DEMAND PROMISSORY NOTE
$1,500,000.00 March 1, 2004
FOR VALUE RECEIVED, the undersigned, DIALYSIS CORPORATION OF AMERICA, a
Florida corporation (the "Borrower"), hereby promises to pay the Principal
Sum (as defined below) to the order of MEDICORE, INC., a Florida corporation,
or its successors and assigns (hereinafter, with any subsequent holder, the
"Holder"), at its principal offices located at 2337 West 76th Street,
Hialeah, Florida 33016, or at such other place or to such other party as
Holder of this demand promissory note ("Note") may from time to time
designate in writing, up to the maximum principal sum of One Million Five
Hundred Thousand and 00/100 ($1,500,000.00) Dollars ("Maximum Sum") in
accordance with this Note, together with accrued interest on the Principal
Sum (as defined below)at the rate of 1 1/4% per annum in excess of the prime
rate as reported by the Wall Street Journal (the "Prime Rate," which term
plus 1 1/4% is referred to as the "Interest"), which Interest shall be
computed daily, with Interest calculated as of the date each Advance (as
defined below) is made by Holder to Borrower. Advance shall mean those funds
advanced by Holder to Borrower in amounts of no less than Twenty-Five
Thousand and 00/100 ($25,000.00) Dollars, upon the detailed request of
Borrower solely for dialysis equipment purchases; and the Advances shall be
recorded and endorsed on the "Schedule of Advances and Payments" attached to
and made a part of this Note. The failure of Holder to make any such record
or endorsement shall in no way detract from or add to Borrower's obligations
under this Note. The Principal Sum shall mean all outstanding Advances to
the date of calculation of the Principal Sum. All payments of this Note
shall be made in lawful currency of the United States and in immediately
available funds. If the Principal Sum due under this Note is not paid in
full upon demand of Holder, Borrower agrees to pay, in addition to the
Principal Sum due under this Note, all costs of collection, including
reasonable attorneys' fees and expenses, whether suit is brought or not.
Borrower shall have the right to prepay all or any part of the Principal
Sum, together with all accrued Interest thereon, at any time without penalty.
Upon the occurrence of Borrower's failure to pay upon demand by Holder, and
during the continuance of such default, the rate of Interest accruing on the
Principal Sum and accrued Interest shall be increased to a fixed rate of 5%
over the Prime Rate.
This Note is subject to the express condition that at no time shall
Borrower be obligated or required to pay Interest hereunder at a rate that
could subject Holder to either civil or criminal liability as a result of
being in excess of the maximum lawful rate which Borrower is permitted by law
to contract or agree to pay. If, by the terms of this Note, Borrower is at
any time required or obligated to pay Interest at a rate in excess of such
maximum lawful rate, the rate of Interest under this Note shall be deemed to
be immediately reduced to such maximum lawful rate and Interest payable
hereunder shall be computed at such maximum lawful rate and the portion of
all prior Interest payments in excess of such maximum lawful rate shall be
applied and shall be deemed to have been payments in reduction of the
Principal Sum.
Borrower waives all exemption rights, whether under any state
constitution, homestead exemption or otherwise, and also waives demand,
presentment for payment, notice of dishonor, protest valuation and appraisal,
notice of protest, notice of dishonor, and any other notice required to be
given by law in connection with the delivery, acceptance, performance,
default or enforcement of this Note, and consents to all forbearance or
waiver of any term hereof or release or discharge by Holder of Borrower, or
the failure to act on the part of Holder or any other indulgence shown by
Holder from time to time, in one or more instances (without notice to or
further assent from Borrower), and Borrower agrees that no such action,
failure to act or failure to exercise any right or remedy on the part of
Holder shall in any way affect or impair the obligations of Borrower under
this Note or be construed as a waiver by Holder of or otherwise affect any of
Holder's rights under this Note.
All agreements, covenants, representations and warranties contained in
this Note or made in writing by or on behalf of Borrower in connection with
the transactions contemplated hereby shall survive the execution and delivery
of this Note until the Note is fully paid and performed. No termination or
cancellation (regardless of cause or procedure) of this Note shall in any way
affect or impair the powers, obligations, duties, rights and liabilities of
the parties hereto in any way with respect to any transaction or event
occurring prior to such termination or cancellation. Borrower further agrees
that to the extent that Borrower makes a payment or payments to Holder, which
payment or payments or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy,
insolvency or similar state or federal law, common law or equitable cause,
then, to the extent of such payment or repayment, the obligation or part
thereof intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been received by Holder.
