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BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
Attorneys for Plaintiff
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to N0. ?_ ?II?C. Ctvi) -Ferm
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs. CIVIL ACTION - LAW
WAYNE M. PECHT,
Defendant CONFESSION OF JUDGMENT
CONFESSION OF JUDGMENT
I appear for the Defendant, Wayne M. Pecht, pursuant to the
authority contained in a Commercial Guaranty agreement, dated
January 29, 1999, and Disclosure of Confession of Judgment
thereto, executed by the Defendant, Wayne M. Pecht, in favor of
the Plaintiff, a true and correct copy of which is attached as
Exhibit "B" to the Complaint filed in this action, and confess
judgment in favor of the Plaintiff and against the Defendant as
follows:
Principal Balance: $298,000.00
Interest through 10/10/2007 at
the per diem rate of $68.29 $ 27,589.81
Late Charges through 10/10/07 $ 1,143.84
Legal Fees (10%) $ 29,800.00
TOTAL: $356,533.65
Together with interest at the contract rate (currently $68.29 per
diem) from October 11, 2007 forward, and for all additional late
charges, attorney's fees and costs of suit.
BINGAMAN, HESS, C ENTZ & BELL, P.C.
By.
Kurt Alt use, Esquire
Attorneys for States Resources Corp.
282428
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
Attorneys for Plaintiff
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs.
WAYNE M. PECHT,
Defendant
NO.
CIVIL ACTION - LAW
CONFESSION OF JUDGMENT
COMPLAINT IN CONFESSION OF JUDGMENT
1. The Plaintiff, States Resources Corp., maintains an
office at 4848 South 131St Street, Omaha, NE 68137 ("States").
2. The Defendant, Wayne M. Pecht, is an adult individual,
maintaining an address at 35 High Ridge Trail, Mechanicsburg, PA
17055.
3. On or about January 29, 1999, National Health Systems,
Inc. ("Borrower") executed and delivered to Harris Savings Bank, a
Promissory Note in the original principal amount of $400,000.00,
(the "Note"). A true and correct copy of the Note is attached
hereto as Exhibit "A" and is incorporated herein by reference.
4. To secure the Note, on or about January 29, 1999, the
Defendant executed and delivered to Harris Savings Bank his
Commercial Guaranty and Disclosure for Confession of Judgment
(collectively, the "Guaranty"), whereby he authorized Plaintiff to
enter judgment by confession in the event of default under the
Note. A true and correct copy of the Guaranty is attached hereto
as Exhibit "B" and is incorporated herein by reference.
5. Sovereign Bank, successor by merger to Harris Savings
Bank, assigned said Note to States by instrument dated June 29,
2007, a true and correct copy of which is included in Exhibit "A".
States has not assigned the Note and is the holder thereof.
6. Judgment has not heretofore been entered on the Note or
Guaranty in any jurisdiction.
7. The Borrower has defaulted in its obligations under the
Note by virtue of its failure to make payments when due on demand.
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A true and correct copy of the Notice of Demand served on
Borrower and Defendant is attached hereto as Exhibit "C" and
incorporated herein by reference. The Defendant has defaulted in
his obligations under the Guaranty by virtue of his failure to
make payments when due. The Guaranty permits entry of judgment by
confession against the Defendant at this time. The Guaranty
provides for attorney's fees of 10% of the principal balance due.
8. Judgment is not being entered by confession against a
natural person in connection with a consumer transaction in that
the debt evidenced by the Note is for commercial purposes.
9. The Defendant is liable to the Plaintiff under the
Guaranty as follows:
Principal Balance: $298,000.00
Interest through 10/10/2007 at
the per diem rate of $68.29 $ 27,589.81
Late Charges through 10/10/07 $ 1,143.84
Legal Fees (10%)
TOTAL:
29,800.00
$356,533.65
Together with interest at the contract rate (currently $68.29 per
diem) from October 11, 2007 forward, and for all additional late
charges, attorney's fees and costs of suit.
WHEREFORE, the Plaintiff demands judgment against the
Defendant, Wayne M. Pecht, in the total amount of $327,733.65
together with interest at the contract rate (currently $68.29 per
diem) from October 11, 2007 forward, all additional late charges,
attorneys' fees, and costs of this action.
BINGAMAN, HESS, C BLENTZ & BELL, P.C.
By : ??
Kurt Alt ous , Esquire
Attorneys for States Resources Corp.
Date: (V t ks-'Q7
282428
EXHIBIT "A"
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? F12 HARRIS86
SAVINGS BANK
PROMISSORY NOTE
e erences in the shaded area are for Lender's use only and do not limit the a licabili of this document to an ular loan or item.
Borrower: National Health Systems, Inc. (TIN: 25-1575431) Lender: Harris Savings Bank
1104 Femwood Drive 234 N. Second Street
Camp Hill, PA 17011 P 0 Box 1711
Harrisburg, PA 17105
Principal Amount: $400,000.00 Initial Rate: 7.750% Date of Note: January 29, 1999
PROMISE TO PAY. National Health Systems, Inc. ("Borrower") promises 10 pay to Harris Savings Banc ("Lender), or order, In lawful money of
the United States of America, on demand, the principal amount of Four Hundred Thousand a 001100 Dollars ($400,000.00) or so much as may
be outstanding, together with Interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date
of each advance until repayment of each advance.
