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KEYSTONE FINANCIAL BANK, N.A., : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA : CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY :
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
:NO.gy-?rr?
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants CIVIL ACTION - LAW
CONFESSION OF JUDGMENT
Pursuant to the authority contained in the Promissory Notes, Commercial Guaranty
agreements and Disclosure For Confession of Judgment documents, true and correct copies of
which are attached to the Complaint filed in this action, we appear for the Defendants and
confess judgment in favor of Plaintiff and against the Defendants as follows:
1. AS TO THOMAS M. DARDICK:
Principal amount due ........................ $770,314.58
Interest through September 27, 1999 ............. $ 16,591.00
Late charges through September 27, 1999 ......... 5 10,775.08
Plus accruing daily interest under the Promissory Notes, additional late charges, attorneys' fees
and costs of suit.
2. AS TO KATHLEEN A. VICKROY:
Principal amount due .......................... $188,000.00
Interest through September 27, 1999 ............. 5 16,591.00
Late charges through September 27, 1999 ......... 5 10,775.08
Plus accruing daily interest under the Promissory Note, additional late charges, attorneys' fees
and costs of suit.
Respectfully submitted,
McNEES, WALLACE & NURICK
By/
Michael A. Doctrow
Attorney I.D. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
P. O. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717) 232-8000
Attorneys for Keystone Financial Bank, N.A.,
successor by merger to Pennsylvania National Bank
& Trust Company and Financial Trust Company
Date: October 4. 1999
KEYSTONE FINANCIAL BANK, N.A., : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA : CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY :
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
NO.
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants CIVIL ACTION - LAW
AND NOW, comes Plaintiff, Keystone Financial Bank, N.A., successor by merger to
Pennsylvania National Bank & Trust Company and Financial Trust Company, by and through its
counsel, the law firm of McNees, Wallace & Nurick, and files this Complaint pursuant to Pa. R.
Civ. P. 2951(b) for judgment by confession and avers as follows:
1. Plaintiff Keystone Financial Bank, N.A., successor by merger to Pennsylvania
National Bank & Trust Company and Financial Trust Company ("Plaintiff") is a national banking
institution with offices located at 1415 Ritncr Highway, P.O. Box 220, Carlisle, Cumberland
County, Pennsylvania 17013.0220.
2. Defendant Thomas M. Dardick ("Mr. Dardick") is an adult individual with a last
known address of 6 Shaker PL., Nashua, New Hampshire 03063.
3. Defendant Kathleen M. Vickroy ("Mrs. Vickroy") is an adult individual with a last
known address of 6 Shaker PL., Nashua, New Iampshire 03063.
4. At all times during the commencement of the hereinafter discussed loan
relationships and execution of the hereinafter described loan documentation, Mr. Dardick and
Mrs. Vickroy resided at their former address, being 5566 Moreland Court, Mechanicsburg,
Cumberland County, Pennsylvania 17055.
5. Darcom Technologies, Inc. (the "Company") is a Pennsylvania corporation with
its registered office in Pennsylvania listed as 5521 Carlisle Pike, Suite 201, Mechanicsburg,
Cumberland County, Pennsylvania 17055, and its principal place of business is located at 77
Northeastern Boulevard, Nashua, New Hampshire 03062.
6. Mr. Dardick is the Vice President of the Company.
7. On November 13, 1997, the Company entered into a Business Manager
relationship with Plaintiff, pursuant to which the Company executed The Business Manager
Agreement and a Business Loan Agreement, whereby Plaintiff extended to the Company a
Business Manager line of credit in the maximum amount of $600,000 (the "1997 Business
Manager Line"). A true and correct copy of the Business Manager Agreement and the Business
Loan Agreement executed in association with the 1997 Business Manager Line is attached hereto
as Exhibit "A".
8. On November 13, 1997, Mr. Dardick executed a Commercial Guaranty (the "1997
Guaranty") in favor of Plaintiff, whereby Mr. Dardick personally guaranteed the repayment of
any and all indebtedness of the Company to Plaintiff under the 1997 Business Manager Line. A
true and correct copy of the 1997 Guaranty, together with a signed Disclosure For Confession of
Judgment, is attached hereto as Exhibit "B".
-2-
9. On September 29, 1998, the Company executed a Promissory Note in favor of
Plaintiff in the principal amount of $188,000 to evidence a loan extended to the Company by
Plaintiff (the "1998 Note"). The 1998 Note was amended in part by the Change in Tcrms
Agreement dated May 27, 1999. A true and correct copy of the 1998 Note and the Change in
Terms Agreement is attached hereto as Exhibit "C".
10. On September 29, 1998, Mr. Dardick and Mrs. Vickroy each executed a
Commercial Guaranty (the "1998 Guaranty") in favor of Plaintiff, whereby Mr. Dardick and Mrs.
Vickroy jointly and severally personally guaranteed the repayment of the 1998 Note by the
Company to Plaintiff. A true and correct copy of the 1998 Guaranty, together with a signed
Disclosure for Confession of Judgment, is attached hereto as Exhibit "D."
11. The Company has defaulted under its payment obligations to Plaintiff under the
1997 Business Manager Line and the 1998 Note.
12. On September 3, 1999, Plaintiff notified the Company and Mr. Dardick and Mrs.
Vickroy by letter (the "Demand Letter") that all monies owed under the 1997 Business Manager
Line, the 1998 Note, the 1997 Guaranty and the 1998 Guaranty must be paid to Plaintiff on or
before September 13, 1999. A true and correct copy of the Demand Letter is attached hereto as
Exhibit "E".
13. Subsequent to delivery of the Demand Letter, the Company has continued to fail
to make payment to Plaintiff and to otherwise comply with the terms of the 1997 Business
Manger Line and the 1998 Note, and the Company remains in default under the 1997 Business
Manager Line and 1998 Note.
-3-
14. Plaintiff reasserts and incorporates herein the allegations of Paragraphs 1 - 13.
15. Pursuant to the 1997 Guaranty, Mr. Dardick became personally liable for
repayment of the 1997 Business Manager Line by the Company to Plaintiff.
16. Mr. Dardick is in default under the 1997 Guaranty, having failed to make payment
to Plaintiff pursuant to the 1997 Guaranty and the Demand Letter.
17. The total sum due and owing to Plaintiff, as of September 28, 1999, under the
1997 Business Manager Line and the 1997 Guaranty is $582,314.58.
18. Judgment has not been entered in any jurisdiction on the attached instruments.
19. The attached instruments have not been assigned.
20. The Judgment is not being entered by confession against a natural person in
connection with a consumer credit transaction.
21. Mr. Dardick is not subject to the protection of the provisions of the Soldiers and
Sailors Civil Relief Act of 1940, as amended.
22. The Confession of Judgment Clause set forth in the 1997 Guaranty provides for
recovery of the entire unpaid balance of principal, accrued interest, finance charges, attorneys'
fees, costs and expenses of suit and collection fees.
23. Mr. Dardick's failure to make payment to Plaintiff pursuant to the terms of the
1997 Guaranty provides Plaintiff with the authority to file this Complaint.
-4-
WHEREFORE, as to Count I, Plaintiff Keystone Financial Bank, N.A., successor by
merger to Pennsylvania National Bank & Trust Company and Financial Trust Company,
respectfully requests that this Honorable Court enter judgment by confession against Mr. Dardick
for monetary damages, as authorized by the attached 1997 Guaranty, in the amount of
$582,314.58, plus any interest provided for in the 1997 Business Manager Line loan documents,
both before and alter entry of judgment, any permissible late charges, attorneys' fees, and all
costs of suit.
24. Plaintiff reasserts and incorporates herein the allegations of Paragraphs I - 23.
25. Pursuant to the 1998 Guaranty, Mr. Dardick and Mrs. Vickroy became personally
liable for payment of the 1998 Note by the Company to Plaintiff.
26. Mr. Dardick and Mrs. Vickroy are each in default under the 1998 Guaranty,
having failed to make payment to Plaintiff pursuant to the 1998 Guaranty and the Demand Letter.
27. The total sum due and owing to Plaintiff, including accrued interest and late
charges, as of September 28, 1999, under the 1998 Note and the 1998 Guaranty is $215,366.08.
28. Judgment has not been entered in any jurisdiction on the attached instruments.
29. The attached instruments have not been assigned.
30. The Judgment is not being entered by confession against a natural person in
connection with a consumer credit transaction.
31. Mr. Dardick and Mrs. Vickroy arc not subject to the protection of the provisions
of the Soldiers and Sailors Relief Act of 1940, as amended.
-5-
32. The Confession of Judgment clause set forth in the 1998 Guaranty provides for
recovery of the entire unpaid balance of principal, accrued interest, finance charges, attorneys'
fees, costs and expenses of suit and collection fees.
33. Mr. Dardick's and Mrs. Vickroy's failure to make payment to Plaintiff pursuant to
the terms of the 1998 Guaranty provides Plaintiff with the authority to file this Complaint.
WHEREFORE, as to Count 11, Plaintiff Keystone Financial Dank, N.A., successor by
merger to Pennsylvania National Bank & Trust Company and Financial Trust Company,
respectfully requests that this Honorable Court enter judgment by confession against Mr. Dardick
and Mrs. Vickroy for monetary damages, as authorized by the attached 1998 Guaranty, in the
amount of $215,366.08, plus accruing interest from September 28, 1999 of $48.31 per diem, as
provided in the 1998 Note, both before and after entry of judgment, additional late charges,
attorneys' fees, and all costs of suit.
Respectfully submitted,
McNEES, WALLACE & NURICK
By Michael A. Yoctrow
Attorney I.D. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
P. O. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717) 232-8000
Attorneys for Keystone Financial Dank, N.A.,
successor by merger to Pennsylvania National Bank
& Trust Company and Financial Trust Company
Date: October 4, 1999
-6.
KEYSTONE FINANCIAL BANK, N.A., : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
NO.
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants : CIVIL ACTION - LAW
AFFIDAVIT OF LAST KNOWN ADDRESS
We hereby certify that the last known address of the Defendants is: Thomas M. Dardick
and Kathleen A. Vickroy, 6 Shaker PL., Nashua, New Hampshire 03063.
Respectfully submitted,
McNEES, WALLACE & NURICK
r
By 10
w
Michael ADD
Attorney I.D. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
`y
P. 0. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717) 232-8000
Attorneys for Keystone Financial Bank, N.A.,
successor by merger to Pennsylvania National Bank
110
& Trust Company and Financial Trust Company
A
;y
Date: October 4, 1999
FROM IMC NEED 6MLRCE PAMICK 717 237 D300 1999.09-20 14147 U454 P.03/04
Subject to the penalties of Ig Pa.C.S.A. § 4904, relating to unworn falsification to
I authorities, I hereby certify that I am JACK V. IJUTCIBSON, Assistant Vice President- Special
Assets, at Keystone Financial Bank, N.A., successor by merger to Pennsylvania National Bank &
Trust Company and Financial Trust Company, and that I am authorized to verify the foregoing
Complaint For Confession of Judgment, and that the facts set forth in the foregoing are true and
comet to the best of my information and belief.
?tchlson
Assistant Vice President - Special Assets
Dated: September 4w, 1999
i
EXHIBIT "A"
-7
)0031
THE BUSINESSIMANAGERS AGREEMENT
WITH BUSINESSES AND PROFESSIONALS
TO: Pennsylvania National Bank & FROM: Darcom Technologies
Trust Co. 77 Northeastern Blvd.
One Keystone Plaza Nashua, NH 03082
Front a Market Streets
Harrisburg, PA 17101
(the "Bank") (the "Business")
The Business named above agrees to the following terms according to which, when accepted by
the Bank, the Business will receive payment for receivables arising from sales or services to
Customers and purchased by the Bank pursuant to the Bank's BusinesslManager plan.
SECTION 1: _DEFINITIONS
1.1 "Credit Application and Agreement" means a Credit Application and Agreement
executed by a Customer and any other agreement or documentation that governs the terms and
disclosures relating to a Receivable.
1.2 "Credit Memo" means a form reflecting a credit, other than a credit arising from a
payment, to a Customer's account with the Business.
1.3 "Customer" means a debtor obligated on one or more Receivables which arose
from goods the Business sold or services it rendered to the Customer.
1.4 "Face Amount" of a Receivable means on any date the outstanding balance of
such Receivable (after taking into account, without duplication, all payments, returns, credits, or
allowances of any nature at any time Issued, owing, granted or outstanding), plus any taxes
imposed in connection with such Receivable.
1.5 "Invoice" means an invoice or similar evidence of the terms of a sale of goods or
provision of services previously made by the Business to a Customer.
1.8 "Net Amount" of a Receivable means the Face Amount of a Receivable less the
Service Charge.
1.7 "Obligations" means all of the Business's obligations to the Bank, whether pursuant
to this Agreement, under any note, contract, guaranty, accommodation or otherwise, however
and whenever created, arising or evidenced, whether direct or indirect, absolute or contingent,
now or hereafter existing or due.
1.8 "Receivables" means all accounts, Instruments, contract rights, chattel paper,
documents, and general Intangibles arising from the Business's sale of goods or rendering of
services, and the proceeds thereof, and all security and guaranties therefore, whether now
existing or hereafter created, that are accepted by the Bank for purchase hereunder in the Bank's
sole and absolute discretion.
1.9 "Recourse Obiloation" means the liability of the Business to the Bank under this
Agreement in an amount equal on any date to the Face Amount of Receivables on that date,
plus attorneys' fees (if incurred) and accrued and unpaid finance charges related to such
Receivables. Upon a Default or termination under this Agreement, the Recourse Obligation shall
also Include the amount of all indemnities and other obligations arising under this Agreement.
1.10 "Reserve" means funds of the Business used to provide for the securing of the
Business's Recourse Obligation. "Reserve Account" means the deposit account of the Business
containing the Reserve established pursuant to Section 2.5 of this Agreement.
1.11 "Service Charge" means a discount equal to 3.9% of the Face Amount of each
Receivable the Business tenders to the Bank that Is acquired by the Bank. The Service Charge
may be periodically reviewed and adjusted at the Bank's discretion, based on activity levels,
credit quality, and current economic conditions. The Business acknowledges that the Service
Charge is a discount for value and in no event constitutes Interest or a similar charge and that
the transaction contemplated under this Agreement is not a transaction for the use, forbearance
or detention of money. The Service Charge is in the view of the parties a reasonable and
customary discount.
SECTION-2, SALE: PURCHASE PRICE: BILLING AND COLLECTION: RESERVE
2.1 Assignment and Sale. The Business hereby assigns and sells to the Bank as
absolute owner, with full recourse as set out below, the Business's entire Interest in such of its
currently outstanding Receivables as are described on attached Exhibit 2.1, as well as Its future
Receivables represented by Invoices It delivers to the Bank; provided, however, that at no time
shall the total Face Amount of Receivables outstanding exceed $600,000.00 unless agreed to in
a written document signed by the Bank. The Business and the Bank agree that the transaction
contemplated by this Agreement is an account purchase transaction and that the accounts are
being purchased by the Bank from the Business at a discount. The amount of the Recourse
Obligation shall be payable by the Business to the Bank on demand by the Bank following a
Default or termination under this Agreement.
2.2 Purchase Price. The purchase price of the Receivables shall be equal to the Net
Amount thereof. The Net Amount less the Reserve associated with the Receivables shall be
credited to the Business's primary account with the Bank on or before the second banking day
after delivery to the Bank of acceptable Invoices.
2.3 Documentation, The Business will provide the Bank with Credit Applications and
Agreements, Invoices, and Credit Memos (if applicable) related to all sales and services creating
Receivables of Customers, and such other documents and proof of delivery of goods or
rendering of services as the Bank may require. As to the Receivables described on Exhibit 2.1,
the payment of the purchase price by the Bank as set forth In Section 2.2 hereof shall be
conclusive evidence of assignment and sale thereof, and, if the Bank so requires, any invoices
the Business may thereafter send (if any) will clearly indicate that the related Receivables ;lave
been assigned, sold, and are payable to the Bank only.
2.4 Billing. The Bank will send a monthly statement to all Customers itemizing their
account activity during the preceding billing period, unless otherwise agreed by the parties. All
Customers will be instructed to make payments to a post office box controlled by the Bank. All
payments received from or for the account of a Customer will be applied to the obligations of that
Customer. Payment will be deemed made when received by the Bank. All variations,
modifications or extensions of Indebtedness on Receivables sold to the Bank hereunder will be
made only by the Bank. Nothing in this Agreement authorizes the Business to collect
Receivables sold to the Bank hereunder, but in the event the Business receives a payment
related to any Receivable after the Business has sold the Receivable to Bank, such payment
shall be deemed to have been received in trust for the Bank and the Business shall deliver such
payment to the Bank, property endorsed, no later than the next banking day after receipt. The
Business will pay to the Bank any finance charges Incurred pursuant to the applicable Credit
Application and Agreement by a Customer because of delay on the Business's part in delivering
payments or Credit Memos to the Bank.
2.5 Reserve, The Bank may retain a portion of the sums payable to the Business, the
amount of which the Bank may adjust from time to time in Its reasonable discretion, to provide
for satisfaction of the Business's Recourse Obligation. The Initial amount of the Reserve will be
equal to 10.00% of the Face Amount of all Receivables initially purchased by the Bank.
Thereafter, and subject to the Bank's right to adjust the Reserve as set out above, the amount of
the Reserve will be increased by 10.00% of the Face Amount of all Receivables purchased by
the Bank subsequent to its initial purchase of the Receivables. The Reserve will be held in a
separate, interest-bearing account for the benefit of the Business for as long as the Business has
any Recourse Obligation to the Bank and/or as long as there remain any Receivables purchased
by the Bank under this Agreement which have not been completely collected. The Business
shall not withdraw any portion of the Reserve without the consent of the Bank, and the Reserve
shall not be subject to turnover in any insolvency or bankruptcy proceeding commenced by or
against the Business as long as the Business has any Recourse Obligation to the Bank and/or as
long as there remain any Receivables purchased by the Bank under this Agreement which have
not been completely collected.
SECTION 3• REASSIGNMENT OF RECEIVABLES SECURITY INTEREST
3.1 RBDMIMb e. With respect to any Receivables Initially Purchased by the Bank and
shown on Exhibit 2.1, the Bank may require the Business to repurchase all or any portion of such
Receivables If any minimum payment due on one or more of such Receivables remains unpaid
following 90 days after its due date. With respect to any Receivables purchased subsequent to
the Bank's Initial purchase hereunder, the Bank may require the Business to repurchase all or
any portion of such Receivables If any minimum payment due on one or more of such
Receivables remains unpaid following 90 days after Its due date. For purposes of this
Agreement, the aging status of Receivables purchased from the Business as shown on the aging
of Receivables produced or generated by the Bank will be deemed conclusive (absent manifest
error) In determining which Receivables the Bank may require the Business to repurchase.
Regardless of when purchased, the Bank may require the Business to repurchase all or any
portion of Receivables for any particular Customer If such Customer Is bankrupt or insolvent or if
any dispute arises with a Customer regarding such Receivables (including, without limitation, any
alleged deduction, defense, offset, preference claim or counterclaim thereto). The Bank may
also require the Business to repurchase all outstanding Receivables (a) upon a Default, as
defined In Section 8, or (b) upon the termination of this Agreement. Any decision by the Bank to
require the Business to repurchase less than the maximum amount permitted by this Agreement
shall not be deemed a waiver of the Bank's rights to require repurchase to the maximum extent
permitted by this Agreement. The provisions of this paragraph shall survive the expiration and/or
termination of this Agreement.
