PROMISSORY NOTE
Principal Loan Date Maturity Loan No Call Collateral Account
$604,000.00 03-05-1999 09-05-2000 95141 41 1 310638
Officer Initials
3
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.
Borrower: THE FORSYTHE GROUP, INC. (TIN: 72-1331423)
507 TRENTON ST.
WEST MONROE, LA 71291
Lender: FIRST REPUBLIC BANK TIN: 72-0442767
1220 NORTH 18TH STREET P.O. BOX 2066
MONROE, LA 71201
Principal Amount: $604,000.00 Interest Rate: 9.750% Date of Note: March 5,1999
PROMISE TO PAY. THE FORSYTHE GROUP, INC. ("Borrower") promises to pay to the
order of FIRST REPUBLIC BANK ("Lender"), In law money of the United States of
America the sum of Six Hundred Four Thousand & 00/100 Dollars (U.S.$604,000.00)
or such other or lesser amounts as may be reflected from time to time on the
books and records of Lender as evidencing the aggregate unpaid principal
balance loan advances made to Borrower on a revolving line of credit basis as
provided below, together with simple Interest at the rate of 9.750% annum
assessed on the unpaid principal balance of this Note as outstanding from time
to time, commencing on March 6, 1999 and continue until this Note Is paid In
full, or until default under this Note with Interest thereafter being subject
to the default Interest rate provisions forth herein.
LINE OF CREDIT. This Note evidences a revolving line of credit "master note'.
Advances under this Note, as well as directions for payment from Borrower's
accounts, may be requested orally or In writing by Borrower or by an
authorized person. Lender may, but need not, require that all oral requests
be confirmed in writing. The following party or parties are authorized to
request advances under the line of credit until Lender receives from
Borrower at Lender's address shown above written notice of revocation
of their authority: JOANNE M. CALDWELL BAYLES, PRESIDENT. Borrower agrees
to be liable for all sums either: (a) advanced in accordance with the
instructions of an authorized person or (b) credited to any of Borrower's
deposit accounts with Lender. The unpaid principal balance owing on this
Note at any time may be evidenced by endorsements on this Note or Lender's
internal records, including daily computer print-outs. Lender will have
no obligation to advance funds under this Note if: (a) Borrower or guarantor
is in default under the terms of this Note or any agreement that Borrower
or any guarantor has with Lender, Including any agreement made connection
with the signing of this Note; (b) Borrower or any guarantor ceases doing
business or Is Insolvent; (c) any guarantor seeks, claims otherwise attempts
to limit, modify or revoke such guarantor's guarantee of this Note or
any other loan with Lender; (d) Borrower has applied fun provided pursuant
to this Note for purposes other than those acceptable to Lender; or (a)
Lender In good faith deems itself Insecure under this Note any other agreement
between Lender and Borrower.
PAYMENT. Borrower will pay this loan on demand, or If no demand Is made,
In one payment of all outstanding principal plus all accrued unpaid Interest
on September 5, 2000. In addition, Borrower will pay regular monthly
payments of accrued unpaid Interest beginning April 1999, and all subsequent
Interest payments are due on the same day of each month after that until
this Note Is paid In full. The annual interest rate for this 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 t outstanding principal balance,
multiplied by the actual number of days the principal balance Is outstanding.
Borrower will pay Lender at Lend address shown above or at such other
place as Lender may designate In writing. Unless otherwise agreed or
required by applicable law, payments be applied first to any unpaid collection
costs and any late charges, then to any unpaid Interest, and any remaining
amount to principal.
PREPAYMENT; MINIMUM INTEREST CHARGE. Borrower may prepay this Note In
full at any time by paying the then unpaid principal balance of t Note,
plus accrued simple Interest and any unpaid late charges through date
of prepayment. It Borrower prepays this Note in full, or if Lender
accelerates payment, Borrower understands that, unless otherwise required by
law, any prepaid fees or charges will not be subject to rebate and be earned
by Lender at the time this Note Is signed. Unless otherwise agreod to
In writing, early payments under this Note will not relieve Borrower's
obligation to continue to make regularly scheduled payments under
the above payment schedule. Early payments will Instead reduce the principal
balance due, and Borrower may be required to make fewer payments under
this Note.
