Unsecured Promissory Note

8-5-2010

or FOR VALUE RECEIVED, the National Emergency Medical Services Association (hereafter, ,,NEMSA"), a Califomia Mutual Benefit Corporation, promises to pay Torren K. Colcord, an individual (hereafter,"Holder" or "Colcord"), at 5141 Almsbury Drive, Salida, CA 95368 or at such other place as Holder hereof may from time to time designate in writing, the principal sums as described within this document, with interest accruing on the unpaid principal at the rates set forth in this document, from August 5,2010 until paid in full. The
aforementioned principal sums represent monies owed to Torren K. Colcord for unpaid salaries owed to Colcord, and for unpaid monies owed to Colcord by the National Emergency Medical Services Association.

o'Maker"

Minimum Payment Amount And Methodology

NEMSA agrees to pay Colcord at minimum a fixed sum of $3000.00 per month, with the payment divided equally between the three categories of "Monies To Be Repaid" listed in this Note. Each payment shall first be credited against interest accrued and due at the time of receipt of payment, with the remainder credited against unpaid principal. Interest shall cease to accrue on any principal so credited' If the payment amount is greater than the minimum, or a category balance payment will be equally split between remaining balances.
as defined in this Note is paid

in full, the

Principal and interest are payable in monthly installments due on or before the twentieth (20) day of each month until paid in full, with the first such payment to be made on or before October 20,2010. In no event shall interest exceed the maximum amount permitted by law. Any amount collected in excess of the maximum legal rate shall be applied to reduce the principal balance.

No Pre-Payment Penalty
This Note may, in whole or in part, be prepaid without penalty beforg the maturity date hereof.

Temporary Suspension Of Payments NEMSA may, atit's sole discretion temporarily suspend payment of this note for one period of no greater than two calendar months per calendar year by notiffing Colcord with written notice via hand delivery or certified mail of it's intent to do so. Interest will continue to accrue during this temporary suspension period on all balances.
Colcord may, athis sole discretion notify NEMSA with written notice via hand delivery or cerlified mail of his willingness to have payments temporarily suspended for an additional two calendar months, should Colcord choose to extend the suspension period listed above. Only upon mutual agreement of the parties will the suspension period be
extended. lnterest

will continue to accrue during

the temporary suspension period and extensions of the suspension

period.

Accounting, Record Keeping, and Disputes Over Accounting and Record Keeping

NEMSA will provide the full and complete cost and effort associated with proper accounting of monies assigned within this promissory note, with all documentation including proof of methodology being available to Colcord upon request. In the event of a dispute regarding proper accounting of monies, the parties will first attempt non-binding mediation using an altemate strike method from a list of seven (7) mediators. Should mediation fail to resolve the dispute, either party may submit notice to the other within 10 business days of the cessation of mediation, notifying method the other party that the dispute will be reviewed through a binding arbitration process, using an altemate strike paid by the losing parly. The parties will use the from a lisi of seven (7) arbitrators with the arbitration fees to be upon' services of the American Arbitration Association or other such service as mutually agreed

Default
Should NEMSA default under or otherwise breach this Promissory Note and not cure said default or breach on or before the tenth (1Oth) day after Colcord gives NEMSA written notice thereof, by personal delivery or certified mailing, all principal remaining unpaid and interest accruing thereon shall, at the option of Colcord, become immediately due and payable to Colcord. Notice shall be deemed given on the date of personal delivery or date of mailing, whichever applies. No delay or failure in giving notice of said default or breach shall constitute a waiver of the right of Colcord to exercise said right in the event of a subsequent or continuing default or breach. Furthermore, in the event of such default or breach, Maker promises to pay Colcord all collection andlor litigation costs incurred,

including reasonable attomey fees and court costs, whether judgment is rendered or not.

Default Due To Dissolution or Cessation of NEMSA Business Operations

In the event that NEMSA should default due to the dissolution and/or cessation of business operations, NEMSA agrees that it shall enter into negotiations with Colcord for a settlement amount; based on available funds NEMSA has at the time of such dissolution or cessation of business operations. Categories of Monies To Be RePaid Monies to be repaid arc categorized and repayment terms specified as follows:

1.

Past Legal Expenses and Interest Owed To Colcord

a. b. c. d.

This category consists of past legal expenses incurred by Colcord on behalf of NEMSA during the years2004,2005, and 2006 and previously accrued interest owed to Colcord on the same. All past interest applied to this amount in addition to remaining principal shall be treated as the new principal amount for the purposes of interest calculation in this note. Interest shall be applied to this classification at arate of l0% simple interest per annum. The new principal amount as of the date of this Promissory Note shall be$76.490.32.

2.

Past Indemnification Amounts and Interest Owed To Colcord

a. b. c.

d. e. 3. a. b. c. d. e.

This category consists of monies owed to Colcord as part of the Board of Director's decision on January 2,2007 to indemniff Colcord from the judgment against him in SEIU Local 250 v. Bonifay et al. Case No. RG04143696 where Colcord had a gamishment placed on gross wages as a result of said judgment. NEMSA had indemnified Colcord based on incorrect calculations, resulting in monies being owed to Colcord to comply with the indemnification terms. A11 past interest applied to this amount in addition to remaining principal shall be treated as the new principal amount for the purposes of interest calculation in this note. Interest shall be applied to this classification atarate of l}Yo compound interest per annum. The new principal amount as of the date of this Promissory Note shall be $39,526.15.