3 Eff
that It Is is ect of Repurchase Immediately upon the sending of written notice by the Bank
requiring the Business to repurchase Receivables in accordance with paragraph 3.1, (a)
the Business shall be deemed to have repurchased such Receivables, and (b) the Business shall
be liable to the Bank for payment of the Recourse Obligation with respect to the repurchased
Receivables. Without any further notice or demand, the Bank may setoff and/or debit such
amount (and any amount necessary to bring the Reserve to the level required by the Bank In its
sole and reasonable discretion) against the Business's Reserve Account or any other deposit
account of the Business with the Bank. In the event such accounts contain Insufficient funds for
the Bank's setoff or the Bank elects not to make such setoff, the Business agrees to pay any
such deficiency or shortfall on demand. Upon a repurchase of Receivables, the Bank shall have
no further Interest In the Receivables or undertaking with respect to the billing or collection of the
Receivables so repurchased. The provisions of this paragraph shall survive the expiration and/or
termination of this Agreement.
3.3 Seeurlt_ v I_ nterest The Business hereby grants the Bank a security Interest and a
right of setoff in all of Its present and future accounts, Instruments, contract rights, chattel paper,
documents and general Intangibles (in each case as defined in the Uniform Commercial Code as
in effect in the State whose law governs this Agreement) and the proceeds thereof, and all
returned, repossessed, and reclaimed goods, and related books and records, to secure all of the
Business's Obligations, and agrees to execute appropriate UCC•1 financing and other related
statements. The Business further sells and assigns the Bank all of the Business's rights as an
unpaid vendor or lienor, all of Its related rights of stoppage In transit, replevin and reclamation
and rights against third parties, and the Business agrees to cooperate with the Bank in exercising
these rights. In addition, the Business grants the Bank a security Interest and a right of setoff in
the Reserve and in the Reserve Account to secure all of the Business's Obligations. The
Business agrees to execute such additional documents and take such further action as Bank
deems necessary or desirable In order to perfect the security Interests granted herein, to
effectuate the sale and assignment of the Receivables, and otherwise to effectuate the purposes
of the Agreement. In the event that the Bank requires additional security for the Business's
obligations under this Agreement and the Business or other party executes additional security
agreements, pledge agreements, guaranties and documents of similar Import (collectively, the
'Additional Security Documentsj, terms used therein such as, but not limited to, 'loans,'
*indebtedness," secured obligations,' and 'obligations,* shall be deemed to include the Recourse
Obligation as defined herein, and notwithstanding the provisions of the Additional Security
Documents, the Recourse Obligation secured thereby shall not constitute loans or indebtedness.
SECTION 4: REPRESENTATIONS. WARRANTIES AND COVENANT
4.1 Representations and Warranties, The Business represents and warrants that it is
fully authorized to enter Into this Agreement and to perform hereunder, and that this Agreement
constitutes its legal, valid and binding obligation; that the Business Is solvent and in good
standing in the State of Its organization; that its Receivables are and that they will be at the time
of their creation, bona fide and existing obligations of Customers of the Business arising out of Its
sales or services, free and clear of all security Interests, liens, and claims whatsoever of third
parties and that the documentation under which the Receivables are payable authorize the payee
thereof to charge, collect and receive Interest at the rate provided In such documentation; that all
Receivables and all documents and practices related thereto comply with all applicable federal
and state laws; that the collateral of the Business in which a security interest is granted In Section
3.3 hereof or any Additional Security Documents is not subject to any other security Interest, lien
or encumbrance whatsoever (except in favor of the Bank), and that the Business will not permit
such collateral to become so encumbered without the Bank's prior written consent; and that the
Business's inventory is not subject to any security interest, lien or encumbrance whatsoever and
that the Business will not permit its Inventory to become so encumbered without the Bank's prior
written consent.
4,2 Covenants, The Business covenants that (1) it will allow the Bank to review and
Inspect during reasonable business hours, and the Business will supply, financial information and
necessary documentation on the Business, any guarantors, or on any Customer upon the Bank's
request; and (to with respect to each Receivable as It arises: (a) the Business will have made
delivery of the goods and/or will have rendered the services represented by the Invoice, and the
goods and/or services will have been accepted; (b) the Business will have preserved and will
continue to preserve any liens and any rights to liens available by virtue of the sales and/or
services; (c) the Customer will not be the Business's affiliate; (d) the Bank's copy of the Invoice
will be genuine and will comply with this Agreement; (e) the Business will have no knowledge of
any dispute or potential dispute that may impair the validity of the transaction or the Customer's
obligation to pay the related Receivable in accordance with its terms; (f) the Business will have
the right to render the services and/or to sell the goods creating the Receivable, and will do so In
accordance with all applicable laws; (g) the Business will have paid or provided for the payment
of all taxes arising from the transaction creating the Receivable; and (h) the Receivable will not
be subject to any deduction, offset, defense, or counterclaim.
SECTIONS: FORMS AND PROCEDURES; RESPONSIBILITY FOR US
5.1 Forms and Procedures. The Business will use only forms, agreements, and
advertising materials supplied or approved by the Bank in connection with the Receivables and
will follow all procedures that are satisfactory to the Bank in connection with the use of such
forms, agreements, and advertising materials.
5.2 gesponsibility, The Business will be solely responsible for the adequacy,
completeness and accuracy of the raw data and Its preparation In the form required and its
transmission to the Bank, and will indemnify and hold the Bank and Its agents and employees
(and anyone else providing processing, billing, or receivables management services) harmless
from (and pay all reasonable attorneys' fees with respect to) any claim or liability sustained by
virtue of acting In reliance upon data furnished by the Business. The Business understands that
the form of credit application and agreement and other documentation the Bank supplies to the
Business should be reviewed by the Business's local counsel as the Bank makes no
representation or warranty as to their enforceability in the Business's state or their compliance
with applicable federal and state laws. The Bank and the Business agree that the Bank is the
owner of all Receivables purchased by the Bank hereunder, except for those Receivables the
Bank has required the Business to repurchase, and that all activities of the Bank in connection
with the collection of Receivables, generation of Information, and processing of data, Is for the
account of the Bank's own affairs; that the information generated in connection therewith is the
property of the Bank; and that the use of computers by the Bank In connection with its activities
under this agreement is used to facilitate the performance of services other than "data
processing.' The Business will indemnify and hold the Bank and its agents, affiliates and
employees (and anyone else providing processing or billing services) harmless from (and pay all
reasonable attorneys' fees with respect to) any loss or claim involving breach of warranty or
representation by the Business and from any loss or claim by any Customer relating to the
Receivables or to goods and/or services (or the manner or type of their sale or provision) giving
rise to Receivables purchased by the Bank hereunder. The provisions of this paragraph will
survive the termination and/or expiration of this Agreement.
SECTION 6: POWER OF ATTORNEY
The Business appoints the Bank as its attomey-in-fact to receive, open, and dispose of all
mall addressed to the Business pertaining to Receivables; to endorse the Business's name upon
any notes, acceptances, checks, drafts, money orders, and other evidences of payment of
Receivables that may come into the Bank's possession, and to deposit or otherwise collect the
same; and to do all other acts and things necessary to carry out the terms of this Agreement.
This power, being coupled with an Interest, is irrevocable while any Receivable shall remain
unpaid regardless of the expiration or termination of this Agreement.
SECTION 7: APPLICABLE l AW
This Agreement shall be governed by, construed and enforced according to the laws of the
Commonwealth of Pennsylvania.
ON 8: DEFAUL
8.1 Event of Default. The following events will constitute a default (a "Default") under
the terms of this Agreement: (a) the Business fails to pay the Recourse Obligation or any other
payment obligation of the Business under this Agreement on demand or the Business fails to pay
any Indebtedness of the Business owed to the Bank pursuant to Its terms; (b) the Business falls
to perform any obligation, covenant or liability in connection with this Agreement within ten (10)
days after the date that written notice thereof is given to the Business; (c) any warranty,
representation or statement whenever made by the Business in connection with this Agreement
proves to be false In any material respect when made, or the Business falls to disclose to the
Bank that any such warranty, representation or statement has become untrue in any material
respect; (d) dissolution or termination of the Business If the Business is a corporation,
partnership, or other entity, or if the Business is an Individual, the death of such Individual; (e)
the Business's Insolvency; (Q the assignment for the general benefit of the Business's creditors,
the appointment of a receiver or trustee for Its assets, the commencement of any proceeding
under any bankruptcy or insolvency laws by or against the Business or any proceeding for the
dissolution or liquidation, settlement of claims against or winding up of Its affairs; (g) the
termination or withdrawal of any guaranty for the Business's Obligations; (h) the Business falls to
pay when due any tax Imposed an it or any tax lien is filed against the Business or any of Its
assets; (i) any judgment against the Business remains unpaid, unstayed on appeal,
undischarged, unbonded or undismissed for a period of thirty (30) days; (j) the Business
discontinues Its business as a going concern; or (k) the Bank In good faith deems the prospect of
the Business's payment or performance of Its Obligations to have been impaired.
8.2 Effect of Default. Upon the occurrence of any Default, In addition to any rights the
Bank has under this Agreement or applicable law, the Bank may Immediately terminate this
Agreement, at which time all Obligations the Business owes to the Bank will immediately
become due and payable without notice, and the Bank's obligations to the Business hereunder
will cease. After the occurrence of a Default. the Bank will have the right to withhold any further
payments to the Business, and none of the Bank's rights or collateral will be adversely affected
thereby.
SECTION 9• NON LIABILITY OF BANK' RELEASE
Except for a breach by the Bank of this Agreement, the Business hereby releases,
discharges, and acquits the Bank, Its officers, affiliates, directors, employees, participants,
successors and assigns from any and all claims, demands, losses, and liability of any nature
which the Business ever had, now or hereafter can, shall or may have in connection with or
arising out of the transactions contemplated herein or the documentation hereof. In addition to
the provisions of this Section and Section 5.2, the Bank shall not be liable for any Indirect,
special or consequential damages, such as loss of anticipated revenues or other economic loss
in connection with or arising out of any default In performance hereunder or other matter arising
herefrom. Nor shall the Bank be liable for any errors of judgment or mistake of fact when acting
as the Business's attorney-in-fact pursuant to Section 8, or liable for delay in the performance of
the Bank's duties caused by strike, lawsuit, riot, civil disturbance, fire, shortage of supplies or
materials, or any other cause reasonably beyond the Bank's control. The provisions of this
paragraph shall survive the expiration and/or termination of this Agreement.
SECTION 10: EFFECTIVE DATE• TERMINATION' BINDING EFFECT
This Agreement will be effective when accepted by the Bank, and will continue in full force
and effect until the earlier of: (a) one year after the effective date of this Agreement; or (b) sixty
(80) days after written notice of termination has been given by one party to the other (in each
case subject to immediate termination upon a Default); and the term of this Agreement will
automatically be extended for periods of one year each following Its otherwise scheduled
termination, subject to Section 8.2 above and to the parties' rights to terminate this Agreement
under clause (b) of this Section 10. Upon termination of this Agreement, the Business will pay all
of Its Obligations to the Bank; and in any event the Business will remain liable to the Bank for
any deficiency remaining after liquidation of any collateral; and the Bank may withhold any
payment to the Business unless supplied with an Indemnity satisfactory to the Bank. This
Agreement shall bind the Business and the Business's heirs, executors, successors and assigns
and shall inure to the benefit of the Bank and the Bank's successors and assigns. The Business
agrees that the Bank may delegate Its duties hereunder, but that the Business may not do so
without the Bank's prior written consent. Following termination of this Agreement, any funds
remaining in the Reserve Account shall not be disbursed to the Business until the Business has
paid all of Its Obligations to the Bank and all Receivables have either been liquidated or
repurchased by the Business.
SECTION 11: ATTORNEYS FEES; PAST-DUE OBLIGATIONS; WAIVER; SEVERABILITY;
HEADINGS; ENTIRE AND CONTROLLING AGREEMENT; NOTICES;
COUNTERPARTS
The Business will pay all reasonable expenses incurred by the Bank in connection with the
execution of this Agreement, Including expenses Incurred in connection with the filing of
financing statements, continuation statements and record searches. All past-due obligations of
the Business arising under this Agreement shall bear interest at the maximum nonusudous rate
permitted under applicable state or federal law. The Business hereby waives grace, demand
(other than demand pursuant to Section 2.1 hereol), presentment for payment, notice of dishonor
or default, notice of intent to accelerate, notice of acceleration, protest and notice of protest and
diligence in collecting and bringing of suit against the Business. Upon liquidation of any
collateral, settlement or prosecution of a dispute with any Customer, or enforcement of any
obligation of the Business hereunder, the Business will pay to the Bank, and the Bank may
charge to the Business's account, all costs and expenses Incurred, including reasonable
attorneys' fees, and such costs, expenses and fees shall constitute part of the Business's
Obligations. No delay or failure on the Bank's part in exercising any right, privilege, or option
hereunder shall operate as a waiver of such or of any other right, privilege, or option, and no
waiver, amendment or modification of any provision of this Agreement shall be valid unless in
writing signed by the Bank, and then only to the extent therein stated; the Bank does, however,
have the right to amend this Agreement upon thirty (30) days written notice to the Business.
Should any provision of this Agreement be prohibited by or invalid under applicable law, the
validity of the remaining provisions shall not be affected. The headings herein are for
convenience only, and shall not define or limit the scope, extent, meaning or Intent of this
Agreement. This Agreement embodies the Business's entire agreement as to Its affiliation with
the Bank's BuslnesslManager program, although the Business anticipates that the Bank will
subsequently outline certain depository and billing procedures. In the event of any inconsistency
between this Agreement and any other agreement signed by the Business and the Bank in
connection with this Agreement, Including without limitation, any Additional Security Documents,
the terms and provisions of this Agreement shall control and the terms and provisions of any
such other document shall be Ineffective to the extent of any such Inconsistency. Any notice,
request or demand to be given hereunder will be deemed to be given when deposited with a
delivery service addressed to, or sent by registered or certified mail to, the address of the
recipient listed at the beginning of this Agreement. This Agreement may be executed in multiple
counterparts, which when taken together shall constitute one and the same Agreement.
SECTION 12• SPECIAL STIPULATIONS
A Commercial Security Agreement Covering All Business Assets.
The Personal Guarantees of D. Scott Dardick, Steven M. Dardick and Thomas M. Dardick.
BUSINESS:
By: D. Scott Dardick
Title: President
ACCEPTANCE:
This Agreement is accepted this Zday of but
191:
BANK: PENNSYLVANIA NATIONAL BANK
b TRUST CO.
By:
arias M. Wasson
Title: Assistant Vice President
O Copyright 1995 by Private Business, Inc. All Rights Reserved. BusinessIManager® Is a
registered trademark of Private Business, Inc.
0895.PBI
BUSINESS LOAN AGREEMENT
Pr gopal i~ ,
I
800'
00,.'
< oars Dee
11-13-1997
Maturity,
:
Loan No
801.30016
Cell.
BMGR
•
Collateral
: SEC,
' Account : -
140703'
Officer
CW95.
nl{tale
'
References In the shaded area are for Lendoes use on and do not Omit the app licability of this document to an articular Ian or Item.
Borrower: Darcom Technologies, Inc. Lender: PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY
77 Northeastern Boulevard CAMP HILL COMMUNITY OFFICE
Nashua, NH 03062 4231 TRINDLE ROAD
CAMP HILL, PA 17011
THIS BUSINESS LOAN AGREEMENT between Darcom Technologies, Inc. ("Borrower') and PENNSYLVANIA NATIONAL BANK AND TRUST
COMPANY ("Lender") Is made and executed on the following terms and conditions. Borrower has received prior commercial bans from
Lender or has applied to Lender for a commercial loan or loans and other financial accommodations, Including those which may be described
on any exhibit or schedule attached to this Agreement. All such tans and financial accommodations, together with all future bans and
financial accommodations from Lander to Borrower, are referred to to this Agreement Individualy, as the "Loan" and collectively as the
"Loco" Borrower understands and agrees that: (a) In granting, renewing, or extending any Loan, Lander Is retying upon Borrower's
representations, warranties, and agreements, as sat forth In this Agreement; (b) the granting, renewing, or extending of any Loan by Lander
at all tfmes shall be subject to Lender's sole judgment and discretion; and (c) all such Loans shall be and shall remain subject to the following
terms and conditions of this Agreement.
TERM. This Agreement shall be effective as of November 13, 1997, and shall continue thereafter until all Indebtedness of Borrower to Lender has
been performed In full and the parties terminate this Agreement In writing.
OEFINIT:ONS. The following words shalt have the following meanings when used In this Agreement. Terms not otherwise defined In this Agreement
shall have the meanings attributed to such terms In the Uniform Commercial Code. NI references to dollar amounts shell mean amounts In lawful
money of the United States of America.
Agreemanl. The word 'Agros menr mans this Business Lan Agreement, as this Business Lan Agreement may be amended or modified from
time to time, together with all exhibits and schedules attached to this Business Lan Agreement from time to time.
Borrower. The word "Borrowef means Darcom Technologies, Inc.. The word 'Borrower' also Includes, as applicable, all subsidiaries and
amtiates of Borrower as provided below In the paragraph lilted "Subsidiaries and Affiliates'
CERCLA. The word'CERCLA" means the Comprehensive Environmental Response, Compensation, and Liability Act of 1900, as amended.
Collateral. The word "Conaterar mans and incudes without limitation all property and assets granted as collateral security for a Lan, whether
real or personal property, whether granted directly or Indirectly, whether granted now or In the future, and whether granted In the form of a security
Interest, mortgage, deed of trust, assignment, pledge, chattel mortgage, chattel trust, factor's lion, equipment trust, conditional sale, trust fecolpt,
Ban, charge, lien or tills retention contract, lease or consignment Intended as a security device, or any other security or lien Interest whatsoever,
whether created by law, contract, or otherwise.
ERISA. The word''ERISA" means the Employ" Retirement Income Security Act of 1974, as amended.
Event of Default. The words "Event of Default" mean and Include without limitation any of the Events of Default set forth below In the section titled
"EVENTS OF DEFAULT.'
Granoor. The word "Grantor means and Includes without limitation each and all of the persons or entities granting a Security Interest in any
Collateral for the Indebtedness, including without limitation all Borrowers granting such a Security Interest.
Guarantor. The word *Guarantor" means and Includes without limitation each and all of the guarantors, sureties, and accommodation parties In
connection with any Indebtedness.
Indebtedness. The word 'Indebtedness" means and Includes without limitation all Loans, together with all other obligations, debts and liablutias
of Borrower to Lender, or any one or more of them, as well as all claims by Lender against Borrower, or any one or more of them; whether now or
hereafter existing, voluntary or Involuntary, duo or not due, absolute or contingent, liquidated or unequldated; whether Borrower may be liable
Individually or jointly with others; whether Borrower may be obligated as a guarantor, surety, or otherwise; whether recovery upon such
Indebtedness may be or hereafter may become barred by any statute of limitations; and whether such Indebtedness may be or hereafter may
become otherwise, unenforceable.
Lender. The word 'Lender' means PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY, Its successors and esslgns.
Loan. The word 'Loan" or I Ions" means and includes without limitation any and as commercial loans and financial accommodations from
Lender to Borrower, whether now or hereafter existing, and however evidenced, Including without limitation those loans and financial
accommodations described heroin or described on any exhibit or schedule attached to this Agreement from time to time.
Note. The word "Nola' means and Includes without limitation Borrower's promissory note or notes, If any, evidencing Borrower's Loan obligations
In favor of Lender, as woo as any substitute, replacement or refinancing note or notes therefor.
