Document:

ex10-27.htm

Exhibit 10.27

 

EXHIBITS

Exhibit A

 

PROMISSORY NOTE

 

	
US $100,000

	
March 29, 2012

(the Effective Date)

 

FOR VALUE RECEIVED, the undersigned, MS Health, Inc., an Illinois corporation ("Maker"), hereby promises to pay to the order ofMS Health Software Corporation, a New Jersey corporation ("Payee"), the principal sum of one hundred thousand dollars ($100,000), in lawful money in United States of America, which shall be legal tender, bearing interest and payable as provided herein.  This Promissory Note (this "Note" or "Promissory Note") has an effective date as set forth above (the "Effective Date").  This Note is an Exhibit to the Asset Purchase Agreement by and between various parties, including Maker and Payee, dated as of the date hereof, the terms of which are incorporated herein.

 

1.         Interest on the unpaid balance of this Note shall bear interest at the rate of six percent (6%) per annum, which interest shall accrue from the effective date until the Maturity Date (as defined below), unless prepaid prior to such Maturity Date. All past-due principal and interest (which failure to pay such amounts after a fifteen (15) day cure period, shall be defined herein as an "Event of Default") shall bear interest at the rate of ten percent (1 0%) per annum until paid in full (the "Default Interest Rate"). Upon an Event of Default, Payee may declare the entire amount of this Note immediately due and payable.  Interest will be computed on the basis of a 360-day year.

 

2.         The principal amount of this Note plus any accrued and unpaid interest shall be due and payable on the date that is five (5) years after the Effective Date (the "Maturity Date").

 

3.         This Note shall be payable in monthly installments of principal and interest amortized over a period of ten (10) years, with the first such Monthly Payment in the amount of $1,110.21 due on the first day of the month that is two (2) years after the Effective Date and continuing on the first day of each month thereafter.  This Promissory Note is a full standby Note for the lesser of two (2) years or the payment of all amounts due under the SBA loan of the Maker. Provided however that if the total amount due under the Note is less than any Monthly Payment, the Maker shall only be obligated to pay the remaining balance of the Note. Monthly Payments shall be due and payable by Maker to Payee until such time as the Note has been repaid in full, at which time the Maker shall no longer be required to make Monthly Payments, and Maker's  obligations under this Note shall be completed in full.

 

 

THE DOCUMENTARY STAMP TAX REQUIRED TO BE PAID ON THE INDEBTEDNESS EVIDENCED HEREBY HAS BEEN PAID, AFFIXED HERETO, AND CANCELLED.

 

  

  

  

 

4.         This Note may be prepaid in whole or in part, at any time and from time to time, without premium or penalty.

 

5.         If any payment of principal or interest on this Note shall become due on a Saturday, Sunday or any other day on which national banks are not open for business, such payment shall be made on the next succeeding business day.  All payments shall be made to Payee at P.O. Box 8156, Madeira Beach, Florida 33708 or to such other address as Payee or a subsequent Holder notifies Maker in writing.

 

6.         This Note shall be binding upon and inure to the benefit of the Payee named herein and Payee's respective successors and assigns. Each holder of this Note, by accepting the same, agrees to and shall be bound by all of the provisions of this Note. Payee may assign this Note or any of its rights, interests or obligations to this Note without the prior written approval of Maker.

 

7.         No provision of this Note shall alter or impair the obligation of Maker to pay the principal of and interest on this Note at the times, places and rates, and in the coin or currency, herein prescribed.

 

8.         The Maker will do or cause to be done all things reasonably necessary to preserve and keep in full force and effect its corporate existence, rights and franchises and comply with all laws applicable to the Maker, except where the failure to comply could not reasonably be expected to have a material adverse effect on the Maker. Failure to comply with this provision shall constitute an Event of Default.

9.         Notwithstanding anything to the contrary in this Note or any other agreement entered into in connection herewith, whether now existing or hereafter arising and whether written or oral, it is agreed that the aggregate of all interest and any other charges constituting interest, or adjudicated as constituting interest, and contracted for, chargeable or receivable under this Note or otherwise in connection with this loan transaction, shall under no circumstances exceed the Maximum Rate (as hereinafter defined).

