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Exhibit 4.2
DEMAND NOTE
$1,000,000.00 Executed at LIMA , Ohio
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June 2 , 1997
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ON DEMAND, for value received, the undersigned, THE DRUGGIST, INC., AN OHIO
CORPORATION ("Debtor"), promises to pay to the order of NATIONAL CITY BANK,
COLUMBUS, A NATIONAL BANKING ASSOCIATION ("Bank"), which has its principal place
of business in Columbus, Ohio, at any office of Bank, ONE MILLION AND 00/100
DOLLARS (or, if less, the unpaid principal balance shown on an attachment to
this note or on Bank's loan account records) in lawful money of the United
States, together with interest, as provided below, payable monthly commencing
JULY 1 , 1997, and on demand.
This note represents an arrangement that allows Debtor to obtain advances
without giving Bank a separate note for each advance. However, THIS NOTE DOES
NOT OF ITSELF CONSTITUTE A COMMITMENT BY BANK TO MAKE ANY ADVANCES TO DEBTOR.
Bank will record the date and amount of each advance on an attachment to this
note or on Bank's loan account records. Xxxxxx agrees that each advance so
recorded shall be prima facie evidence that an advance was made on the date and
in the amount indicated. The number of advances and the amount of each advance
are not limited; provided, however, that the maximum unpaid principal balance
outstanding at any time shall not exceed the face amount of this note.
Prior to demand, principal and any overdue interest shall bear interest,
computed daily (on the basis of a 360-day year and actual days elapsed), at
rates determined according to the following options, to be elected by Debtor
from time to time for all or parts of the outstanding principal balance of this
note and, with regard to Option 2, for various periods of time (each being an
"Interest Period"):
OPTION 1: Computed at a fluctuating rate equal to the Prime Rate.
OPTION 2: Computed at a rate equal to the sum of: (i) two percent (2.0%)
PLUS (ii) the rate, as determined by Bank's Investment Department at
approximately 10:00 A.M. (Columbus, Ohio, time) on the date a quote is requested
by Debtor, at which deposits in U. S. Dollars are offered to Bank in the London
Interbank Market for maturities comparable to such Interest Period and in effect
as of the first day of the relevant Interest Period. Advances under this Option
2 shall be available only for Interest Periods of thirty (30), sixty (60),
ninety (90) or one hundred eighty (180) days and in minimum amounts of Five
Hundred Thousand and 00/100 Dollars ($500,000.00).
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Exhibit 4.2
If, for any amount upon which interest is accruing under Option 2, Debtor fails
to elect a subsequent option at the end of any Interest Period, Debtor shall be
deemed to have elected Option 1 for such amount until such time as Debtor
thereafter makes another election.
If interest is accruing under Option 1 for all or any portion of the outstanding
principal balance of this note, Debtor may prepay such principal amount, in
whole or in part, at any time without premium or penalty. If interest is
accruing under Option 2, Debtor may prepay such principal amount, in whole or in
part: (a) on the last day of the relevant Interest Period for such amount
without premium or penalty or (b) at any other time upon one (1) Business Day's
prior written notice if, concurrently with the prepayment, Debtor pays to Bank a
premium based upon the principal amount prepaid and computed (on the basis of a
360-day year and actual days elapsed) at a rate per annum equal to the excess,
if any, of the applicable interest rate over the Reinvestment Rate, for the
period from the date of prepayment to the last day of the relevant Interest
Period.
Concurrently with any prepayment of the principal of this note, Debtor shall pay
the unpaid interest accrued on the principal being prepaid.
If Debtor fails to pay any amount due hereunder, or any fee in connection
herewith, in full within ten (10) days after its due date, Debtor, in each case,
will incur and shall pay a late charge equal to the greater of Twenty and 00/100
Dollars ($20.00) or five percent (5.0%) of the unpaid amount. The payment of a
late charge will not impair any holder's right to demand repayment of this note.
Except as otherwise agreed in writing, payments will be applied first to accrued
but unpaid interest and fees, in that order, on an invoice by invoice basis in
the order of their respective due dates, until paid in full, then to late
charges and then to principal.
If this note is not paid in full on demand (whether by lapse of time,
acceleration of maturity or otherwise), the interest rate otherwise in effect
hereunder shall be increased by three percent (3.0%) per annum, provided that in
no event shall the principal of and interest on this note bear interest after
maturity at a rate less than the interest rate actually in effect hereunder
immediately after demand.