Permitted Liana. The words 'Permitted Lions' moan: (a) liens and security Interests securing Indebtedness owed by Borrower to Lender; (b)
Lions for taxes, assessments, or similar charges either not yet due or being contested In good failh; (c) hens of malerlalmon, mechanics,
warehousemen, or carriers, or other like liens arising In the ordinary course of business and securing obligations which are not yet delinquent; (d)
purchase money lions or purchase money avow ly Interests upon or In any property acquired or held by Borrower in the ordinary course of
business to secure Indebtedness outstanding on tho data of this AgreemsN or permuted to be Incurred under the paragraph of this Agreement
titled'Indebledriess and Liens'; (e) Ilan and security Interests which, as of the dale of this Agreement, have been disclosed to and approved by
the Lander In writing; and (r) those lions and security Interests which In the aggregate constitute an Immaterial and Insignificant monetary amount
with respect to the net value of Borrower's wets.
Related Documents. The wads 'Related Documents' mean and Include without limitation all promissory notes, credit agreements, loan
agreements, environmental agreements, guaranties, security agreements, mortgages, dads of trust, and all other instruments, agreements and
documents, whether now or hereafter existing, executed In connection with the Indebtedness.
Security Agreement. The words 'Security Agreement' mean and include without limitation any agreements, promises, covenants, arrangements,
understandings or other agreements, whether created by law, contract, or otherwise, "dancing, governing, representing, or creating a Security
Interest.
Security Interest. The words *Security Interest" mean and Include without limitation any type of collateral security, whether in the form of a lion,
charge, mortgage, dead of trust, assignment, pledge, chattel mortgage, chattel trust" faclor's lien, equipment trust, conditional sale, trust receipt,
lion or bile retention contract, lease or consignment Intended as a security device, or any other security or lion interest whatsoever, whether
created by law, contract, or otherwise.
SARA. The wcrd *SARA' means the Superfund Amendments and Reauthorization Act of 1908 as now or hereaner amended.
CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the initial Loan Advance and each subsequent Loan Advance under
this Agreement shall be subject to the fullinmenl to Lander'& satisfaction of all of the conditions sot lath in Ibis Agreement and in the Related
Documents.
Loan Documents. Borrows( shall provide to Lander in form satisfactory to Lendor the following documents for the Loan: (a) the Note, (b)
Security Agreements granting to Lender soeunty Interests In hie Collateral, (c) Financing Statements perteztirg Lender's Soeunly Interests; full
evidence of Insurance as required below; and (a) any other documents rogwred under this Agreement or by Lander or its counsel, Including
without limitation any guaranties described below,
Borrower's Authorization. Borrower shall have provided in form and substance satisfactory to Lander property corlified rosolution9, duly
authorizing the execution and delivery of this Agreement, the Nola and the Related Documents, and such other euthoritalions and other
documents and Instruments as lender or Its counsel, in their sole disciehon, may mquira.
Payment of Fees and Expenses. Borrower shall have paid to Lender all loss, charges, and other expenses which are than due and payable as
specified In this Agreement or any Related Document.
Representations and Warranties. The representations and wonanlies set forth in this Agreement, In the Rolaled Documents, and In any
document or carhncele delivered to Lander under this Agreement are true and correct.
No Event of Default. There shall not exist of the time of any advance a condition which would constitute an Event of Default under this
Agreement.
REPRESENTATIONS AND WARRANTIES, Borrower roprosenls and warrants to Londor, as of Ino date of Ibis Agroomonl, as of the data of each
disbursement of Loan proceeds, as of the date of any renewal, extension of modification of any I can, and at all times any Indehtedness exists:
11-13-1997 BUSINESS LOAN AGREEMENT Page 2
Loan No 801-30016 (Continued)
Organization. Borrower Is a corporation which is duly organized, validly existing, and In good standing under the laws of the State of New
Hampshire and Is validly existing and In good standing In all slates In which Borrower Is doing business. Borrower has the full power and
authority to own Its properties and to transact the businesses In which It is presently engaged or presently proposes to engage. Borrower also la
duly qualified as a foreign corporation and Is in good standing in all states In which the failure to to qualify would have a material adverse effect on
Its businesses or financial condition.
Authorization. The execution, delwary, and performance of this Agreement and all Related Documents by Borrower, to the extent to be executed,
delivered of performed by Borrower, have been duly authorized by as necessary action by Borrower; do not require the consent er approval of
any other parson, regulatory authority or governmental body; and do not conflict with, result In a violation of, or constitute a default under (a) any
provislon of Its articles of Incorporation or organization, or bylaws, or any agreement or other Instrument binding upon Borrower or (b) any law,
governmonlel regulation, court decree, or order applicable to Borrower.
Financial Information. Each financial statement of Borrower supplied to Lander truly and completely disclosed Borrower's financial condition as
of the date of the statement, and there has been no material adverse change In Borrowers financial condition subsequent to the date of the most
recent snanclal statement supplied to Lender. Borrower has no material contingent obligations except as disclosed In such financial statements.
Legal Effect. This Agreement constitutes, and any Instrument or agreement required hereunder to be given by Borrower when delivered will
constitute, legal, valid and binding obligations of Borrower enforceable against Borrower In accordance with their rospective terms.
Properties. Except as contemplated by this Agreement or as previously disclosed In Borrower's financial statements or In writing to Lander and as
accepted by Lander, and except for property tax liens for taxes not presently duo and payable, Borrower awns and has good title to all of
Borrower's properties free and clear of all Security Interests, and has not executed any security documents or financing statements totaling to such
properties. All of Borrower's properties are tilled In Borrower's legal name, and Borrower has not used, or filed a financing statement under, any
other name for at least the last five (6) years.
hazardous Substances. The forms 'hazardous waste; "hazardous substance," "disposal; "release; and "threatened raloaso, as used In this
Agreement, shall have the same meanings as set loath In the "CERCLA," "SARA; the Hazardous Materials Transportation Act, 49 U.S.C. Section
1801, at seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, at seq., er other applicable state or Federal taws, rules, at
regulations adopted pursuant to any of the foregoing. Except as disclosed to and acknowledged by Lender in writing, Borrower represents and
warrants that: (a) During the period of Borrower's ownership of the properties, there has been no use, generation, manufacture, storage,
treatment, disposal, release or threatened release of any hazardous waste or substance by any person on, under, about or from any at the
properties. (b) Borrower has no knowledge of, or reason to believe that there has been (1) any use, generation, manufacture, storage, treatment,
disposal, release, or threatened release of any hazardous waste or substance on, under, abed or from the properties by any prior owners or
occupants of any of the properties, or (if) any actual or threatened litigation or claims of any kind by any person totaling to such mailers. (c)
Neither Borrower not any tenant, contractor, agent or other authorized user of any of the properties shah use, generate, manufacture, store, treat,
dispose of, or release any hazardous waste or substance on, under, about or from any of the properties; and any such activity shall be conducted
In compliance with all applicable federal, state, and local laws, regulations, and ordinances, Including without Ilmltallon those taws, regulations and
ordinances described above. Borrower authorizes Lender and Its agents to enter upon the properties to make such Inspections and lest$ a$
Lender may deem appropriate to determine compliance of the properties with this section of the Agreement. Any Inspections or lasts made by
Lender shall be at Borrower's expense and lot Lender's purposes only and shall not be construed to create any responsibility or liability on the part
of Lender to Borrower or to any other person. The representations and warranties contained herein are based on Borrower's due diligence in
Investigating the properties for hazardous waste and hazardous substances. Borrower hereby (a) releases and waives any future claims against
Lender for Indemnity or contribution In the event Borrower becomes liable for cleanup or other costs under any such laws, and (b) agrees to
Indemnity and hold harmless Lender against any and all claims, losses, liabilities, damages, penalties, and expenses which Lender may directly or
Indirectly sustain or suffer resulting from a breach of this section of the Agreement or as a consequence of any use, generation, manufacture,
storage, disposal, release or threatened release occurring prior to Borrower's ownership or Interest In the properties, whether or not the Sam was
or should have boon known to Borrower. The provisions of this section of the Agreement, Including the obligation to Indemnity, shall survive the
payment of the Indebtedness and the termination or expiration of this Agreement and shall not be affected by Lender's acquisition of any Interest
In any of the properties, whether by foreclosure or otherwise.
Ullgallon and Claims. No Intgo9on, claim, Investigation, administrative proceeding or similar action (Including those lot unpaid taxes) against
Borrower h pending or threatened, and no other event has occurred which may materially adversely affect Borrower's financial condition or
properties, other than litigation, claims, or other events, it any, that have been disclosed to and acknowledged by Lender in willing.
Taxes. To the best of Borrower's knowledge, all tax returns and reports of Borrower that are or were required to be hied, have bean filed, and an
taxes, assessments and other governmental charges have been paid in full, except those presently being of to be contested by Borrower in good
fallh In the ordinary course of business and for which adequate reserves have been provided.
Lien Priority. Unless otherwise previously disclosed to Lender In wilting, Borrower has not entered Into or granted any Security Agreements, Or
permitted the filing or attachment of any Security Interests on or affecting any of the Collateral directly or Indirectly securing repayment of
Borrowers Loan and Note, that would be prior or that may In any way be superior to Lender's Security Interests and rights In and to such
Collateral.
Binding Effect. This Agreement, the Note, all Security Agreements directly or Indirectly securing repayment of Borrower's Loan and Note and all
of the Related Documents are binding upon Borrower as well as upon Borrower's successors, representatives and assigns, and are legally
enforceable In accordance with their respective terms.
Commercial Purposes. Borrower Intends to use the Loan proceeds Safety for business or commercial related purposes.
Employee Benefit Plane. Each employee benefit plan as to which Borrower may have any liability complies In all material respects %411h as
applicable requirements of taw and regulations, and (t) no Reportable Event nor Prohibited Transaction (as defined In ERISA) has occurred with
respect to any such plan, (if) Borrower has not withdrawn from any such plan or Initialed steps to do so, (III) no slept have been taken to
terminate any such plan, and (Iv) there are no unfunded liabilities other than those previously disclosed to Lender in writing.
Location of Borrower's Offices and Records. Borrower's place of business, or Borrower's Chief executive office, if Borrower has more than one
place of business, Is located at 77 Northeastern Boulevard, Nashua, NH 03062. Unless Borrower has designated otherwiso In writing this location
Is also the office or offices where Borrower keeps its records concerning the Collateral.
Information. An Information heretolora or conlemporeneously herewith furnished by Borrower to Lender for the purposes of or in connection with
this Agreement or any transaction contemplated hereby Is, and all information hereafter furnished by or on behell of Borrower to Lender will be,
true and accurate In every material respect on the date as of which such Information is dated or certified; and none of such Information Is or will be
Incomplete by omitting to slate any material fact necessary to make such information not misleading.
Survival of Representations and Warranties. Borrower understands and agrees that Lander, withoul Independent investigation, is relying upon
the above representations and warranties In extending Loan Advances to Borrower. Borrower Further agrees that the foregoing representations
and warranties shall be continuing In nature and shall remain In full force and effect unlit such time as Borrower's Indebtedness shall be paid In
tun, or until this Agreement shall be terminated in the manner provided above, whichever Is the last to occur.
AFFIRMATIVE COVENANTS. Barowar covuMnls and mgitia* wen Lancer that, whoa uxa Agreemem is on onoel, Borrower will:
Litigation. Promptly Inform Lender In writing of (a) all material adverse changes in Borrower's hnanciat condition, and (b) as exstng and as
threatened litigation, claims, investigations, administrative proceedings Or similar actions affecting Borrower or any Guarantor which could
materially affect the financial condition of Borrower of the financial condition of any Guarantor.
Financial Records, Maintain its books and records In accordance with generally accepted accounting piuiciples, applied on a consistent bash,
and permit Lender to examine and audit Borrower's books and records at all reasonable limos.
Additional Information. Furnish such additional Information and statements, lists of asses and liabilities, agirgs of receivables and payabtes.
Inventory schedules, budgets, forecasts, tax returns, and other reports with respect to Borrowers financial condition and business operations as
Lander may request from time to time.
Insurance. Maintain fire and other risk Insurance, public liability insurance, and such ofhor insurance as tender may require with respect to
Borrower's properties and operations, in form, amounts, coverages and with insurance companies reasonably acceptable to Lender. Borrower,
upon request of Lender, will deliver to Lender from tuna to Irmo the policies Of certificates of irlsmancit in form salisfaclory 10 Lender, including
stipulations that coverages will not be cancelled or diminished without at least lair (10) days' pilot written notice to Lender. Each insurance policy
also shall Include an endorsement providing that coverage In favor of Lender will not be imparted in any way by any act, omission Of default of
Barowar or any other person. In connection with all policies covering assets in which Lander holds of is offered a Socunly Interest for the Loans,
Borrower will provide Lender with such loss payable Or other endorsements as Lender may noquee.
Insurance Reports. Furnish to Lender, upon request at Lander, reports on each existing insurance policy showing sox:h information as Lander
may reasonably request, Including without Ilmilation the following: (a) ilia name of the insurer; (b) Ilia risks Insured; Ic) ilia amount of ilia policy;
(d) the properties Insured; (a) the then current property values on addition. basis ion which insurance n has
weeny obtaniero alto i than annually), of and ilia determining those values; and (1) ilia expiration dalu of the policy { q
11-13-1997 BUSINESS LOAN AGREEMENT Page 3
Loan No 801-30016 (Continued)
Borrower will have an Independent appraiser satisfactory to Lender determine, as applicable, the actual cash vela or replacement cost of any
Collateral. The cal of such appraisal shah be paid by Borrower.
Guaranties. Prior to disbursement of any Loan proceeds, furnish executed guaranties of the Loans In favor of Lender, executed by the guarantors
named below, on Lender's forms, and In the amounts and under the conditions spelled out in those guaranties.
wlltlmtm Amount!
D. Scott Dardlck $600,000.00
Steven M. Dardlck saw,0oom
Thomas M. Dardick $600,000.00
Other Agreements. Comply with all terms and conditions of all other agreements, whether now or hereefier existing, between Borrower and any
other party and notify Lender Immediately In writing of any default In connection with any other such agreements.
Loan Proceeds. Use all Lan proceeds solely for Borrower's business operations, unless specifically consented to the contrary by Lender In
writing.
Taxes, Charges and Liens. Pay and diraharge when due all of its Indebtedness and obllgabons, Including without limitation all assessments,
taxes, governmental chatges, loves and lions, of every kind and nature, Imposed upon Borrower or its properties, Income, or profits, prior to the
data on which penalties would attach, and all lawful claims that. If unpaid, might become a lion or charge upon any of Borrower's properties,
Income, or profits. Provided however, Borrower will not be required to pay and discharge any such assessment, tax, charge, levy. Ilen or claim to
long as (a) the legality of the some shah be contated In good faith by appropriate proceedings, and (b) Borrower shad have established on Its
books adequate reserves with respect to such contested essessmam, lax, charge, levy, lion, or claim In accordance with generally accepted
accounting practices. Borrower, upon demand of Lander, will furnish to Lander evidence of payment of the assessments, loxes, charges, levies,
(lens and claims and will authorize the appropriate governmental official to deliver to Lender at any Ems a written statement of any assessments,
taxes, charges, tavles, hens and claims against Borrower's properties, Income, or profits.
Performance. Perform and comply with all terms, conditions, and provisions set forth In this Agreement and in the Related Documents in a timely
manner, and promptly notify Lender If Borrower loarns of the occurrence of any event which conshlula an Event of Default under this Agreement
or under any of the Related Documents.
Operations. Maintain executive and management personnel with substantially the same qualifications and experience as the present executive
and management personnel; provld3 written notice to Lender of any change In executive and management personnel; conduct its business affairs
In a reasonable and prudent manner and In compliance with all applicable federal, state and municipal laws, ordmsnces, rules and reputations
respecting Its piopertles, charters, businesses and operations, Including without limitation, compliance with the Americans With Disabilities Act and
with all minimum funding standards and other requirements of ERISA and other taws applicable to Sonower's employee benefit plans.
Inspection. Permit employees or agents of Lander at any reasonable arts to Inspect any and all Collateral for the Lan or Loans and Borrower's
other properties and to examine or audit Borrower's books, accounts, and records and to make copies and memoranda of Borrower's books,
accounts, and records. If Borrower now or at any time her after maintains any records (including whhout limitation computer generated records
and computer software programs for the generation of such records) In the possession of a third party, Borrower, upon request of Lender, shah
notify such party to permit Lander free access to such records at all reasonable times and to provide Lander wilh copies of any records II may
request, fig at Borrower's expense.
Compliance Certificate. Unless waived In writing by Lender, provide Lender at least annually and of the time of each disbursement of Lan
proceeds with a cerEficals executed by Borrower's chief financial officer, or other other or person acceptable to Lender, certifying that the
representations and warranties set forth In this Agreement ere hue and conrecl as of the dale of the certificate and further certifying that, as of the
date of The certificate, no Event of Default exists under this Agreement.
Environmental Compliance and Reports. Borrower shah comply In all respects with orb environmental protection federal, state and local laws,
slalulas, regulations and ordinances; not cause or permit to exist, as a result of an Intentional or unintentional action of omission on Its part or on
the part of any third party, on property owned and/or occupied by Borrower, any environmental activity where damage may resutl to the
environment, unless such environmental achvity is pursuant to and In compliance with the conditions of a permit issued by [he appropriate federal,
stale or local governmental authorities; shag furnish to Lander promptly and In any event within thirty (30) days after receipt thereof a copy of any
not", summons, ban, .citation. direcbve, letter or other communication from any governmental agency or Instrumentality concerning any Intentional
or unintentional action on cmisslon on Borrower's part in connection with any environmental activity whether or not there Is damage to the
environment and/or other natural resources.
Additional Assurances. Make, execute and deliver to Lander such promissory notes, mortgages, deeds of trust, security agreements, financing
statements, Instruments, documents and other agreements as Lander or Its attorneys may reasonably request to evidence and secure the Loans
and to perfect all Security Interests.
NEGATIVE COVENANTS. Borrower covenants antl agrees with Lender that while this Agreement N In effect, Borrower shah not, without the prior
written consent of Lender:
Indebtedness and Leans. (a) Except for trade debt Incurred In the normal course of business and Indebtedness to Lender contemplated by this
Agreement, crate, Incur or assume Indebtedness fora borrowed money, Including capital leases, (b) except as allowed as a Permitted Lien, soil,
transfer, mortgage, assign, pledge, lease, grant a security Interest in, or encumber any of Borrower's assets, or (c) sell with recourse any of
Borrower's accounts, except to Lender.
Continuity of Operations. (a) Engage In any business activities substantially dlhefenl than those In which Borrower Is presently engaged, (b)
cease operations, liquidate, merge, transfer, acquire of consolidate with any other entity, charge ownership, change its name, dissolve or transfer
or sell Collateral out of the ordinary course of business, (c) pay any dividends on Borrower's stock (other than dividends payable In Its stock),
provided, however that notvtlhslanding the foregoing, but only so long as no Event of Default has occurred and is continuing or would result from
the payment of dividends, It Borrower Is a'Subchapler S Corporation' (as defined In the Internal Revenue Code of 1996, as amended), Borrower
may pay cash dividends on Its stock to Its shareholders from time to time In amounts necessary to enable the shareholders to pay income loxes
and make estimated Income tax payments to satisfy their liabilities under federal and slate law which arise solely from their status as Shareholders
of a Subchaplsr S Corporation because of their ownership of shares of stock of Borrower, or (d) purchase or rehire any of Borrower's outstanding
shares or alter or amend Borrower's capital structure.