 

10.       The occurrence of any one or more of the following events with respect to Maker shall constitute an event of default hereunder ("Event of Default"):

 

a.         If Maker fails to pay when due any payment of principal on this Note and such failure continues for five (5) days after written notice.

 

b.         If, pursuant to or within the meaning of the United States Bankruptcy Code or any other federal or state law relating to insolvency or relief of debtors (a "Bankruptcy Law"), Maker shall (i) commence a voluntary case or proceeding; (ii) consent to the entry of an order for relief against it in an involuntary case; (iii) consent to the appointment of a trustee, receiver, assignee, liquidator or similar official; (iv) make an assignment for the benefit of its creditors; or (v) admit in writing its inability to pay its debts as they become due.

 

  

  

  

 

c.         If a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against Maker in an involuntary case, (ii) appoints a trustee, receiver, assignee, liquidator or similar official for Maker or substantially all of Maker's properties, or (iii) orders the liquidation of Maker, and in each case the order or decree is not stayed or dismissed within 150 days.

 

11.       Upon an Event of Default, as defined above, Payee, in Payee's sole discretion and without further notice or demand, may raise the rate of interest accruing on the outstanding Principal by three percentage points (3%) above the rate of interest otherwise applicable, independent of whether Payee elects to accelerate the unpaid principal

balance as a result of such default.  Such default interest rate shall continue, in Payee's sole discretion, until all defaults are cured.

12.       Borrower shall pay a late charge (the "Late Charge") of 5% of the amount then due if any payment in whole or in part due under this Note is not received by Payee or any subsequent Holder within fifteen (15) days after its due date.  The Late Charge shall be payable to Payee on demand, or if demand is not made, then on the due date of the next payment under this Note.

 

13.       In the event the maturity of this Note is accelerated by reason of an Event of Default under this Note, then earned interest may never include more than the Maximum Rate allowable by law, computed from the dates of each advance of the loan proceeds outstanding until payment.  If from any circumstance any holder of this Note shall ever receive interest or any other charges constituting interest, or adjudicated as constituting interest, the amount, if any, which would exceed the Maximum Rate shall be applied to the reduction of the principal amount owing on this Note, and not to the payment of interest; or if such excessive interest exceeds the unpaid balance of principal hereof, the amount of such excessive interest that exceeds the unpaid balance of principal hereof shall be refunded to Maker.  In determining whether or not the interest paid or payable exceeds the Maximum Rate, to the extent permitted by applicable law (i) any nonprincipal payment shall be characterized as an expense, fee or premium rather than as interest; and (ii) all interest at any time contracted for, charged, received or preserved in connection herewith shall be amortized, prorated, allocated and spread in equal parts during the period of the full stated term of this Note.  The term "Maximum Rate" shall mean the maximum rate of interest allowed by applicable federal or state law.

 

14.       Except as provided herein, Maker and any sureties, guarantors and endorsers of this Note, if any, jointly and severally waive demand, presentment, notice of nonpayment or dishonor, notice of intent to accelerate, notice of acceleration, diligence in collecting, grace, notice and protest, and consent to all extensions without notice for any period or periods of time and partial payments, before or after maturity, without prejudice to the holder.  The holder shall similarly have the right to deal in any way, at any time, with one or more of the foregoing parties without notice to any other party, and to grant any such party any extensions of time for payment of any of said indebtedness, or to grant any other indulgences or forbearance whatsoever, without notice to any other party and without in any way affecting the personal liability of any party hereunder.  In the event of action or proceeding regarding this Promissory Note, the prevailing party shall receive from the other party, its costs and expenses, including reasonable attorney's fees.

 

  

  

  

15.       A copy of this Promissory Note signed by one party and faxed to another party shall be deemed to have been executed and delivered by the signing party as though an original. A photocopy of this Promissory Note shall be effective as an original for all purposes.

 

16.       This Note shall be construed and enforced under and in accordance with the laws of the State of Florida, without regard to choice-of-law rules of any jurisdiction.

