EXHIBIT 10.l
PROMISSORY NOTE
(NON-NEGOTIABLE)
$5,000,000 May 31, 1995
FOR VALUE RECEIVED, the undersigned, HOSPITAL COST CONSULTANTS, INC., a
California corporation ("Borrower"), hereby unconditionally promises to pay to
FIRST FINANCIAL MANAGEMENT CORPORATION, a Georgia corporation ("Lender"), at
Lender's office located at 3 Corporate Square, Suite 700, Atlanta, Georgia
30329, or at such other place as Lender of this Note may from time to time
designate in writing, in lawful money of the United States of America and in
immediately available funds, the principal sum of FIVE MILLION DOLLARS
($5,000,000), together with interest thereon as provided herein.
The principal amount hereof shall be due and payable in full on August 31,
1995 (the "Initial Maturity Date"); provided, however, that Borrower may extend
the maturity hereof until December 29, 1995 (the "Extended Maturity Date") by
delivering written notice of such extension to Lender not less than five (5)
days prior to the Initial Maturity Date. As a condition to such extension, no
Event of Default (as defined below) shall have occurred and been continuing as
of the effective date of such extension.
Borrower unconditionally promises to pay interest on the outstanding unpaid
principal amount hereof at the following rates:
(a) from the date hereof to, but not including, the Initial Maturity
Date, the outstanding unpaid principal amount hereof shall bear interest at
the rate per annum equal to LIBOR (as hereinafter defined) as in effect on
the date hereof, plus four percent (4%);
(b) from the Initial Maturity Date to, but not including, the Extended
Maturity Date, the outstanding unpaid principal amount hereof shall bear
interest at the rate per annum equal to LIBOR as in effect on the Initial
Maturity Date, plus six percent (6%).
Interest shall be due and payable on the last day of each of the periods
described in clauses (a) and (b) above, on the date of any partial prepayment of
the principal amount hereof and on the date of payment of this Note in full
(whether at maturity or by reason of prepayment in full or acceleration of the
principal amount hereof. Interest shall be computed on the daily outstanding
principal amount hereof on the basis of a 360-day year for the actual number of
days elapsed in the period during which it accrues.
As used herein, "LIBOR," as of any date of determination thereof, means the
rate published in the "MONEY RATES" column of The Wall Street Journal on such
date of determination (or if The Wall Street Journal is not published on such
date, then on the most recent date preceding such date of determination that The
Wall Street Journal is published) as the average
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of interbank offered rates for three month dollar deposits in the London market
based on quotations at five major banks, regardless of the stated effective date
thereof. In the event that The Wall Street Journal ceases to be published, then
Lender, by written notice to Borrower, shall specify an alternate, comparable
source for LIBOR.
Nothing contained in this Note shall be deemed to establish or require the
payment of a rate of interest in excess of the maximum rate permitted by any
applicable law. In the event that any rate of interest required to be paid
under this Note exceeds the maximum rate permitted by applicable law, such rate
shall automatically be reduced to the maximum rate permitted by such law and any
excess previously collected by Lender shall be, at Lender's option, either
applied to principal or returned to Borrower.
Payment of this Note is secured pursuant to the terms of that certain
Accounts Security Agreement of even date herewith between Borrower and Lender
(the "Security Agreement") and is guaranteed pursuant to the terms of that
certain Corporate Guaranty of even date herewith (the "Guaranty"), executed by
C.I.S. Technologies, Inc. ("C.I.S.") in favor of Lender, which Guaranty is
secured pursuant to the terms of that certain Pledge Agreement of even date
herewith (the "Pledge Agreement"), between C.I.S. and Lender.
Borrower may prepay the principal amount of this Note, in whole or in part,
at any time without penalty or premium. Upon any such prepayment, Borrower
shall pay all accrued but unpaid interest on the principal amount prepaid.