Loans, Acquisitions and Guaranties. (a) Loan, Invest to or advance money of assets, (b) purchase, create or acquire any Interest In any other
enterprise or entity, or (c) Incur any obligation as surety or guarantor other than In the ordinary course of business.
CESSATION OF ADVANCES. If Lander has made any commitment to make any Lan to Borrower, whether under this Agreement or under any over
agreement, Lender shall have no obligation to make Loan Advances or to disburse Loan proceeds It: (a) Borrower of any Guarantor Is In default under
the terms of this Agreement or any of the Related Documents or any other agreement that Borrower of any Guarantor has with Lender; (b) Borrower or
any Guarantor becomes Insolvent, hoes a petition in bankruptcy or similar proceedings, on Is adjudged a bankrupt; (c) there occurs a material adverse
charge In Borrower's financial condition, in the financial condition of any Guarantor, or In the value of any Conaieral securing any Lan; (d) any
Guatanlor seeks, claims or otherwise attempts to hmri, modify or revoke such Guaranler's guaranty of the Loan or any other loan with Lender; or (e)
Lender In good faith deems Itself Insecure, even though no Event of Dufauil shall f w.u o:cuned.
COVENANTS. Borrower will maintain quaifedy financial statements.
Borrower will provide monthly accounts payable aging.
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory security inlerest in, and hereby assigns, conveys, delivers, pledges, and
transfers to Lander all Borrower's right, title and Interest In and to, Borrowers accounts with Lander (whathar checking, savings, er some offer
account), Including without limhation all accounts hold jointly with someone else and all accounts Borrower may open In the future, excluding however
all IRA and Keogh accounts, and all uusl accounts for which the grant of a security interest would be prohibited bylaw. BorrowereulhodtesLender, Io
the extent permitted by applicable law, to charge or setoff All sums owing on the Indebtedness against any and all such accounts.
EVENTS OF DEFAULT. Each of The following shall constitute an Event of Default under this Agreement:
Default on Indebtedness. Failure of Borrower to make any payment when due on the Loans.
Other Defaults. Fellure of Borrower or any Granter to comply with or TO perform when due any other term, obligation, covenant or condition
contained In this Agreement or In any of the Rested Documents, or failure of Borrower to comply with or to perform any other term, obligation,
covenant of condition contained In any outer agreement belwoen Lander and Borrower.
Default In Favor of Third Parties. Should Borrower or any Grantor default under any loan, extension of credit, security agreement, purchase of
sales agreement, or any other agreement. In favor of any other creditor or person that may materially affect any of Borrower's property oi
Borrower's or any Granters ability to repay the Loans or perform their respective obligations under this Agreement or any of the Related
Documents.
False Statements. Any warranty, representation or statement made or furnished 10 Lander by or on behalf of Borrower or any Grantor undo( this
11-13-1997 BUSINESS LOAN AGREEMENT Page 4
Loan No 801-30018 (Continued)
Agreement w the Related Documents is false or misleading In any malarial respect at the time made or furnished, or becomes false or misleading
at any lime Ihersafier.
Defective Collslaralixation. This Agreement or any of the Related Documents ceases to be In full force and effect (Including failure of any
Security Agreement to create a valid and perfected Security Interest) at any time and for any reason.
Insolvency. The dissolution or termination of Borrowers existence as a going business, the Insolvency of Borrower, the appointment of a receiver
for any part of Borrower's property, any assignment for the benefit of creditors, any typo 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, any creditor of any Grantor against any collateral socuring the Indebtedness, or by
any governmental agency. This Includes a garnishment, attachment, or levy on or of any of Borrower's deposit accounts with Lander. However,
this Event of Default shall not apply If there is a good faith dispute by Borrower or Grantor, as the case may be, as to the validity or reasonableness
of the claim which Is the basis of the creditor or forfeiture proceeding, and If Borrower or Grantor gives Lender written notice of the creditor or
forfeiture proceeding and furnishes reserves or a surety bond for the creditor or forfeiture proceeding satisfactory to Lander.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any Guarantor of any of the Indebtedness or any Guarantor dies
or becomes Incompetent, or revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness. Lender, at its option, may, but
shall not be required to, permit the Guarantor's estate to assume unconditionally the obligations arising under the guaranty in a manner satisfactory
to Lender, and, In doing so, cure the Event of Default.
Change In Ownership. Any change In ownership of twenty-five percent (25x) of more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in Borrower's financial condition, or Lender believes the prospect of payment or
performance of the Indebtedness Is Impaired.
Insecurity. Lender, In good faith, deems Itself Insecure.
Right to Cure. It any default, other than a Default on Indebtedness, Is curable and If Borrower a( Grantor, as the case may be, has not been
given a notice of a similar defaull within the preceding twelve (12) months, It may be cured (and no Event of Default will have occurred) It Borrower
or Grantor, as the use may be, alter recelvirg writon notice from Lender demanding cure of such default: (a) cures the default within fifteen (15)
days; or (b) If the owe requires more than fifteen (16) days, Immediately Initiates steps which Lender deems in Lenders sole discretion to be
sufficient to cure the default and thereafter continues and completes an reasonable and necessary steps sufficient to produce compliance as soon
as reasonably practical.
EFFECT OF AN EVENT OF DEFAULT. It any Event of Default shall occur, except where otherwise provided In this Agreement a the Related
Documents, ea commitments and obligations of Lander under this Agreement or the Related Documents or any other agreement Immediately win
terminate (Including any obligation to make Loan Advances or disbursements), and, at Lender's option, all Indebtedness Immediately win become duo
and payable, all without notice of any kind to Borrower, except that in the case of an Event of Default of the type described in the Insolvency'
subsection above, such Acceleration shall be automatic and not optional. In addition, Lender shall have se the rights and remedies provided in the
Related Documents or available at law, In equity, or otherwise. Except as may be prohibited by applicable taw, all of Landers rights and remedies shall
be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an obligation of Borrower or of any Grantor shall not affect Lender's light to
declare a default and to exercise Its rights and remedies.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Agreement:
Amendments. This Agreement, together with any Related Documents, constitutes the entire understanding and agreement at the parties as to the
matters set faith In this Agreement. No alteration of or amendment to this Agreement shall be effective unless given in writing and signed by the
party or parties sought to be charged or bound by the alteration or amendment.
Applicable Law. This Agreement has been delivered to Lender and accepted by Lender In the Commonwealth of Pennsylvania. If there Is
a lawsuit, Borrower agrees upon Lander's request to submit to the jurisdiction of the courts of CUMBERLAND County, the Commonwealth
of Pennsylvania. This Agreement shall be governed by and construed In accordance with the laws of the Commonwealth of
Pennsylvania.
Caption Headings. Caption headings In this Agreement are for convenience purposes only and are not to be used to Interpret or define the
provislons of this Agreement.
Multiple Parties; Corporate Authority. Ali obligations of Borrower under this Agreement shall be joint and several, and all referorices to Borrower
shall mean each and every Borrower. This moans that each of the persons signing below Is responsible for all obligations In this Agreement.
Consent to Loan Participation. Borrower agrees and consents to Lander's sale or transfer, whether now or later, of one or more participation
Interests In the Loans to one or more purchasers, whether related or unrelated to Lender. Lender may provide, without any limitation whatsoever,
to any one or mote purchasers, or potential purchasers, any Information Or knowledge Lander may have about Borrower or about any other matter
relating to the Loan, and Borrower hereby waives any rights to privacy it may have with respect to such matters. Borrower additionally waives any
and an notices of sale of padicipatlon Interests, as well as all notices of any repurchase at such participation Interests. Borrower also agrees that
the purchasers of any such participation Interests will be considered as the absolute owners of such interests In the Loans and will have ail the
rights granted undor the participation agreement or agreements governing The sale of such participation Interests. Borrower further waives an
rights of offset or counterclaim that It may have now or later against Lender or against any purchaser of such a participation interest and
unconditionally agrees that either Lender or such purchaser may enforce Borrower's obligation under the Loans Irrespective Of the failure or
Insolvency of any holder of any Interest In the Loans. Borrower further agrees that the purchaser of any such participation interests may enforce its
Interests Irrespective of any personal claims a defenses that Borrower may have against Lender.
Costs and Expenses. Borrower agrees to pay upon demand all of Lenders expenses, Including without limitation attorneys' tees, Incurred in
connection with the preparation, exocubon, enforcement, modification and collection of this Agreement or in connection with the Loans made
pursuant to this Agreement. Lender may pay someone else to help canal the Loans and to enforce this Agreement. and Borrower win pay 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' foes for bankruptcy proceedings (including elicits to modify or vacate any automatic stay or injunction), appeals, and
any anticipated post-judgment collection services. Dorrewer also will pay any court costs, In addition to all other sums provided by law.
Notices. All notices required to be given under this Agreement shall be given In writing, may be sent by lelefacsimile (unless otherwise required
by law), and Snell be effective when actually delivered or when deposited with a nationally recognized overnight courier or deposited in the United
Slaters man, brat class, postage prepaid, addressed to the party to whom the notice Is to be given at the address shown above. Any party may
change its address for notices under this Agreement by giving formal written notice to the other parties, specitying that the purpose of the notice is
to change the party's address, To the extent permitted by applicable law, if there n more than ore Borrower, notice to any Borrower will constitute
notice to all Borrowers. For notice purposes, Borrower will hoop Lender informed at all limes of Borrower's current address(es)
Severablllty. If a court of competent jurisdiction Ands any provision of this Agreement to be Invalid ai unenforceable its to any person or
Ct¢unulancu, such Ending shall out runda, trial piuviiiian iiwaud or unoololcaaula es to any other porticos or circumstances. If feasible, any such
offending provision shall be daunted to be modified to be within the limits of enforceability or validity; however, it the offending provision cannot be
so modified, it shall be stricken and all other provisions of this Agreement in all offset (aspects shall remain valid and enforceable.
Subsidiaries and Affiliates of Borrower. To the extent the context of any provisions of this Agreement makes it appiopoato, including without
limitation any represontatron, warranty or covenant, the wad 'Borrower' as used herein slaty include as subsidarws and affiliates of Borrower.
Notwithstanding the foregoing however, under no circumstances shall this Agreement be construed to require Lender to make any Loan Of other
financial accommodation to any subsidiary a( atulate of Do ewer.
Successors and Assigns. A l covenants and agreements contained by or on behalf of Borrower shall bind its successors and asWn% end shad
inure to the benabt of Lender, its successors and assigns. Borrower shall not, however, have the fight Io assign Its nights under this Agreement or
any Interest therein, without the prior written consent of Lender.
Survival. All warranties, representations, and covenants made by Borrower In this Agreement or in any certificate or other instrument dolivwed by
Borrower to Lander under this Agreement shall be considered to have boon rolled upon by Lender and will survive the making of the Loan end
delivery to Lander of the Related Documents, regardless of any Investigation made by Lando( or on Lander 's bohalf.
Time Is of the Essence. Time is of the essence in the performance of this Agreement.
Waiver. Lander shall not be doomed to have waived any nights undo this Agreement unless such walver is given in willing And Srgnod by
Lender. No delay or omission on the part of Londe( In e¦oicisi g any night shall operate as A waiver at Stich right a any airier tight. A waver try
Lender of a provision of this Agreement shall not prejudice or constitute a waive, of lender's fight othelikmu to dornand Shirt C.ongiaarxvr wits Ilxd
provision or any other provision of this Agreement. No prior waiver by Lander, nor any eourso sal foaling butwrmn t under and Hrxmww, a
botwoon 1 tinder and any Grantor, Shan cooslihitu a waiver of any 011 onder's rights or Of any obligations to Roilowur 01 of ally Uinnhx its 10 ally
11-13-1997 BUSINESS LOAN AGREEMENT Page B
Loan No 801-30016 (Continued)
hNn transactions. Whenam the consent of Lender Is required under this Agreement, the granting of such cons ent by Lender In any Instance
shall not oonstllula continuing consent In subsequent Instancm where such consent Is roquked, and In all cum such consent may be granted or
withheld In IM sole discretion of Lender.
BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT, AND BORROWER AGREES TO
ITS TERMS. THIS AGREEMENT 18 DATED AS OF NOVEMBER 13, 1997.
THIS AGREEMENT HAS BEEN 810NED AND SEALED BY THE UNDERSIGNED.
s
S.
LENDQU
PENNB NATIONAL BANK AND TRUST COMPANY
uthonno urneer
LASER PRO. No. U.S. NL \ T.M. OIL, Vr. iN p11 M Oft Proawverti Inc. AprgnlulB"Od.IPA-CA0 DARCOMTE.LN CLDVLI
EXHIBIT "B"
COMMERCIAL GUARANTY
Principal Loan Date Maturltyr an No Call
BMGR Collateral
SEC Account
140703 Officer
Nee IntUela
References In the shaded area are for Lender's use only and du not limit the applicability of this document t0 an adlCUl at loan or Item.
Borrower: Darcom Technologies, Inc. Lender: PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY
T7 Northeastern Boulevard CAMP HILL COMMUNITY OFFICE
Nashua, NH 09062 1231 TRINDLE ROAD
CAMP HILL, PA 17611
Guarantor: Thomas M. Dardlck
655 Moreland Court
Mechanicsburg, PA 17066
AMOUNT OF GUARANTY. This Is a guaranty of payment of the Note, Including without limitation the principal Note amount of Six Hundred
Thousand & 001100 Dollars ($600,000.00).
GUARANTY. For good and valuable consideration, Thomas M. Dardlck ("Guarantor") absolutely and unconditionally guarantees and promises
to pay to PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY ('tender") or Its order, on demand, In lead tender of the United Stales of
America, the Indebtedness (as that term is donned below) of Darcom Technologies, Inc. ("Borrower") to Lender on the terms and conditions
sal forth In this Guaranty.
DEFINITIONS. The following words shall have the following meanings when used In this Guaranty:
Borrower. The word "Borrower means Darcom Technologies, Inc..
Guarantor. The word "Guarantor" means Thomas M. Dardlck.
Guaranty. The word "Guaranty" means this Guaranty made by Guarantor for the benefit of Lender dated November 13, 1997.
Indebtedness. The word "Indebtedness' means the Note, Including (a) all principal, (b) all Interest, (c) all late charges, (d) all loan tees and
loan charges, and (6) all collection costs and expenses relating to the Note or to any collateral for the Note. Collection costs and expenses
Include without limitation all of Lender's attorneys' lees and Lender's legal expenses, whether or not suit Is Instituted, and atorneys' fees and legal
expenses for bankruptcy proceedings (Including efforts to modify or vacate any automatic day or injunction), appeals, and any anticipated
post-judgment collection services.
Lender. The word'Lender" means PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY, Its successor and assigns.
Note. The word "Note" means the promissory note or credit agreement dated November 13, 1997, In the original principal amount of
$000,000.00 from Borrower to Lender, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and
substitutions for the promissory note or agreement. Notice to Guarantor: The Note evidences a revolving line of credit from Lender to
Borrower.
Related Documents. The words 'Related Documents' mean and Include without limitation all promissory notes, credit agreements, loan
agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, and all other Instruments, agreements and
documents, whether now or hereafter existing, executed In connection with the Indebtedness.
MAXIMUM LIABILITY. The maximum liability of Guarantor under this Guaranty shall not exceed at any one time the amount of the
Indebtedness described above, plus all costs and expenses of (a) enforcement of this Guaranty and (b) collection and sale of any collateral
securing this Guaranty.
The above limitation on liability Is not a restriction on the amount of the Indebtedness of Borrower to Lender either In the aggregate or at any one time.
If Lender presently holds one or more guaranties, or hereafter receives additional guaranties from Guarantor, the rights of Lender under all guaranties
shall be cumulative. This Guaranty shall not (unless specifically provided below to the contrary) affect or Invalidate any such other guaranties, The
liability of Guarantor will be the aggregate liability of Guarantor under the terms of this Guaranty and any such other unterrninated guaranties.
NATURE OF GUARANTY. Guarantor Intends to guarantee at an times the performance and prompt payment when due, whether at maturity or earlier
by reason of acceleration or otherwise, of all Indebtedness within the limits set forth In the preceding section of this Guaranty. This Guaranty Covers s
revolving line of credit and guarantor understands and agrees that this guarantee shall be open and continuous until the line of credit Is
terminated and the Indebtedness Is paid In full, as provided below.
DURATION OF GUARANTY. This Guaranty will take enact when received by Lender without the necessity of any acceptance by Lender, or any notice
to Guarantor or to Borrower, and will continue in full force until an Indebtedness shall have been fully and finally paid and satisfied and all other
obligations of Guarantor under this Guaranty shall have been performed In full. Release of any other guarantor or termination of any other guaranty of
the Indebtedness shall not affect the liability of Guarantor under this Guaranty. A revocation received by Lander from any one or more Guarantors shall
not affect the ilabllity of any remaining Guarantors under this Guaranty. This Guaranty covers a revolving line of credit and 11 Is specifically
anticipated that fluctuations will occur In the aggregate amount of Indebtedness owing from Borrower to Lender. Guarantor specifically
acknowledges and agrees that fluctuations In the amount of Indebtedness, even to zero dollars ($ 0.00), shall not constitute a termination of
this Guaranty. Guarantor's liability under this Guaranty shall terminate only upon (a) termination In writing by Borrower and Lender of the line
of credit, (b) payment of the Indebtedness In full In legal tender, and (c) payment In full In legal lender of all other obligations of Guarantor
under this Guaranty.
GUARANTOR'S AUTHORIZATION TO LENDER. Guarantor authorizes Lender, without notice or demand and without lessening Guarantor's
liability under this Guaranty, from time to time: (a) to make one or more additional secured or unsecured loans to Borrower, to lease
equipment or other goods to accelerate, or otherwise change one oor, more times the time for payment oo her forms of r the Indebtedness alter, or any pan of the Indebtedness,
Including Increases and decreases of the rate of Interest on the Indebtedness; extensions may be repeated and may be for longer than the
original ben term; (c) to take and hold security for the payment of this Guaranty or the Indebtedness, and exchange, enforce, waive,
subordinate, fall or decide not to perfect, and release any such security, with or without the substitution of new collateral; (d) to refuse,
substitute, agree not to we, 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; (e) to determine how, when and what application of payments and credits shall be made on the Indebtedness;
(q to apply such security and direct the order or manner of sale thereof, Including without limitation, any nonjudiclal sale permitted by the
terms of the controlling security agreement or deed of trust, as Lender In Its discretion may determine; (g) to sell, transfer, assign, or grant
participations In all or any part of the Indebtedness; and (h) to assign or transfer this Guaranty In whole or In part.
GUARANTOR'S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Lender that (a) no representations or agreements
of any kind have been made to Guarantor which would limit or quality in any way the terms of this Guaranty; (b) this Guaranty Is executed at
Borrower's roquesl and not at the request of Lender; (c) Guarantor has full power, right and authority to enter into this Guaranty; (d) the provisions of
this Guaranty do not conflict with or result in a doiault under any agreement or other instrument binding upon Guarantor and do not result in a violation
of any law, regulation, court decree or order applicable to Guarantor; (e) Guarantor has not and will not, without the prior written consent of Lender,
sell, laase, assign, encumber, hypothecate, transfer, or otherwise dispose of all or substantially all of Guarantor's assets, w any In:aesl therein; (f) upon
Lender's request, Guarantor will provide to Lender financial and credit Information In form acceptable to Lender, and all such financial Information
which currently has been, and all future financial Information which will be provided to Lender is and will be true and correct in all material respects and
fairly present the financial condition of Guarantor as of the dates the financial information Is provided; (g) no material adverse change has occurred In
Guarantor's financial condition since the dale of the most recent financial statements provided to Lender and no event has occurred which may
materially adversely enact Guarantor's financial condition; (h) no litigation, claim, Investigation, administrative proceeding or similar action (Including
those for unpaid taxes) against Guarantor Is pending or threatened; (q Lender has made no representation to Guarantor as to the creditworthiness of
Borrower; and 0) Guarantor has established adequate means of obtaining from Borrower on a continuing basis information regarding Borrower's
financial condition. Guarantor agrees to keep adequately Informed from such means of any facts, events, or circumstances which might in any way
affect Guarantor's nsks under Ihls Guaranty, and Guarantor further agrees that Lender shall have no obligation to disclose to Guarantor any Information
or documents acquired by Lender In the course of its relationship with Borrower.
