)
incurred in collecting or attempting to collect this Note or incurred in any
other matter or proceeding relating to this Note.  Any amounts payable with respect to the loan
evidenced by this Note which shall not be paid when due, including, without
limitation, principal, interest and the aforesaid costs and expenses, shall
bear interest at the Default Rate from the date payable until the date they are
paid in full.

 

                Borrower hereby represents that
the principal amount of the loan is a business loan, that the proceeds thereof
shall be used for business purposes only and that the same is exempt from
limitations upon lawful interest, pursuant to the terms of Section 205/4
of Chapter 815 of the Illinois Compiled Statutes.

 

                This Note may not be amended,
modified or changed nor shall any waiver of any of the provisions hereof be
effective, except only by an instrument in writing, signed by the party against
whom enforcement of any waiver, amendment, change, modification or discharge is
sought.

 

                No reference herein to the Loan
Agreement, and no provision of this Note, the Loan Agreement, or any of the
other Loan Documents, shall alter or impair the obligation of the Borrower,
which is absolute and unconditional, to pay the principal of and interest on this
Note at the place, at the respective times, and in the currency herein
prescribed.

 

                The provisions of this Note
shall be binding upon Borrower, its successors and assigns, and shall inure to
the benefit of and extend to the Bank and any holder hereof.

 

                THIS NOTE
HAS BEEN EXECUTED AND DELIVERED TO BANK AND ACCEPTED BY BANK IN THE STATE OF
ILLINOIS, IN WHICH STATE IT SHALL BE PERFORMED BY BORROWER.  THIS NOTE SHALL, IN ALL RESPECTS, BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO THE
CONFLICTS OF LAW PROVISIONS) OF THE STATE OF ILLINOIS, INCLUDING ALL MATTERS OF
INTERPRETATION, ENFORCEMENT, CONSTRUCTION, VALIDITY, PERFORMANCE AND EFFECT.

 

 

4

 

                EXCEPT AS
PROVIDED IN THE FOLLOWING PARAGRAPH, THE BANK AND BORROWER AGREE THAT ALL
DISPUTES BETWEEN THEM ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE, AND
WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED ONLY
BY STATE OR FEDERAL COURTS LOCATED IN COOK COUNTY, ILLINOIS.  BORROWER WAIVES IN ALL DISPUTES ANY OBJECTION
IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.

 

                BORROWER AGREES THAT THE BANK
SHALL HAVE THE RIGHT TO PROCEED AGAINST BORROWER OR ITS PROPERTY IN A COURT IN
ANY LOCATION NECESSARY TO ENABLE THE BANK TO OBTAIN A JUDGMENT AGAINST THE
BORROWER OR TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
INDEBTEDNESS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF
THE BANK.  BORROWER WAIVES ANY OBJECTION
THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH THE BANK HAS
COMMENCED A PROCEEDING DESCRIBED IN THIS PARAGRAPH.

 

                BORROWER AND THE BANK EACH WAIVE
ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING
IN CONTRACT, TORT, OR OTHERWISE, BETWEEN THE BANK AND BORROWER ARISING OUT OF,
CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THEM IN CONNECTION WITH THIS NOTE. 
INSTEAD, ANY DISPUTES RESOLVED IN COURT WILL BE RESOLVED IN A BENCH
TRIAL WITHOUT A JURY.

 

                Bank hereby notifies Borrower
that pursuant to the requirements of the USA Patriot Act (Title III of
Pub.  L. 107-56, signed into law October 26,
2001) (the “Act”), and Bank’s policies and practices, Bank is required to
obtain, verify and record certain information and documentation that identifies
Borrower, which information includes the name and address of Borrower and such
other information that will allow Bank to identify Borrower in accordance with
the Act.  In addition, Borrower shall (a) ensure
that no person who owns a controlling interest in or otherwise controls
Borrower or any subsidiary of Borrower is or shall be listed on the Specially
Designated Nationals and Blocked Person List or other similar lists maintained
by the Office of Foreign Assets Control (“OFAC”), the Department of the
Treasury or included in any Executive Orders, (b) not use or permit the
use of the proceeds of this Note to violate any of the foreign asset control
regulations of OFAC or any enabling statute or Executive Order relating
thereto, and (c) comply, and cause any of its subsidiaries to comply, with
all applicable Bank Secrecy Act (“BSA”) laws and regulations, as amended.