IN WITNESS WHEREOF, Maker has duly executed this Note as of the day and year first written above.ex10-28.htm

Exhibit 10.28

 

Exhibit B

 

COVENANT NOT TO COMPETE; CONSULTING AGREEMENT NON­ COMPETITION and CONSULTING AGREEMENT, dated as of March_, 2012, between MS Health, Inc., an Illinois Corporation (referred to herein as the "Company" and "Covenantee"), and MS Health Software Corporation, a New Jersey Corporation (herein "MS"), & Michael Sedita, an Individual (herein "Sedita") and Dorothy E. Higgins (herein Higgins) (Sedita and MS are referred to collectively herein as "Consultant" or "Covenantor" and Higgins as "Covenantor").

 

RECITALS

 

A. Contemporaneously with the execution and delivery of this Non-Competition and Consulting Agreement ("Agreement"), Covenantee is acquiring substantially all of the assets of MS Health Software Corporation, under the terms and conditions set forth in that certain Asset Purchase Agreement executed on the date hereof (the "Asset Purchase Agreement").

 

B. Michael Sedita and Dorothy E. Higgins are the only shareholders of MS Health Software Corporation which is the owner of the assets being sold pursuant to the Asset Purchase Agreement

 

C. MS Health Software Corporation is software development and support company, creating and supporting software which provides Behavioral Healthcare and Social Services providers (the" Software Product").

 

D. As a condition of the Asset Purchase Agreement, Covenantor agrees to grant to Covenantee a covenant not to compete with the assets for the term and in the area described specifically in Section 1 hereof.

 

E. As a precondition of the Asset Purchase Agreement, Consultant agrees to render services to the Company in connection with the Software Product upon the consummation of the transactions contemplated in and by the Asset Purchase Agreement.

 

F. This Agreement shall be of no force or effect if the Asset Purchase Agreement is not executed and the transaction is not consummated.

 

NOW, THEREFORE, in consideration of the monies paid and payable as provided in the allocation of purchase price required by the Asset Purchase Agreement, the promises of the parties each to the other set forth herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged by each Covenantor by execution of this Agreement, the parties agree as follows:

 

  

  

  

AGREEMENTS

 

1. Except for the duties provided for herein, Covenantor hereby agrees, promises to and covenants with the Covenantee (the "Covenant") that for the period of time specified in subsection "a" hereof, each Covenantor agrees jointly and severally that it will not compete with the Software Product within the geographical area specified in subsection (b) as the Protected Area. Some of the terms used in this section are defined in subsection (c). Those terms shall have the meanings set forth in that subsection wherever used in this Agreement.

 

In furtherance of the foregoing and not in limitation thereof, the Covenantor agrees that for a period of two (2) years from the date hereof, the Covenantor shall not, (aa) directly or indirectly, solicit or service in any way, on behalf of Covenantor or on behalf of or in conjunction with others, any customers, or prospective customers who have been solicited or serviced by the Covenantor, or (bb) directly or indirectly take any action which may induce any customer or divert any business from the Company.

 

(a) The term of the Covenant shall commence upon the date of execution of the Asset Purchase Agreement and shall continue without interruption, except as provided in Section 3, for a period ending on the date which is two (2) years from the date of this Agreement.

 

(b) The area protected by the Covenant shall be the United States, known hereafter as the "Protected Area."

 

(c) The following terms shall have the meanings set forth herein for purposes of this section:

 

(i) "Business Organization" shall mean any proprietorship, corporation, trust, limited liability company, general partnership, limited partnership, company, limited liability partnership, association, joint venture or other organization of any kind, wherever

formed.

(ii) "Compete with" shall mean to participate, directly or indirectly, as an owner, principal, sole proprietor, partner, member, shareholder, officer, director, manager, employee, consultants, contractor, trustee or in any other capacity whatsoever of any Business Organization, including, without limitation, an equitable or beneficial interest as such held for the benefit of Covenantor, including any community property interest or interest held by a spouse as sole and separate property.

 

(iii) "Participate in" shall mean to join in, encourage, support, give financial assistance to, lend to, or advise a Business Organization.

 

  

  

  

 

(iv) "Work" shall mean to be employed, retained or engaged to perform services, whether as an employee or as an independent contractor or agent, for a Business Organization and shall include services performed as a member of the board of directors, officer, manager, member, agent, adviser and consultant.

