Exhibit 10.27

 

LOGO [g606995ex10_1pg01.jpg]

PROMISSORY NOTE

 

Principal    Loan Date    Maturity    Loan No    Call / Coll    Account   
Officer    Initials $2,010,027 00    03-19-2013    03-18-2014    11119391    4a
   37027    RUSSN     

References in the boxes above are for Lender’s use only and do not limit the
applicability of this document to any particular loan or item

Any item above containing **** has been omitted due to text length limitations

 

Borrower   

Foundation Surgery Affiliates, LLC

(TIN 80-0322719)

East El Paso Physicians’ Medical Center LLC

(TIN 26-1281512)

14000 N PORTLAND AVE STE 205

OKLAHOMA CITY, OK 73134-4004

   Lender   

Legacy Bank

OKC May

2801 W Memorial

Oklahoma City OK 73134

 

 

 

 

Principal Amount $2,010,027 00    Date of Note March 19, 2013

PROMISE TO PAY Foundation Surgery Affiliates, LLC, and East El Paso Physicians
Medical Center, LLC (“Borrower”) jointly and severally promise to pay to Legacy
Bank (“Lender”), or order, in lawful money of the United States of America the
principal amount of Two Million Ten Thousand Twenty-seven & 00/100 Dollars
($2,010,027 00) or so much as may be outstanding, together with interest on the
unpaid outstanding principal balance of each advance interest shall be
calculated from the date of each advance until repayment of each advance

PAYMENT Borrower will pay this loan in full immediately upon Lenders demand If
no demand is made, Borrower will pay this loan in one payment of all outstanding
principal plus all accrued unpaid interest on March 18, 2014 In addition
Borrower will pay regular monthly payments of all accrued unpaid interest due as
of each payment date, beginning April 19, 2013, with all subsequent interest
payments to be due on the same day of each month after that Unless otherwise
agreed or required by applicable law, payments will be applied first to any
unpaid collection costs then to any late charges, then to any accrued unpaid
interest and then to principal Borrower will pay Lender at Lender’s address
shown above or at such other place as Lender may designate in writing

VARIABLE INTEREST RATE The interest rate on this Note is subject to change from
time to time based on changes in an independent index which is the minimum prime
lending rate for large U S Money Center Commercial banks as published in the
Money Rate Section of the Wall Street Journal (the “Index”) The Index is not
necessarily the lowest rate charged by Lender on its loans If the Index becomes
unavailable during the term of this loan Lender may designate a substitute index
after notifying Borrower Lender will tell Borrower the current Index rate upon
Borrower’s request The interest rate change will not occur more often than each
day Borrower understands that Lender may make loans based on other rates as well
The Index currently is 3 250% per annum Interest on the unpaid principal balance
of this Note will be calculated as described in the “INTEREST CALCULATION
METHOD” paragraph using a rate of 3 750 percentage points over the Index rounded
up to the nearest 0 001 percent adjusted if necessary for any minimum and
maximum rate limitations described below resulting in an initial rate of 7 000%
per annum based on a year of 360 days NOTICE Under no circumstances will the
interest rate on this Note be less than 7 000% per annum or more than the
maximum rate allowed by applicable law

INTEREST CALCULATION METHOD Interest on this Note is computed on a 365/360
basis, that is, by applying the ratio of the interest rate over a year of 360
days, multiplied by the outstanding principal balance, multiplied by the actual
number of days the principal balance is outstanding All interest payable under
this Note is computed using this method

PREPAYMENT Borrower agrees that all loan fees and other prepaid finance charges
are earned fully as of the date of the loan and will not be subject to refund
upon early payment (whether voluntary or as a result of default) except as
otherwise required by law Except for the foregoing Borrower may pay without
penalty all or a portion of the amount owed earlier than it is due Early
payments will not unless agreed to by Lender in writing relieve Borrower of
Borrower’s obligation to continue to make payments of accrued unpaid interest
Rather early payments will reduce the principal balance due Borrower agrees not
to send Lender payments marked “paid in full” “without recourse or similar
language If Borrower sends such a payment Lender may accept it without losing
any of Lender’s rights under this Note and Borrower will remain obligated to pay
any further amount owed to Lender All written communications concerning disputed
amounts including any check or other payment instrument that indicates that the
payment constitutes “payment in full of the amount owed or that is tendered with
other conditions or limitations or as full satisfaction of a disputed amount
must be mailed or delivered to Legacy Bank OKC May 2801 W Memorial Oklahoma City
OK 73134