In this note, (a) DEBT means, collectively, all monetary liabilities, and any
charges or expenses incurred in connection therewith, now or hereafter owing by
the Person or Persons in question, including, without limitation, every such
liability whether owing by such Person or one (1) of such Persons alone or
jointly, severally or jointly and severally, whether owing absolutely or
contingently, or directly or indirectly, and whether created by loan, overdraft,
guaranty or other contract or by quasi-contract, tort, statute or other
operation of law; (b) BANK DEBT means Debt payable to Bank, whether initially
payable to Bank or acquired by Bank by purchase, pledge or
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Exhibit 4.2
otherwise and whether assigned or participated to or from Bank in whole or in
part; (c) PRIME RATE means the fluctuating rate of interest which is publicly
announced from time to time by Bank at its principal place of business as being
its "prime rate" or "base rate" thereafter in effect, with each change in the
Prime Rate automatically, immediately and without notice changing the
fluctuating interest rate thereafter applicable hereunder, it being agreed that
the Prime Rate is not necessarily the lowest rate of interest then available
from Bank on fluctuating rate loans; (d) OBLIGOR means any Person who is or
shall become obligated or whose property is or shall serve as collateral for the
payment of Debtor's Bank Debt or any part thereof in any manner and, in addition
to Debtor, includes, without limitation, any maker, endorser or guarantor; (e)
REINVESTMENT RATE means a rate of interest equal to the "bond equivalent yield"
for the most actively traded issues of U. S. Treasury Bills, U. S. Treasury
Notes or U. S. Treasury Bonds for a term similar to the period from the date of
prepayment to the last day of the relevant Interest Period and in a principal
amount comparable to the principal amount being prepaid, all as reasonably
determined by Bank; (f) RELATED WRITING means a writing of any form or substance
signed by any Obligor (whether as principal or agent) or by any attorney,
accountant or other representative of any Obligor and received by Bank in
respect of Debtor's Bank Debt or any part thereof, including, without
limitation, any credit application, credit agreement, reimbursement agreement,
financial statement, promissory note, guaranty, indenture, mortgage, security
agreement, authorization, subordination agreement, certificate, opinion or any
similar writing; (g) PERSON means a natural person or entity of any kind,
including, without limitation, any corporation, partnership, trust, governmental
body, or any other form or kind of entity; and (h) BUSINESS DAY means a day on
which Bank's main office is open to the public for carrying on substantially all
of its banking functions, but shall not include Saturdays, Sundays or legal
holidays. All accounting terms used in this note and not otherwise defined shall
be defined in accordance with generally accepted accounting principals.
Debtor certifies to Bank that all funds disbursed under this note will be used
for business or commercial purposes.
Xxxxxx and the undersigned guarantor hereby authorize Bank to share all credit
and financial information relating to Debtor and the undersigned guarantor with
Bank's parent company, and with any subsidiary or affiliate company of Bank or
of Bank's parent company.
In no event shall the interest rate in effect on this note exceed the maximum
rate permissible under the law governing this note.
Any holder's delay or omission in the exercise of any right under this note
shall not operate as a waiver of that right or of any other right under this
note.
If any provision of this note is determined by a court of competent jurisdiction
to be invalid, illegal or unenforceable, that determination shall not affect any
other provision of this note, and each
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Exhibit 4.2
such other provision shall be construed and enforced as if the invalid, illegal
or unenforceable provision were not contained herein.
This note and the Related Writings set forth the entire agreement between the
parties regarding the transactions contemplated hereby, and supersede all prior
agreements, commitments, discussions, representations and understandings,
whether written or oral, and any and all contemporaneous oral agreements,
commitments, discussions, representations and understandings between the parties
relating to the subject matter hereof.
No amendment, modification or supplement to this note or any Related Writings
shall be binding unless executed in writing by all parties thereto, and this
provision shall not be subject to waiver by any party and shall be strictly
enforced.
This note shall be governed by the law of the state in which Bank has its
principal place of business.
Debtor and the undersigned guarantor jointly and severally authorize any
attorney-at-law to appear in any state or federal court of record in the United
States after this note matures (whether by lapse of time, acceleration of
maturity or otherwise); to waive the issuance and service of process; to confess
judgment against Xxxxxx and/or the undersigned guarantor in favor of the holder
of this note for the amount then appearing due, together with interest and costs
of suit; and to release all errors and waive all rights of appeal and stay of
execution. If any judgment against Xxxxxx and/or the undersigned guarantor is
vacated for any reason, this warrant of attorney may be used to obtain
additional judgments.
WARNING-BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT TRIAL.
IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR
PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU
REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR RETURNED
GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH AGREEMENT, OR ANY OTHER
CAUSE.
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Exhibit 4.2
0000 Xxxxxxxxx Xxxx XXX XXXXXXXX, XXX.,
Xxxxxxxx, Xxxx 00000-0000 AN OHIO CORPORATION
(000) 000-0000
By: /s/ Xxxx X. Xxxxx
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Its: Secretary
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FOR VALUE RECEIVED, the undersigned guarantor (a) consents to the provisions of
the note, including, without limitation, the warrant of attorney; (b)
guarantees, absolutely and unconditionally, and jointly and severally with the
other undersigned guarantors, if any, the prompt payment in full of the note
(and any extensions thereof in whole or in part) when due (whether by lapse of
time, acceleration of maturity or otherwise) and whether or not the holder of
the note shall resort or shall have resorted to any other Obligor or to
security, if any; (c) waives presentment, demand for payment, notice of dishonor
and every other kind of notice to which the undersigned guarantor might be
entitled but for this waiver; (d) waives any and all claims, rights or remedies
the undersigned guarantor may now have or hereafter acquire against Debtor that
arises from the undersigned guarantor's performance hereunder or is in any way
related hereto, including, without limitation, subrogation, reimbursement,
contribution or indemnification, whether direct or indirect or arising by
contract, law, equity or otherwise; and (e) agrees that the liability of the
undersigned guarantors shall not be affected by any act, omission or course of
dealing on the part of the holder including, without limitation, any extension
of time, any waiver of an Event of Default, any release or exchange of security
(irrespective of the consideration, if any, received therefor) or any other
indulgence granted to any Obligor, in each case whether with or without notice
to the undersigned guarantor.
WARNING - BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT
TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR
RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT,
OR ANY OTHER CAUSE.
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Exhibit 4.2
0000 Xxxxxxx Xxxx - Xxx 000 XXXXX XXXXXX XXXX XXXXXXX,
Xxxx, Xxxx 00000-0840 A DELAWARE CORPORATION
(000) 000-0000
By: /s/ X. X. Xxxxxxxxxxx
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Its: VP & Treasurer
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