 

[signature page follows]

 

 

5

 

IN
WITNESS WHEREOF, the Borrower has caused this Note to be duly executed and
delivered as of the date first above written.

 

	
   

  	
   

  	
   

  	
  BRAD
  FOOTE GEAR WORKS, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:
  

  	
  /s/
  J. Cameron Drecoll

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  J.
  Cameron Drecoll

  
	
   

  	
   

  	
   

  	
  Title:
  

  	
  President

  
	
  Attest:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:
  

  	
  /s/
  Joan M. Drecoll

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Joan
  M. Drecoll

  	
   

  	
   

  	
   

  
	
  Title:
  

  	
  Secretary

  	
   

  	
   

  	
   

  
							

 

 

6Exhibit 10.34

 

CONSOLIDATED TERM NOTE

 

	
  Amount:
   $7,899,332.98

  	
   

  	
  Date:
  February 1, 2006

  
	
   

  	
   

  	
  Chicago,
  Illinois

  

 

FOR
VALUE RECEIVED, the undersigned, BRAD FOOTE GEAR WORKS, INC., f/k/a BFG
Acquisition Corp., an Illinois corporation (the “Borrower”), with its chief
executive office located at 1309 S. Cicero Avenue, Cicero, Illinois 60650,
hereby promises to pay to the order of LASALLE BANK NATIONAL ASSOCIATION f/k/a
LaSalle National Bank, f/k/a LaSalle Bank NI, a national banking association
(collectively, together with any holder hereof, the “Bank”), at the Bank’s main
offices at 135 South LaSalle Street, Chicago, Illinois.  60603, or such other address hereafter
designed by the Bank in writing, the principal sum of Seven Million Eight
Hundred Ninety Nine Thousand Three Hundred Thirty Two and 98/100
($7,899,332.98) Dollars (U.S.) in fifty-nine (59) equal successive monthly
installments of principal of $131,655.55, commencing on February 28, 2006
and continuing on the last Business Day of each month thereafter, to and
including December 31, 2010, followed by a final payment of the entire
remaining principal balance plus all accrued and unpaid interest due on January 31,
2011 (the “Maturity Date”).

 

Borrower
promises to pay to the Bank interest on the unpaid principal balance hereof
calculated at a variable rate per annum equal to the Prime Rate (as hereinafter
defined) minus one percent (1.0%), subject to Borrower’s one-time option set
forth below to convert the rate charged on this Note to a fixed rate.  Accrued interest shall be payable monthly
concurrently with each principal payment and on the Maturity Date.

 

The
term “Prime Rate” at any time means the rate of interest then most recently
announced or published by the Bank as its prime rate.  Each change in the interest rate on this Note
shall take effect on the effective date of the change in the Prime Rate.  It is expressly agreed that the use of the
term “Prime Rate” is not intended nor does it imply that said rate of interest
is a preferred rate of interest or one which is offered by the Bank to its most
creditworthy customers.  Bank shall be
under no obligation to notify Borrower of any change in the Prime Rate.  Interest shall be computed on the basis of a
year consisting of 360 days and paid for actual days elapsed.

 

Borrower
shall have a one-time option exercisable at any time during the term hereof and
provided no Event of Default shall then exist, upon two Business Days prior
written notice to the Bank to convert this Note to a fixed rate note (the “Fixed
Rate Conversion”) and two Business Days after Bank’s receipt of such written
notice (the “Fixed Rate Conversion Date”), and for the balance of the term of
this Note, the entire unpaid principal balance of this Note shall bear interest
at the Fixed Rate (as hereinafter defined). 
The “Fixed Rate” shall mean two hundred (200) basis points over the Swap
Rate (as hereinafter defined), as determined by the Bank as of the Fixed Rate
Conversion Date.  Upon the Fixed Rate
Conversion:  (i) the outstanding
principal balance of this Note shall be payable in equal monthly installments
of principal and interest in an amount sufficient to fully amortize the
outstanding principal balance of this Note, bearing interest at the Fixed Rate,
by the Maturity Date, (ii) the Bank will notify the Borrower in writing as
to the amount of such monthly payments, and (iii) such monthly payments
shall remain 

 

 

payable
on the last Business Day of each month thereafter, with a final payment of the
entire unpaid principal balance and all accrued and unpaid interest due on the
Maturity Date.