LATE CHARGE if a payment is 11 days or more late Borrower will be charged 5 000%
of the unpaid portion of the regularly scheduled payment or $23 50, whichever is
greater

INTEREST AFTER DEFAULT Upon default including failure to pay upon final maturity
the interest rate on this Note shall be increased by adding an additional 5 000
percentage point margin (“Default Rate Margin”) The Default Rate Margin shall
also apply to each succeeding interest rate change that would have applied had
there been no default However in no event will the interest rate exceed the
maximum interest rate limitations under applicable law

DEFAULT Each of the following shall constitute an event of default (“Event of
Default”) under this Note

Payment Default Borrower fails to make any payment when due under this Note

Other Defaults Borrower fails to comply with or to perform any other term
obligation covenant or condition contained in this Note or in any of the related
documents or to comply with or to perform any term obligation covenant or
condition contained in any other agreement between Lender and Borrower

Default in Favor of Third Parties Borrower or any Grantor defaults under any
loan extension of credit security agreement purchase or sales agreement or any
other agreement in favor of any other creditor or person that may materially
affect any of Borrower’s property or Borrower’s ability to repay this Note or
perform Borrower’s obligations under this Note or any of the related documents

False Statements Any warranty representation or statement made or furnished to
Lender by Borrower or on Borrower’s behalf under this Note or the related
documents is false or misleading in any material respect either now or at the
time made or furnished or becomes false or misleading at any time thereafter

Death or Insolvency The dissolution of Borrower (regardless of whether election
to continue is made) any member withdraws from Borrower or any other termination
of Borrower’s existence as a going business or the death of any member the
insolvency of Borrower, the appointment of a receiver for any part of Borrower’s
property any assignment for the benefit of creditors any type of creditor
workout or the commencement of any proceeding under any bankruptcy or insolvency
laws by or against Borrower

Creditor or Forfeiture Proceedings Commencement of foreclosure or forfeiture
proceedings whether by judicial proceeding self-help repossession or any other
method by any creditor of Borrower or by any governmental agency against any
collateral securing the loan This includes a garnishment of any of Borrower’s
accounts including deposit accounts with Lender However this Event of Default
shall not apply if there is a good faith dispute by Borrower as to the validity
or reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower gives Lender written notice of the creditor or
forfeiture proceeding and deposits with Lender monies or a surety bond for the
creditor or forfeiture proceeding in an amount determined by Lender in its sole
discretion as being an adequate reserve or bond for the dispute

Events Affecting Guarantor Any of the preceding events occurs with respect to
any Guarantor of any of the indebtedness or any Guarantor does or becomes
incompetent or revokes or disputes the validity of or liability under any
guaranty of the indebtedness evidenced by this Note

Adverse Change A material adverse change occurs in Borrower’s financial
condition or Lender believes the prospect of payment or performance of this Note
is impaired

Insecurity Lender in good faith believes itself insecure

Cure Provisions If any default other than a default in payment is curable and if
Borrower has not been given a notice of a breach of the same provision of this
Note within the preceding twelve (12) months it may be cured if Borrower after
Lender sends written notice to Borrower demanding cure of such default (1) cures
the default within ten (10) days or (2) if the cure requires more than ten
(10) days immediately initiates steps which Lender deems in Lender’s sole
discretion to be sufficient to cure the default and thereafter continues and
completes all reasonable and necessary steps sufficient to produce compliance as
soon as reasonably practical

LENDER S RIGHTS Upon default Lender may declare the entire unpaid principal
balance under this Note and all accrued unpaid interest immediately due and then
Borrower will pay that amount

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Loan No 11119391   

PROMISSORY NOTE

(Continued)

   Page 2

 

 

 

 

ATTORNEYS FEES EXPENSES Lender may hire or pay someone else to help collect this
Note if Borrower does not pay Borrower will pay Lender that amount This includes
subject to any limits under applicable law Lender’s attorneys fees and Lenders
legal expenses whether or not there is a lawsuit including without limitation
all attorneys’ fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction) and appeals If not
prohibited by applicable law Borrower also will pay any court costs in addition
to all other sums provided by law