GUARANTOR'S WAIVERS. Except as prohibited by applicable law, Guarantor waives any right 10 require Lender (a) to continue lending money or to
extend other credit to Borrower; (b) to make any presentment, protest, demand, or notice of any kind. Including notice of any nonpayment of the
Indebtedness or of any nonpayment related to any collateral, or notice of any action or nonection on the part of Borrower, Lender, any surety, endorser,
or other o pror in connecor with Ire Indebtedness
any person, Including Borrower or any oother guarantor; (d) to proceed directly against or exhaust any
payment or or t to proceed directly from once against a en
collateral held by Lender Irom Borrower, any other guarantor, or any other person; (e) to give nolH;o of the terms, time, and place 01 any public; or
private sale of personal property security hold by Lender from Borrower or to comply with any other applicable provisions of the Uniform Commercial
Code; (f) to pursue any other remody within Lender's power; or (g) to commit any act or omission of any kind, or at any time, with respect to any
matter whatsoever.
11-13-1997 COMMERCIAL GUARANTY Page 2
Loan No 801-30015 (Continued)
If now or hereafter (a) Borrower shall be or become Insolvent, and (b) the Indebtedness shall not at all times unlit paid be fully secured by collateral
pledged by Borrower, Guarantor hereby forever waives and relinquishes In favor of Lender and Borrower, and their respective successors, any claim or
right to payment Guarantor may now have or hereafter have or acquire against Borrower, by subrogation or otherwise, so that at no time shall
Guarantor be or become a "Creditor of Borrower within the meaning of i t U.S.C. section 547(b), or any successor provision of the Federal bankruptcy
laws.
Guarantor also waives any and all rights or defenses arising by reason of (a) any "one action" or "anb-ciahciency" law or any other law which may
prevent Lender from bringing any action, including a claim for deficiency, against Guarantor, before or attar Lender's commencement or completion of
any foreclosure action, either judicially or by exercise of a power of sale; (b) any election of remedies by Lender which destroys or otherwise adversely
affects Guarantor's subrogation rights or Guarantor's rights to proceed against Borrower for reimbursement, including Without limitation, any loss of
rights Guarantor may suffer by reason of any law limiting, qualifying, or discharging the Indebtedness; (c) any disability or other defense of Borrower, of
any other guarantor, or of any other person, or by reason of the cessation of Borrower's liability from any cause whatsoever, other than payment in full
In legal lender, of the Indebtedness; (d) any right to claim discharge of the Indebtedness on the basis of unjustified impairment of any collateral for the
Indebtedness; (e) any statute of limitations, if d any time any action or suit brought by Lender against Guarantor is commenced there is outstanding
Indebtedness of Borrower to Lander which is not barred by any applicable statute of limitations; or (p any defenses given to guarantors of law or In
equity other than actual payment and pedormancie of the Indebtedness. If payment Is made by Borrower, whether voluntarily or otherwise, or by any
third party, on the Indebtedness and thereafter Lender Is forced to remit the amount of that payment to Borrower's trustee in bankruptcy or to any
similar person under any federal or state bankruptcy law or law for the relief of debtors, the Indebtedness shall be considered unpaid for the purpose of
enforcement of this Guaranty.
Guarantor further waives and agrees not to assert or claim at any time any deductions to the amount guaranteed under this Guaranty for any claim of
setoff, counterclaim, counter demand, recoupment or similar right, whether such claim, demand or right may be asserted by the Borrower, the
Guarantor, or both.
GUARANTOR'S UNDERSTANDING WITH RESPECT TO WAIVERS. Guarantor warrants and agrees that each of the waivers set forth above is made
with Guarantor's fug knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary to
public policy or taw. If any such waiver is determined to be contrary to any applicable law or public policy, such waiver Shan be effective only to the
extent permitted by law or public policy.
LENDER'S RIGHT OF SETOFF. In addition to all liens upon and rights of salon against the moneys, securities or other property of Guarantor given To
Lender by law, Lender shall have, with respect to Guafenlor's obligations to Lender under this Guaranty and to the extent permitted by law, a
contractual possessory security Interest in and a right of setoff against, and Guarantor hereby assigns, conveys, delivers, pledges, and transfer to
Lender all of Guarantor's right, title and interest in and to, all deposits, moneys, securities and other property of Guarantor now or hereafter In the
possession of or on deposit with Lender, whether held In a general or special account or deposit, whether held jointly with someone also, or whether
hold for safekeeping or otherwise, excluding however all IRA, Keogh, and trust accounts. Every such security Interest and right of setoff may be
exercised without demand upon or notice to Guarantor. No security Interest or right of setoff shall be doomed to have been waived by any act or
conduct on the part of Lender or by any neglect to exercise such right of setoff or to enforce such security Interest or by any delay In to doing. Every
right of setoff and security Interest shah continue in lull force and effect until such right of setoff or security Interest Is specifically waived or released by
an Instrument In writing executed by Lender.
SUBORDINATION OF BORROWER'S DEBTS TO GUARANTOR. Guarantor agrees that the Indebtedness of Borrower to Lender, whether now
existing or hereafter created, shall be prior to any claim that Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower
becomes Insolvent. Guarantor hereby expressly subordinates any claim Guarantor may have against Borrower, upon any account whatsoever, to any
claim that Lender may now or hereafter have against Borrower, In the event of Insolvency and consequent liquidation of the assets of Borrower,
through bankruptcy, by an assignment for the benefit of creditors, by voluntary liquidation, or otherwise, the assets of Borrower applicable to the
payment of the claims of both Lender and Guarantor shalt be paid to Lander and shall be first applied by Lender to the Indebtedness of Borrower to
Lender. Guarantor does hereby assign to Lander all claims which it may have or acquire against Borrower or against any assignee or trustee In
bankruptcy of Borrower; provided however, that such assignment shall be effective only for the purpose of assuring to Lender full payment In legal
lender of the Indebtedness. If Lender so requests, any notes or credit agreements now or hereafter evidencing any debts or obligations of Borrower to
Guarantor shall be marked with a legend that the same are subject to this Guaranty and Shan be delivered to Lender. Guarantor agrees, and Lender
hereby is authorized, in the name of Guarantor, from time to time to execute and file financing statements and continuation statements and to execute
such other documents and to take such other actions as Lender deems necessary or appropriate to perfect, preserve and enforce its rights under this
Guaranty.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Guaranty
Amendments. This Guaranty, together with any Rotated Documents, constitutes the entire understanding and agreement of the parties as to the
natters set forth in this Guaranty. No alteration of or amendment to this Guaranty shall be effective unless given In wring and signed by The party
or parties sought to be charged or bound by The alteration or amendment.
Applicable Law. This Guaranty has been delivered to Lender and accepted by Lender in the Commonwealth of Pennsylvania. If there Is a
lawsuit, Guarantor agree upon Lender's request to submit to the jurisdiction of the courts of CUMBERLAND County, Commonwealth of
Pennsylvania. This Guaranty shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania.
Attorneys' Fees; Expenses. Guarantor agrees to pay upon demand all of Lender's costs and expanses, Including attorneys' loss and Lender's
legal expense, Incurred In connection with the enforcement of this Guaranty. Lender may pay someone else to help enforce this Guaranty, and
Guarantor shall pay the costs and expenses of such enforcement. Costs and expense Include Lender's attorneys' foss and legal expanse
whether or not there is a lawsuit, Including attorneys' fees and legal expenses for bankruptcy proceedings (and Including efforts to modify or
vacate any automatic stay or injunction), appals, and any anticipated post-judgment collection service. Guarantor also shalt pay AN court costs
and such additional fees as may be directed by the court.
Notices. All notices required to be given by either party to the other under this Guaranty shah be In writing, may be sent by lelelacsimlle (unless
otherwise required by law), and shall be elloclive when actually delivered or when deposited with a nationally recognized overnight courier, or
when deposited in the United States mail, first class postage prepaid, addressed to the party to whom the notice is to be given at the address
shown above or to such other addresses as either party may designate to the other In writing. It Inere is more than one Guarantor, nonce to any
Guarantor will conshtuto notice to all Guarantors. For notice purposes, Guarantor agrees to keep Lender Informed at all times of Guarantor's
current address.
Interpretation. In all cases where there is more than one Borrower or Guarantor, then all words used in this Guaranty in The singular shah be
deemed to have boon used in the plural whore the context and construction so require; and where there is more than one Borrower named In This
Guaranty or when this Guaranty is executed by more than one Guarantor, the words "Borrower' and "Guarantor' respectively shah man all and
any one or more of them. oho words *Guarantor; 'Borrower; and 'Lander' include the heirs, successors, assigns, and transforms of each of
them. Caption headings in this Guaranty are for convenience purposes only and are not to be used to interpret or define the provisions of this
Guaranty. II a court of competent jurisdiction finds any provision of this Guaranty to be invalid or unenforceable as to any person or circumstance,
such finding shall not tender that provision invalid or unenforceable as to any other persons a circumstances, and all provisions of this Guaranty
In all other respects shall remain valid and enforceable. II any one or mere of Rorrowef M Guarantor are corporations or partnerships, 11 is not
necessary for Lender to inquire into the powers of Borrower or Guarantor or of the officers, directors, partners, or agents acting or purporting to act
an their behalf, and any Indebtedness made or created In reliance upon the professed exercise of such powers shall be guaranteed under INS
Guaranly.
Waiver. Lander shall not be doomed to have waived any rights under this Guaranty unless such waiver Is given In writing and signed by Lender.
No delay of omission on the part of Lender In exercising any right shalt operate as a waiver of such right or any other rghl. A waiver by Lander of
a provision of this Guaranty shall not prejudice or constitute a waiver of Lender's right otherwise to demand strict compliance with that provision or
any other provision of this Guaranty. No prior waiver by Lender, nor any course of dealing between Lender and Guarantor, shall constitute a
waiver of any of Lender's rights or of any of Guarantor's obligations as to any future transactions. Whenever the consent of Lender is requited
under this Guaranty, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsoquent instances
where such consent is required and in all cases such consent may be granted or withhold in the sole discretion of Lender.
11-13-1997 COMMERCIAL GUARANTY Page 3
Loan No 801-30016 (Continued)
CONFESSION OF JUDGMENT. GUARANTOR HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE
PROTHONOTARY OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR
GUARANTOR AFTER A DEFAULT UNDER THIS GUARANTY, AND WITH OR WITHOUT COMPLAINT FILED. AS OF ANY TERM, CONFESS OR
ENTER JUDGMENT AGAINST GUARANTOR FOR THE ENTIRE PRINCIPAL BALANCE OF THIS GUARANTY, ALL ACCRUED INTEREST, LATE
CHARGES, AND ANY AND ALL AMOUNTS EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THE
INDEBTEDNESS TOGETHER WITH INTEREST ON SUCH AMOUNTS, TOGETHER WITH COSTS OF SUIT, AND AN ATTORNEY'S COMMISSION OF
TEN PERCENT (10%) OF THE UNPAID PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN
FIVE HUNDRED DOLLARS ($600) ON WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR
SO DOING, THIS GUARANTY OR A COPY OF THIS GUARANTY VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY
GRANTED IN THIS GUARANTY TO CONFESS JUDGMENT AGAINST GUARANTOR SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT
AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS
GUARANTY. GUARANTOR HEREBY WAIVES ANY RIGHT GUARANTOR MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY
SUCH CONFESSION OF JUDGMENT, EXCEPT ANY NOTICE AND/OR HEARING REQUIRED UNDER APPLICABLE LAW WITH RESPECT TO
EXECUTION OF THE JUDGMENT, AND STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF
JUDGMENT PROVISION TO GUARANTOR'S ATTENTION OR GUARANTOR HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL.
EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS GUARANTY AND AGREES TO ITS
TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT THIS GUARANTY IS EFFECTIVE UPON GUARANTORS EXECUTION AND
DELIVERY OF THIS GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE MANNER SET FORTH
IN THE SECTION TITLED "DURATION OF GUARANTY." NO FORMAL ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY
EFFECTIVE. THIS GUARANTY IS DATED NOVEMBER 13, 11111117.
THIS GUARANTY HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
GUAR/R:
X ? f2 r -(SEAL)
Thoffin M.DWdICk
LASCA %10, 0416 U.S. PSI. i T.M. Off., VNA.14ICI IN/ CFI Rosh iIs. Im. All rlgh to NEM EC IPA -EEO OARCOMTEAN CI.M1
DISCLOSURE FOR CONFESSION OF JUDGMENT
Principal
=600000.00 Loan Date
11-13-1997 Maturity Loan No
801-30016 Call Collateral
BMGR SEC Account
140703 Officer
CW85 Inttlele
References in the shaded area are for Lenders use only and do not Ilmit the applicability of this document to any pedicular Ian or Item.
Borrower: Darcom Technologies, Inc. Lander: PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY
77 Northeastern Boulevard CAMP HILL COMMUNITY OFFICE
Nashua, NH 09062 1271 TRINDLE ROAD
CAMP HILL, PA 17011
Guarantor: Thomas M. Dardkk
6666 Moreland Court
Mechanlcsburg, PA 17056
DISCLOSURE FOR CONFESSION OF JUDGMENT
-A-
I AM EXECUTING, THIS e,3 , DAY OF ^/C?F?'u3c? , 199?, A GUARANTY OF A PROMISSORY NOTE FOR
$600,000.00 OBLIGATING ME TO REPAY THAT AMOUNT.
A. I UNDERSTAND THAT THE GUARANTY CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO
ENTER JUDGMENT AGAINST ME IN COURT, AFTER A DEFAULT ON THE GUARANTY, WITHOUT ADVANCE NOTICE TO ME AND WITHOUT
OFFERING ME AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY OF JUDGMENT. IN EXECUTING THE GUARANTY, BEING FULLY
AWARE OF MY RIGHTS TO ADVANCE NOTICE AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS
THAT LENDER MAY ASSERT AGAINST ME UNDER THE GUARANTY, I AM KNOWINGLY, INTELLIGENTLY, AND VOLUNTARILY WAIVING
THESE RIGHTS, INCLUDING ANY RIGHT TO ADVANCE NOTICE OF THE ENTRY OF JUDGMENT, AND 1 EXPRESSLY AGREE AND CONSENT
TO LENDER'S ENTERING JUDGMENT AGAINST ME BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT
PROVISION. INITIALS: '-10
B. I FURTHER UNDERSTAND THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST ME WITHOUT
ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE GUARANTY ALSO CONTAINS LANGUAGE THAT
WOULD PERMIT LENDER, AFTER ENTRY OF JUDGMENT, TO EXECUTE ON THE JUDGMENT BY FORECLOSING UPON, ATTACHING,
LEVYING ON, TAKING POSSESSION OF OR OTHERWISE SEIZING MY PROPERTY, IN FIAT OR PARTIAL PAYMENT OF THE JUDGMENT.
HOWEVER, LENDER MUST PROVIDE NOTICE TO ME UNDER APPLICABLE LAW IN EXECUTING ANY CONFESSED JUDGMENT. IN
EXECUTING THE GUARANTY, BEING FULLY AWARE OF MY RIGHTS TO ADVANCE NOTICE AND A HEARING AFTER JUDGMENT IS
ENTERED AND BEFORE EXECUTION ON THE JUDGMENT, I AM KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE
RIGHTS, AND I EXPRESSLY AGREE AND CONSENT TO LENDER'S EXECUTING ON THE JUDGMENT, IN ANY MANNER PERMITTED BY
APPLICABLE STATE AND FEDERAL LAW. INITIALS: ")
C. AFTER HAVING READ AND DETERMINED WHICH OF THE FOLLOWING STATEMENTS ARE APPLICABLE, AND BY PLACING MY
INITIALS NEXT TO EACH STATEMENT WHICH APPLIES, I REPRESENT THAT:
INITIALS
1. 1 WAS REPRESENTED BY MY OWN INDEPENDENT LEGAL COUNSEL IN CONNECTION WITH THE GUARANTY.
2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE
GUARANTY TO MY ATTENTION.
0. 1 CERTIFY THAT MY ANNUAL INCOME EXCEEDS $10,000; THAT THE BLANKS IN THIS DISCLOSURE WERE FILLED IN WHEN 1
INITIALED AND SIGNED IT; AND THAT I RECEIVED A COPY AT THE TIME OF SIGNING.
THIS DISCLOSURE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
AFFI ?w
(SEAL)
Thomas M. Dardlck
LASER PRO. Ala. U.S. Pal. I T.M. 0,1.. Var. 3 NICI 1997 CFi PrOSarw?cn, cc. AnripnUraa.w O. IPA-030 OARCC VTE LY C',OVLI
7
e
EXHIBIT "C" a
PROMISSORY NOTE
Principal
5188000.00 Loan Dale
09-29-1998 Maturity
02-28-1999 Loan No CaliM Collateral Account Officer
30038 COM SEC 305700 CWSO Initials
References in the Shaded area are for Lender's use only and co not limit the anoici ihiv of this document to an particular loan or item.
Borrower: Darcom Technologies, Inc. Lender: Financial Trust Company
77 Northeastern Boulevard Camp HIII
Nashua, NH 03062 4231 Tnndle Road
Camp HIII, PA 17011
Principal Amount: $188,000.00 Initial Rate: 9.2500% Date of Note: September 29, 1998
PROMISE TO PAY. Darcom Technologies, Inc. (`Borrower") promises to pay to Financial Trust Company ("Lender"), or order, In lawful money
of the United States of America, the principal amount of One Hundred Eighty Eight Thousand A, 001100 Dollars ($188,000.00), together with
Interest on the unpaid principal balance from September 29, 1998, until paid In full.
PAYMENT. Borrower will pay this loan In one principal payment of $188,000.00 plus Interest on February 28, 1999. This payment due February
20, 1999, will be for all principal and accrued Interest not yet paid. The annual interest rate for this Note is Computed on a 3651360 basis; that is, by
applying the ratio of the annual 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. Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate
to writing. Unless otherwise agreed or required by applicable law, payments will be applied first to accrued unpaid interest, then to principal, and any
remaining amount to any unpaid collection costs and late charges.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based on changes in an index which is Lender's
Pnme Rate (the'lndei This is the rate Lender charges, or would charge, on 90-day unsecured loans to the most creditworthy corporate customers.
This rate may or may not be the lowest rate available from Lender at any given time. Lender Will tell Borrower the current Index rate upon Borrower's
request. Borrower understands that Lender may make loans based on other rates as well. The interest rate change will not occur more often than
each DAY. The Index currently Is 8250% per annum. The Interest rate to be applied to the unpaid principal balance of this Note will be at a
rate of 1.000 percentage point over the Index, resulting In an Initial rate of 9.250% per annum. NOTICE: Under no circumstances will the interest
rate on this Note be more than the maximum rata allowed by applicable law.