PAYMENT. Borrower will pay this loan Immediately upon Lender's demand. In addition
Borrower wN monthly
accrued unpaid interest due as of each payment date, beginning March 1, 1999, with all subsequent Pat payment to be payments of all
nn the same
day of each month after that. The annual Interest rate for this Note is computed on a 365/360 basis that IInterest t? nf ratio tbf due
rate over a year of 360 days, multiplied by, the outstandin Y aPPNof the of the annual interest
outstanding. Borrower will pay Lender at Lener's address shown bp ove oratsuch other plates the as Len teem may of days the principal otherwise
balance
agreed or required by applicable law, payments will be applied first to accrued unpaid interest, then to princiipae d any reme ning amount oyany
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
Prime Rate (the "Index"). 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 Borrowees
I 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 7,750% per annum. The Interest rate to be applied to the unpaid principal balance of this Note will be at a
equal to the Index, resulting in an initial rate of 7.75076 per annum. NOTICE: Under no circumstances will the interest rate on this Note be
more than the maximum rate 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 of accrued unpaid interest. Rather, they will reduce the
principal balance due.
LATE CHARGE If a regularly scheduled interest payment is 15 days or more late, Borrower will be charged payment or $10.00, whichever Is greater. If Lender demands
loan an rithin IS scheduled
payment of this loan, and Borrower does not 5. pay the of
Lender's demand Borrower also will be charged wlt 5 days abler
whichever Is greater. either 5.000% of the sum of the unpaid principal plus accrued unpaid Interest totereal or S10.00,
LENDER'S RIGHTS. Lender may hire or pay someone ease to help collect this Note N Borrower does not pay. Borrower also will pay Lender that
amount. This includes, subject to any limits under applicable law, Lender's attorneys' fees and Lender's legal expenses whether or not there is a
lawsuit, including attorneys' fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or Injunction),
appeals, and any anticipated post--judgment collection services. If not prohibited by applicable law, Borrower also wall pay any court costs, in addition
to all other sums provided by law. If 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
Co him n weunth of P nn mvann ia. It of hem Is a lawsuit, t, Borrow crida rBorrower evs up hereby hr's request to submit to the Jurisdiction of the courts of Pennsylv or counterclaim brought by either Lender or Borrower waive the right to any jury trod In any carer, proceeding,
the laws of the Commonwealth of Pennsylvania. against the other. This Note shill be governed by and construed In accordance with
RIGHT OF SETOFF. Borrower grants to Lender a contractual security interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to, Borrower's accounts with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone also 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 security interest would be prohibited by law. Borrower authorizes Lender, 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.
LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this Note may be requested orally by Borrower or by an authorized
person. Lender may, but nosed not, require that all oral requests be confirmed in writing. All communications, instructions, or directions by telephone or
otherwise to Lender are to be directed to Lender's office shown above. The following party or parties are authorized to request advances under the line
of credit until Lender receives from Borrower at Lender's address shown above written notice of revocation of their authority: Wayne M. Pecht,
Preaident; and Bruce E. Seagrist, Secretary. Borrower agrees to be liable for all sums either: (a) advanced in accordance with the Instructions of an
authorized person or (b) credited to any of Borrower's accounts with Lender. The unpaid principal balance owing on this Note at any lime may be
evidenced by endorsements on this Note or by Lender's internal records, including daily computer print-outs. Lender will have no obligation to
advance funds under this Note if: (a) Borrower or any guarantor is in default under the terms of this Note or any agreement that Borrower or any
guarantor has with Lender, including any agreement made in connection with the signing of this Note; (b) Borrower or any guarantor ceases doing
business or is insolvent; (c) any guarantor seeks, claims or otherwise attempts to limit, modify or revoke such guarantor's guarantee of this Note or any
other loan with Lender; (d) Borrower has applied funds provided pursuant to this Note for purposes other than those authorized by Lender, or (e)
Lender in good faith deems itself insecure under this Note or any other agreement between Lender and Borrower.
ANNUAL PAYOUT/ANNUAL REVIEW. The Note is subject to a 30-day payout during each fiscal year at which time the balance-must be paid in full for
a period of thirty (30) consecutive days. The Loan commitment will expire on December 31, 1999. The Lender will review, the Loan annually for
renewals and extensions; such renewals and extensions to be granted predicated on the performance of the company and/or Individuals and
adherence to the Loan Agreement and/or loan policy.
01-29-1999 PROMISSORY NOTE Page 2
Loan No 8877000682 (Continued)
SECURITY. AN eolialeral (as herein defined) Is security for this Note and any renewals, extensions and modifications thereof, and the payment,
performance and discharge of all other present or future Indebtedness, obligations and undertakings (whether individual, joint, several, direct,
contingent or otherwise) of the Borrower to or for the benefit of Lender, whether arising directly to tender under this Note or under any other
agreement, promissory note or undertakings now existing or hereinafter entered into by Borrower to Lender. The term "Collateral" includes all tangible
and Intangible property (1) described in any mortgage, assignment or any other security document separately executed by the Borrower In favor of
Lender, and (ti) in which Borrower has granted a security Interest to Lender pursuant to this Note.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or 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 terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker,
guarantor, accommodation maker or endorser, shall be released from liability. AN such parties agree that Lender may renew or extend (repeatedly and
for any length of time) this loan, or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender's security Interest In the
collateral; and take any other action deemed necessary by Lender without the consent of or notice to anyone. All such parties also agree that Lender
may modify this loan without the consent of or notice to anyone other than the party with whom the modification Is made. N 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 ($500) ON WHICH
JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR $O 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 BORROWERS 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.
