Page 1 of 4
-----------------------------
OMB APPROVAL
-----------------------------
OMB Number: 3235-0145
Expires: August 31, 1999
Estimated average burden
hours per response: 14.90
-----------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. _______)*
Westmark Group Holdings, Inc.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock
- --------------------------------------------------------------------------------
(Title of Class of Securities)
960577 40 1
- --------------------------------------------------------------------------------
(CUSIP Number)
Douglas P. Fremont, Esq., Greenberg Traurig, 777 S. Flagler Drive, Suite 300E,
- --------------------------------------------------------------------------------
West Palm Beach, FL 33401, (561) 650-7900
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
February 21, 1998
- --------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box. [ ]
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss.240.13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Potential persons who are to respond to the collection of information contained
in this form are not required to respond unless the form displays a currently
valid OMB control number.
SEC 1746 (2-98)
<PAGE>
CUSIP NO: 960577 40 1 Page 2 of 4
- -------- -----------------------------------------------------------------------
1 Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Mark Schaftlein
- -------- -----------------------------------------------------------------------
2 Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [ ]
- -------- -----------------------------------------------------------------------
3 SEC Use Only
- -------- -----------------------------------------------------------------------
4 Source of Funds (See Instructions)
SC, BK, PF
- -------- -----------------------------------------------------------------------
5 Check Box if Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e)
[ ]
- -------- -----------------------------------------------------------------------
6 Citizenship or Place of Organization
United States Citizen
- ------------------- ------- ----------------------------------------------------
7 Sole Voting Power
Number of
Shares 229,008
------- ----------------------------------------------------
Beneficially 8 Shared Voting Power
Owned by
Each -0-
------- ----------------------------------------------------
Reporting 9 Sole Dispositive Power
Person With
229,008
------- ----------------------------------------------------
10 Shared Dispositive Power
-0-
- -------- -----------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
229,008
- -------- -----------------------------------------------------------------------
12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions)
[ ]
- -------- -----------------------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11)
7.8%
- -------- -----------------------------------------------------------------------
14 Type of Reporting Person (See Instructions)
IN
- -------- -----------------------------------------------------------------------
<PAGE>
Schedule 13D - Mark Schaftlein Page 3 of 4
Item 1. Security and Issuer
1(a) Common Stock
1(b) Westmark Group Holdings, Inc. (the "Issuer")
8000 North Federal Highway
Boca Raton, FL 33487
Item 2. Identity and Background
2(a) Mark Schaftlein
2(b) 8000 North Federal Highway
Boca Raton, FL 33487
2(c) Chief Executive Officer and President, Westmark Group
Holdings, Inc., 8000 North Federal Highway, Boca Raton,
FL 33487
2(d) None.
2(e) None.
2(f) United States.
Item 3. Source and Amount of Funds or Other Consideration
Prior to the Date of Event which requires filing of this Statement, the
Reporting Person owned 20,574 shares of Common Stock of the Issuer. 18,824
shares of Common Stock of the Issuer were acquired in satisfaction of a fourth
quarter, 1997 bonus payable to the Reporting Person. 21,177 shares of Common
Stock of the Issuer were acquired pursuant to and in accordance with a
Conversion Agreement between the Issuer and the Reporting Person in satisfaction
of indebtedness. 103,333 shares of Common Stock of the Issuer were acquired for
the sum of $219,583; $170,000 of which the Reporting Person borrowed from the
Security Bank of Dupage in exchange for two (2) executed promissory notes in the
amounts of $100,000 and $70,000 respectively; and $49,583 of which was borrowed
from the Issuer in exchange for an executed promissory note in favor of the
Issuer. 2,100 shares of Common Stock of the Issuer were acquired for the sum of
$2,679.05 on the open market by the Reporting Person with his personal funds.
The number of shares beneficially owned by the Reporting Person includes: (i)
45,000 shares of Common Stock that may be issued upon the exercise of
outstanding options; and (ii) 18,000 shares that may be issued upon the exercise
of outstanding warrants.
Item 4. Purpose of Transaction
As stated in Item 3, the Reporting Person acquired 40,001 shares of
Common Stock of the Issuer in satisfaction of indebtedness, 103,333 shares of
Common Stock of the Issuer were purchased for the sum of $219,583, and 2,100
shares of Common Stock of the Issuer were purchased for the sum of $2,679,.05.