This Note shall be governed by, and construed in accordance with, the
laws of the State of Florida.
In the event any one or more of the provisions contained in this Note
shall, for any reason, be held to be invalid, illegal, or unenforceable in
any respect, such invalidity, illegality, or unenforceability shall not
affect any other provision of this Note and this Note shall be construed as
if such invalid, illegal, or unenforceable provision had never been contained
herein.
This Note may not be changed orally, but only by an agreement in writing
signed by the parties against whom enforcement of any waiver, change,
modification or discharge is sought.
Borrower represents that it has full power, authority and legal right to
execute and deliver this Note and that the debt hereunder constitutes the
valid and binding liability and obligation of Borrower.
IF THIS NOTE IS NOT PAID UPON DEMAND, BORROWER IRREVOCABLY AUTHORIZES
ANY CLERK OF ANY COURT OF RECORD OR ANY ATTORNEY TO ENTER IN ANY COURT OF
COMPETENT JURISDICTION IN THE STATE OF FLORIDA, JUDGMENT BY CONFESSION
AGAINST BORROWER AND IN FAVOR OF HOLDER OF THIS NOTE FOR THE ENTIRE AMOUNT OF
THIS NOTE THEN REMAINING UNPAID (INCLUDING PRINCIPAL, ACCRUED INTEREST AND
LATE CHARGES), TOGETHER WITH REASONABLE ATTORNEY'S FEES AND COURT COSTS,
WITHOUT ISSUANCE OR SERVICE OF PROCESS, STAY OF EXECUTION OR RIGHT OF APPEAL,
AND EXPRESSLY WAIVING THE BENEFIT OF ALL EXEMPTION LAWS (WHETHER BY STATE
CONSTITUTION, HOMESTEAD EXEMPTION OR OTHERWISE) AND ALL IRREGULARITY OR ERROR
IN ENTERING SAID JUDGMENT OR THE EXECUTION THEREON AND ALL RIGHTS OF APPEAL
AND STAYS OF EXECUTION, AND WILL REPRESENT A DEBT JUSTLY DUE HOLDER. NO
SINGLE EXERCISE OF THE FOREGOING POWER TO CONFESS JUDGMENT SHALL BE DEEMED TO
EXHAUST THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD BY ANY
COURT TO BE INVALID, VOIDABLE OR VOID, BUT THE POWER SHALL CONTINUE
UNDIMINISHED, AND IT MAY BE EXERCISED FROM TIME TO TIME AS OFTEN AS HOLDER OF
THIS NOTE SHALL ELECT, UNTIL SUCH TIME AS HOLDER OF THIS NOTE SHALL HAVE
RECEIVED PAYMENT IN FULL OF ALL INDEBTEDNESS OF BORROWER TO HOLDER OF THIS
NOTE UNDER THE TERMS HEREOF. THE EXECUTION OF THIS NOTE WILL BE DEEMED THE
EXECUTION OF THE AFFIDAVIT OF CONFESSION OF JUDGMENT FOR ENTRY OF THE
JUDGMENT WHICH HOLDER MAY ENFORCE IN ANY COURT OF COMPETENT JURISDICTION.
BORROWER KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHTS HE
MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, OR IN CONNECTION WITH THIS NOTE.
This Note and Borrower's obligations may not be assigned by Borrower
without the prior written consent of Holder.
This Note shall be binding upon Borrower and its successors and assigns
and shall inure to the benefit of Holder and its successors and assigns.
IN WITNESS WHEREOF, Borrower has duly executed this Note by its duly
authorized officer as of the day and year first above written.
ATTEST: BORROWER:
DIALYSIS CORPORATION OF AMERICA
/s/ Mike Rowe /s/ Stephen W. Everett
- ----------------------------- By:-------------------------------
STEPHEN W. EVERETT, CEO and President
STATE OF MARYLAND )
) SS:
COUNTY OF ANNE ARUNDEL )
The foregoing instrument was acknowledged before me this 1st day of
March, 2004 by STEPHEN W. EVERETT, as Chief Executive Officer and President
of DIALYSIS CORPORATION OF AMERICA, a Florida corporation, the individual who
I am satisfied is the person mentioned in the within instrument and thereupon
he acknowledged that he signed and delivered the foregoing instrument for the
uses and purposes therein expressed, on behalf of the corporation.
/s/ Priscilla Jackson
---------------------------------
Notary Public
SCHEDULE OF ADVANCES AND PAYMENTS
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Amount of Amount of
Amount of Principal Interest Principal Endorsed
Date Advance Prepaid Paid Balance By Lender
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