BORROWER:
National HIMM System inc.
_
By.
W" P. Poch t
LENDER:
Hams Sevin Batik
By:
Augrorized Officer
.......... .................................................................
Bruce E. SeagAsl, tie ary
VarlableRate. Line of Credit. LASER PRO, Reg. U.S. Pat. 6 T.M. Off., Ver. 3.26a (e)11r6fi CFI ProServices, Inc. All rights reserved. IPA-D20 F3.26 NATIONAL.LN C1.OVLI
Is 0
Allonge
Pay to the order of States Resources Corp. without recourse, representations or
warranties of any kind.
Executed as of this 29`x' day of June 2007.
Sovereign Bank
By: athleen cC y
Its: ice President
DROSURE FOR CONFESSION OF JUDGNOIT
References in the shaded area are for Lender's use only and do not limit the applicability of this document to any particular loan or item
Borrower: National Health Systems, Inc. Lender: Harris Savings Bank
1104 Fernwood Dr. 234 N. Second Street
Camp Hill, Pa. 17011 P.O. Box 1711
Harrisburg, PA 17105
DISCLOSURE FOR CONFESSION OF JUDGMENT
THE UNDERSIGNED IS EXECUTING, THIS TWENTY NINETH DAY OF JANUARY, 1999, A PROMISSORY NOTE FOR 5400,000.00
OBLIGATING THE BORROWER TO REPAY THAT AMOUNT.
A I UNDERSTAND THAT THE NOTE CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO
ENTER JUDGMENT AGAINST THE CORPORATION IN COURT, AFTER A DEFAULT ON THE NOTE, WITHOUT ADVANCE NOTICE
TO THE CORPORATION AND WITHOUT OFFERING THE CORPORATION AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY
OF JUDGMENT. IN EXECUTING THE NOTE, BEING FULLY AWARE OF THE CORPORATION'S RIGHTS TO ADVANCE NOTICE
AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS THAT LENDER MAY ASSERT
AGAINST THE CORPORATION UNDER THE NOTE, I, IN BEHALF OF THE CORPORATION, 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 JUDGMENT AGAINST THE CORPORATION BY
CONFESSI N AS OVIDED FOR IN THE CONFESSION OF JUDGMENT PROVISION.
INITIALS: 1 . W
B. I FURTHER UNDERSTAND THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST THE
CORPORATION WITHOUT ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE NOTE
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 OTHER WISE SEIZING THE
CORPORATION'S PROPERTY, IN FULL OR PARTIAL PAYMENT OF THE JUDGMENT. HOWEVER, LENDER MUST PROVIDE
NOTICE TO THE CORPORATION UNDER APPLICABLE LAW IN EXECUTING ANY CONFESSED JUDGMENT. IN EXECUTING THE
NOTE, 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 LENDS S CU nNG ON THE JUDGMENT, IN ANY MANNER PERMITTED BY
APPLICABLE STATE AND FEDERAL LAW. INITIALS: . W116
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 NOTE.
W 2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE
NOTE TO MY ATTENTION.
D. I CERTIFY THAT THE CORPORATION'S ANNUAL INCOME EXCEEDS $10,000.00; THAT THE BLANKS IN THIS DISCLOSURE
WERE FILLED IN WHEN I INITIALED AND SIGNED IT; AND THAT I RECEIVED A COPY AT THE TIME OF SIGNING.
THIS DISCLOSURE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
AFFIANT:
By
Wayne . Pecht, President
Hy.
Bruce E. Seagrist, Secretary
EXHIBIT "B"
282428
ff COMMERCIAL GUARANTIO
^T'•^ k ? RvvRa"a{i? ? nrviaf4a !?J VQ1f 4V11fI(6i1R1 'R4'(i[7gi#k {,,1???.. .... ?[??I$
References in the shaded area are for Lender's use only and do not limit the applicability of this document to any particular loan or item
Borrower: National Health Systems, Inc. (TIN: 25-1575431) Lender: Harris Savings Bank
1104 Fernwood Drive 234 N. Second Street
Camp Hill, PA 17011 P O Box 1711
Harrisburg, PA 17105
Guarantor: Wayne M. Pecht
35 High Ridge Trail
Mechanicsburg, PA 17055
ALWXW OF GUARANTY. The amount of this Guaranty Is Unlimited.
CONTINUING UNLIMITED GUARANTY. For good and valuable consideration, Wayne M. Pecht ("Guarantor") absolutely and unconditionally
guarantees and promises to pay to Harris Savings Banc ("Lender") or Its order, on demand, In legal tender of the United States of America, the
Indebtedness (as that term Is defined below) of National Health Systems, Inc. ("Borrower") to Lender on the terms and conditions set forth in
this Guaranty. Under this Guaranty, the Mobility of Guarantor is unlimited and the obligations of Guarantor are continuing.
DEFINITIONS. The following words shag have the following meanings when used in this Guaranty:
Borrower. The word "Borrower" means National Health Systems, Inc..
Guarantor. The word "Guarantor" means Wayne M. Pecht.
Guaranty. The word "Guaranty" means this Guaranty made by Guarantor for the benefit of Lender dated January 29, 1999.