PREPAYMENT. 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 under the payment schedule. Rather, they will reduce the
principal balance due.
LATE CHARGE. If a payment is 15 days or more late, Borrower will be charged 5.000% of the regularly scheduled payment.
DEFAULT. Borrower will be in default if any of the following happens: (a) Borrower fails to make any payment when due. (b) Borrower breaks any
promise Borrower has made to Lentler, or Borrower fails to Comply with or to perform when due any Other form, obligation, covenant, or condition
contained in this Note or any agreement totaled to this Note, or in any other agreement or loan Borrower has with Lender. (c) Borrower defaults under
any loan, extension of credit, socunly agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or person that
may maternally 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. (d) Any representation or statement mace or furnished to Lentler by Borrower or on Borrower's behalf is false or misleading in any
material respect either now or at the lime made or furnished. (e) Borrower becomes insolvent, a receiver is appointed for any part of Borrower's
property. Borrower makes an assignment for the benefit of creditors, or any proceeding is Commenced either by Borrower or against Borrower under
any bankruptcy or insolvency laws. (f) Any creditor tries to take any of Borrower's property on or in which Lender has a lien or security Interest. This
includes a garnishment of any of Borrower's accounts with Lender. (g) Any guarantor dies or any of the other events described in this default section
occurs with respect to any guarantor of this Note. (h) A material adverse Change occurs in Borrower's financial condition, or Lender believes the
prospect of payment or performance or the Indebtedness is impaired. (I) Lender in good faith deems itself insecure.
LENDER'S RIGHTS. Upon default, Lender may, after giving such notices as required by applicable law, declare the entire unpaid principal balance on
this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount. Lender may hire or pay someons also to help
Collect this Note if Borrower does not pay. Borrower also will pay Longer that amount. This includes, subject to any limits under applicable law,
Lender's attorneys' foes 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 iniunction), appeals, and any anticipated post-juogmont collection services. If
not prohibited by applicable jaw, Borrower also will pay one court costs, in addition to all Other sums provided by law. II judgment is entered in
connection with this Note, interest will continue to accrue on this Note after judgment at the interest rate applicable to this Note at the time judgment is
entered. This Note has been delivered to Lender and accepted by Lender In the Commonwealth of Pennsylvania. II there Is a lawsuit,
Borrower agrees upon Lender's request to submit to the jurisdiction of the courts of Cumberland County, the Commonwealth of Pennsylvania.
This Note shall be governed by and construed In accordance with the laws of the Commonwealth of Pennsylvania.
RIGHT OF SETOFF. Borrower grans, to Lender a contractual security interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrowers nght, title and interest in and to, Borrower's accounts with Lender (whether checking, savings, or some other account), including
without limitation all accounts hold jointly with someone else and all accounts Borrower may open in the future, excluding however all IRA and Keogh
accounts, and all trust accounts for which the grant of a secunty interest would be prohibited by law. Borrower authonzes Lentler, to the extent
permitted by applicable law, to charge or setoff all sums owing on this Note 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 on this paragraph.
COLLATERAL. This Note IS secured by, in addition to any othe• collateral, a Mortgage dated September 29, 1998, to Lender on real property located
in Cumberland County, Commonwealth of Pennsylvania, a Mortgage dated Seotemner 29, 1998, to Lander on real property located in Cumberland
County, Commonwealth of Pennsylvania, and a Mortgage dated September 29. 1998, to Lender on real property located in Cumberland County,
Commonwealth of Pennsylvania, all the terms and conofions or which are rereoy incorporated and made a part of Ih,s Note.
YEAR 2000 PROVISIONS. Year 2000 Issues have not resunao in, and will not result in, a material adverse change to the business, properties, assets,
financial condition, results of operations or prospects of the Borrower, any rave not and will not impair materially the anility or Ins Borrower to serve
and punctually pay or perform any of its obligations owed to the Lentler. From tithe to time, within twenty (20) days airier any request by the Lender, the
Borrower shall deliver to the Loader a written report as 10 its compi,ance e'tons n connection wdn Year 2000 issues, the costs incurred to Oita and the
anticipated future Costs thereof, and irformation as to any Lability fire Borrower expects to incur in connoCfor witn year 2000 Issues, all in Such detail
as the Lender may reasonably request. In aOdiDon, Ire Borrower sr'ap, upon request of Ire Lancer, Permit the Lenow, upon reascnabie notice and
during normal business hours. to meet with the Borrower s information systems and iechnocg as ampioye6s and/or outside orowders to discuss the
status of the Borrower's compliance enorfs in connecton with Yea.' 2700 issues and Ine actual anticpatec cost tnefoof. The Borrower shall lake all
action necessary to ensure that A will be year 2000 Ccmpiianf to, a I m ssion cn[ca, systems on or prior to December 31, 1999 and to ensure that it will
to Year 2000 Compliant'Cr all otrei major systems on or Or or to Deromce, 1. 1999 such !hat 10 material ap.erse crango to fire Borrower's business.
09-29.1998 PROMISSORY NOTE Page 2
(Continued)
properties, assets, financial condition, results of operations, Or proSOecIS will result. For purposes of this provision, "Year 2000 lasues" means the risk
that computer applications, (including all software, embedded micro-CNps and Other processing capabilities) used by or for the benefit of the Borrower
may be unable to recognize or properly perform dalo-sensitive functions involving certain dates prior to, and any dale after, December 31, 1999, and
Year 2000 Compliant" means that all software, embedded micro-Chips and other processing Capab0ities utilized by and material to the Borrower are
able to effectively and correchy process data and perform functions for all calendar dates. Including dates in and after the Year 2000.
YEAR 2000 DEFAULT. In addition to the other Events of Default described in this Agreement, each of the following Shall constitute an Event of Default
under this Agreement: (a) any representation or statement made Or furnished to the Lender by or on behalf of the Borrower with respect to year 2000
Issues is false or misleading in any material respect either now or at the time made or furnished. (b) the Borrower fads to moat the deadlines required in
this Agreement to be Year 2000 Compliant. (c) the Borrower fails to Comply with any other provision of this Agreement relating to Year 2000 Issues. or
(d) the Lender determines, in its sole dlscreti0n, that there 'S a reasonable likelihood that the Borrower cannot be Year 20DO Compliant an or borfore
December 1, 1999.
BORROWER'S WAIVER AND INDEMNIFICATION. Borrower hereby Indemnifies and holds harmless Lender and Lender's affiliates and controlling
entities, their respective successors and assigns, and all of their officers, directors, employees and agents (each as "Indemnified Person" and
collectively the "Indemni0ed Persons") against any and all claims, demands, losses, costs, and expenses (Including without limitation attorney's fees
and costs whether at trial or otherwise, and on any appeal or petition for review) incurred by any Indemnified Person arising out of or relating to any
Investigatory or remedial action involving the Year 2000 Issues, or on account of the breach of any Indemnified Person pursuant to this Agreement. In
addition to this indemnity, the Borrower hereby releases and waives all present and future claims against the Lender or any Indemnified Person for
indemnity or contribution in the event the Borrower becomes liable for any failure or default under the Year 2000 Provisions of this Agreement. The
Indemnity and waiver provisions set forth this Section shall survive the payment by the Borrower of the obligations owed to the Lender under this
Agreement or any other agreement.
CESSATION OF ADVANCES. In addition 10 the other remedies set forth in this Agreement, If the Lender has made any commitment to make any loan,
advance or other extension of credit to the Borrower, whether under this Agreement or under any other agreement or instrument, the Lender shall have
no obligation to make any loan, advance or other extension of credit to the Borrower, or to amend credit accommodations to the Borrower of any kind,
it, as a result of the Borrower's failure to comply with the provision of this Agreement relating to the Year 2000, a material adverse change in the
Borrower's financial condition, properties, business or operations occurs or is likely to result, or if any other event or circumstances has occurred or
arisen which is reasonably likely to result In a compliance failure or default under the Year 2000 provision of this Agreement.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights Of remedies under this Note without losing them. Borrower 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 berms 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, fad 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 parry with whom the modification Is made. If any portion of this Note is
for any reason determined to be unenforceable, it will not affect the enforceability of any other provisions of this Note.
CONFESSION OF JUDGMENT. BORROWER HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY
OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR BORROWER AFTER
A DEFAULT UNDER THIS NOTE, AND WITH OR WITHOUT COMPLAINT FILED, AS OF ANY TERM, CONFESS OR ENTER JUDGMENT AGAINST
BORROWER FOR THE ENTIRE PRINCIPAL BALANCE OF THIS NOTE, ALL ACCRUED INTEREST, LATE CHARGES, AND ANY AND ALL AMOUNTS
EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THIS NOTE TOGETHER WITH INTEREST ON SUCH
AMOUNTS. TOGETHER WITH COSTS OF SUIT, AND AN ATTORNEY'S COMMISSION OF TEN PERCENT (10%) OF THE UNPAID PRINCIPAL
BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS (M) ON WHICH
JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS NOTE OR A COPY OF THIS
NOTE VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY GRANTED IN THIS NOTE TO CONFESS JUDGMENT
AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND
AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS NOTE. BORROWER HEREBY WAIVES ANY RIGHT BORROWER
MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT, EXCEPT ANY NOTICE AND/OR
HEARING REQUIRED UNDER APPLICABLE LAW WITH RESPECT TO EXECUTION OF THE JUDGMENT, AND STATES THAT EITHER A
REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO BORROWER'S ATTENTION OR
BORROWER HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE
INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED
COPY OF THE NOTE.
THIS NOTE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
By:_ (SEAL)
D.D. Scott k, President
Vanegy Rafe srig,IPAV. ASERPAC. RIg 05 Pit' /tiff On,ve, 72elCl9641Cc P,3S1-nnx ?"c Aur.glllgp,vlg. i PA-Deg OaRCOVL9CS.0VLl
CHANGE IN TERMS AGREEMENT
Principal Loan Data Maturity Loan No Call Collateral Account Officer initials
$1881100,00 06-0-1999 30038 COMM SEC 305700 CMW83
References in the shaded area are for Lenders use only and do not limit the aoclicability of this document to any particular loan or item.
Borrower: Darcom Technologies, Inc.
77 Northeastern Boulevard
Nashua, NH 03062
Lender: KEYSTONE FINANCIAL BANK, N.A.
Camp Hit
4231 Trindle Road
Camp Hill, PA 17011
Principal Amount: $188,000.00 Dale of Agreement: May 27, 1999
DESCRIPTION OF EXISTING INDEBTEDNESS. A $108,000.00 Promissory Nola to Keystone Financial Bank, NA., (formerly Financial Trust Company)
dated September 29, 1996 with a current principal balance of s188,ooo.oo and accrued unpaid Interest due from the 29th day of September, 1998.
DESCRIPTION OF CHANGE IN TERMS.
Effective February 28, 1999, Keystone Financial Bank, NA., (formerly Financial Trust Company) and the undersigned hereby agree to extend the
maturity date from February 28, 1999 to June 30, 1999, when all outstanding principal and accrued interest shall be due and payable in full.
AMENDMENT TO CREDIT DOCUMENTS
THIS AMENDMENT TO CREDIT DOCUMENTS dated as of May 27, 1999, (this 'Amendment") Is entered into by and between Darcom Technologies,
Inc., a Corporation organized and existing under laws of the State of Pennsylvania (Borr ei and Keystone cinancial Bank, NA., (formerly Financial
Trust Company), a national banking association (the 13ai
RECITALS:
1. The Bank has previously made, or is concumently with the signing of this Amendment making, loans or other extensions of credit Id the Borrower,
which are or may be evidenced by certain loan or credit agreements, promissory notes, socunty documents, and all other agreements, contracts and
instruments (all of such loan or credit agreements, promissory notes made by the Borrower in favor of the Bank, or entered into by and between the
Borrower and the Bank, whether previously entered into, entered Into simultaneously with the execution of this Amendment, or entered Into attar the
date of this Amendment, collectively the 'Credit Document").
2. The Bank has requested, and the Borrower has agreed, to amend the Credit Documents as set forth below, In order to add additional provisions to
the Credit Documents In connection with the Year 20DO Issues (as defined below).
NOW THEREFORE, In consideration of the promises, the mutual covenants and agreements contained herein, the Bank's continuing agreement to
extend credit under the Credit Documents to the Borrower and other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and with the intent to be legally bound hereby, the parties hereto agree as follows:
Section 1. Amendments to Credit Documents The following defined terms, representations and warranties and covenants are hereby added to and
deemed incorporated into the Credit Documents.
a. Defined Terms.
"Year 2000 COmplianr means, with respect to any person or entity, all software, embedded micro-chips and other processing capabilities utilized by
and material to the business operations or financial condition of such person or entity are able to interpret and manipulate data on and involving all
calendar dales correctly and without causing any abnormal ending scenario, including In relation to certain dales prior to, and any date after, December
31, 1999.
'year 2000 Issues' means the risk that computer applications used by or for the benefit of the Borrower may be unable to recognize or property
perform dato-sensitive functions Involving certain dales prior to, and any date after, December 31, 1999.
b. Representations Regarding Year 2000 Issues.
On the basis of a comprehensive inventory. review and assessment of the Borrower's computer applications and hardware containing micro-chips and
all software and other processing capabilities of the Borrower, upon Inquiry made the Borrower's material suppliers and vendors, in the opinion of the
Borrowers Senior Management, the Borrower and all such vendors and suppliers will be Year 2000 Compliant before December 1, 1999.
c. Covenants.
1. Information Concerning Year 2000 Issues.
Within twenty (20) days after any request by the Bank, the Borrower shall deliver to the Bank (A) a written report as to its compliance efforts In
connection with the Year 2000 Issues, in such detail as the Bank may reasonably request, (8) a report as to the costs incurred by the Borrower to date,
and the additional costs the Borrower expects to incur in connection with the Year 2000 Issues, and (C) a report as to any liability which the Borrower
expects to Incur in connection with Year 2000 Issues. Promptly upon receipt by the Borrower thereof, the Borrower shall, upon request of the Bank,
permit the Bank upon reasonable notice and during normal business hours, to most with the Borrower's information systems and technologies
employees, outside providers and consultants, accountants and other persons to discuss the status of the Borrower's compliance efforts in connection
with the Year 2000 Issues.
it Year 2000 Compliance.
The Borrower shall take all action necessary to insure that all of the material computer-based systems (including all software, embedded micro-Chips
and other processing capabilities) utilized by or for the benefit of the Borrower are Year 2000 Compliant on or prior to December 1, 1999.
Section 2. No Other Amendments or Waivers. The Amendments to the Credit Documents sat forth above do not enter implicitly or explicitly alter,
waive or amend, except as expressly provided in this Amendment, the provisions of the Credit Documents. The amendments set forth above do not
waiver, now or in the future, compliance with any other covenant, term or condition to be performed or complied with nor do they impair any rights or
remedies of the Bank under any of the Credit Documents with respect to any such violation. Nothing in this Amendment shall be deemed or construed
to be a waiver or release of, or a limitation upon, the Bank's exercise of any of Its rights and remedies under any or the Credit Documents, whether
arising as a consequence of any defaults or events of default which may now exist or otherwise, and all subh rights and remedies are hereby expressly
reserved.
Section 3. Ratification of Terms. Except as expressly amended by this Amendment, the Credit Documents and each and every representation,
warranty, covenant, term and condition contained therein are specifically retried end confirmed.
Section a. Incorporation Into Credit Documents. This Amendment is deemed incorporated into the Credit Documents. To the extent that any term
or provision of this Amendment is or may be deemed expressly inconsatent wdn any term or provision of any of the Cred.t Documents, the terms antl
?:-. `ICI
06-27-1999 CHANGE IN TERMS AGREEMENT Page 2
(Continued)
provisions hereof shall control.
Section e. COUnlarparla. This Amendment may be executed in different counterparts, each Of Which When executed by the Borrower and the Bank
shah be regarded as an original, and all Such counterparts Shall constitute one Amendment.
Section a. Governing Law. This Amendment shall be construed In accordance with and governed by the laws of the State of Pennsylvania,
without regard to the provisions thereof regarding conflicts of law.
IN WITNESS WHEREOF, the parties hereto, with the intend to be legally bound hereby, have caused this Amendment to Credit Documents to be duly
executed by their respective duly authorized representatives as a document under seal, as of the day and year first above written.
CONTINUING VALIDITY, Except es expressly changed by this Agreement, the terms of the original obligation or obligations, including all agreements
evidenced or securing the obligation(s), remain unchanged and in full force and effect. Consent by Lender to this Agreement does not waive Lender's
right to strict performance of the obligation(s) as changed, nor obligate Lander to make any future change in terms. Nothing in this Agreement will
including aceomamodall nl pthe arts$, l unless a party is expressly released by Lander in (writing. Any maker or endorser, InGuding accommodation ggamaken,
Will not be released by virtue of this Agreement. If any person who signed the original obligation does not sign this Agreement below, then se persons
signing below acknowledge that this Agreement Is given conditionally, based on the representation to Lender that the non-signing party consents to the
changes and provisions of this Agreement or otherwise will not be released by it. This waiver applies not only to any initial extension, modification or
release, but also to all such subsequent actions.
CONFESSION OF JUDGMENT. BORROWER HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY
OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR BORROWER AFTER
A DEFAULT UNDER THIS AGREEMENT, AND WITH OR WITHOUT COMPLAINT FILED, AS OF ANY TERM, CONFESS OR ENTER JUDGMENT
AGAINST BORROWER FOR THE ENTIRE PRINCIPAL BALANCE OF THIS AGREEMENT, ALL ACCRUED INTEREST, LATE CHARGES, AND ANY AND
ALL AMOUNTS EXPENDED OR BY LENDER TO ANY ON SUCH AMOUNTS, TOGETH RVWITH COSTS OF SUIT, ANDGAN ATTORNEYS COMMISSION OF TEIN PERCENT (10%) OF THE UNPAID
PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS (1500) ON
WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS AGREEMENT OR A
COPY OF THIS AGREEMENT VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY GRANTED IN THIS AGREEMENT TO
CONFESS JUDGMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT AUTHORITY, BUT SHALL CONTINUE
FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS AGREEMENT. BORROWER HEREBY
WAIVES ANY RIGHT BORROWER MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT,
EXCEPT ANY NOTICE ANDIOR HEARING REQUIRED UNDER APPLICABLE LAW WITH RESPECT TO EXECUTION OF THE JUDGMENT, AND
STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO
BORROWER'S ATTENTION OR BORROWER HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL.
THE AGREEMENT.
PRIOR TO AGREES TO SIGNING
THE TERMS OF THE AGREEMENT AND ACKNOWLEDGES RECE FT OF A COMPLETED COPY OF I BORROWER
THIS AGREEMENT HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
BORROWR:
Dareom Tech j ss, Inc.
1 IL
B .•.... .: (/(/! ? (SEAL) BY:? J -L)
8tev Dardlek, Chief Exeeutlve Officer D. Scott Dardlck, President
C
vV4De Rtle. SM911 Ply. LASERPRO,RIp.U.e.P11.?T.M.DIL,YV.7 rIC IC)IIIICFIRasuvgll.. V,1. AnnpnUnurrlp.IPA-D20FS.7100ARCOMLLNLOVLt
COMMERCIAL GUARANTY
L Principal Loan Date Maturity Loan No Cell
COMM Collateral
SEC Account
305700 Officer
CW60 Initiate
References in iM shaded area are for Lender's use only and do not limn the applicability of this document to an erfleular loan or item.
