Exhibit 10.14
TERM PROMISSORY NOTE
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$14,000,000.00 AUGUST __, 1996
LOUISVILLE, KENTUCKY
FOR VALUE RECEIVED, HILLHAVEN PROPERTIES, LTD., an Oregon corporation
("Maker"), promises to pay, on or before the final maturity date stated below,
to the order of VENCOR, INC., a Delaware corporation ("Payee"), its successors
and assigns, at 3300 Providian Center, Louisville, Kentucky 40202 or at such
other place as the holder hereof may from time to time designate in writing, the
principal sum of $14,000,000.00, in lawful money of the United States, together
with interest on the outstanding principal balance thereof at the rate described
below (from time to time the "Interest Rate"). If an "Event of Default" (as
described below) shall exist, the rate of interest payable upon the outstanding
principal balance of this Note shall, at the option of Payee, increase to a rate
("Default Rate") equal to two percent (2%) in excess of the Interest Rate and
shall continue at such rate during the period that such Event of Default shall
exist.
1. INTEREST RATE. The principal balance of this Note shall bear interest
at a rate per annum equal to one percent (1%) over the Prime Rate from time to
time in effect. The "Prime Rate" as used herein, on any day, shall mean the
interest rate per annum most recently designated and announced by National City
Bank of Kentucky ("Bank") from time to time as its Prime Rate in effect at its
principal office. The Prime Rate is not necessarily the best or lowest rate
offered by Bank. The interest rate which the principal balance of this Note
bears shall be adjusted from time to time on the same day the Prime Rate is
changed by Bank. All interest upon sums owing under this Note shall be computed
over an assumed year of three hundred sixty (360) days and over the actual
number of days elapsed.
2. PAYMENT OF INTEREST. Interest shall be payable in quarterly
installments, the first of which being due and payable on the first day of the
first of January, April, June or September following the date of this Note and
subsequent installments being due and payable on the first day of each calendar
quarter (based upon the months just named) thereafter until this Note is paid in
full.
3. PAYMENT OF PRINCIPAL; APPLICATION OF PAYMENTS . The principal balance
of this Note, if not sooner paid, shall be repaid to Payee in its entirety on
the first anniversary of the date of this Note unless the maturity date of this
Note shall be extended by Payee in its sole discretion. This Note may be not be
prepaid in whole or in part at any time prior to the expiration of six months
from the date of its execution. Thereafter, this Note may be prepaid in whole or
in part without premium or penalty.
Payments received by Payee in respect of this Note shall be applied first to
expenses incurred by Payee in collecting this Note, then to accrued delinquency
or other charges hereof, then to accrued interest due on the principal balance
of this Note and then to the principal balance of this Note.
4. LATE PAYMENT CHARGE. In the event interest on this Note is not paid on
or before the 10th of the month in which it is due, a late charge of 5% of the
amount of such payment so overdue may be charged by the holder hereof.
5. EVENTS OF DEFAULT. Upon the occurrence of any of the events described
below ("Event of Default"), Payee may elect to declare this Note and all other
obligations of Maker to Payee hereunder to be in default and require the
immediate payment of the entire unpaid principal balance of this Note and all
other such obligations plus accrued interest and any delinquency or other
charges. The Events of Default are:
1) The failure to pay any installment or payment due in respect of this
Note when due and the expiration of ten days thereafter; or
2) A default by Maker under the terms of any loan or other financing
arrangement to which Maker is a party pursuant to the terms of which Maker is
directly, immediately or contingently liable for the payment of any sum in
excess of $5,000,000.00; or
3) The dissolution or winding-up of the business of Maker; or
4) The failure of Maker at any time prior to the maturity date of this
Note or any extension thereof to maintain a net worth (based upon generally
accepted accounting principles consistently applied) of at least $50,000,000.00.
5) The failure to pay any other obligation to Payee under other
indebtedness of Maker to Payee; or
6) The filing of any future petition by or against Maker under any
bankruptcy, receivership, insolvency or similar laws relating to relief for
debtors.
Maker and all persons now or hereafter liable, whether primarily or
secondarily, for the whole or any part of the indebtedness evidenced by this
Note jointly and severally:
(a) agree to remain and continue bound for the payment of the
principal of, and interest on, this Note notwithstanding any extensions of the
time of the payment of said principal or interest, or any changes in the amounts
to be paid under and by virtue of the obligation to pay provided for in this
Note, or any changes by way of release or surrender of any collateral, real or
personal, held as security for the payment of this Note, and waive all and every
kind of notice of such extensions or changes, and agree that same may be made
without the joinder of any such persons;
(b) waive presentment, notice of dishonor, protest, notice of protest
and diligence in collection, and all exemptions, whether homestead or otherwise,
to which they or any of them may now or hereafter be entitled under the laws of
the Commonwealth of Kentucky or of any other state;
(c) agree, upon default, to pay all costs of collecting, securing or
attempting to collect or secure this Note, including a reasonable attorney's
fee, whether same be collected or secured by suit or otherwise, providing the
collection of such costs and fees are permitted by applicable law.
6. SAVINGS CLAUSE. None of the terms and provisions contained in this
Note, or any other document or instrument now or hereafter securing the
indebtedness evidenced hereby or related hereto shall ever be construed to
create a contract for the use, forbearance or detention of money requiring
payment of interest at a rate in excess of the maximum interest rate permitted
to be charged by the laws of the Commonwealth of Kentucky. Neither the Maker nor
any other party now or hereafter becoming liable for the payment of this Note
shall be liable for the payment of interest at a rate in excess of the maximum
interest rate that may be lawfully charged under the laws of the Commonwealth of
Kentucky, and the provisions of this paragraph shall control over all other
provisions hereof and of any other instrument executed in connection herewith or
executed to secure the indebtedness evidenced hereby which may be in apparent
conflict with this paragraph. In the event the holder shall collect monies which
are deemed to constitute payments in the nature of interest which would
otherwise increase the effective interest rate on this Note to a rate in excess
of that permitted to be charged by the laws of the Commonwealth of Kentucky, all
such sums deemed
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to constitute interest in excess of the maximum rate shall be refunded to the
undersigned in cash and the undersigned hereby agrees to accept such refund.
7. CERTAIN WAIVERS. Payee shall have the right, without notice, to deal
in any way and at any time with Maker, and to grant Maker an extension of time
for payment of this Note or any other indulgence or forbearance whatsoever, and
may release any collateral for the payment of this Note and/or modify the terms
of any agreement securing or relating hereto, and may release Maker, any
guarantor or accommodation party from liability for payment of this Note, in
every instance without the consent of Maker or any guarantor or accommodation
party, and without in any way affecting the liability of Maker hereunder or of
any guarantor or accommodation party, and without waiving any rights which Payee
may have under this Note, any agreements securing or relating hereto, or by law.
8. MISCELLANEOUS. If any provision, or portion thereof, of this Note, or
the application thereof to any persons or circumstances, shall to any extent be
invalid or unenforceable, the remainder of this Note, or the application of such
provision, or portion thereof, to any other person or circumstances, shall not
be affected thereby, and each provision of this Note shall be valid and
enforceable to the fullest extent permitted by law. In the event of any
inconsistency between the terms hereof and those of any instrument securing
payment hereof, the holder hereof shall have the sole option to elect which of
such provisions shall govern.
9. GOVERNING LAW. This Note shall be governed by, and construed in
accordance with, the laws of the Commonwealth of Kentucky without regard to its
conflict of laws rules.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be
effective as of the date first above written.
HILLHAVEN PROPERTIES, LTD.,
an Oregon corporation
BY:_________________
ITS:________________
("Maker")
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