Indebtedness. The word "Indebtedness" is used in its most comprehensive sense and means and includes any and all of Borrower's liabilities,
obligations, debts, and indebtedness to Lender, now existing or hereinafter incurred or created, including, without limitation, all loans, advances,
interest, costs, debts, overdraft Indebtedness, credit card indebtedness, lease obligations, other obligations, and liabilities of Borrower, or any of
them, and any present or future judgments against Borrower, or any of them; and whether any such Indebtedness is voluntarily or involuntarily
incurred, due or not due, absolute or contingent, liquidated or ungquidated, determined or undetermined; whether Borrower may be liable
individually or jointly with others, or primarily or secondarily, or as guarantor or surety; whether recovery on the Indebtedness may be or may
become barred or unenforceable against Borrower for any reason whatsoever; and whether the Indebtedness arises from transactions which may
be voidable on account of infancy, insanity, ultra vires, or otherwise.
Lender. The word lender" means Harris Savings Bank, its successors and assigns.
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.
NATURE OF GUARANTY. Guarantor's liability under this Guaranty shag be open and continuous for so long as this Guaranty remains in force.
Guarantor intends to guarantee at all times the performance and prompt payment when due, whether at maturity or earlier by reason of acceleration or
otherwise, of all Indebtedness. Accordingly, no payments made upon the Indebtedness will discharge or diminish the continuing liability of Guarantor
in connection with any remaining portions of the Indebtedness or any of the Indebtedness which subsequently arises or is thereafter incurred or
contracted.
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 incurred or contracted before receipt by Lender of any notice of
revocation shall have been fully and finally paid and satisfied and all other obligations of Guarantor under this Guaranty shag have been performed in
full. If Guarantor elects to revoke this Guaranty, Guarantor may only do so in writing. Guarantors written notice of revocation must be mailed to
Lender, by certified mail, at the address of Lender listed above or such other place as Lender may designate in writing. Written revocation of this
Guaranty will apply only to advances or new Indebtedness created after actual receipt by Lender of Guarantors written revocation. For this purpose
and without limitation, the term "new Indebtedness" does not include Indebtedness which at the time of notice of revocation is contingent, unliguldated,
undetermined or not due and which later becomes absolute, liquidated, determined or due. This Guaranty will continue to bind Guarantor for all
Indebtedness incurred by Borrower or committed by Lender prior to receipt of Guarantors written notice of revocation, including any extensions,
renewals, substitutions or modifications of the Indebtedness. All renewals, extensions, substitutions, and modifications of the Indebtedness granted
after Guarantors revocation, are contemplated under this Guaranty and, specifically will not be considered to be new Indebtedness. This Guaranty
shall bind the estate of Guarantor as to Indebtedness created both before and after the death or incapacity of Guarantor, regardless of Lenders actual
notice of Guarantors death. Subject to the foregoing, Guarantors executor or administrator or other legal representative may terminate this Guaranty in
the same manner in which Guarantor might have terminated it and with the same effect. Release of any other guarantor or termination of any other
guaranty of the Indebtedness shall riot affect 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. It Is anticipated that Muctuallm may occur in the
aggregate amount of Indebtedness covered by this Guaranty, and It Is specifically admowledged and agreed by Guarantor that reductions M
the amount of Indebtedness, even to zero dollars ($0.00), prior to written revocation of this Guaranty by Guarantor shall not constitute a
termination of this Guaranty. This Guaranty Is binding upon Guarantor and Guarantor's heirs, successors and assigns so long as any of the
guaranteed Indebtedness remains unpaid and even though the Indebtedness guaranteed may from time to time be zero dollars (SOAO).
GUARANTOR'S AUTHORIZATION TO LENDER. Guarantor authorizes Lender, either before or after any revocation hereof, without notice or
demand and without lessening Guarantor's Iiability under this Guaranty, from time to time: (a) prior to revocation as set forth above, 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 otherwise 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 repeated and may be for longer than the original loan term; (c) to take and hold security for the payment of
this Guaranty or the indebtedness, and exchange, enforce, waive, subordinate, fail or decide not to perfect, and release 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; (e) to determine how, when and what application
of payments and credits shall be made on the Indebtedness; (f) to apply such security and direct the order or manner of sale thereof,
including without limitation, any nonjudicial 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 participatkms In all or any part of the Indebtedness; and (h) to assign or
transfer this Guaranty in whole or in part.
01-29-1999 COMMERCIAL GUARANTY Page 2
Loan No 8877000682 (Continued)
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 qualify 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 Guaranty do not conflict with or result in a default 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, 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 affect 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 thte creditworthiness of
Borrower, and (j) 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 risks under this 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 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 part of Borrower, Lender, any surety, endorser,
or other guarantor in connection with the Indebtedness or in connection with the creation of new or additional loans or obligations; (c) to 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 notice of the terms, time, and place of 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 remedy 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.
Guarantor also waives any and all rights or defenses arising by reason of (a) any "one action" or "anti-deficiency" law or any other law which may
prevent Lender from bringing any action, including a claim for deficiency, against Guarantor, before or after tender'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 fimitation, 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 tender, 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 is outstanding
Indebtedness of Borrower to Lender which is not barred by any applicable statute of limitations; or (n any defenses given to guarantors at 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, 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 full knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary to
public policy or law. If any such waiver is determined to be contrary to any applicable 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 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 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 exercised
without demand upon or notice to Guarantor. No security interest or right of setoff shall be deemed 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 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.