Reporting Person intends to purchase additional shares of Common Stock of the
Issuer from time to time on the open market dependent upon market conditions.
Reporting Person does not contemplate any sales, transfers or extraordinary
corporate transactions. No plans to alter the present board of directors,
charter, bylaws or corresponding instruments are contemplated and no material
change in the Issuer's present capitalization or dividend policy will occur as a
result of this acquisition. This acquisition will not result in any class of the
Issuer's securities to be delisted or cease to be authorized to be quoted in any
inter-dealer quotation system. This acquisition will not result in any class of
Issuer's equity securities becoming eligible for termination of registration
pursuant to Section 12(g)(4) of the Act nor is any action similar to those
listed above contemplated. <PAGE>
Page 4 of 4
Item 5. Interest in Securities of the Issuer
5(a) The Reporting Person beneficially owns 229,008 shares giving him
7.8% of the Issuer's Common Stock. The number of shares beneficially owned by
the reporting person includes: (i) 45,000 shares of Common Stock that may be
issued upon the exercise of outstanding options; and (ii) 18,000 shares that may
be issued upon the exercise of outstanding warrants.
5(b) Reporting Person has the sole voting and dispositive power with
respect to the 229,008 shares.
5(c) Other than the acquisitions which are the subject of this report,
no other transactions concerning the Issuer's securities have been effected by
Reporting Person within the last 60 days.
5(d) No other person other than the Reporting Person is entitled to
receive or direct the receipt of dividends from the subject securities.
5(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer
None.
Item 7. Material to Be Filed as Exhibits
Copies of Promissory Notes (See Item 3).
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: 10/22/98 /s/ Mark Schaftlein
---------------------------------
Mark Schaftlein, Reporting Person
The original statement shall be signed by each person on whose behalf
the statement is filed or his authorized representative. If the statement is
signed on behalf of a person by his authorized representative (other than an
executive officer or general partner of the filing person), evidence of the
representative's authority to sign on behalf of such person shall be filed with
this statement: provided, however, that a power of attorney for this purpose
which is already on file with the Commission may be incorporated by reference.
The name an any title of each person who signs the statement shall be typed or
printed beneath his signature.
Attention: Intentional misstatements or omissions of fact constitute Federal
criminal violations (See 18 U.S.C. 1001)
PROMISSORY NOTE
Principal
$100,000.00
Loan Date
04-17-1998
Maturity
05-17-2001
Loan No.
017243
Call
0806B0
Collateral
110
Account
3000158 000
Officer
01
Initials
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.
Borrower: MARK SCHAFTLEIN (SSN: ###-##-####)
217 GLEASON STREET #B
DELRAY BEACH, FL 33483
Lender: SECURITY BANK OF DUPAGE
COMMERCIAL LOANS
1112 SOUTH WASHINGTON STREET
NAPERVILLE, IL 60540
Principal Amount: $100,000.00 Interest Rate: 10.000%
Date of Note: April 17, 1998
PROMISE TO PAY. I promise to pay to SECURITY BANK OF DUPAGE ("Lender"), or
order, in lawful money of the United States of America, the principal amount of
One Hundred Thousand & 00/100 Dollars ($100,000), together with interest at the
rate of 10.000% per annum on the unpaid principal balance from April 17,1998,
until paid in full.
PAYMENT. I will pay this loan in 12 payments of $9,830.84 each payment. My first
payment is due August 17, 1998, and all subsequent payments are due on the same
day of each quarter after that. My final payment will be due on May 17, 2001,
and will be for all principal and all accrued interest not yet paid. Payments
include principal and interest. Interest on this Note is computed on a 365/365
simple interest basis; that is, by applying the ratio of the annual interest
rate over the number of days in a year, multiplied by the outstanding principal
balance, multiplied by the actual number of days the principal balance is
outstanding. I will pay Lender at Lender's address shown above or at such other
place as Lender may designate in writing. Unless otherwise agreed or required by
applicable law, payments will be applied first to any unpaid collection costs
and any late charges, then to any unpaid interest, and any remaining amount to
principal.
PREPAYMENT. I 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 me of my obligation to continue to make payments under the
payment schedule. Rather, they will reduce the principal balance due and may
result in me making fewer payments.
LATE CHARGE. If a payment is 10 days or more late, I will be charged 5.000% of
the unpaid portion of the regularly scheduled payment or $5.00, whichever is
greater.