Borrower: Darcom Technologies, Inc. Lender: Financial Trust Company
77 Northeastern Boulevard Camp Hill
Nashua, NH Weal 4231 Trlndle Road
Camp Hill, PA 17011
Guarantor: Thomas M. Dardlck and Kathleen A. Vickroy
55sa Moreland Court
Mechanicsburg, PA 17055
AMOUNT OF GUARANTY. This Is a guaranty of payment of the Note, Including without limitation the principal Note amount of One Hundred
Eighty Eight Thousand & 001100 Dollars (6190,000.00).
GUARANTY. For good and valuable consideration, Thomas M. Dardick and Kathleen A. Vickroy ("Guarantor") absolutely and unconditionally
guarantee and promise to pay, jointly and severally, to Financial Trust Company ("Lender") or Its order, In legal tender of the United States of
America, the Indebtedness (as that term Is defined below) of Darcom Technologies, Inc, ("Borrower") to Lender on the terms and conditions
set forth In this Guaranty.
DEFINITIONS. The following words Shall have the following meanings when used In this Guaranty:
Borrower. The Wald 'Bonowee means Dareom Technologies, Inc..
Guarantor. The word "Guarantor" means Thomas M. Dardick and Kathleen A. Vickroy, who are signing this Guaranty jointly and severally.
Guaranty. The word "Guaranty' means this Guaranty made by Guarantor for the benefit of Lender dated September 29, t998.
Indebtedness. The word'Indobtednoss" means the Note, Including (a) all principal, (b) all interest, (c) all late charges, (d) all loan fees and
loan charges, and (e) all coaecfion costs and expenses relating to the Note or to any collateral for the Note. Collection costs and expenses
Include without limitation all of Lender's atorneys' fees and Lender's legal expenses, whether or not suit is instituted, and 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.
Lender. The word "Lender' means Financial Trust Company, its successors and assigns.
Note. The word 'Note' means the promissory note or credit agreement dated September 29, 1998, In the original principal amount of
618SAM.00 from Borrower to Lentler, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and
substitutlons for the promissory note or agreement.
Related Documents. The words 'Related Documents' mean and include without limitation all promissory notes, credit agreements, loan
agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, and all other instruments, agreements and
documents, whether now or hereafter existing, executed In connection with the Indebtedness.
MAXIMUM LIABILITY. The maximum liability of Guarantor under this Guaranty shall not exceed at any one time the amount of the
Indebtedness described above, plus all costs and expenses of (a) enforcement of this Guaranty and (b) collection and sale of any collateral
securing this Guaranty.
The above limitation on liability Is not a restriction on the amount of the Indebtedness of Borrower to Lender either in the aggregate or at any one time.
If Lender presently holds one or more guaranties, or hereafter receives additional guaranties from Guarantor, the rights of Lender under all guaranties
shad be cumulative. This Guaranty shall not (unless specifically provided below to the contrary) affect or invalidate any such other guaranties. The
liability of Guarantor will be the aggregate liability of Guarantor under the terms of this Guaranty and any such other unterminated guaranties.
NATURE OF GUARANTY. Guarantor intends Io guarantee at all times the performance and prompt payment when due, whether at malunty or earlier
by reason of acceleration or otherwise, of all Indebtedness within the limits set forth in the preceding section of this Guaranty. The obligations of
Guarantors shall be joint and several. Lender may proceed against any of the Guarantors individually. against any group of Guarantors, or against all
the Guarantors In one action, without affecting the right of Lender to proceed against other Guarantors for amounts that are covered by thij Guaranty.
Any Inability of Lender to proceed against any Guarantor (whether caused by actions of a Guarantor or of Lender) will not affect Lender's right to
proceed against any or all remaining Guarantors for all or part of the amounts covered by this Guaranty.
DURATION OF GUARANTY. This Guaranty will take effect when received by Lender without the necessity of any acceptance by Lender, or any notice
to Guarantor or to Borrower, and will continue in full force until all Indebtedness shall have been fully and finally paid and satisfied and all other
obligations of Guarantor under this Guaranty shall have been performed In full. Release of any other guarantor or termmahon of any other guaranty of
the Indebtedness shall not enact the liability of Guarantor under this Guaranty. A revocation received by Lender from any one or more Guarantors shall
not affect the liability of any remaining Guarantors under this Guaranty.
GUARANTOR'S AUTHORIZATION TO LENDER. Guarantor authorizes lender, without notice or demand and without lesssning Guarantor's
liability under this Guaranty, from time to time: (a) to make one or more additional secured or unsecured loans to Borrower, to lease
equipment or other goods to Borrower, or otherwise to extend additional credit to Borrower; (b) to alter, compromise, renew, extend,
accelerate, or otherwlas change one or more times the time for payment or other terms of the Indebtedness or any part of the Indebtedness,
Including Increases and decreases of the rate of Interest on the Indebtedness; extensions may be repealed and may be for longer than the
original loan term; (c) to lake and hold security for the payment of this Guaranty or the Indebtedness, and exchange, enforce, waive,
subordinate, fall or decide not to perfect, and raise" any such security, with or without the substitution of new collateral; (d) to 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; (a) to determine how, when and what application of payments and credits shall be made on the Indebtedness;
in to apply such "curtly and direct the order or manner or sale thereof, Including without llndtatlon, any nonjudlelel sale permitted by the
terms of the controlling security agreement or deed of trust, as Lender In Its discretion may determine; (g) to sell, transfer, assign, or grant
participations In all or any part of the Indebtedness; and (h) to assign or transfer this Guaranty In whole or In part.
GUARANTOR'S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Lender that (a) no representations or agreements
of any kind have been made to Guarantor which would limit or quality in any way the terms of this Guaranty; (b) this Guaranty is executed at
Borrower's request and not at the request of Lender; (c) Guarantor has full power, right and authority to enter into this Guaranty; (d) the provisions of
this Guarany do not conflict with or result in a default under any agreamont or other instrument binding upon Guarantor and do not result in a violation
of any law, regulation, court docree or order applicable to Guarantor; (e) Guarantor has not and will not, without the prior written consent of Lender,
l'"
09-29-1998 COMMERCIAL GUARANTY Page 2
(Continued)
sell, lease, assign, encumber, hypothecate, transfer, or otherwise dispose of all or substantially all of Guarantor's assets, or any interest therein; (f) upon
Lender's request, Guarantor will provide to Lender financial and credit information in form acceptable to Lender, and all such financial Information
which currently has been, and all future financial information which will be provided to Lender is and will be true and correct in all material respects and
fairly present the financial Condition of Guarantor as of the dates the financial information is provided; (g) no material adverse change has occurred in
Guarantor's financial condition since the date of the most recent financial statements provided to Lender and no event has occurred which may
materially adversely allect Guarantor's financial condition; (h) no litigation, claim, investigation, administrative proceeding or similar action (Including
those for unpaid taxes) against Guarantor is pending or threatened; (I) Lender has made no representation to Guarantor as to the creditworthiness of
Borrower; and U) Guarantor has established adequate means of obtaining Irom Borrower on a continuing basis Information regarding Borrower's
financial condition. Guarantor agrees to keep adequately informed from such means of any facts, events, or circumstances which might In any way
allect Guarantor's risks under this Guaranty, and Guarantor further agrees Thal Lender shall have no obligation to disclose to Guarantor any information
or documents acquired by Lender in the course Of its relationship with Borrower.
GUARANTOR'S WAIVERS. Except as prohibited by applicable law. Guarantor waives any right to require Lender (a) to continue lending money or to
extend other credit to Borrower; (b) to make any presentment, protest, demand, or notice of any kind. Including notice of any nonpayment of the
Indebtedness or of any nonpayment related to any collateral, or notice of any action or nonaction on the pan of Borrower, Lender, any surely, endorser,
or other guarantor In connection with the Indebtedness or in connection with the creation of new or additional loans or obligations; (c) Its resort for
payment or to proceed directly or at once against any person, including Borrower or any other guarantor; (d) to proceed directly against or exhaust any
collateral held by Lender from Borrower, any other guarantor, or any other person; (e) to give note of the terms, time, and place of any public or
private sale of personal property security held by Lender from Borrower or to comply with any other applicable provisions of the Uniform Commercial
Coda; (f) to pursue any other remedy within Lenders power; or (g) to commit any act or omission of any kind, or at any time, with respect to any
matter whatsoever.
Guarantor also waives any and all rights or defenses arising by reason of (a) any "one action" or "anti-deficiency" law or any other taw which may
prevent Lender from bringing any action, Including a claim for deficiency, against Guarantor, before or after Lender's commencement or Completion of
any foreclosure action, either Judicially or by exercise of a power of sale; (b) any election of remedies by Lender which destroys or otherwise adversely
affects Guarantor's subrogation rights or Guarantor's rights to proceed against Borrower for reimbursement, including without limitation, any loss of
rights Guarantor may suffer by reason of any law limiting, qualifying, or discharging the Indebtedness; (c) any disability or other defense of Borrower, of
any other guarantor, or of any other person, or by reason of the cessation of Borrower's liability from any cause whatsoever, other than payment in full
In legal lender, of the Indebtedness; (d) any right to claim discharge of the Indebtedness on the basis of unjustified impairment of any collateral for the
Indebtedness; (e) any statute of limitations, if at any time any action or suit brought by Lender against Guarantor is commenced there to outstanding
Indebtedness of Borrower to Lender which is not barred by any applicable statute of limitations; or (f) any defenses given to guarantors of law or in
equity other than actual payment and performance of the Indebtedness. If payment is made by Borrower, whether voluntarily or otherwise, or by any
third party, an the Indebtedness and thereafter Lender is forced to remit the amount of that payment to Borrower's trustee in bankruptcy or to any
similar person under any federal or stale bankruptcy law or law for the relief of debtors, the Indebtedness shall be considered unpaid for the purpose of
enforcement of this Guaranty.
Guarantor further waives and agrees not to assert or claim at any time any deductions to the amount guaranteed under this Guaranty for any claim of
setoff, counterclaim, counter demand, recoupment or similar right, whether such claim, demand or right may be asserted by the Borrower, the
Guarantor, or both.
GUARANTOR'S UNDERSTANDING WITH RESPECT TO WAIVERS. Guarantor warrants and agrees that each of the waivers set forth above is made
with Guarantor's full knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary to
public policy or law. It any such waiver is determined to be contrary to any applicablo law or public policy, such waiver shall be effective only to the
extent permitted by law or public policy.
LENDER'S RIGHT OF SETOFF. In addition to all liens upon and rights of setoff against the moneys, securities or other property of Guarantor given to
Lender by Law. Lender shall have, with respect to Guarantor's obligations to Lender under this Guaranty and to the extent permitted by law, a
contractual security interest In and a right of setoff against, and Guarantor hereby assigns, conveys, delivers, pledges, and transfers to Lender as of
Guarantor's right, title and Interest in and to, all deposits, moneys, securities and other property of Guarantor now or hereafter in the possession of or
on depose with Lender, whether held in a general or special sccouni or deposit, whatnot held jointly with someone else, or whether held for
safekeeping or otherwise, excluding however all IRA, Keogh, and trust accounts. Every such security interest and right of setoff may be Orercised
without demand upon or notice to Guarantor. No security Interest or right of salon shall be doomed to have boon waived by any act or conduct on the
pan of Lender or by any neglect to exercise such right of setoff or to enforce such security interest or by any delay in so doing. Every right of setoff and
security interest shall continue in full force and effect until such right of setoff or security interest is specifically waived or released by an Instrument In
writing executed by Lender.
SLI30RDINATION OF BORROWER'S DEBTS TO GUARANTOR. Guarantor agrees that the Indebtedness of Borrower to Lender, whether now
extsting or hereafter created, shall be prior to any claim that Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower
becomes Insolvent. Guarantor hereby expressly subordinates any claim Guarantor may have against Borrower, upon any account whatsoever, to any
claim that Lender may now or hereafter have against Borrower. In the event of insolvency and consequent liquidation of the assets of Borrower,
through bankruptcy, by an assignment for the benefit of creditors, by voluntary liquidation, or otherwise, the assets of Borrower applicable to the
payment of the claims of both Lender and Guarantor shall be paid to Lender and shall be first applied by Lender to the Indebtedness of Borrower to
Lender. Guarantor does hereby assign to Lender all claims which it may have or acquire against Borrower or against any assignee or trustee In
bankruptcy of Borrower, provided however, that such assignment shall be effective only for the purpose of assuring to Lender lull payment In legal
lender of the Indebtedness. If Lender so requests, any notes or credit agreements now or hereafter evidencing any debts or obligations of Borrower to
Guarantor shall be marked with a legend that the same are subject to this Guaranty and shall be delivered to Lender. Guarantor agrees, and Lender
hereby Is authorized, in the name of Guarantor, from time to time to execute and file financing statements and continuation statements and to execute
such other documents and to take such other actions as Lender deems necessary or appropriate to perfect, preserve and enforce its rights under this
Guaranty.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Guaranty:
Amendments. This Guaranty, together with any Re'atod Documents, constitutes the entire understanding and agreement of the parties as to Ue
matters set forth in this Guaranty. No alteration of or amendment to this Guaranty shall be effective unless given in writing and signed by the party
or parties sought to be charged or bound by the alteration or amendment.
Applicable Law. This Guaranty has been delivered to lender and accepted by Lender in the Commonwealth of Pennsylvania. It there is a
lawsuit. Guarantor agrees upon Lender's request to submit to the jurisdiction of the courts of Cumberland County. Commonwealth of
Pennsylvania. This Guaranty shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania.
Attorneys' Fees; Expenses. Guarantor agrees to pay upon demand all of Lender's Costs and expenses, including attorneys' fees and Lender's
legal expenses, incurred in connection with the enforcement of this Guaranty. Lender may pay someone else to neap enforce this Guaranty, and
Guarantor shall pay the costs and expenses of such enforcement. Costs and expenses include Lender's anorneys' fees and legal expenses
whether or not there is a lawsuit. Including attorneys' fees and legal expenses for bankruptcy proceedings (and including efforts to modify or
09-29-1998 COMMERCIAL GUARANTY Page 3
(Continued)
vacate any automate stay or injunction), appeals, and any anticipated post-judgment collection services. Guarantor also shall pay all court costs
and such additional fees as may be directed by the court.
Notices. All notices required to be given by edhor party to the other under this Guaranty shall be in writing, may be sent by telefacsimile (unless
otherwise required by law), and shalt be effective when actually delivered or when deposited with a nationally recognized overnight courier, or
when deposited in the United States mail, first class postage prepaid, addressed Io the party 10 whom the notice is to be given at the address
shown above or to such other addresses as either party may designate to the other in writing. If there is more than one Guarantor, notice to any
Guarantor will constitute notice to all Guarantors. For notice purposes, Guarantor agrees to keep Lender Informed at all times of Guarantor's
cuff ant address.
Interpretation. In all cases where there is more than one Borrower or Guarantor, then all words used In this Guaranty in the singular shall be
deemed to have been used in the plural where the context and construction so require; and where there is more than one Borrower named in this
Guaranty or when this Guaranty Is executed by more than one Guarantor, the words "Borrower" and "Guarantor" respectively shall mean all and
any one or more of them. The words "Guarantor; "Borrower,* and lender" Include the heirs, successors, assigns, and transferees of each of
them. Caption headings in this Guaranty are for convenience purposes only and are not to be used to interpret or define the provisions of this
Guaranty. If a court of competent jurisdiction finds any provision of this Guaranty to be invalid or unenforceable as to any person or circumstance,
such finding shall not render that provision Invalid or unenforceable as to any other persons or circumstances, and all provisions of this Guaranty
in all other respects shall remain valid and enforceable. If any one or more of Borrower or Guarantor are corporations or partnerships, it Is not
necessary for Lender to Inquire Into the powers of Borrower or Guarantor or of the officers, directors, partners, or agents acting or purporting to act
on their behalf, and any Indebtedness made or created in reliance upon the professed exercise of such powers shall be guaranteed under this
Guaranty.
Waiver, Lender shall not be deemed to have waived any rights under this Guaranty unless such waiver Is given in writing and signed by Lender.
No delay or omission on the part of Lender In exercising any right shall operate as a waiver of such fight or any other right. A waiver by Lender of
a provision of this Guaranty shall not prejudice or constitute a waiver of Lender's right otherwise to demand strict compliance with that provision or
any other provision of this Guaranty. No prior waiver by Lander, nor any course of dealing between Lender and Guarantor, shall constitute a
waiver of any of Lender's rights or of any of Guarantor's obligations as to any future transactions. Whenever the consent of Lender Is required
under this Guaranty, the granting of such consent by Lender In any Instance shall not constitute continuing consent to subsequent Instances
where such Consent Is required and In all oases such consent may be granted or withheld in the sole discretion of Lender.
CONFESSION OF JUDGMENT. GUARANTOR HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE
PROTHONOTARY OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR
GUARANTOR AFTER A DEFAULT UNDER THIS GUARANTY, AND WITH OR WITHOUT COMPLAINT FILED, AS OF ANY TERM, CONFESS OR
ENTER JUDGMENT AGAINST GUARANTOR FOR THE ENTIRE PRINCIPAL BALANCE OF THIS GUARANTY, ALL ACCRUED INTEREST. LATE
CHARGES, AND ANY AND ALL AMOUNTS EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THE
INDEBTEDNESS TOGETHER WITH INTEREST ON SUCH AMOUNTS, TOGETHER WITH COSTS OF SUIT, AND AN ATTORNEY'S COMMISSION OF
TEN PERCENT (10%) OF THE UNPAID PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN
FIVE HUNDRED DOLLARS (M) ON WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR
SO DOING, THIS GUARANTY OR A COPY OF THIS GUARANTY VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY
GRANTED IN THIS GUARANTY TO CONFESS JUDGMENT AGAINST GUARANTOR SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT
AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS
GUARANTY. GUARANTOR HEREBY WAIVES ANY RIGHT GUARANTOR MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY
SUCH CONFESSION OF JUDGMENT, EXCEPT ANY NOTICE AND/OR HEARING REOUIREO UNDER APPLICABLE LAW WITH RESPECT TO
EXECUTION OF THE JUDGMENT, AND STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF
JUDGMENT PROVISION TO GUARANTOR'S ATTENTION OR GUARANTOR HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL.
EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS GUARANTY AND AGREES TO ITS
TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT THIS GUARANTY IS EFFECTIVE UPON GUARANTOR'S EXECUTION AND
DELIVERY OF THIS GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE MANNER SET FORTH
IN THE SECTION TITLED "DURATION OF GUARANTY." NO FORMAL ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY
EFFECTIVE. THIS GUARANTY IS DATED SEPTEMBER 29,1993.
THIS GUARANTY HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
GUARAN
X (SEAL)
T ffaj M. Oardlck
Reg. U.S. PAL a T.M. Off., 116f, 3.26 (t) 1999 OF i Praserv K91. Inc.
DISCLOSURE FOR CONFESSION OF JUDGMENT
Principal Loan Date Maturity Loan No Cell Collateral Account Of}Icer IntUele
$188100M 09-29-1998 02-28-1999 30038 COMM SEC 305700 CW60
aererawm 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: Darcom Technologies, Inc. Lender: Financial Trust Company
77 Northeastern Boulevard Camp HIII
Nashua, NH OW62 1231 Trlndle Road
Camp HIII, PA 17011
Guarantor: Thomas M. Dardlck and Kathleen A. Vlckroy
6566 Moreland Court
Mechanicsburg, PA 17055
DISCLOSURE FOR CONFESSION OF JUDGMENT
I AM EXECUTING, THIS -?25'c- DAY OF , .kl I,- - , 19 A GUARANTY OF A PROMISSORY NOTE FOR
$196,000.90 OBLIGATING ME TO REPAY THAT AMOUNT.