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 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 full payment in legal
tender 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 GuaraInty:
Amendments. This Guaranty, together with any Related Documents, constitutes the entire Wnderstanding and agreement of the parties as to the
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 delivered to Lender and accepted by Lender in mmonwealth of Pennsylvania. If there is a
lawsuit, Guarantor agrPPs upon Lende '!est to submit to the jurisdiction of the courts o hin County, Commonwealth of Pennsylvania.
01-29-1999 COMMERCIAL GUARANTY
Loan No 8877000682 T (Continued) •
Page 3
Lender and Guarantor hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Guarantor
against the other. 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 help enforce this Guaranty, and
Guarantor shall pay the costs and expenses of such enforcement. Costs and expenses include Lender's attorneys' 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
vacate any automatic 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 either party to the other under this Guaranty shall be in writing, may be sent by telefacsimile (unless
otherwise required by law), and, except for revocation notices by Guarantor, shall 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 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. All
revocation notices by Guarantor shall be in writing and shall be effective only upon delivery to Lender as provided above in the section titled
"DURATION OF GUARANTY" 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 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 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 right 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 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 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 cases 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 (3500) 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
j 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 JANUARY 29,1999.
THIS GUARANTY HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
G T R:
X
":;)
Wayne ht
LASER PRO, Reg. U.S. Pat. 8 T.M. Off., Ver. 3.29a (c) 1999 CFI ProServlCee, Inc. All rights reserved. IPA-E20 NATIONAL.LN C1.OVLI
DISCLOORE FOR CONFESSION OFQDGMENT
# r cipai t crert Adis IVtoto ity t.van 1 1 Cats Co ref tccvunt iflti sv' i
1?,flD >tf1=?9-989 $877Ut>?6$? 4A? 6r?p ?
References in the shaded area are for Lender's use only and do not limit the applicability of this document to any particular loan or item
Borrower: National Health Systems, Inc. (TIN: 25-1575431) Lender: Harris Savings Bank
1104 Fernwood Drive 234 N. Second Street
Camp Hill, PA 17011 P O Box 1711
Harrisburg, PA 17105
Guarantor: Wayne M. Pecht
35 High Ridge Trail
Mechanicsburg, PA 17055
DISCLOSURE FOR CONFESSION OF JUDGMENT
I AM EXECUTING, THIS p DAY OF V (? 11 UA r'L. 19111 A GUARANTY FOR AN UNLIMTED AMOUNT.
A. 1 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, 1 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 ENTERIMENT AGAINST ME BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT
PROVISION. INITIALS:::`
9. 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, 1 AM KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE
RIGHTS, AND 1 EXPRESSLY AGREE AND CONSENT T R'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.
W Wig 2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE
GUARANTY TO MY ATTENTION.
D. 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 1 RECEIVED A COPY AT THE TIME OF SIGNING.
THIS DISCLOSURE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
AFFIANT:
X s< .
.................................................................:::....
SEAL
Ways . Pecht
LASER PRO, Reg. U.S. Pat. & T.M. Off., Ver. 3.26a (c) 1999 CFI ProServices, Inc. All rights reserved. IPA-D30 F3.26 NATIONAL.LN C1.OVLI
EXHIBIT "C"
282428
Certified Article Number
7160 3901 9849 7511 5383
SENDERS RECORD -
NCAMAH HESS
DAVID E TURNER ATTORNEYS AT LAW
MARK G. YODER
KURT ALTHOUSE
LYNNE K. BEUST
HARRY D. McMUNIGAL
PATRICK T. BARRETT
ERIC J. FABRIZIO
ELIZABETH D. McMUNIGAL
MAHLON J. BOYER
THOMAS A. ROTHERMEL'
'Also admitted in NJ
Treeview Corporate Center
Suite 100.2 Meridian Boulevard
Wyomissing, PA 19610
610.374.8377
Fax 610.376.3105
www.bheb.com
October 10, 2007
VIA FIRST CLASS MAIL and
CERTIFIED MAIL; RETURN RECEIPT REQUESTED
Mr. Wayne M. Pecht
35 High Ridge Trl
Mechanicsburg, PA 17050-1513
Re: Loan Obligations due States Resources Corp.
Our File No.: 99095-77
Dear Mr. Pecht:
NOTICE
LLEWELLYN R. BINGAMAN
1907-1996
RAYMOND K. HESS
1919-2005
J. WENDELL COBLENTZ
1911-2003
JAMES F. BELL
1921-1988
This office represents States Resources Corp. with respect to the above-
referenced loan relationship. This letter is a demand for payment of the commercial
loan obtained from Harris Savings Bank, now due States Resources Corp., Assignee of
Sovereign Bank, successor by Merger to Harris Saving Bank. Payment in full of these
loans was guaranteed by you under and pursuant to the terms of the Commercial
Guaranty dated January 29, 1999. For convenience of reference, hereinafter you will
be referred to as the "Guarantor". Your attention is drawn to the following:
Loan Documents
A Promissory Note dated January 29, 1999, executed and delivered by National
Health System, Inc. in the original principal amount of $400,000.00, evidencing a term
loan, executed and delivered by the Borrower to Harris Savings Bank. The Note was
assigned by Sovereign Bank, successor by merger to Harris Savings Bank. For the
sake of convenience of reference the note shall be described herein as the "Note".
282328
ft"i ,f-
E r?
G. CHRISTOPHER EVES
'EEN;A.B.KOVACH
,OF COUNSEL
RALPH ALTHOUSE, JR.