 

2. Without restricting the absolute discretion of Covenantee to seek each and every remedy afforded the Covenantee with respect to any breach of the Covenant by Covenantor, the Covenantee, upon discovering evidence sufficient to persuade it that the Covenantor has or may have breached or may be breaching or intending to breach the Covenant of this Non-Competition Agreement, the Covenantee may provide the Covenantor with a written notice that the Covenantee believes Covenantor has, is or may be intending to breach the Covenant and stating generally the nature of the breach suspected. If such a notice is given and within five (5) business days following the receipt of such notice the Covenantor satisfies the Covenantee that:

 

(a) It has not breached and does not intend to breach its Covenant; or

 

(b) It has terminated and reversed the effect of the act or ceased and desisted from the conduct which constitutes or constituted a breach of the Covenant or, if the reversal of an act cannot be accomplished without the participation of others, it has taken all steps within its power to do so and that the termination or reversal will be completed with diligence and in due business course; or

 

(c) Its breach was not intentional and not recurring and no further action is needed to prevent a recurrence; and (in each case), then, the Covenantee may (but shall not be compelled to) elect not to pursue its remedies hereunder with respect to such breach. No such election by the Covenantee shall prevent the Covenantee from later pursuing other remedies against the Covenantor with respect to the same breach or breaches described in the notice or another or other breaches. The Covenantor Wlderstands and agrees that the agreements of this section grant to the Covenantee substantial discretion with respect to whether or not a breach has or will occur, whether, if a breach has occurred it has been reversed or the conduct constituting the breach abandoned and whether the business of the Covenantee in the Prohibited Area or any part thereof has been damaged. This section exists solely for the purpose of permitting the parties to resolve matters without the expense and aggravation of litigation and shall confer no right or privilege on Covenantor with respect to any act or conduct which is a breach of its Covenant granted by this Non-Competition Agreement.

 

3. The parties agree that the remedy of the Covenantee at law for any actual or threatened breach of the Covenant by any Covenantor would be inadequate and that, upon the occurrence of such an actual or threatened breach, in addition to any other remedy available to it, the Covenantee shall be entitled to specific performance hereof, injWictive relief, or both, by temporary or permanent injunction or other appropriate judicial remedy, writ or order, without the requirement to post bond.

 

4. Each Covenantor acknowledges that the Covenantee has entered into this Non­ Competition Agreement and will enter into the Asset Purchase Agreement in reliance on this Covenant. Each Covenantor further acknowledges and agrees that the Covenant is necessary and fundamental to the preservation of the Software Product of the Covenantee, is not contrary to the public interest and may be assigned by the Covenantee in the event that the Covenantee should sell the Software Product (or be sold by its owners). The duties and obligations of Covenantor may not be assigned by them. If the transaction contemplated by the proposed Asset Purchase Agreement is not consummated, this Agreement shall be null and void.

 

  

  

  

a. This Covenant is intended by the parties to be and is believed by them to be a reasonable restraint on the right of Covenantor to engage in business activities which compete with the Software Product within the geographical area from which the Software Product has derived customers historically and for a time which is reasonable in light of the substantial value of the goodwill involved. Each provision of this Covenant shall be severable from each other term and provision hereof; each month of each year of its duration shall be viewed as a separate time restriction and each state or other geographic subdivision within the Protected Area shall be viewed as a separate geographical restriction, to the end that, if any such time or geographical restriction (or both) should be determined by a court which has been asked to enforce the terms of this Agreement by injunction or other equitable remedy against conduct of Covenantor and which has jurisdiction over Covenantor and such subject matter, to be against public policy as unreasonable or arbitrary in time restriction or geographical restriction, or both, such court may sever from this Agreement so much of the time restriction and so much of the geographical restriction as it fmds to be violative of public policy and enforce the remaining time and geographical restrictions. In severing unenforceable provisions from this Agreement, the parties intend that only the offending clause, phrase, sentence, paragraph or section be stricken, leaving intact the largest possible remainder.

