THIS NOTE IS SUBJECT TO THE TERMS AND CONDITIONS OF THAT CERTAIN
SUBORDINATION AGREEMENT DATED AS OF AUGUST 7, 1997, BY AND
BETWEEN THE LENDER NAMED BELOW AND FOOTHILL CAPITAL CORPORATION.
PROMISSORY NOTE
$2,000,000.00 St. Louis, Missouri
August 7, 1997
FOR VALUE RECEIVED, the undersigned, ALLIED HEALTHCARE PRODUCTS,
INC., a Delaware corporation, B&F MEDICAL PRODUCTS, INC., a Delaware
corporation, BEAR MEDICAL SYSTEMS, INC., a California corporation, HOSPITAL
SYSTEMS, INC., a California corporation, LIFE SUPPORT PRODUCTS, INC., a
California corporation, BICORE MONITORING SYSTEMS, INC., a California
corporation, each with their chief executive office located at 0000 Xxxxxxxx
Xxxxxx, Xx. Xxxxx, Xxxxxxxx, 00000 (collectively "Borrowers") HEREBY JOINTLY
AND SEVERALLY PROMISE TO PAY to the order of WOODBOURNE PARTNERS, L.P., a
Missouri limited partnership (the "Lender") in lawful money of the United
States of America, the principal sum of TWO MILLION AND NO/100 DOLLARS
($2,000,000.00), together with interest thereon from the date hereof at a
fixed rate per annum equal to fourteen percent (14%), compounded
semi-annually. Principal and interest shall be due and payable as follows:
(a) Interest shall be due on the first Business Day of each month
(for the immediately preceding month), computed through the last calendar day
of the preceding month, and on the Maturity Date. Interest shall be
calculated on a daily basis (computed on the actual number of days elapsed
over a year of 360 days), commencing on the date hereof (including the first
day but excluding the last day); and
(b) Principal shall be due and payable on the earlier of: (a)
February 7, 1998 or thirty (30) days thereafter if extended in accordance
with the Purchase Agreement (the "Maturity Date"), or (b) the occurrence of
an Event of Default (as defined in the hereinafter defined Purchase
Agreement).
This Promissory Note ("Note") is the Promissory Note referred to in,
and is issued under the terms of, and pursuant to, the provisions of that
certain Note Purchase Agreement between the Lender and the Borrowers dated as
of August 7, 1997 (as the same may be amended, restated, extended, replaced
or otherwise modified from time to time, the "Purchase Agreement") and is
entitled to all of the benefits and security of the Purchase Agreement. All
of the terms, covenants and conditions of the Purchase Agreement and of the
other instruments evidencing or securing the indebtedness hereunder are
hereby made a part of this Note and incorporated herein in full by this
reference. All capitalized terms used herein, unless otherwise specifically
defined in this Note, shall have the same meanings as given them in the
Purchase Agreement.
If any payment of principal or interest due on this Note is payable on
a day other than a Business Day, then such payment shall be made on the next
Business Day.
If any Event of Default shall occur and shall not have been waived in a
writing given by the Lender to the Borrowers, then the outstanding principal
balance of this Note shall bear interest from and after the occurrence of
such Event of Default at the Default Rate until the principal balance of this
Note is paid in full.
Borrowers shall prepay this Note at the time and in the manner set
forth in the Purchase Agreement. Borrowers may wholly prepay this Note and
make partial prepayments hereon in whole multiples of $1,000 from time to
time, without penalty or premium, but only if (i) the Borrowers give Lender
written notice of their intention to make such prepayment at least one
Business Day prior to tendering the prepayment, and (ii) Borrowers pay any
accrued and unpaid interest on the Note to the date of such payment.
The earlier of the Maturity Date or the occurrence of an Event of
Default under the Purchase Agreement shall constitute an event of default
under this Note and shall entitle the Lender, at its option, to declare the
then outstanding principal balance and accrued interest thereon to be, and
the same shall thereupon become, immediately due and payable without notice
to or demand upon the Borrowers, all of which the Borrowers hereby expressly
waive.