RETIRED
October 10, 2007
Page 2
States has accelerated the balance due and demanded payment in full. States
hereby demands payment in full of the Note and all obligations due thereunder under
the Guaranty. The obligations due States under the Note are as follows:
Principal: $298,000.00
Interest to 10/10/2007: $ 27,589.81
Late Charges $ 1,143.84
Legal Fees to date $ 1,000.00
TOTAL: $327,733.65
Interest accrues at the t rate of 8.25%, which is $68.29 per diem. Costs and
expenses incurred by States will be added to this account.
In addition, the Borrower is responsible for payment of the costs and expenses
incurred by the Bank in connection with the collection of these delinquent commercial
loan obligations. Costs and expenses incurred by States will be charged to this
account.
Demand for Payment.
Please allow this letter to serve as States' formal demand for immediate payment
in full of the commercial loan obligations more fully set forth above. Payment in full is
due immediately.
The Note, together with the Commercial Guaranty, provide that a default under
any obligation of payment or performance constitutes a default under all such
instruments of obligations of payment or performance to States. By your Commercial
Guaranty executed and delivered to the Bank you have guarantied payment in full of the
obligations of Borrower under the foregoing Note.
In addition, please be advised that States does not now, and in the future will not,
agree to waive this notice of demand or any of its rights or remedies with respect to the
collection of these delinquent commercial loan obligations except as may be set forth in
a written agreement which must be satisfactory in form and content to States and to
States' counsel.
282328
October 10, 2007
Page 3
Please contact the undersigned immediately in order to arrange for payment of
these obligations. States considers itself free to exercise any and all of its rights and
remedies, whether such rights and remedies are set forth in the loan documents or
available under applicable law, without further notice unless required by statute.
Sincerely yours,
BINGAMAN H
Kurt Althouse
KA:chh
cc: Robin Oberg - States Resources Corp.
YF r?
282328
1
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
Attorneys for Plaintiff
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to NO. 01- (0115 Civit--61"
Sovereign Bank, successor by merger to
Harris Savings Bank,
vs.
WAYNE M. PECHT,
Plaintiff :
Defendant
STATE OF NEBRASKA
ss.
COUNTY OF AD
CIVIL ACTION - LAW
CONFESSION OF JUDGMENT
ROBIN OBERG, being duly sworn according to law, deposes and
says that he is a duly authorized officer of States Resources
Corp., Plaintiff herein, and that he is authorized to execute
Affidavits on Plaintiff's behalf, and that the facts set forth on
the foregoing Complaint are true and correct to the best of his
knowledge, information and belief-r _
xotJan'Uber[
States Resources
Sworn to and subscribed before me
this q day of 10C_j0U_LjV 2007.
ayu-n &A-w -
Notary Public
GENERAL NOTARY - State of Nebraska
DONNA BUTLER
My Comm. Ew Sept 24, 2008
262428
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238 Attorneys for Plaintiff
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to NO. 01- (0115 (evil Ter*.
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs. CIVIL ACTION - LAW
WAYNE M. PECHT,
Defendant CONFESSION OF JUDGMENT
CERTIFICATION OF ADDRESSES
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF BERKS
ss.
Kurt Althouse, Esquire, being duly sworn according to law,
deposes and says that to the best of his knowledge, information
and belief, the addresses of the judgment creditor and the
judgment debtors in the above-captioned case are as follows:
Creditor: Debtor:
States Resources Corp. Wayne M. Pecht
4848 South 131St Street 35 High Ridge Trail
Omaha, NE 68137 Mechanicsburg, A 17055
se, Esquire
Sworn to and subscribed before me this D-day of
2007.
Notary Public
CCMMdNyyEALTW OF; PENNSYLVANIA
No#a.rial Seal
Donna L. VJitrr n, Notary Public
Spring UP.. 6erks County
My Commission Expires $ept.12, 2010
Member, PPnnsy1van4 Association of Notaries
282428
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
Attorneys for Plaintiff
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW n
STATES RESOURCES, CORP., assignee to NO. Civiler?1
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
VS. CIVIL ACTION - LAW
WAYNE M. PECHT,
Defendant CONFESSION OF JUDGMENT
AFFIDAVIT OF EARNINGS
ROBIN OBERG, being duly sworn according to law, deposes and
says that he is a duly authorized officer of States Resources
Corp., Plaintiff herein, and that he makes this Affidavit on its
behalf, being authorized to do so, and as such states that to the
best of his knowledge, information and belief, at the time of the
signing of the instrument containing the provision for judgment
by confession, the Defendant ay M. Pecht, earned more than
$10,000.00 per year. F--("\
Robin Oberg
States Resources Ciorp.
Sworn to and subscribed before me this day of
ncsolan , 2 0 0 7 .
Notary Public
GENERAL NOTARY - State 01 Nebraska
DONNA BUTLER
My Comm. Exp. Sept 24.2008
282428
.r
Defendant : CONFESSION OF JUDGMENT
AFFIDAVIT OF COMMERCIAL TRANSACTION
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238 Attorneys for Plaintiff
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW n
STATES RESOURCES, CORP., assignee to NO. p'7- (01155 C?v'l Term
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs. CIVIL ACTION - LAW
WAYNE M. PECHT,
I hereby certify that I am counsel for States Resources
Corp., the Plaintiff herein, and hereby certify that judgment is
not being entered against a natural person in a consumer
transaction.