LATE CHARGE. It Borrower fails to pay any payment under this Note
In full within 10 days of when due, Borrower agrees to pay Lender a late
payment for In an amount equal to U.S. $ 100.00. Late charges will not
be assessed following declaration of default and acceleration of maturity
of this Note.
DEFAULT. The following actions and/or reactions shall constitute default
events under this Note:
Default Under Loan Agreement. Should an event of default occur or exist
under the terms of Borrowor's Loan Agreement In favor of Lender.
Default Under This Note. Should Borrower default In the payment of
principal and/or Interest under this Note.
Default Under Security Agreements. Should Borrower or any guarantor
violate, or fall to comply fully with any of the terms and conditions
of, or default under any security right, Instrument, document, or agreement
directly or Indirectly securing repayment of this Note.
Other Defaults In Favor of Lender. Should Borrower or any guarantor
of this Note default under any other loan, extension of credit, security
right, instrument, document, or agreement, or obligation In favor of
Lender.
Default In Favor of Third Parties. Should Borrower or any guarantor
default under any loan, extension of credit, security agreement, purchase
sales agreement, or any other agreement, In favor of any other creditor
or person that may affect any property or other collateral directly
lndirectly securing repayment of this Note.
Insolvency. Should the suspension or Insolvency, However evidenced,
of Borrower or any guarantor of this Note occur or exist.
Death or Interdiction. Should any guarantor of this Note die or Interdicted.
Readjustment of Indebtedness. Should proceedings for readjustment of
indebtedness, reorganization,bankruptcy, composition or extention under
any insolvency law be brought by or against Borrower or any gauantor
Assignment for Benefit of Creditors. Should Borrower or any guarantor
file proceedings for a respite or make a general assignment for the
benefit of creditors.
Receivership. Should a receiver of all or any part of Borrowor's property,
or the property of any guarantor, be applied for or appointed.
Dissolution Proceedings. Should proceedings for the dissolution or
appointment of a liquidator of Borrower or any guarantor be commenced.
False Statements. Should any representation, warranty, or material
statement of Borrower or any guarantor made in connection with the
obtaining of the loan evidenced by this Note or any security agreement
directly or Indirectly securing repayment of this Note, prove to be
incorre or misleading in any respect.
Material Adverse Change. Should any material adverse change occur in
the financial condition of Borrower or any guarantor of this Note should
any material discrepancy exist between the financial statements submitted
by Borrower or any guarantor and the actual financial condition of Borrower
or such guarantor.
Insecurity. Should Lender deem itself to be Insecure with regard to
repayment of this Note.
LENDER'S RIGHTS UPON DEFAULT. Should any one or more default events occur or
exist under this Note as provided above, Lender shall have the right, at its
sole option, to declare formally this Note to be in default and to accelerate
the maturity and insist upon immediate payment in full of the unpaid principal
balance then outstanding under this Note, plus accrued interest, together with
reasonable attorneys' fees, costs, expenses and other fees and charges as
provided herein. Lender shall have the further right, again at its sole
option, to declare formal default and to accelerate the maturity and to
insist upon immediate payment in full of each and every other loan,
extension of credit, debt, liability and/or obligation of every nature and
kind that Borrower may then owe to Lender, whether direct or indirect or by
way of assignment, and whether absolute or contingent, liquidated or
unliquidated, voluntary or involuntary, determined or undetermined, secured
or unsecured, whether Borrower is obligated alone or with others on a
"solidary" or "joint and several" basis, as a principal obligor or otherwise,
all without further notice or demand, unless Lender shall otherwise elect.