DEFAULT. I will be in default if any of the following happens: (a) I fail to
make any payment when due. (b) I break any promise I have made to Lender, or I
fail to comply with or to perform when due any other term, obligation, covenant,
or condition contained in this Note or any agreement related to this Note, or in
any other agreement or loan I have with Lender. (c) Any representation or
statement made or furnished to Lender by me or on my behalf is false or
misleading in any material respect either now or at the time made or furnished.
(d) I die or become insolvent, a receiver is appointed for any part of my
property, I make an assignment for the benefit of creditors, or any proceeding
is commenced either by me or against me under any bankruptcy or insolvency laws.
(e) Any creditor tries to take any of my property on or in which Lender has a
lien or security interest. This includes a garnishment of any of my accounts,
including deposit accounts, with Lender. (f) Any of the events described in this
default section occurs with respect to any guarantor of this Note. (g) Lender in
good faith deems itself insecure. If any default, other than a default in
payment, is curable and if I have 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 (and no event of default will have occurred) if I, after receiving written
notice from Lender demanding cure of such default: (a) cure the default within
fifteen (15) days; or (b) if the cure requires more than fifteen (15) days,
immediately initiate steps which Lender deems in Lender's sole discretion to be
sufficient to cure the default and thereafter continue and complete 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 on this Note and all accrued unpaid interest immediately due, without
notice, and then I will pay that amount. Upon default, including failure to pay
upon final maturity, Lender, at its option, may also, if permitted under
applicable law, increase the interest rate on this Note 3.000 percentage points.
The interest rate will not exceed the maximum rate permitted by applicable law.
Lender may hire or pay someone else to help collect this Note if I do not pay. I
also will pay Lender that amount. This includes, subject to any limits under
applicable law, Lender's attorneys' fees and Lender's legal expenses whether or
not there is a lawsuit, including attorneys' fees and legal expenses for
bankruptcy proceedings (including efforts to modify or vacate any automatic stay
or injunction), appeals, and any anticipated post-judgment collection services.
If not prohibited by applicable law, I also will pay any court costs, in
addition to all other sums provided by law. This Note has been delivered to
Lender and accepted by Lender in the State of Illinois. If there is a lawsuit, I
agree upon Lender's request to submit to the jurisdiction of the courts of
DUPAGE County, the State of Illinois. If there is a lawsuit, I agree upon
Lender's request to submit to the jurisdiction of the courts of DUPAGE County,
the State of Illinois. Subject to the provisions on arbitration, this Note shall
be governed by and construed in accordance with the laws of the State of
Illinois.
RIGHT OF SETOFF. I grant to Lender a contractual security interest in, and
hereby assign, convey, deliver, pledge, and transfer to Lender all my right,
title and interest in and to, my accounts with Lender (whether checking,
savings, or some other account), including without limitation all accounts held
jointly with someone else and all accounts I may open in the future, excluding
however all IRA and Keogh accounts, and all trust accounts for which the grant
of a security interest would be prohibited by law. I authorize Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on this
Note against any and all such accounts.
GARNISHMENT. I consent to the issuance of a continuing writ of garnishment or
attachment against my disposable earnings, in accordance with Section 222.11,
Florida Statutes, in order to satisfy, in whole or in part, any money judgment
entered in favor of Lender.
COLLATERAL. This Note is secured by 100,000 SHARES OF WESTMARK GROUP HOLDINGS,
INC. STOCK, TO BE ISSUED IN THE NAME OF MARK SCHAFTLEIN, TRADED ON THE NASDAQ
MARKET UNDER THE SYMBOL "WGHI".
ARBITRATION. Lender and I agree that all disputes, claims and controversies
between us, whether individual, joint, or class in nature, arising from this
Note or otherwise, including without limitation contract and tort disputes,
shall be arbitrated pursuant to the Rules of the American Arbitration
Association, upon request of either party. No act to take or dispose of any
property securing this Note shall constitute a waiver of this arbitration
agreement or be prohibited by this arbitration agreement. This includes, without
limitation, obtaining injunctive relief or a temporary restraining order;
invoking a power of sale under any deed of trust or mortgage; obtaining a writ
of attachment or imposition of a receiver; or exercising any rights relating to
personal property, including taking or disposing of such property with or
without judicial process pursuant to Article 9 of the Uniform Commercial Code.