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: 11 Kza 11-)lk
Kurt A tho se, Esquire
Sw,grn to and subscribed
, 2007.
before me this 1 S day of
Notary Public
COMMONWEALTH OF F'f:.NNSY 'J';4441A
Notarial Seal
Donna L. Witrnan, Notary Puok;
Spring Twp., Berns C,w inty
My Commission E)Oi :Sep,: 12, 2010
Member. PennsNrzr=?a: ?::ja_•s;i•;n.+,,+No;aries
282428
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238 Attorneys for Plaintiff
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to NO. 07- LAS Cjv:t 7w_rw?
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs. CIVIL ACTION - LAW
WAYNE M. PECHT,
Defendant CONFESSION OF JUDGMENT
AFFIDAVIT OF NON-MILITARY SERVICE
STATE OF NEBRASKA
ss.
COUNTY OF (,!
Robin Oberg, being duly sworn according to law, deposes and
says that he is a duly authorized officer of States Resources
Corp., Plaintiff herein, and as such states the following:
1. The Defendant, Wayne M. Pecht, is not in the military
or naval service of the United States or its allies, or otherwise
within the provisions of the Soldiers' and Sailors' Civil Relief
Act of 1940, as amended.
2. The Defendant, Wayne M. Pecht, is more than 21 years of
age and have an address of 35 High Ridge Trail, Mechanicsburg,
PA 17055.
3. He has ascertainpd- the information by personal
investigation and makes t s Affida t th due authority.
Robin ObL?-rg
States Resource Corp.
Sworn to and subscribed before me this day of
Q_? , 2007. can
- GENERAL NOTARY -State of Nebraska dc..w_L-
DONNABUTLER Notary Public
My Comm. Exp. Sept. 24, 2008 ?'
282428
# ? O
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IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PA
CIVIL DIVISION
Date: Ca1!)er Jr/ , 2007
Wayne M. Pecht
35 High Ridge Trail
Mechanicsburg, PA 17055
RE: States Resources Corp., assignee of Sovereign Bank,
successor by merger to Harris Savings Bank vs.
Wayne M. Pecht
No. QT_ Cp115 Cumberland County C . C . P .
Dear Mr. Pecht:
States Resources Corp., assignee of Sovereign Bank,
successor by merger to Harris Savings Bank, has entered judgment
by confession against you in the Court of Common Pleas of
Cumberland County, Pennsylvania, in the total amount of
$356,533.65 plus interest at the contract rate (currently $68.29
per diem) from October 11, 2007 forward and for all additional
late charges, attorney's fees and costs of this proceeding. This
judgment was entered to No. p7_ (011,5 Cumberland County Court
of Common Pleas.
Enclosed please find true and correct copies of the
following documents filed by States Resources Corp. in the
subject action:
1. Complaint in Confession of Judgment;
2. Confession of Judgment;
3. Certification of Addresses;
4. Affidavit of Earnings;
5. Non-Military Affidavit; and
6. Affidavit of Commercial Transaction
Cumberland County Prothonotary
By: &4,:& a
.He?tzty Prothonot rypK8
If you have any questions regarding this Notice,
please contact the filing party:
NAME: Kurt Althouse, Esquire
ADDRESS: Bingaman, Hess, Coblentz & Bell, P.C.
Treeview Corporate Center, Suite 100
2 Meridian Blvd., Wyomissing, PA 19610
TELEPHONE: 610-374-8377
282428
OCT-19-2007 FRI 03:30 PM BINGAMAN HESS FAX NO. 6103745962 P. 03
HINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238 Attorneys for Plaintiff
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL kCTION - LAW
STATES RESOURCES, CORP., assignee to
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs.
WAYNE, M. PECHT,
Defendant
NO. 07-6115 Civil Term
CIVIL ACTION - LAW
CONFESSION OF JUDGMENT
ACCEPTANCE OF SERVICE
1, HERBERT HENDERSON, ESQUIRE, on behalf of Defendant,
Wayne M. Pecht, hereby accept service of Complaint in Confession
of Judgment filed in this action and certify that I am
authorized to do so. The following address is designated as the
place at which notices and papers shall be served:
Herbert Henderson, Esquire
55 West High Street
Elizabethtown, PA 17022
Dated: October 19, 2007
Herbert Henderson, Esquire
Attorney for Defendant
283310
-rs
°
?34
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y
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to
Sovereign Bank, successor by merger to No. 07-6115
Harris Savings Bank,
Plaintiff
VS.
WAYNE M. PECHT,
Defendant
PRAECIPE
Please enter the appearance of Herbert P. Henderson, II, Esquire on behalf of Wayne M.
Pecht in the above captioned matter.
Respectfully Submitted,
By:
Herbert P. Henderson, II, Esq.
55 West High Street
Elizabethtown, PA 17022
(717) 367-2800
I.D. # 56304
'
ty`
ryY f
W
SHERIFF'S RETURN - REGULAR
CASE NO: 2007-06115 P
COMMONWEALTH OF PENNSYLVANIA:
COUNTY OF CUMBERLAND
STATES RESOURCES CORP ET AL
VS
PECHT WAYNE M
SHAWN HARRISON , Sheriff or Deputy Sheriff of
Cumberland County,Pennsylvania, who being duly sworn according to law,
says, the within NOTICE UNDER RULE 2958.1 was served upon
PECHT WAYNE M the
DEFENDANT
at 1625:00 HOURS, on the 27th day of December , 2007
at 35 HIGH RIDGE TRAIL
MECHANICSBURG, PA 17055 by handing to
CARRIE PECHT, WIFE
a true and attested copy of NOTICE UNDER RULE 2958.1
OF JUDGMENT & EXECUTION THEREON
together with
and at the same time directing Her attention to the contents thereof.
