PROMISSORY
NOTE
$1,500,000
September 29,
2006
FOR VALUE RECEIVED, the
undersigned, SOUTHPARK HOLDINGS II,
L.L.C., a Louisiana
limited liability company (the " Purchaser "), promises to
pay to PACER HOLDINGS OF LAFAYETTE, INC. D/B/A PACER HEALTH
HOLDINGS OF LAFAYETTE, INC., a Louisiana corporation ("
Pacer " and together with the Purchaser, the " Pa rt
ies " and each a " Party "), in lawful money of the
United States of America, the principal sum of One Million Five
Hundred Dollars ($1,500,000) pursuant to the following
terms:
RECITAL:
WHEREAS, the Parties and
Southpark Community Hospital, L.L.C., a Louisiana limited
liability company (the "Company"), have, simultaneously upon
the execution of this Promissory Note, entered into that certain
Agreement (the "Agreement") pursuant to which the Purchaser
acquired all of Pacer's Membership Interests in the Company, in
exchange for, among other things, the issuance by the Purchaser to
Pacer of this Promissory Note; and
WHEREAS, this Promissory
Note is incorporated into the Agreement as part thereof and is an
integral part of the consideration for the Agreement.
NOW THEREFORE, in
consideration of the terms and conditions contained herein and in
the Agreement, the Parties agree as follows:
AGREEMENT:
1.
Recital
. The Recital to this
Promissory Note, which the Parties acknowledge is true
and
correct, is hereby
incorporated herein by this reference.
2.
Payment
.
a.
This Promissory Note
shall be amortized over ten (10) years accruing interest
at
the rate of nine percent
(9%) per annum from the date hereof. The annual interest rate for
this Promissory Note is computed on a 365/360 basis; that is, by
applying the ratio of the annual interest rate over a year of
360 days, multiplied by the outstanding principal balance,
then multiplied by the actual number of days the principal balance
is outstanding. Equal payments of principal and interest shall
be due and payable beginning April 1, 2007 and commencing on
the first day of each month thereafter until March 1, 2017 as
provided on the amortization scheduled attached hereto as Schedule
2.
b.
The Company intends to
obtain one or more loans at such terms and from such sources as the
Company deems advisable and proper, for the purpose of refinancing
certain short and long term liabilities of the Company (the
"Refinancing"). In the event that the Company undertakes the
Refinancing and receives therefrom funds of at least $21,000,000
refinancing package before April 1, 2007, then the commencement of
the monthly payments referenced in
Section 2.a. shall be
accelerated to begin on the first calendar day of the month
following the date that is thirty (30) days from the date that
Company receives the Refinancing funds. In that event, a new
amortization schedule shall be prepared with the same interest rate
and monthly payment terms, but with a difference commencement date.
Payments under the Note shall still be made over ten (10) years on
a monthly basis.
c.
In the event that an
investor purchases certain membership interests in the Company and
invests capital directly into the Company (the "Investment") and
the Company receives more than $1,000,000 over and above
any investment funds committed to capital improvements related to
the Investment, then the commencement of the monthly payments
referenced in Section 2.a. shall be accelerated to begin on the
first calendar day of the month following the date that is thirty
(30) days from the date that the Company receives the Investment
funds. In that event, a new amortization schedule shall be prepared
with the same interest rate and monthly payment terms, but with a
difference commencement date. Payments under the Note shall still
be made over ten (10) years on a monthly basis.
d.
In the event that the
Company obtains the Refinancing as described in Section
2.b. and the Company
receives the Investment as described in Section 2.c., the Purchaser
shall pay $500,000 (the "Lump Sum Payment") towards principal and
accrued interest under the terms of this Promissory Note within
thirty (30) days of the Refinancing if the Refinancing is the later
of the two events to occur or within ten (10) days of the
Investment if the Investment is the later of the two events to
occur.
e.
Any such payment
referenced in Section 2d shall be applied first to outstanding
interest due hereunder and then to the outstanding principal
balance. In the event of such a
payment, the payments
under this Promissory Note on the remaining principal balance
("Balance Payments") shall be recalculated as follows:
i.
the number of months,
counting any partial month as one month, remaining during the
original term of this Promissory Note shall be the repayment
term
for the Balance
Payments;
ii.
the first Balance
Payment shall be due thirty (30) days following the date of the
Lump Sum Payment, with each remaining payment due on that date each
month;
iii.
equal monthly payments
shall be calculated for the months described in
Section 2.e.i.
above.
f.
Payments shall be made by the Purchaser
to Pacer by corporate check or money
order at Pacer's
address listed in Section 16 hereof, or at such other place in the
United States of
America as Pacer shall
designate to the Purchaser in writing.
g.
The Purchaser may,
without premium or penalty, at any date that a payment of principal
and interest payment is due, prepay all or any portion of the
outstanding principal balance due under this Promissory Note.
Unless otherwise agreed to in writing, early payments under this
Promissory Note will not relieve the Purchaser of the Purchaser's
obligation to
2
continue to make
regularly scheduled payments under the above payment schedule.
Early payments will instead reduce the principal balance due under
this Promissory Note.
h.
If the Purchaser fails
to pay any payment under this Promissory Note in full within five
(5) days of when due, the Purchaser agrees to pay Pacer a late
payment fee in an amount equal to 10.000% of the delinquent amount
of principal and interest due. Late charges will not be assessed
following declaration of default and acceleration of maturity of
this Promissory Note.
3.
Maturi V. The Purchaser
shall be obligated to continue to make payments to Pacer under this
Promissory Note, plus any and all interest accrued hereon and any
and all late fees, through such date on which the Purchaser fully
pays off the face amount of this Promissory Note to
Pacer, plus any and all interest accrued
hereon and any and all late fees, in accordance with
Section 2
herein
4.
Waiver and
Consent . To
the fullest extent permitted by law and except as otherwise
provided herein, the Purchaser waives demand, presentment, protest,
notice of dishonor, suit against or joinder of any other person,
and all other requirements necessary to charge or hold the
Purchaser liable with respect to this Promissory Note.
5.
Costs, Indemnities
and Expenses . In the event of default as
described herein, the Purchaser agrees to pay all reasonable fees
and costs incurred by Pacer in collecting or securing or attempting
to collect or secure this Promissory Note, including reasonable
attorneys' fees and expenses, whether or not involving litigation,
collecting upon any judgments and/or appellate or bankruptcy
proceedings. The Purchaser agrees to pay any documentary stamp
taxes, intangible taxes or other tax