A. I UNDERSTAND THAT THE GUARANTY CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO
ENTER JUDGMENT AGAINST ME IN COURT, AFTER A DEFAULT ON THE GUARANTY, WITHOUT ADVANCE NOTICE TO ME AND WITHOUT
OFFERING ME AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY OF JUDGMENT. IN EXECUTING THE GUARANTY, BEING FULLY
AWARE OF MY RIGHTS TO ADVANCE NOTICE AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS
THAT LENDER MAY ASSERT AGAINST ME UNDER THE GUARANTY, I AM KNOWINGLY, INTELLIGENTLY, AND VOLUNTARILY WAIVING
THESE RIGHTS, INCLUDING ANY RIGHT TO ADVANCE NOTICE OF THE ENTRY OF JUDGMENT, AND I EXPRESSLY AGREE AND CONSENT
TO LENDER'S ENTERING JUD ENT AGAINST ME BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT
PROVISION. INITIALS:
B. 1 FURTHER UNDERSTAND THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST ME WITHOUT
ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE GUARANTY ALSO CONTAINS LANGUAGE THAT
WOULD PERMIT LENDER, AFTER ENTRY OF JUDGMENT, TO EXECUTE ON THE JUDGMENT BY FORECLOSING UPON, ATTACHING,
LEVYING ON, TAKING POSSESSION OF OR OTHERWISE SEIZING MY PROPERTY, IN FULL OR PARTIAL PAYMENT OF THE JUDGMENT.
HOWEVER, LENDER MUST PROVIDE NOTICE TO ME UNDER APPLICABLE LAW IN EXECUTING ANY CONFESSED JUDGMENT. IN
EXECUTING THE GUARANTY, BEING FULLY AWARE OF MY RIGHTS TO ADVANCE NOTICE AND A HEARING AFTER JUDGMENT IS
ENTERED AND BEFORE EXECUTION ON THE JUDGMENT, I A KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE
RIGHTS, AND I EXPRESSLY AGREE AND CONSENT TO LE DE S EXECUTING ON THE JUDGMENT, IN ANY MANNER PERMITTED BY
APPLICABLE STATE AND FEDERAL LAW. INITIALS:
C. AFTER HAVING READ AND DETERMINED WHICH OF THE FOLLOWING STATEMENTS ARE APPLICABLE, AND BY PLACING MY
INITIALS NEXT TO EACH STATEMENT WHICH APPLIES, I REPRESENT THAT:
INITIALS
1. I WAS REPRESENTED BY MY OWN INDEPENDENT LEGAL COUNSEL IN CONNECTION WITH THE GUARANTY.
2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE
GUARANTY TO MY ATTENTION.
0. 1 CERTIFY THAT MY ANNUAL INCOME EXCEEDS $10,000; THAT THE BLANKS IN THIS DISCLOSURE WERE FILLED IN WHEN I
INITIALED AND SIGNED IT; AND THAT I RECEIVED A COPY AT THE TIME OF SIGNING.
THIS DISCLOSURE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
(SEAL)
(SEAL)
A.
Poe us Pit aT.M CI vs,33251,1,251crl PrcSVr,nr,^c AnngnOau',53 PA-C37 CARCOM LNC3 OVLI
EXHIBIT "E"
MCNEES, WALLACE & NURICK
ATTORNEYS AT LAW
100 PINE STREET
P. O. BOX 1100
HARRISBURG, PA 17106.1160
T0.CPMCNC17171232.0000
Fix 17171237-5300
httpJAv; mwn.com
CHAD P. PHIPPS
DIXI=DIN.: (717) 277-0110
E-MAIL ADDRESS: CPHIPPSOMWN.COM
September 3, 1999
Steven M. Dardick, Chief Executive Officer
Darcom Technologies, Inc,
3 Bud Way, Suite 25
Nashua, NH 03062
FILE COPY
VIA FACSIMILE 1603-886-58881
and FIRST CLASS U.S. MAIL
Re: Keystone Financial Bank, N.A.
Darcom Technologies, Inc,
Our File No. 19128-0016
Dear Mr. Dardick:
Please be advised that this office serves as legal counsel to Keystone Financial Bank, N.A.,
successor by merger to Financial Trust Company and Pennsylvania National Bank and Trust
Company (the "Bank'). As you know, Darcom Technologies, Inc. ("Darcom') presently has three
outstanding loans with the Bank. The outstanding indebtedness with respect to these three loans,
as of August 18, 1999, is as follows:
Date of the Loan Original Amount of he Loan Doff Amount as of 8/18/99
1.) 12/17/96 S 250,000 Line of Credit S 252,222.74
2.) 11/13197 S 600,000 Line of Credit S 593,540.71
3.) 9/29/98 S 188,000 Term Note S 213,321.84 ?-r"r
The aforementioned loan payoff figures include accrued interest and late charges only through
August 18, 1999. Darcom also owes the Bank additional interest and late charges which accrue
subsequent to August 18, 1999, as well as the Bank's attorneys' fees and other costs incurred both j.
prior hereto and hereafter in attempting to collect the indebtedness. In addition, Darcom shall
continue to be obligated to pay to Bank any other amounts as provided in the documentation
executed in association with the aforementioned loans. The total amount outstanding under the three
Darcom loans, as well as any and all other attorneys' fees, costs, charges, etc., which Bank is entitled
to recover from Darcom pursuant to the loan documentation, is hereinafter collectively referred to
as the "Darcom Indebtedness."
• COLUMBUS. OH WASHINGTON, D.C.
Mr. Steven M. Dardick, Chief Executive Officer
September 3, 1999
Page 2
The $250,000 line of credit is evidenced by the Business Loan Agreement and the Promissory
Note (the "1996 Note"), each dated December 17, 1996, executed by Darcom in favor of the Bank.
Under the 1996 Note, the Bank may demand payment in full at any time, whether or not there has
been a default by Darcom. The 1996 Note is secured by a Commercial Security Agreement, dated
December 17, 1996, whereby Darcom granted to Bank a first lien in its accounts and inventory, as
well as a lien subject to the lien of U.S. Computer Systems, Inc. d/b/a Dynatech Wireless
Technologies, Inc. ("Dynatech") with respect to Darcom's other assets. The 1996 Note is further
secured by the Commercial Guaranty of David Scott Dardick and Janet M. Dardick and the
Commercial Guaranty of Dardick Technical Services, Inc., each dated December 17, 1996.
The $600,000 Business Manager line of credit is evidenced by the loan commitment letter
and the Business Loan Agreement, each dated November 13, 1997 (the "1997 Business Manager
Line"). As you know, the 1997 Business Manager Line documentation governs the relationship
between the Bank and Darcom regarding the Bank's funding and purchase of Darcom's receivables.
The 1997 Business Manager Line is secured by a Commercial Security Agreement, dated November
13, 1997, whereby Darcom granted to Bank a first lien security interest in all of its accounts
receivable and proceeds therefrom. In addition, the 1997 Business Manager Line is secured by the
Commercial Guaranty of Thomas Dardick, and an accompanying Open-End Mortgage from Thomas
Dardick and Kathleen Vickroy to Bank, each executed on November 13, 1997. The 1997 Business
Manager Line is further secured by the Commercial Guaranty of Steven Dardick, and an
accompanying Open-End Mortgage from Steven and Necia Dardick to Bank, each executed on
November 13, 1997. Furthermore, the 1997 Business Manager Line is secured by the Commercial
Guaranty of David Scott Dardick, and an accompanying Open-End Mortgage from Janet Russavage
a/k/a Janet Dardick to Bank, each dated November 13, 1997.
The $188,000 term loan is evidenced by the Promissory Note from Darcom to Bank dated
September 29, 1998 (the "1998 Note"). The 1998 Note matured on February 28, 1999. Despite the
Bank's April 29, 1999 letter to Darcom and the guarantors of the 1998 Note demanding immediate
full payment of the 1998 Note, Darcom and the guarantors of the 1998 Note have not tendered
payment to Bank to date. The 1998 Note is secured by a Commercial Security Agreement, dated
September 29, 1998, whereby Darcom granted to Bank a security interest in its inventory, chattel
paper, accounts, equipment, general intangibles and fixtures. The 1998 Note is further secured by
the Commercial Guaranty of Thomas Dardick and Kathleen Vickroy, dated September 29, 1998.
Moreover, the 1998 Note is secured by the Commercial Guaranty of David Scott and Janet Dardick,
and the accompanying Mortgage from Janet Russavage aik/a Janet Dardick to Bank, each dated
September 29, 1998. In addition, the 1998 Note is also secured by the Commercial Guaranty of
Steven and Necia Dardick, and the accompanying Mortgage from Steven and Necia Dardick to Bank,
each dated September 29, 1998.
All of the loan documentation executed in association with the 1996 Note, the 1997 Business
Manager Line and the 1998 Note are hereinafter sometimes collectively referred to as the "Darcom
Mr. Steven M. Dardick, Chief Executive Officer
September 3, 1999
Page 3
Loan Documents." In addition, Thomas Dardick, Kathleen Vickroy, David Scott Dardick, Janet
Russavage a/k/a Janet Dardick, Steven Dardick, Necia Dardick and Dardick Technical Services, Inc.
are sometimes hereinafter collectively referred to as the "Guarantors."
Due to Darcom's failure to make timely payments to Bank and to otherwise comply with its
obligations under the Darcom Loan Documents, Darcom is in defau',: under the Darcom Loan
Documents. Due to Darcom's defaults under the Darcom Loan Documents and Darcom's failure
to remedy such defaults, the Bank hereby declares the entire Darcom Indebtedness to be immediately
due and payable, as authorized under the Darcom Loan Documents. (Even absent a default, the 1996
Note is a demand obligation and Bank hereby demands full payment thereof, and the 1998 Note has
already matured and is past-due). As set forth above, as of August 18, 1999, the aggregate Darcom
indebtedness is $1,059,085.29, exclusive of attorneys' fees and other amounts which may be
recoverable by Bank upon a default by Darcom under the Darcom Loan Documents. As a result of
Darcom's continuing defaults under the Darcom Loan Documents, the Bank hereby demands that
Darcom pay to Bank the sum of $1,059,085.29 within ten (10) days from the date of this letter. If
Darcom fails to pay said sum within ten (10) days, the Bank intends to pursue its available legal
rights and remedies against Darcom, including entering judgment by confession and exercising its
rights as a secured parry.
In addition to Darcom being in default under the Darcom Loan Documents, the Guarantors
are also presently in default under their obligations to the Bank for having failed to tender payment
to the Bank pursuant to their respective guaranty agreements. In particular, Dardick Technical
Services, Inc. is obligated to the Bank for all of Darcom's obligations under the 1996 Note. David
Scott Dardick, as a guarantor under the 1996 Note, the 1997 Business Manager Line and the 1998
Note, is personally obligated to Bank for the entire Darcom Indebtedness. Janet Dardick is
personally obligated to Bank for all of Darcom's obligations under the 1996 Note and the 1998 Note.
Thomas Dardick is personally obligated to the Bank as a guarantor of the 1997 Business Manager
Line and the 1998 Note. Kathleen Vickroy is personally obligated to the Bank as a guarantor of the
1998 Note. Steven Dardick is personally obligated to the Bank as a guarantor of the 1997 Business
Manager Line and the 1998 Note. Necia Dardick is personally obligated to the Bank as a guarantor
of the 1998 Note. -
As the aforementioned Guarantors are presently in default of their obligations to the Bank
as guarantors of certain of the Darcom Indebtedness, the Bank hereby demands that the Guarantors
make full payment to Bank under their obligations set forth in the respective guaranty agreements
within ten (10) days from the date of this letter. By copy of this letter, the respective Guarantors are
receiving proper notice from Bank under the Darcom Loan Documents. If Darcom and the
Guarantors fail to make the necessary payments to Bank within ten (10) days, the Bank intends to
also exercise its rights against the Guarantors, including its right to enter judgments by confession,
as well as its rights under the respective mortgage documents executed by some of the Guarantors.
Mr. Steven M. Dardick, Chief Executive Officer
September 3, 1999
Page 4
It is important that Darcom and the Guarantors take immediate action in response to this
letter. The Bank can no longer sit idly by and allow the indebtedness to increase. As you are aware,
the largest component of the Darcom Indebtedness is the 1997 Business Manager Line. Based on
your letter of August 26, 1999 to the Bank, it appears as though the majority of outstanding
receivables will not be collected. Naturally, this causes great concern from the Bank's perspective.
Assuming that Darcom and/or the Guarantors do not make payment to the Bank as demanded above,
the Bank is left with no choice but to aggressively pursue collection of the loans from Darcom and
the Guarantors by exercising its available legal rights and remedies under the loan documentation.
So that we may work together in attempt to recover payment on as many receivables as
possible and so that the Bank has a better understanding of Darcom's present situation, within ten
(10) days from the date of this letter, you must provide the Bank with the following information:
¦ copies of the underlying sales contracts that Darcom executed with its larger account
debtors;
¦ the status, quantity, estimated value and location of all of the Bank's collateral;
¦ the status of any efforts Darcom or the Guarantors are making to pay the debts owed
to the Bank; and
¦ the status of Darcom's indebtedness to Dynatech and Dynatech's present
involvement with Darcom, including the lease of the New Hampshire premises.
If you have any questions or comments regarding anything stated above, please contact Jack
Hutchison or the undersigned. Also, if Darcom and/or the Guarantors are represented by legal
counsel regarding this matter, please have your counsel contact Mike Doctrow at (717) 237-5311
or the undersigned at (717) 237-5410.
Very truly yours,
McNEES, WALLACE & NURICK
_ By
Chad F. Phipps
cc: Dardick Technical Services, Inc.
David Scott Dardick and Janet M. Russavage wk/a Janet M. Dardick
Thomas M. Dardick and Kathleen Vickroy
Steven M. and Necia Dardick
Jack V. Hutchison
ioc: Michael A. Doctrow, Esq.
KEYSTONE FINANCIAL BANK, N.A. : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA : CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY :
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
NO.
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants : CIVIL ACTION -LAW
NOTICE OF JUDGMENT
TO: Thomas M. Dardick
6 Shaker PL.
Nashua, New Hampshire 03063
YOU ARE HEREBY NOTIFIED that on {. , 1999, a judgmcnt by
confession of judgment was entered against you in the above matter in the amount of
$797,680.66, together with accruing daily interest, additional late charges, attorneys' fees and
costs.
Date: lb J ` ??
?Pnthonotary U
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE
OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP.
Cumberland County Lawyer Referral Service
Court Administrator
Cumberland County Courthouse
Carlisle, Pennsylvania 17013
(717) 240-6200
We hereby certify that the following is the address of the Defendant stated in the
certificate of residence:
Thomas M. Dardick
6 Shaker PL,
Nashua, New Hampshire 03063
Respectfully submitted,
McNEES, WALLACE & NURICK
By i^
Michael row
Attorney I.D. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
P. 0. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717) 232-8000
Attorneys for Keystone Financial Bank, N.A.,
successor by merger to Pennsylvania National Bank
& Trust Company and Financial Trust Company
Date: October 4, 1999
KEYSTONE FINANCIAL BANK, N.A. : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA : CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
NO.
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants CIVIL ACTION -LAW
TO: Kathleen A. Vickroy
6 Shaker PL.
Nashua, New Hampshire 03063
YOU ARE HEREBY NOTIFIED that on r , 1999, a judgment by
confession of judgment was entered against you in the above matter in the amount of
$215,366.08, together with accruing daily interest, additional late charges, attorneys' fees and
costs.
Date: l? Jr- ?1
C
P Konotary
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE
OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP.
Cumberland County Lawyer Referral Service
Court Administrator
Cumberland County Courthouse
Carlisle, Pennsylvania 17013
(717) 240-6200
We hereby certify that the following is the address of the Defendant stated in the
certificate of residence:
Kathleen A. Vickroy
6 Shaker PL.
Nashua, New Hampshire 03063
Respectfully submitted,
McNEES, WALLACE & NURICK
By
Michael A. Doc row
Attorney I.D. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
P. O. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717)232.8000
Attorneys for Keystone Financial Bank, N.A.,
successor by merger to Pennsylvania National Bank
& Trust Company and Financial Trust Company
Date: October 4, 1999
0
KEYSTONE FINANCIAL BANK, N.A., : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA : CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY :
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
NO, 99-6116
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants CIVIL ACTION - LAW
NOTICE UNDER RULE 2958.1 OF JUDGMENT
THER_F.ON AND EXECUTION
NOTICE OF DEFENDANT'S RIGHTS
TO: Thomas M. Dardick
6 Shaker PL.
Nashua, New Hampshire 03063
Ajudgment in the amount of $797,680.66 has been entered against you and in favor of
the plaintiff without any prior notice or hearing based on confession ofjudgment provisions
contained in written agreements or other paper allegedly signed by you. The sheriff may take
your money or other property to pay the judgment at any time after thirty (30) days after the date
on which this notice is served on you.
You may have legal rights to defeat the judgment or to prevent your money or property
from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE
JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE
DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR
RIGHTS.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER OR CANNOT AFFORD ONE. GO TO OR TELEPHONE THE
1 ar
OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP: if$
Cumberland County Lawyer Referral Service
Court Administrator
Cumberland County Courthouse
Carlisle, Pennsylvania 17013
(717) 240-6200
Respectfully submitted,
McNEES, WA"LLACE & NURICK g
By
Michael A. Doctrow
Attorney LD. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
P. O. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717) 232-8000
Attorneys for Keystone Financial Bank, N.A.,
successor by merger to Pennsylvania National Bank
& Trust Company and Financial Trust Company
Date: October 27, 1999
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KEYSTONE FINANCIAL BANK, N.A., : IN THE COURT OF COMMON PLEAS
successor by merger to PENNSYLVANIA : CUMBERLAND COUNTY, PENNSYLVANIA
NATIONAL BANK & TRUST COMPANY :
and FINANCIAL TRUST COMPANY,
Plaintiff
V.
NO. 99-6116
THOMAS M. DARDICK and
KATHLEEN A. VICKROY,
Defendants CIVIL ACTION - LAW
NOTICE UNDER RULE 2958.1 OF JUDGMENT
THEREON AND EXECU
NOTICE OF DEFENDANT'S RIGHTS
TO: Kathleen A. Vickroy
6 Shaker PL.
Nashua, New Hampshire 03063
A judgment in the amount of $215,366.08 has been entered against you and in favor of
the plaintiff without any prior notice or hearing based on a confession of judgment contained in a
written agreement or other paper allegedly signed by you. The sheriff may take your money or
other property to pay the judgment at any time after thirty (30) days after the date on which this
notice is served on you.
You may have legal rights to defeat the judgment or to prevent your money or property
from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE
JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE
DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR
RIGHTS.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE
1.-
OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP:
Cumberland County Lawyer Referral Service
Court Administrator
Cumberland County Courthouse
Carlisle, Pennsylvania 17013
(717) 240-6200
Respectfully submitted,
McNEES, WALLACE & NURICK
By EGVW
Michael A. Doctrow
Attorney I.D. No. 36805
Chad F. Phipps
Attorney I.D. No. 78055
P. 0. Box 1166
100 Pine Street
Harrisburg, Pennsylvania 17108-1166
(717) 232-8000
Attorneys for Keystone Financial Bank, N.A.,
successor by merger to Pennsylvania National Bank
& Trust Company and Financial Trust Company
Date: October 27, 1999
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