 

5. The term of the consulting aspect of this Consulting Agreement shall be for a period of six (6) months commencing upon the date of consummation of the transaction contemplated by the Asset Purchase Agreement execution of the Asset Purchase Agreement and shall expire of the earliest of (a) six months after the Closing Date of the Asset Purchase Agreement; (b) termination of this Agreement; (c) the Consultant's death; or (d) for Cause. For purposes of this Section 6, "Cause" shall mean the failure of Consultant to perform the sales services on behalf of Company for a period of three (3) consecutive months. Consultant shall not be required to remain in the State of Florida or to be physically present to perform the services.

 

6. Consultant shall provide technical services, as well as continuing support services for existing customers of MS Health as applicable.

 

7. As the full and entire compensation for all of the services to be rendered by the Consultant under this Agreement, the Company will pay to the Consultant and the Consultant hereby accepts the following payment schedule:

 

(a) Consultant Sedita will provide 30 days at no additional cost.

 

(b) After 30 days Consultant Sedita will consult at a rate of $75 per hour, at such reasonable times, as Sedita will make himself available, from time to time.

 

  

  

  

8. Consultant will turn over all sales leads that come in from the telephone, MS Health email or MS Health website for the next two years at no additional cost.

 

9. Consultant Sedita shall not be deemed an employee of the Company by virtue of his retention hereunder, but shall, for all purposes be deemed an independent contractor. The Company shall not be obligated to deduct social security, withholding or other payroll or related taxes from any payments to be made to Consultant under this Agreement. Consultant shall not be deemed to have been granted any right or authority to assume or create any obligation or responsibility on behalf of or in the name of the Company except as may be specifically authorized in writing by the Company.

 

10. The Consultant Sedita agrees that the services provided pursuant to this Agreement are personal in its nature and Consultant shall not without the prior written consent of the Company, assign or transfer this Agreement or any rights, duties or obligations hereunder.

 

11. This Agreement shall inure to the benefit of and be binding upon the parties and their respective heirs, personal representatives, successors and assigns and may be executed in one or more counterparts, each of which shall be an original, but all of which, taken together, shall be one instrument.

 

12. The parties agree that there is no adequate remedy at law for the breach of the Consulting obligations herein; accordingly the Company shall have the right to enjoin such violation by injunction or other equitable remedy, without the requirement to post bond.

 

13. The remedies provided for in this Agreement are non-exclusive and are in addition to each other and to any other remedy available elsewhere in this Agreement or available generally at law or in equity.

 

14. The failure of any party at any time to require performance of any other party of any provision hereof or to resort to his, her or its remedy at law or in equity or otherwise, shall in no way affect the right of such party to require full performance or to resort to such remedy at any time thereafter, nor shall a waiver by any party of any breach of any provision hereof be taken or held to be a waiver of any subsequent breach of any such provision, unless expressly so stated in writing. No waiver of any of the provisions hereof shall be effective unless in writing and signed by the party to be charged therewith.

 

15. All notices which any party may desire or be required to send to another party hereunder shall be delivered in person or mailed by certified or registered mail, return receipt requested, and if mailed, shall be deemed to have been given on the date of the posting of the mail to the party at his address as it appears on the first page of this Agreement or at such other address as may be designated by the parties, from time to time, by notice in accordance with this Section.

 

16. No alteration, modification, variation or waiver of this Agreement or any of the provisions hereof shall be effective unless in writing and executed by the parties hereto, or in the case of a waiver, by the party or parties waiving compliance.

 

  

  

  

 

17. This Agreement is made under the laws of the State of Illinois and shall for all purposes be governed by and interpreted under the laws of Illinois without regard for any conflict of laws principles which, but for this section, would be applicable.

 

18. If any provision of this Agreement or its application to any situation shall be invalid or unenforceable to any extent, the remainder of this Agreement shall not be affected and every provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

 

19. If any action is brought to enforce or interpret any part of this Agreement, the prevailing party in such action shall be entitled to recover as an element of such party's costs of suit, and not as damages, reasonable attorneys' fees to be fixed by the court. If there is no clearly prevailing party, each party shall bear its own costs.

 

20. This Agreement may be signed in multiple counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

[Signature Page to follow on next page.]

 

 

 

 

 

 

  

  

  

 

IN WITNESS WHEREOF, the parties have executed or caused to be executed this Non­ Competition Agreement as of the day and year first above written.

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