 

The
term “Swap Rate” shall mean a rate of interest equal to the per annum rate of
interest at which the Bank determines to be its cost of funds equal to the
yield on United States Treasury Notes or Securities having a maturity closest
to the Maturity Date plus a corresponding swap spread as published in “Bloomberg’s
Financial Markets Commodities News”, in effect on the Fixed Rate Conversion
Date, and in the absence of such publication, as determined by the Bank in its
sole discretion.

 

Any
amount of principal which is not paid when due, whether at the stated maturity,
by acceleration, or otherwise, shall bear interest payable on demand at an
interest rate per annum equal at all times to the interest rate otherwise then
prevailing on this Note plus three percent (the “Default Rate”).  In addition, a late charge equal to five
percent (5%) of each late payment may be charged on any payment not received by
the Bank within five (5) calendar days after the payment due date, but
acceptance of payment of this charge shall not waive any Default or Event of
Default.

 

Borrower
may prepay the principal balance of this Note in whole or in part at any time
while this Note bears interest at a variable rate.  Borrower may voluntarily prepay the principal
balance of this Note in whole or in part at any time after the Fixed Rate
Conversion Date, subject to the following conditions:

 

(i)                                   Not less than
14 days prior to the date upon which Borrower desires to make such prepayment,
Borrower shall deliver to Bank written notice of its intention to prepay, which
notice shall be irrevocable and state the prepayment amount and the prepayment
date;

 

(ii)                                Borrower shall
pay to Bank, concurrently with such prepayment, the Prepayment Premium (as
hereinafter defined);

 

(iii)                             Borrower shall
pay to Bank all accrued and unpaid interest through the date of such prepayment
on the principal balance being prepaid; and

 

(iv)                            Borrower shall
pay to Bank any other obligations (related to this Note) of Borrower to Bank
then due which remain unpaid.

 

Borrower
acknowledges that the loan evidenced hereby was made on the basis and
assumption that Bank would receive the payments of principal and interest set
forth herein for the full term hereof. 
Therefore, whenever the maturity hereof has been accelerated by Bank by
reason of the occurrence of an Event of Default, there shall be due, in
addition to the outstanding principal balance, accrued interest and other sums
due hereunder, a premium equal to the Prepayment Premium that would be payable
pursuant to the preceding paragraph if such principal balance had been
voluntarily prepaid by Borrower.

 

For
purposes of this Note, the “Prepayment Premium” shall be the amount calculated
as follows:  (i) an amount equal to
five percent (5%) of the principal amount prepaid if paid in the first loan
year, (ii) an amount equal to four percent (4%) of the principal amount
prepaid if paid 

 

2

 

in
the second loan year, (iii) an amount equal to three percent (3%) of the
principal amount prepaid if paid in the third loan year, (iv) an amount
equal to two percent (2%) of the principal amount prepaid if paid in the fourth
loan year, and (v) an amount equal to one percent (1%) of the principal
amount prepaid if paid in the fifth loan year or at any time thereafter.  For purposes of this Note, a “loan year”
shall mean each twelve-month period following the Fixed Rate Conversion Date.

 

All
payments made on account of the principal and interest hereof shall be
evidenced by entries on the books and records of the Bank and shall be
rebuttable presumptive evidence of the principal amount and interest owing
hereon.  The failure to so record any
such amount or any error so recording any such amount shall not, however, limit
or otherwise affect the obligations of the Borrower hereunder to repay the
principal amount borrowed hereunder and all interest accruing thereon.

 

Unless
otherwise agreed, all payments shall be first applied to accrued interest to
the date of payment, then to unpaid principal, and any remaining amount toward
the Bank’s costs and expenses incurred in collecting or attempting to collect
this Note or incurred in any other matter or proceeding relating to this Note.