Wages and Salary Monies Owed To Colcord This category consists of wage and salary monies and previously accrued interest owed to Colcord. This includes full and partial salary monies owed by NEMSA to Colcord and incentive pay increases
A11

owed by NEMSA to Colcord. wage and salary monies were voluntarily defened by Colcord at the time that such monies were due to Colcord All past interest monies added to this amount in addition to remaining principal shall be treated as the new principal amount for the purposes of interest calculation in this note. lnterest shall be applied to this classification at a rute of 10% compound interest per month. The new principal amount as of the date of this Promissory Note shall be $94.934.63.

This promissory Note has been entered into and shall be performed in Stanislaus County, Califomia and shall be construed in accordance with the laws of Califomia and any applicable federal statutes or regulations of the United States. Any claims or disputes conceming this Note shall, at the sole election of Holder, be adjudicated in Stanislaus County, California

Category Name
Past Leeal Expenses Past Indemnification

Princinal Owed
$76490.32 $39s26.1 s s94934.63

Interest Rate

Terms
Simple lnterest Per Annum Compound Interest Per Arurum Compound Interest Per

t0% t0% t0%

Amounts
Past Salary Amounts

Month

Executed By The Holder:

[s Muller,

l,

,,

Lucey, Regional

Paul Angelo, Regional Director

Executed in the presence of:

Date

E.s,i)-o v(1

NEMSA Recap of Balances Due Colcord

As of 8/4/2O1O

Assumes 10% Simple lnterest

Principal
Balance

lnterest
Balance

Remaining
Past legal cost reimbursement
76,1_53.55

Remaining 336.77

Total 76,490.32

Reimbursement of personal income tax effect for reporting garnishment & legal cost reimbursement
as tncome
x Calendar years 2007 - 2009 - actual Jan 1- Aug 4, 2010 - ESTIMATED

26,043.00 9,852.00
1,12,048.55

3,458.34

29,501-.34

9,852.00
3,795.LL

Non-salary related total

115,843.66

Delayed raises not paid

17,692.29 43,153.99 15,845.20 Salary related total

76,691_.48

7,531.31

25,223.60 49,307.78 17,690.19

92,221,.57

lncentive salary increases not paid

Years l- & 2 salaries not paid

6,r53.79
L,844.99
1_5,530.09

Grand total

188,740.03

19,325.20

208,065.23

Based on information provided by NEMSA. Not subjected to audit or other verification proced ures.

* Based on comparing personal income tax per tax returns as filed (including garnishment

&

legal reimbursement reported as taxable income) versus what t9x would have been if no garnishment and legal reimbursement were included.

NEMSA Recap of Balances Due Colcord As of 8/4/2010

Assumes 10% lnterest Compounded Annually

Principal
Balance

nte rest

Balance

Remaining
Past legal cost reimbursement

Remaining

Total 78,801.93

79,801.93

Reimbursement of personal income tax effect for reporting garnishment & legal cost reimbursement
as tncome

* Calendar years 2007 - 2009 - actual Jan 1- Aug 4, zOtO - ESTIMATED Non-salary related total

26,043.00 9,852.00
1,1,4,696.93

3,631".15

29,674.15 9,852.00

3,631.15

118,328.08

Delayed raises not Paid

17,692.29 43,153.99 15,876.48 Salary related total 76,722.76

8,919.58 6,794.22 1,874.73 L7,588.53

26,6LL.87
49,948,21,

lncentive salary increases not paid

Years

1& 2 salaries not paid

17,751'21 94,3LL.29

Grand total

191,,419.69

2I,2r9.68

212,639.37

Based on information provided by NEMSA. Not subjected to audit or other verification proced ures.

Based on comparing personal income tax per tax returns as filed (including

g{!ls@en

&

legal reimbursement reported as taxable income) versus what tax would have been if no garnishment and legal reimbursement were included.

NEMSA Recap of Balances Due Colcord

As of

Assumes 10% lnterest Compounded Monthly (except lncen ive Bi-weekly)

8/4/2010
Principal
Balance
I

nterest
Total 79,113.78

Balance

Remaining
Past legal cost reimbursement 79,1,13.78

Remaining

Reimbursement of personal income tax effect for reporting garnishment & legal cost reimbursement
as income

Calendar years 2007 - 2009 - actual x Jan l- - Aug 4, zOtO - ESTIMATED Non-salary related total

26,043.00 9,852.00 115,008.78

3,782.94

29,825.94 9,852.00

3,782.94

t!8,791,.72

Delayed raises not paid

17,692.29 43,153.99 15,963.54 Salary related total 76,809.82

9,350.57

27,042.86 49,968.40 17,923.37 94,934.63

lncentive salary increases not paid

Years l" & 2 salaries not Paid

6,814.4t
1,959.83

18,r24.81

Grand total

191,818.60

21,,907.75

213,726.35

Based on information provided by NEMSA. Not subjected to audit or other verification proced u res.

Based on comparing personal income tax per tax returns as filed (including garnishment & legal reimbursement reported as taxable income) versus what tax wou have been if no

garnishment and legal reimbursement were included.