Any disputes, claims, or controversies concerning the lawfulness or
reasonableness of any act, or exercise of any right, concerning any property
securing this Note, including any claim to rescind, reform, or otherwise modify
any agreement relating to the property securing this Note, shall also be
arbitrated, provided however that no arbitrator shall have the right or the
power to enjoin or restrain any act of any party. Judgment upon any award
rendered by any arbitrator may be entered in any court having jurisdiction.
Nothing in this Note shall preclude any party from seeking equitable relief from
a court of competent jurisdiction. The statute of limitations, estoppel, waiver,
laches, and similar doctrines which would otherwise be applicable in an action
brought by a party shall be applicable in any arbitration proceeding, and the
commencement of an arbitration proceeding shall be deemed the commencement of an
action for these purposes. The Federal Arbitration Act shall apply to the
construction, interpretation, and enforcement of this arbitration provision.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. I and any other person who signs,
guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, protest 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. 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.
INSURANCE. Unless I provide Lender with evidence of the insurance coverage
required by my agreement with Lender, Lender may purchase insurance at my
expense to protect Lender's interests in the collateral. This insurance may, but
need not, protect my interests. The coverage that Lender purchases may not pay
any claim that I make or any claim that is made against me in connection with
the collateral. I may later cancel any insurance purchased by Lender, but only
after providing Lender with evidence that I have obtained insurance as required
by our agreement. If Lender purchases insurance for the collateral, I will be
responsible for the costs of that insurance, including interest and any other
charges Lender may impose in connection with the placement of the insurance,
until the effective date of the cancellation or expiration of the insurance. The
cost of the insurance may be added to my total outstanding balance or
obligation. The costs of the insurance may be more than the cost of insurance I
may be able to obtain on my own. PRIOR TO SIGNING THIS NOTE, I READ AND
UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE. I AGREE TO THE TERMS OF THE NOTE AND
ACKNOWLEDGE RECEIPT OF A COMPLETED COPY OF THE NOTE.
BORROWER:
x /s/ Mark Schaftlein
--------------------
MARK SCHAFTLEIN
PROMISSORY NOTE
Principal
$70,000.00
Loan Date
06-08-1998
Maturity
05-17-2001
Loan No.
017273
Call
1906B0
Collateral
110
Account
3000185 000
Officer
001
Initials
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.
Borrower: MARK SCHAFTLEIN (SSN: ###-##-####)
217 GLEASON STREET #B
DELRAY BEACH, FL 33483
Lender: SECURITY BANK OF DUPAGE
COMMERCIAL LOANS
1112 SOUTH WASHINGTON STREET
NAPERVILLE, IL 60540
Principal Amount: $70,000.00 Interest Rate: 10.000%
Date of Note: June 8, 1998
PROMISE TO PAY. I promise to pay to SECURITY BANK OF DUPAGE ("Lender"), or
order, in lawful money of the United States of America, the principal amount of
Seventy Thousand & 00/100 Dollars ($70,000), together with interest at the rate
of 10.000% per annum on the unpaid principal balance from June 8,1998, until
paid in full.
PAYMENT. I will pay this loan in 12 payments of $6,786.72 each payment. My first
payment is due August 17, 1998, and all subsequent payments are due on the same
day of each quarter after that. My final payment will be due on May 17, 2001,
and will be for all principal and all accrued interest not yet paid. Payments
include principal and interest. Interest on this Note is computed on a 365/365
simple interest basis; that is, by applying the ratio of the annual interest
rate over the number of days in a year, multiplied by the outstanding principal
balance, multiplied by the actual number of days the principal balance is
outstanding. I will pay Lender at Lender's address shown above or at such other
place as Lender may designate in writing. Unless otherwise agreed or required by
applicable law, payments will be applied first to any unpaid collection costs
and any late charges, then to any unpaid interest, and any remaining amount to
principal.
PREPAYMENT. I 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 me of my obligation to continue to make payments under the
payment schedule. Rather, they will reduce the principal balance due and may
result in me making fewer payments.
LATE CHARGE. If a payment is 10 days or more
late, I will be charged 5.000% of the unpaid portion of the regularly scheduled
payment or $5.00, whichever is greater.
DEFAULT. I will be in default if any of the following happens: (a) I fail to
make any payment when due. (b) I break any promise I have made to Lender, or I
fail to comply with or to perform when due any other term, obligation, covenant,
or condition contained in this Note or any agreement related to this Note, or in
any other agreement or loan I have with Lender. (c) Any representation or
statement made or furnished to Lender by me or on my behalf is false or
misleading in any material respect either now or at the time made or furnished.