 

This
Note is issued pursuant to, is entitled to the benefits of, and is secured by,
among other documents, the Loan and Security Agreement dated as of January 17,
1997 between the Bank and the Borrower (such agreement, as the same has
heretofore or now been, or hereafter may be, amended, restated, supplemented or
otherwise modified from time to time hereafter, the “Loan Agreement”), to which
reference is hereby made for a more complete statement of the terms and
conditions under which the loan evidenced hereby is made, and the terms and
conditions governing the collateral security for the obligations of the
Borrower hereunder.  Capitalized terms
used in this Note without definition shall have the meaning set forth in the
Loan Agreement.

 

This
Note evidences a consolidation and extension of prior loans made by the Bank to
the Borrower in the original principal sums of $6,096,791.00, $3,000,000.00 and
$1,500,000.00, evidenced by Borrower’s Amended and Restated Consolidated Term
Note dated April 29, 2004 in the principal sum of $6,096,791.00, Borrower’s
Amended and Restated Equipment Line Note dated November 15, 2004 in the
principal sum of $3,000,000.00 and Borrower’s Equipment Line Note dated June 15,
2005 in the principal sum of $1,500,000.00 (collectively, the “Prior Notes”).  The indebtedness evidenced by the Prior Notes
is continuing indebtedness evidenced hereby, and nothing herein shall be deemed
to constitute a payment, settlement or novation of the Prior Notes, or to
release or otherwise adversely affect any lien, mortgage or security interest
securing such indebtedness or any rights of the Bank against any guarantor,
surety or other party primarily or secondarily liable for such indebtedness.

 

If
any Event of Default shall occur, then this Note, at the option of the Bank,
shall immediately become due and payable, without notice or demand on the
Borrower, together with all expenses, costs and attorneys’ fees incurred or
expended by the Bank in enforcing its rights hereunder which shall become
additional indebtedness immediately due and payable hereon, and the Bank may
exercise any of the remedies provided by the Loan Documents, or under the
Illinois Uniform Commercial Code or other applicable law.

 

3

 

The
Bank may, at any time or times hereafter, after an Event of Default shall
occur, appropriate and apply toward the payment of this Note any moneys,
credits, deposits, checks, accounts, drafts, securities, certificates of
deposit or other property belonging to the Borrower, in the possession of or
under the control of the Bank, as well as any indebtedness of the Bank to the
Borrower, then due or to become due.

 

Borrower
hereby waives presentment, demand, notice of dishonor and all other notices and
demands in connection with the enforcement of the Bank’s rights hereunder.  Any failure of the Bank to exercise any right
hereunder shall not be construed as a waiver of the right to exercise the same
or any other right at any other time.

 

Borrower
agrees to reimburse the holder or owner of this Note upon demand for any and
all costs and expenses (including, without limit, court costs, legal expenses
and reasonable attorney’s fees, whether inside or outside counsel is used,
whether or not suit is instituted, and, if suit is instituted, whether at the
trial court level, appellate level, in a bankruptcy, probate or administrative
proceeding or otherwise) incurred in collecting or attempting to collect this
Note or incurred in any other matter or proceeding relating to this Note.  Any amounts payable with respect to the loan
evidenced by this Note which shall not be paid when due, including, without
limitation, principal, interest and the aforesaid costs and expenses, shall
bear interest at the Default Rate from the date payable until the date they are
paid in full.

 

Borrower
hereby represents that the principal amount of the loan is a business loan,
that the proceeds thereof shall be used for business purposes only and that the
same is exempt from limitations upon lawful interest, pursuant to the terms of Section 205/4
of Chapter 815 of the Illinois Compiled Statutes.

 

This
Note may not be amended, modified or changed nor shall any waiver of any of the
provisions hereof be effective, except only by an instrument in writing, signed
by the party against whom enforcement of any waiver, amendment, change,
modification or discharge is sought.