INTEREST AFTER DEFAULT. If Lender declares this Note to be in default,
Lender has the right prospectively to adjust and fix the simple interest
rate under this Note until this Note is paid in full, as follows: (1) If the
original principal amount of this Note is $250,000 or less, the fixed default
interest rate shall be equal to eighteen (18%) percent per annum, or three
(3%) per cent per annum in excess of the interest rate under this Note,
whichever is greater. (2) If the original principal amount of this Note is
more than $250,000, the fixed default interest rate shall be equal to twenty-one
(21%) percent per annum, or three (3%) per cent per annum in excess of the
interest rate under this Note at the time of default, whichever is greater.
ATTORNEY'S FEES. If Lender refers this Note to an attorney for collection, or
files suit against Borrower to collect this Note, or if Borrower files for
bankruptcy or other relief from creditors, Borrower agrees to pay Lender's
reasonable attorneys' fees in an amount not exceeding 25.000% of the unpaid
debt then owing under this Note.
NSF CHECK CHARGES. In the event that Borrower makes any payment under this Note
by check and Borrower's check is returned to Lender unpaid due to nonsufficient
funds in my deposit account, Borrower agrees to pay Lender an additional NSF
check charge equal to $18.00.
DEPOSIT ACCOUNTS. As collateral security for repayment of this Note and all
renewals and extensions, as well as to secure any and all other loans,
PROMISSORY NOTE
(Continued)
03-05-1999 Page 2
notes, indebtedness and obligations that Borrower (or any of them) may
now and in the future owe to Lender or incur In Lender's favor, whether
direct or Indirect, absolute or contingent, due or to become due, of any
nature and kind whatsoever (with the exception of any Indebtedness under
a consumer credit card account), Borrower is granting Lender a continuing
security Interest in any and all funds that Borrower may now and In the
future have on deposit with Lender or In certificates of deposit or other
deposit accounts as to which Borrower Is an account holder (with the exception
of IRA. pension, and other tax-deferred deposits). Borrower further agrees
that Lender may at any time apply any funds that Borrower may have on
deposit with Lender or In certificates of deposit or other deposit accounts
as to which Borrower Is an account holder against the unpaid balance of
this Note and any and all other present and future indebtedness and obligations
that Borrower (or any of them) may then owe to Lender, in principal, interest,
fees, costs, expenses, and attorneys' fees.
COLLATERAL. This Note is secured by: Possessory Collateral. Collateral
securing other loans with Lender may also secure this Note as the result
of cross-collateralization.
FINANCIAL STATEMENTS. Borrower agrees to provide Lender with such financial
statements and other related Information at such frequencies and in such
detail as Lender may reasonably request.
GOVERNING LAW. Borrower agrees that this Note and the loan evidenced
hereby shall be governed under the laws of the State of Louisiana.
Specifically, this business or commercial Note Is subject to La.R.S.9:3509
et seq.
WAIVERS. Borrower and each guarantor of this Note hereby waive demand,
presentment for payment, protest, notice of protest and notice of nonpayment,
and all pleas of division and discussion, and severally agree that their
obligations and liabilities to Lender hereunder shall be on a "solidary"
or "joint and several" basis. Borrower and each guarantor further severally
agree that discharge or release of any party who Is or may be liable to
Lender for the Indebtedness represented hereby, or the release of any
collateral directly or indirectly securing repayment hereof, shall not
have the effect of releasing any other party or parties, who shall remain
liable to Lender, or of releasing any other collateral that Is not expressly
released by Lender. Borrower and each guarantor additionally agree that
Lender's acceptance of payment other than In accordance with the terms
of this Note, or Lender's subsequent agreement to extend or modify such
repayment terms, or Lender's failure or delay In exercising any rights
or remedies granted to Lender, shall likewise not have the effect of releasing
Borrower or any other party or parties from their respective obligations
to Lender, or of releasing any collateral that directly or Indirectly
secures repayment hereof. In addition, any failure or delay on the part
of Lender to exercise any of the rights and remedies granted to Lender
shall not have the effect of waiving any of Lender's rights and remedies.