The occurrence of any of the following events shall constitute an "Event of
Default" hereunder:
(a) Borrower fails to pay any principal of or interest on this Note within
five (5) days after the due date thereof;
(b) Borrower fails to observe or perform any covenant or agreement
contained in this Note or in the Security Agreement, or C.I.S. fails to
observe or perform any covenant or agreement contained in that certain
Stock Purchase and Sale Agreement dated May 11, 1995 (the "Purchase
Agreement"), between Lender, MicroBilt Corporation and C.I.S., or in the
Guaranty or the Pledge Agreement and such default continues for thirty (30)
days after written notice from Lender;
(c) Any representation or warranty of Borrower in the Security
Agreement or of C.I.S. in the Purchase Agreement, the Guaranty or the
Pledge Agreement is inaccurate in any material respect as of the date made;
(d) Borrower or C.I.S. ceases to conduct its business as a going
concern;
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(e) A final judgment (after the expiration of all times to appeal
therefrom) for the payment of money in excess of $50,000 in the aggregate
not fully covered by insurance is entered against Borrower or C.I.S. or a
warrant of execution or similar process is issued or levied against
Borrower's or C.I.S.'s property, and within thirty (30) days thereafter,
such judgment, warrant or process shall not have been paid in full;
(f) A default shall occur under any other agreement, document or
instrument to which Borrower or C.I.S. is a party or by which Borrower or
C.I.S. or its property is bound, and such default (i) involves the failure
to make any payment (whether of principal, interest or otherwise) due
(whether by scheduled maturity, required prepayment, acceleration, demand
or otherwise) in respect of any indebtedness of Borrower or C.I.S. in an
aggregate amount exceeding $100,000, except for payments lawfully withheld
by Borrower or C.I.S., as the case may be, as a setoff in connection with a
good faith dispute between Borrower or C.I.S., as the case may be, and the
holder of such indebtedness, or (ii) causes (or permits any holder of such
indebtedness or a trustee to cause) such indebtedness, or a portion thereof
in an aggregate amount exceeding $100,000, to become due prior to its
stated maturity or prior to its regularly scheduled dates of payment;
(g) Borrower or C.I.S. commences a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect to itself
or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial
part of its property, or consents to any such relief or to the appointment
of or taking possession by any such official in an involuntary case or
other proceeding commenced against it, or makes a general assignment for
the benefit of creditors, or fails generally to pay its debts as they
become due, or takes any corporate action to authorize any of the
foregoing;
(h) Any involuntary case or other proceeding is commenced against
Borrower or C.I.S. seeking liquidation, reorganization or other relief with
respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, and such involuntary case or other
proceeding remains undismissed and unstayed for a period of sixty (60)
days; or an order for relief is entered against Borrower or C.I.S. under
the federal bankruptcy laws as now or hereafter in effect.
Upon the occurrence of an Event of Default, Lender may declare the entire
outstanding principal and interest evidenced by this Note immediately due and
payable and may pursue any and all actions to collect and enforce the collection
of such amounts; provided that upon the occurrence of an Event of Default
described in clause (g) or (h) above, the entire outstanding principal and
interest evidenced by this Note automatically shall become immediately due and
payable without any notice or other action whatsoever by Lender. The rights and
remedies of
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Lender are cumulative and not exclusive of any other right or remedy which such
holder may have by contract or at law or in equity.
No delay or failure on the part of Lender in the exercise of any right,
power or privilege granted under this Note or otherwise available by agreement,
at law or in equity, shall impair any right, power or privilege or be construed
as a waiver of any default or any acquiescence therein.
Borrower hereby waives demand, presentment, protest, notice of demand,
dishonor, presentment, protest, nonpayment and all other notices in connection
with this Note.
If this Note is collected by or through an attorney-at-law, all costs of
collection, including reasonable attorneys' fees, shall be payable by the
Borrower.
This Note shall be governed by and construed in accordance with the
internal laws (as opposed to conflicts of law provisions) of the State of New
York.
Whenever possible each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Note.
Whenever in this Note reference is made to Lender or Borrower, such
reference shall be deemed to include, as applicable, a reference to their
respective successors and assigns. The provisions of this Note shall be binding
upon and shall inure to the benefit of such successors and assigns. Borrower's
successors and assigns shall include, without limitation, a receiver, trustee or
debtor in possession of or for Borrower.
WITNESS the hand and seal of the undersigned, as of the date first above
written.
HOSPITAL COST CONSULTANTS, INC.
By: /s/ Phillip D. Kurtz
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Title: Vice President
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Attest: /s/ Kellie J. Watts
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Title: Secretary
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