Exhibit 99.5
AMENDED AND RESTATED PROMISSORY NOTE
THE SECURITIES REPRESENTED BY THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR THE LAWS OF ANY STATE. THIS NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION HEREOF MAY BE PLEDGED, HYPOTHECATED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED ONLY IF REGISTERED AND QUALIFIED PURSUANT TO THE RELEVANT PROVISIONS OF FEDERAL AND STATE SECURITIES LAWS OR IF MAKER IS PROVIDED AN OPINION OF COUNSEL, WHICH OPINION IS SATISFACTORY IN FORM AND SUBSTANCE TO MAKER, TO THE EFFECT THAT SUCH REGISTRATION AND QUALIFICATION IS NOT REQUIRED.
THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER AND THE VOTING OF THE SECURITIES REPRESENTED BY THIS NOTE IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN STOCK RESTRICTION AGREEMENT BY AND BETWEEN MAKER AND CERTAIN HOLDERS OF SECURITIES OF MAKER. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF MAKER.
$250,000 |
| August 29, 2003 |
FOR VALUE RECEIVED, RevCare, Inc., a Nevada corporation (“Maker”), promises to pay to Russell Mohrmann, an individual, and Manuel Occiano, an individual (collectively, “Holder”), the principal sum of Two Hundred Fifty Thousand Dollars ($250,000.00), plus interest thereon from the date hereof until paid on the terms set forth below.
1. Payments. Monthly payments of (i) principal in the amount of Twenty-Five Thousand Dollars ($25,000) and (ii) accrued but unpaid interest shall commence on September 1, 2003. Maker and Holder acknowledge and agree that such payments shall be paid directly by Maker to Comerica Bank, to be applied against payments owed by Holder under that certain Variable Rate-Installment Note dated June 15, 2003 issued in favor of Comerica Bank-California in the original amount of $300,000 (the Comerica Note”), it being understood that Holder borrowed the funds under the Comerica Note to make its loan to Maker. The parties further acknowledge and agree that all payments made in accordance with this Note to Comerica shall be applied to reduce the principal and interest owed under this Note. Such payments shall continue on the first day of each month until this Note is paid in full (the “Maturity Date”).
2. Interest. The unpaid principal balance outstanding under this Note shall bear interest at a rate equal to that rate of interest as is charged under the Comerica Note.
3. Default; Acceleration. The entire sum of unpaid principal and any accrued but unpaid interest hereunder shall become immediately due and payable without further notice, demand or presentment, at Holder’s option, upon the occurrence at any time of any of the following events of default:
1
The foregoing option to accelerate the indebtedness evidenced hereby may be exercised by Holder at any time after the occurrence of any of the events of default. The failure to exercise said option upon the occurrence of one or more of such events of default shall not prevent its exercise upon the reoccurrence of such an event of default or upon the occurrence of any other event of default.
4. Maker Right to Prepay Note. All or any portion of the unpaid principal balance outstanding under this Note may be prepaid at any time during the term of this Note at the option of Maker. In the event only a portion of this Note is prepaid, Maker shall, at the time of prepayment and receipt of this Note, deliver to Holder a new Note evidencing the remaining unpaid principal balance of this Note, which Note shall in all other respects be identical with this Note.
5. Investment Representations. Holder acknowledges that this Note (i) constitutes a “security” under federal and applicable state securities laws, (ii) will be unregistered as such, and (iii) is being transferred in reliance upon exemptions from registration based, in part, upon Holder’s representations contained herein. Holder is acquiring such security for its own account and not with a view to, or for sale in connection with, any distribution thereof.
6. No Assignment. Neither Maker nor Holder shall be entitled to assign, pledge, transfer or otherwise convey the benefits or burdens of this Note without the prior written consent of the other, except that any entity acquiring all or substantially all of the assets or stock of Maker shall automatically acquire the burdens of this Note, however, Maker shall not be released from its obligations hereunder.
2
7. Applicable Law. This Note and the rights and obligations of the parties hereunder shall be construed under, and governed by, the laws of the State of California without giving effect to conflict of laws provisions.
8. Attorneys’ Fees. In the event of any suit, action or arbitration to enforce any of the terms or provisions of this Note, the prevailing party shall be entitled to its reasonable attorneys’ fees and costs. The foregoing entitlement shall also include attorneys’ fees and costs of the prevailing party on any appeal of a judgment and for any action to enforce a judgment.
9. Amendment and Restatement of Prior Note. This Note is being issued in connection with the exchange of certain assets and the promissory notes pursuant to that certain Purchase Agreement among Maker, Holder and Hospital Employee Labor Pool, a California corporation, of even date herewith (the “Purchase Agreement”). This Note amends and restates in its entirety that certain Revolving Note dated September 28, 2001, as amended by that certain First Amendment dated January 10, 2001 and that certain Second Amendment dated January 3, 2003.
10. Subordination. This Note and the rights of Holder hereunder are subordinate to the rights of Bridge Bank, NA pursuant to the terms of a Subordination Agreement executed in favor of Bridge Bank (the “Bridge Subordination Agreement”) and a Subordination Agreement executed in favor of FBR Financial Services Partners, L.P. (the “FBR Subordination Agreement”). Nothing contained in this Note shall directly or indirectly modify the provisions of the Bridge Subordination Agreement or the FBR Subordination Agreement in any manner which might terminate or impair the subordination of Holder’s indebtedness under such agreements or the subordination of the security interest or lien that Holder may have in any property of Maker or its subsidiaries, it being acknowledged that as of the date hereof, Holder has terminated all security interests it has in the property of Maker and its subsidiaries.
| RevCare, Inc., a Nevada corporation | ||
|
|
| |
| By: | /s/ George L. McCabe, Jr. | |
| Name: | George L. McCabe, Jr. | |
| Title: | Chairman | |
|
|
| |
Acknowledged and Agreed: |
|
| |
|
|
| |
|
|
| |
|
|
| |
/s/ Russell Mohrmann |
|
|
|
Russell Mohrmann |
|
| |
|
|
| |
|
|
| |
/s/ Manuel Occiano |
|
|
|
Manuel Occiano |
|
| |
DO NOT DESTROY THIS ORIGINAL NOTE: When paid, said original Note must be surrendered to Maker for cancellation and retention.
3