Any partial exercise of any rights and/or remedies granted to Lender
shall furthermore not be construed as a waiver of any other rights and
remedies; It being Borrower's Intent and agreement that Lender's rights
and remedies shall be cumulative In nature. Borrower and each guarantor
further agree that, should any default event occur or exist under this
Note, any waiver or forbearance on the part of Lender to pursue the rights
and remedies available to Lender, shall be binding upon Lender only to
the extent that Lender specifically agrees to any such waiver or forbearance
In writing. A waiver or forbearance on the part of Lender as to one default
event shall not be construed as a waiver or forbearance as to any other
default. Borrower and each guarantor of this Note further agree that
any late charges provided for under this Note will not be charges for
deferral of time for payment and will not and are not Intended to compensate
Lender for a grace or cure period, and no such deferral, grace or cure
period has or will be granted to Borrower In return for the lmpositon
of any late charge. Borrower recognizes that Borrower's failure to make
timely payment of amounts due under this Note will result In damages to
Lender, Including but not limited to Lander's loss of the use of amounts
due, and Borrower agrees that any late charges Imposed by Lender hereunder
will represent reasonable compensation to Lender for such damages. Failure
to pay In full any Installment or payment timely when due under this Note,
whether or not a late charge Is assessed, will remain and shall constitute
an Event of Default hereunder.
SUCCESSORS AND ASSIGNS LIABLE. Borrower's and each guarantor's obligations
and agreements under this Note shall be binding upon Borrower's and each
guarantor's respective successors, heirs, legatees, devisees, administrators,
executors and assigns. The rights and remedies granted to Lender under
this Note shall inure to the benefit of Lender's successors and assigns,
as well as to any subsequent holder or holders of this Note.
CAPTION HEADINGS. Caption headings of the sections of this Note are
for convenience purposes only and are not to be used to Interpret or to
define their provisions. In this Note, whenever the context so requires,
the singular Includes the plural and the plural also includes the singular.
SEVERABILITY. If any provision of this Note is hold to be invalid, illegal
or unenforceable by any court, that provision shall be deleted from this
Note and the balance of this Note shall be interpreted as it the deleted
provision never existed.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF THIS NOTE.
BORROWER:
THE FORSYTHE GROUP, INC
BY /S/JOANNE CALDWELL-BAYLES
-----------------------------------
JOANE CALDWELL-BAYLES, PRESIDENT
Loan Agreement
State of Louisiana
Parish of Quachita
Before the undersigned witnesses came and appeared The Forsythe
Group. Inc. a Louisiana Corporation with offices at 507 Trenton
Street, West Monroe, Louisiana represented herein by its Secretary Sunshine
Gantt, hereinafter referred to as 'the Forsythe", and The Biltmore
Group of Louisiana, a Louisiana Limited Liability Company with offices
at 507 Trenton Street, West Monroe, Louisiana represented herein by
its Managing Member, Joanne M. Caldwell-Bayles, hereinafter refereed to
as "the Biltmore', who by those present enter into the following loan
agreement, to wit:
Background
I. Biltmore owns or is building Independent and Assisted Living Centers
in Oak Creek Arizona, Bastrop, Farmerville, Minden, Natchitoches,
Louisiana (the facilities").
II. Forsythe is the manager of the facilities owned by Biltmore.
III. From time to time the cash flow of the facilities may not be
sufficient to pay all or part of the operating cost and/or debt
service for the facilities.
IV. Forsythe has arranged a line of credit, which it will make,
advances to cover the cost, if necessary, set forth in paragraph III
above,
V. Advances to be made by Forsythe will be under the same terms and
conditions as set forth in the Forsythe loan with First Republic Bank
of Monroe, Louisiana (Exhibit A).
VI. As the facilities produce excess cash flow from operations the
facilities will repay any loan advance, including interest.
Thus done and signed on this 1st day of March 1999.
The Forsythe Group, Inc.
/S/MIKE BAYLES /S/SUNSHINE GANTT
- ----------------------------- --------------------------------
Witness By it Secretary
/S/FRED BAYLES
- -----------------------------
Witness
The Biltmore Group, Inc. of
Louisiana, L.L.C.
/S/JOANNE CALDWELL-BAYLES
-------------------------------
Managing Member