GOVERNING LAW This Note will be governed by federal law applicable to Lender
and, to the extent not preempted by federal law, the laws of the State of
Oklahoma without regard to its conflicts of law provisions This Note has been
accepted by Lender in the State of Oklahoma

DISHONORED ITEM FEE Borrower will pay a fee to Lender of $20 00 if Borrower
makes a payment on Borrower’s loan and the check or other payment order
including any preauthorized charge with which Borrower pays 5 later dishonored

RIGHT OF SETOFF To the extent permitted by applicable law Lender reserves a
right of setoff in a Borrower’s accounts with Lender (whether checking savings
or some other account) This includes all accounts Borrower holds jointly with
someone else and all accounts Borrower may open in the future However this does
not include any IRA or Keogh accounts or any trust accounts for which setoff
would be prohibited by law Borrower authorizes Lender to the extent permitted by
applicable law to charge or setoff all sums owing on the indebtedness against
any and all such accounts and at Lender’s option to administratively freeze all
such accounts to allow Lender to protect Lender’s charge and setoff rights
provided in this paragraph

COLLATERAL Borrower acknowledges this Note is secured by the following
collateral described in the security instruments listed herein inventory chattel
caper accounts equipment and general intangibles described in Commercial
Security Agreements dated March 19 2013

LINE OF CREDIT This Note evidences a revolving line of credit Advances under
this Note may be requested orally by Borrower or as provided in this paragraph
All oral requests shall be confirmed in writing or the day of the request All
communications instructions or directions by telephone or otherwise to Lender
are to be [ILLEGIBLE] to Lender’s office shows above The following person or
persons are authorized to request advances and authorize payments under the line
of credit until Lender receives from Borrower at Lender’s address shown above
written notice of revocation of such authority Robert M Byers, President/Manager
of Foundation Healthcare Affiliates, L L C , Manager of Foundation Surgery
Affiliates, LLC, Robert M Byers, President/Manager of Foundation Healthcare
Affiliates, L L C, Manager of Foundation Surgical Hospital Affiliates, LLC,
Manager of Foundation Surgical Hospital Holdings, LLC, Manager of East El Paso
Physicians Medical Center LLC, Scott Banks Chief Financial Officer of Foundation
Surgical Hospital Affiliates, LLC and Brad Ottwell, Chief Financial Officer of
Foundation Surgery Affiliates, LLC 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 Borrowers accounts with Lender The unpaid principal
balance owing or this Note at any time may be evidenced by endorsements on this
Note or by Lenders internal records including daily computer print-outs Lender
will have no obligation to advance funds under this Note if (A) Borrower or any
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 in
connection with the signing of this Note (B) Borrower or any guarantor ceases
doing business or is insolvent (C) any guarantor seeks claims or otherwise
attempts to [illegible] modify or revoke such guarantors guarantee of this Note
or any other loan with Lender (D) Borrower has applied funds provided pursuant
to this Note for purposes other than those authorized by Lender or (E) Lender in
good faith believes itself insecure

ADDITIONAL FEES Borrower(s) agrees to pay any and all fees or costs associated
with this indebtedness as deemed necessary by Lender for fee documentation or
security perfect or These additional fees or costs may include but not be
limited to attorney fees appraisal fees title fees filing and recording fees or
abstracting fees Said fees if required for Borrower(s) specific loan If not paid
when Incurred will be added to the principal of this indebtedness

ADVANCES Notwithstanding any other provision of this Agreement Borrower
acknowledges and agrees that all Advances shall be used for the stated purpose
as specified in each application for Advance Borrower further acknowledges and
agrees that Advances shall not be made by Lender to any deposit account owned by
Borrower or when applicable a related entry of Borrower which is held at a
financial institution other than that of Lenders

DOCUMENTATION/INFORMATION FEE Lender may require additional documentation or
information related to this Indebtedness from the Borrower for loan security or
the documentation as deemed appropriate and at the sole discretion of Lender or
in accordance with covenants described in the Business Loan Agreement In the
event Borrower fails to provide requested documentation or information within 60
days from written request by Lender a fee may be assessed for each incidence in
an amount which is the greater of $100 00 or 03% ( 0003) of the outstanding
principal balance of the Indebtedness for each incidence Said fee if not paid
when incurred will be added to the principal of this indebtedness