Time is of the essence of this Note. To the fullest extent permitted
by applicable law, the Borrowers, for themselves and their respective
successors and assigns, expressly waive presentment, demand, protest, notice
of dishonor, notice of non-payment, notice of maturity, notice of protest,
presentment for the purpose of accelerating maturity, diligence in
collection, and the benefit of any exemption or insolvency laws.
Wherever possible each provision of this Note shall be interpreted in
such a manner as to be effective and valid under applicable law, but if any
provision of this Note shall be prohibited 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 remaining
provisions of this Note. No delay or failure on the part of the Lender in
the exercise of any right or remedy hereunder shall operate as a waiver
thereof, nor as an acquiescence in any default, nor shall any single or
partial exercise by the Lender of any right or remedy preclude any other
right or remedy. The Lender, at its option, may enforce its rights against
any collateral securing this Note without enforcing its rights against the
Borrowers, any guarantor of the indebtedness evidenced hereby or any other
property or indebtedness due or to become due to the Borrowers. The
Borrowers agree that, without releasing or impairing any Borrowers' liability
hereunder, the Lender may at any time release, surrender, substitute or
exchange any collateral securing this Note and may at any time release any
party primarily or secondarily liable for the indebtedness evidenced by this
Note. No amendment, modification or waiver of any provision of this Note,
nor consent to any departure by any Borrower herefrom, shall be effective
unless the same shall be in writing signed by an authorized officer of
Lender, and then only in the specific instance and for the purpose for which
given.
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In the event that any payment of any principal or interest due
hereunder shall not be paid when due, whether by reason of acceleration,
termination or otherwise, and this Note is placed in the hands of an attorney
or attorneys for collection or for foreclosure of any agreement, document or
instrument securing payment hereof or for representation of Lender in
connection with bankruptcy or insolvency proceedings relating hereto, each
Borrower jointly and severally promises to pay, in addition to all other
amounts otherwise due hereon, all costs and expenses of such collection,
foreclosure and representation, including, without limitation, reasonable
attorneys' fees, expert witness fees and all other costs and expenses paid or
incurred by Lender in connection therewith (whether or not litigation shall
be commenced in aid thereof).
All notices required to be given or which may be given in connection
with this Note shall be given in the manner required for notices under the
Purchase Agreement.
This Note is governed by and shall be interpreted in accordance with
the internal laws of the State of Missouri, without regard to conflict of law
rules.
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IN WITNESS WHEREOF, each Borrower has caused this Note to be executed
and delivered by its duly authorized representative as of the date first
above written.
ALLIED HEALTHCARE PRODUCTS, INC.
/s/ Xxxxx X. Xxxxx
By: ______________________________
Name: Xxxxx X. Xxxxx
Title: Vice President-Finance
ATTEST:
By: ____________________________
Name: ____________________________
Title: ____________________________
B&F MEDICAL PRODUCTS, INC.
/s/ Xxxxx X. Xxxxx
By: ______________________________
Name: Xxxxx X. Xxxxx
Title: Vice President-Finance
ATTEST:
By: ____________________________
Name: ____________________________
Title: ____________________________
BEAR MEDICAL SYSTEMS, INC.
/s/ Xxxxx X. Xxxxx
By: ______________________________
Name: Xxxxx X. Xxxxx
Title: Vice President-Finance
ATTEST:
By: ____________________________
Name: ____________________________
Title: ____________________________
HOSPITAL SYSTEMS, INC.
/s/ Xxxxx X. Xxxxx
By: ______________________________
Name: Xxxxx X. Xxxxx
Title: Vice President-Finance
ATTEST:
By: ____________________________
Name: ____________________________
Title: ____________________________
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LIFE SUPPORT PRODUCTS, INC.
/s/ Xxxxx X. Xxxxx
By: ______________________________
Name: Xxxxx X. Xxxxx
Title: Vice President-Finance
ATTEST:
By: ____________________________
Name: ____________________________
Title: ____________________________
BICORE MONITORING SYSTEMS, INC.
/s/ Xxxxx X. Xxxxx
By: ______________________________
Name: Xxxxx X. Xxxxx
Title: Vice President-Finance
ATTEST:
By: ____________________________
Name: ____________________________
Title: ____________________________
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