(d) I die or become insolvent, a receiver is appointed for any part of my
property, I make an assignment for the benefit of creditors, or any proceeding
is commenced either by me or against me under any bankruptcy or insolvency laws.
(e) Any creditor tries to take any of my property on or in which Lender has a
lien or security interest. This includes a garnishment of any of my accounts,
including deposit accounts, with Lender. (f) Any of the events described in this
default section occurs with respect to any guarantor of this Note. (g) Lender in
good faith deems itself insecure. If any default, other than a default in
payment, is curable and if I have 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 (and no event of default will have occurred) if I, after receiving written
notice from Lender demanding cure of such default: (a) cure the default within
fifteen (15) days; or (b) if the cure requires more than fifteen (15) days,
immediately initiate steps which Lender deems in Lender's sole discretion to be
sufficient to cure the default and thereafter continue and complete 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 on this Note and all accrued unpaid interest immediately due, without
notice, and then I will pay that amount. Upon default, including failure to pay
upon final maturity, Lender, at its option, may also, if permitted under
applicable law, increase the interest rate on this Note 3.000 percentage points.
The interest rate will not exceed the maximum rate permitted by applicable law.
Lender may hire or pay someone else to help collect this Note if I do not pay. I
also will pay Lender that amount. This includes, subject to any limits under
applicable law, Lender's attorneys' fees and Lender's legal expenses whether or
not there is a lawsuit, including attorneys' fees and legal expenses for
bankruptcy proceedings (including efforts to modify or vacate any automatic stay
or injunction), appeals, and any anticipated post-judgment collection services.
If not prohibited by applicable law, I also will pay any court costs, in
addition to all other sums provided by law. This Note has been delivered to
Lender and accepted by Lender in the State of Illinois. If there is a lawsuit, I
agree upon Lender's request to submit to the jurisdiction of the courts of
DUPAGE County, the State of Illinois. If there is a lawsuit, I agree upon
Lender's request to submit to the jurisdiction of the courts of DUPAGE County,
the State of Illinois. Subject to the provisions on arbitration, this Note shall
be governed by and construed in accordance with the laws of the State of
Illinois.
RIGHT OF SETOFF. I grant to Lender a contractual security interest in, and
hereby assign, convey, deliver, pledge, and transfer to Lender all my right,
title and interest in and to, my accounts with Lender (whether checking,
savings, or some other account), including without limitation all accounts held
jointly with someone else and all accounts I may open in the future, excluding
however all IRA and Keogh accounts, and all trust accounts for which the grant
of a security interest would be prohibited by law. I authorize Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on this
Note against any and all such accounts.
GARNISHMENT. I consent to the issuance of a continuing writ of garnishment or
attachment against my disposable earnings, in accordance with Section 222.11,
Florida Statutes, in order to satisfy, in whole or in part, any money judgment
entered in favor of Lender.
COLLATERAL. This Note is secured by 103,333 SHARES OF WESTMARK GROUP HOLDINGS,
INC. COMMON STOCK, CUSIP #960577 40 1.
ARBITRATION. Lender and I agree that all disputes, claims and controversies
between us, whether individual, joint, or class in nature, arising from this
Note or otherwise, including without limitation contract and tort disputes,
shall be arbitrated pursuant to the Rules of the American Arbitration
Association, upon request of either party. No act to take or dispose of any
property securing this Note shall constitute a waiver of this arbitration
agreement or be prohibited by this arbitration agreement. This includes, without
limitation, obtaining injunctive relief or a temporary restraining order;
invoking a power of sale under any deed of trust or mortgage; obtaining a writ
of attachment or imposition of a receiver; or exercising any rights relating to
personal property, including taking or disposing of such property with or
without judicial process pursuant to Article 9 of the Uniform Commercial Code.
Any disputes, claims, or controversies concerning the lawfulness or
reasonableness of any act, or exercise of any right, concerning any property
securing this Note, including any claim to rescind, reform, or otherwise modify
any agreement relating to the property securing this Note, shall also be
arbitrated, provided however that no arbitrator shall have the right or the
power to enjoin or restrain any act of any party. Judgment upon any award
rendered by any arbitrator may be entered in any court having jurisdiction.