 

No
reference herein to the Loan Agreement and no provision of this Note, the Loan
Agreement, or any of the other Loan Documents shall alter or impair the
obligation of the Borrower, which is absolute and unconditional, to pay the
principal of and interest on this Note at the place, at the respective times,
and in the currency herein prescribed.

 

The
provisions of this Note shall be binding upon Borrower, its successors and
assigns, and shall inure to the benefit of and extend to the Bank and any
holder hereof.

 

THIS NOTE HAS BEEN EXECUTED AND DELIVERED TO BANK AND ACCEPTED BY BANK
IN THE STATE OF ILLINOIS, IN WHICH STATE IT SHALL BE PERFORMED BY BORROWER.  THIS NOTE SHALL, IN ALL RESPECTS, BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO THE
CONFLICTS OF LAW PROVISIONS) OF THE STATE OF ILLINOIS, INCLUDING ALL MATTERS OF
INTERPRETATION, ENFORCEMENT, CONSTRUCTION, VALIDITY, PERFORMANCE AND EFFECT.

 

4

 

EXCEPT AS PROVIDED IN THE FOLLOWING PARAGRAPH, THE BANK AND BORROWER
AGREE THAT ALL DISPUTES BETWEEN THEM ARISING OUT OF, CONNECTED WITH, RELATED
TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION
WITH THIS NOTE, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE,
SHALL BE RESOLVED ONLY BY STATE OR FEDERAL COURTS LOCATED IN COOK COUNTY,
ILLINOIS.  BORROWER WAIVES IN ALL
DISPUTES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT
CONSIDERING THE DISPUTE.

 

BORROWER AGREES THAT THE BANK SHALL HAVE THE RIGHT TO PROCEED AGAINST
BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION NECESSARY TO ENABLE THE
BANK TO OBTAIN A JUDGMENT AGAINST THE BORROWER OR TO REALIZE ON THE COLLATERAL
OR ANY OTHER SECURITY FOR THE INDEBTEDNESS, OR TO ENFORCE A JUDGMENT OR OTHER
COURT ORDER ENTERED IN FAVOR OF THE BANK. 
BORROWER WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF
THE COURT IN WHICH THE BANK HAS COMMENCED A PROCEEDING DESCRIBED IN THIS
PARAGRAPH.

 

BORROWER AND THE BANK EACH WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE
IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE,
BETWEEN THE BANK AND BORROWER ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
NOTE.  INSTEAD, ANY DISPUTES RESOLVED IN
COURT WILL BE RESOLVED IN A BENCH TRIAL WITHOUT A JURY.

 

Bank
hereby notifies Borrower that pursuant to the requirements of the USA Patriot
Act (Title III of Pub. L. 107-56, signed into law October 26, 2001) (the “Act”),
and Bank’s policies and practices, Bank is required to obtain, verify and
record certain information and documentation that identifies Borrower, which
information includes the name and address of Borrower and such other
information that will allow Bank to identify Borrower in accordance with the
Act.  In addition, Borrower shall (a) ensure
that no person who owns a controlling interest in or otherwise controls
Borrower or any subsidiary of Borrower is or shall be listed on the Specially
Designated Nationals and Blocked Person List or other similar lists maintained
by the Office of Foreign Assets Control (“OFAC”), the Department of the
Treasury or included in any Executive Orders, (b) not use or permit the
use of the proceeds of this Note to violate any of the foreign asset control
regulations of OFAC or any enabling statute or Executive Order relating
thereto, and (c) comply, and cause any of its subsidiaries to comply, with
all applicable Bank Secrecy Act (“BSA”) laws and regulations, as amended.

 

IN
WITNESS WHEREOF, the Borrower has caused this Note to be duly executed and
delivered by its duly authorized officers as of the date first above written.

 

5

 

	
   

  	
  BRAD
  FOOTE GEAR WORKS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
       /s/J.
  Cameron Drecoll

  
	
   

  	
   

  	
       J.
  Cameron Drecoll

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  President

  
				

 

Attest:

 

 

	
  By:

  	
      /s/Joan
  M. Drecoll

  	
   

  
	
   

  	
      Joan M. Drecoll

  

 

	
  Title:

  	
  Secretary

  

 

6

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