TIMELY ADVANCES After appropriate written request from Borrower for an advance
of funds on this indebtedness Lender shall have a reasonable time to consider
approval and process of the advance request While Lender will use reasonable
effort to fund the advance as soon as feasible Borrower understands and agrees
that a reasonable time may be up to 72 hours from the time of delivery of the
request not including non business days such as weekends or holidays If delays
are expected beyond 72 hours Lender will notify Borrower of the delay and
expected funding date and time

CROSS PLEDGED AND CROSS COLLATERALIZED This Note is secured by all Collateral
evidenced guaranteed and granted on all Notes and Indebtedness with Lender

SUCCESSOR INTERESTS The terms of this Note shall be binding upon Borrower and
upon Borrowers heirs personal representatives successors and assigns and shall
inure to the benefit of Lender and its successors and assigns

NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES
Borrower may notify Lender if Lender reports any inaccurate information about
Borrower’s account(s) to a consumer reporting agency Borrower’s written notice
describing the specific inaccuracy(ies) should be sent to Lender at the
following address Legacy Bank OKC May 2801 W Memorial Oklahoma City OK 73134

GENERAL PROVISIONS This Note is payable on demand The inclusion of specific
default provisions or rights of Lender shall not preclude Lender’s right to
declare payment of this Note on its demand If any part of this Note cannot be
enforced this fact will not affect the rest of the Note Lender may delay or
forgo enforcing any of its rights or remedies under this Note without losing
them Each Borrower understands and agrees that with or without notice to
Borrower Lender may with respect to any other Borrower (a) make one or more
additional secured or unsecured loans or otherwise extend additional credit (b)
alter compromise renew extend accelerate or otherwise change one or more times
the time for payment or other terms of any indebtedness including increases and
decreases of the rate of interest on the indebtedness (c) exchange enforce waive
subordinate fail or decide not to perfect and release any security with or
without the substitution of new collateral (d) apply such security and direct
the order or manner of sale thereof including without limitation any non
judicial sale permitted by the terms of the controlling security agreements as
Lender in its discretion may determine (e) release substitute agree not to sue
or deal with any one or more of Borrower’s sureties endorsers or other
guarantors on any terms or in any manner Lender may choose and (f) determine how
when and what application of payments and credits shall be made on any other
indebtedness owing by such other Borrower Borrower and any other person who
signs guarantees or endorses this Note to the extent allowed by law waive
presentment demand for payment and notice of dishonor Upon any change in the
terms of this Note and unless otherwise expressly stated in writing no party who
signs this Note whether as maker guarantor accommodation maker or endorser shall
be released from liability All such parties agree that Lender may renew or
extend (repeatedly and for any length of time) this loan or release any party or
guarantor or collateral or impair fail to realize upon or perfect Lender’s
security interest in the collateral and take any other action deemed necessary
by Lender without the consent of or notice to anyone All such parties also agree
that Lender may modify this loan without the consent of or notice to anyone
other than the party with whom the modification is made The obligations under
this Note are joint and several

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Loan No 11119391   

PROMISSORY NOTE

(Continued)

   Page 3

 

 

 

 

PRIOR TO SIGNING THIS NOTE, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS EACH BORROWER
AGREES TO THE TERMS OF THE NOTE

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE

 

BORROWER FOUNDATION SURGERY AFFILIATES, LLC FOUNDATION HEALTHCARE AFFILIATES, L
L C, Manager of Foundation Surgery Affiliates, LLC By   LOGO
[g606995ex10_1pg03a.jpg]   Robert M Byers, President/Manager of Foundation
Healthcare Affiliates, L L C EAST EL PASO PHYSICIANS’ MEDICAL CENTER LLC
FOUNDATION SURGICAL HOSPITAL HOLDINGS, LLC. Manager of East El Paso Physicians’
Medical Center, LLC FOUNDATION SURGICAL HOSPITAL AFFILIATES, LLC, Manager of
Foundation Surgical Hospital Holdings LLC FOUNDATION HEALTHCARE AFFILIATES, L L
C. Manager of Foundation Surgical Hospital Affiliates LLC By   LOGO
[g606995ex10_1pg03b.jpg]   Robert M Byers, President/Manager of Foundation
Healthcare Affiliates, L L C

 

 

 

[ILLEGIBLE]