Nothing in this Note shall preclude any party from seeking equitable relief from
a court of competent jurisdiction. The statute of limitations, estoppel, waiver,
laches, and similar doctrines which would otherwise be applicable in an action
brought by a party shall be applicable in any arbitration proceeding, and the
commencement of an arbitration proceeding shall be deemed the commencement of an
action for these purposes. The Federal Arbitration Act shall apply to the
construction, interpretation, and enforcement of this arbitration provision.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. I and any other person who signs,
guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, protest 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. 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.
INSURANCE. Unless I provide Lender with evidence of the insurance coverage
required by my agreement with Lender, Lender may purchase insurance at my
expense to protect Lender's interests in the collateral. This insurance may, but
need not, protect my interests. The coverage that Lender purchases may not pay
any claim that I make or any claim that is made against me in connection with
the collateral. I may later cancel any insurance purchased by Lender, but only
after providing Lender with evidence that I have obtained insurance as required
by our agreement. If Lender purchases insurance for the collateral, I will be
responsible for the costs of that insurance, including interest and any other
charges Lender may impose in connection with the placement of the insurance,
until the effective date of the cancellation or expiration of the insurance. The
cost of the insurance may be added to my total outstanding balance or
obligation. The costs of the insurance may be more than the cost of insurance I
may be able to obtain on my own. PRIOR TO SIGNING THIS NOTE, I READ AND
UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE. I AGREE TO THE TERMS OF THE NOTE AND
ACKNOWLEDGE RECEIPT OF A COMPLETED COPY OF THE NOTE.
BORROWER:
x /s/ Mark Schaftlein
-------------------
MARK SCHAFTLEIN
PROMISSORY NOTE
$49,583 Delray Beach, Florida
April 17, 1998
For value received, Mark Schaftlein ("Schaftlein") promises to pay to
Westmark Group Holdings, Inc. ("WGHI"), a Delaware corporation, or order, at
8000 North Federal Highway, Boca Raton, Florida 33487, or at such other place as
WGHI may from time to time designate by written notice to Schaftlein, the
principal sum of $49,583 with interest from this date until paid at the rate of
8% per annum on the balance remaining unpaid from time to time. Principal and
interest shall be due and payable in lawful money of the United States of
America in quarterly installments in the sum of $4,688.52 commencing August 17,
1998 and continuing quarterly thereafter on the 17th day of each succeeding
quarter. The entire principal balance and any unpaid and accrued interest shall
be due and payable no later than May 17, 2001.
Each payment shall be credited first to interest then due, then to
principal. In the event a default occurs and any payment provided in this Note
is not received by WGHI within thirty (30) days of the due date or ninety (90)
days of any January due date, the entire principal sum and accrued interest
shall at once become due and payable, without notice, at the option of the
holder of this Note. Failure to exercise such option shall not constitute a
waiver of the right to exercise it in the event of any subsequent default.
Schaftlein shall retain the right to prepay all or any portion of the remaining
unpaid principal balance and accrued interest, without penalty.
Nothing herein contained, nor any transaction related hereto, shall be
construed or so operate to require Schaftlein or any other person liable for
repayment of this Note, to pay interest at a greater rate than is now lawful in
such case to contract for or to make any payment or to do any act contrary to
law. Should any interest or other charges in connection herewith result in the
computation or earning of interest in excess of the maximum rate of interest
which is legally permitted under the applicable laws, then any and all such
excess shall be and the same is hereby waived by the holder of this note, and
any and all such excess paid shall be automatically credited against and in
reduction of the principal balance due under this Note or, at the option of the
holder of this Note, paid directly by the holder to Schaftlein or other parties
liable for the payment of this Note.
Schaftlein agrees to pay for all expenses, costs and attorney's fees
paid or incurred by the holder of this Note or adjudged by a court of competent
jurisdiction with respect to any action to enforce payment of this Note or any
part of it.
This Note is executed in the State of Florida and shall be governed and
construed in accordance with its laws except to the extent that applicable
federal law shall control. If any provision of this Note conflicts with any
statute or applicable rule of law, or is unenforceable for any reason
whatsoever, such provision shall be deemed null and void to the extent of such
conflict or unenforceability and shall be deemed separate from and shall not
invalidate the remaining provisions of this Note. This Note shall, in accordance
with its terms, be binding upon Schaftlein, his successors and assigns, and
shall inure to the benefit of WGHI, its successors and assigns.
Dated: April 17, 1998
/s/ Mark Schaftlein
--------------------
MARK SCHAFTLEIN