Sheriff's Costs:
Docketing 18.00
Service 8.64
Affidavit .00
Surcharge 10.00
00
11D y/4 r(9, 3 6. 6 4
Sworn and Subscibed to
before me this day
So Answers:
r ?
R. Thomas Kline
12/28/2007
BLINGAMAN HES BLE Z
By.
eputy Sheriff
of A. D.
IN THE COURT OF COMMON PLEAS OF CUMBERLAND C O
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to
Sovereign Bank, successor by merger to No. 07-6115
Harris Savings Bank,
Plaintiff
vs.
WAYNE M. PECHT,
Defendant
, PENNSYLVANIA
NOW COMES Petitioner, Wayne M. Pecht, by and thr6uo his counsel, Herbert P.
Henderson, II, Esquire, and respectfully represents the following:
I . Petitioner is the Defendant in the above captioned matter.
2. Respondent is the Plaintiff in the above captioned matter.
3. Judgment was entered against the Petitioner in this Court in this matter on or about
October 22, 2007, pursuant to the purported rights and aluthority to do so as contained
in a Commercial Guaranty Agreement between Petittioner/Defendant and Harris
Savings Bank (hereinafter "The Bank")dated January 29, 1999, which related to a
I
commercial line of credit promissory note. A copy of the Commercial Guaranty
Agreement and Promissory Note was attached to the Co plaint for Confession of
Judgment and was thereby made a part of the record.
4. Petitioner believes, and therefore avers, that the loan do ents provided any change
of ownership of the corporate borrower be approved t e Bank, pursuant to the
negative covenants section of the Borrower Loan
Exhibit "A" and incorporated herein by this reference.
5. At the time the Promissory Note and Commercial
Petitioner/Defendant was the President and a Shareh
attached hereto as
Guaranty were executed,
older of National Health
Systems, Inc., the corporate borrower.
6. Petitioner/Defendant executed a Promissory Note in hi capacity as President of
National Health Systems, Inc. At that time he owned a Ilpercentage of the stock in
National Health System, Inc. together with C. Martin Dixon.
7. In or around March 2004, Petitioner/Defendant did meet with Steven D. Butz who
was, at the time, in charge of the subject commercial I
successor in interest to Harris Savings Bank.
8. During Petitioner/Defendant's meeting with Mr. Butz, P,
Mr. Butz that he was transferring his interest in National
Martin Dixon pursuant to the terms of a Settlement
Agreement, and Release. Petitioner made much disclbs
required the approval of Harris Savings Bank, its succe?
change of ownership.
II
9. Subsequent thereto, Petitioner/Defendant obtained the oral
to the change in ownership of National Health Systems, lnc.
10. Subsequent thereto, Petitioner/Defendant disclosed the sp(
Transfer Agreement to Mr. Butz and requested) Mr. Bu
personal guarantee as the Stock Transfer A eE
Petitioner/Defendant would remain a co-guarantor with r.
for Waypoint Bank, a
advised
Systems, Inc. to C.
at, Stock Purchase
as the loan documents
and/or assigns for the
of Steven D. Butz
ific terms of the Stock
release him from the
;,nt set forth that
for not longer than
three (3) years from the date of closing, meaning that
released from the personal guarantee on May 25, 2007.
11. During this meeting Mr. Butz advised Peti
would not release Petitioner/Defendant until earlier than
would be
that Waypoint Bank
three years set forth in
the Agreement.
i
12. Due to the relationship between Petitioner/Defen4ant acrd
requiring approval of the change in ownership be in writi:
not demand a written confirmation of the same.
13. After the transfer of Petitioner's ownership in National
Butz encouraged Mr. Dixon to make an additional drajw
further demonstrated the The Bank's acquiescence in the
Agreement.
14.
15.
. Butz, and Mr. Butz not
Petitioner/Defendant did
Systems, Inc., Mr.
the line of credit. This
of the Stock Transfer
Petitioner/Defendant believes, and therefore avers, that as 4 result of the assumption
of the terms of the Stock Transfer Agreement, that t?e ersonal guarantee of the
Respondent/Plaintiff herein is invalid and, the Confession of Judgment is improper
and should be stricken.
Petitioner/Defendant further believes, and therefore 0
receive any personal benefit from the National Health SY,
16. Petitioner/Defendant believes, and therefore avers, t
consent on behalf of Waypoint Bank to the chang? in
Mr. Dixon to further access the line of `I cr
Petitioner/Defendant transferring all of his interes? in
to Mr. Dixon and resigning as President.
that at no time did he
Inc. loan proceeds.
)sequent to Mr. Butz's
iip, Mr. Butz did advise
imself subsequent to
al Health Systems, Inc.
17. Petitioner/Defendant believes, and therefore averts, as re ult of the foregoing, that in
the event the personal guarantee and entry and jodgme t i proper, that the amount of
the judgment is inappropriate and should be red0ced tc amount which was due as
of May 25, 2004 and by the amount of attorney fees laimed which exceed the
amount of fees which are reasonable under the
WHEREFORE, your Petitioner respectfully requests that t e judgment in the above
captioned matter be opened to permit him to bring in a defend, o , in the alternative that the
judgment be stricken because it is invalid due to fatal defects i6 th record.
Respectfully
Dated: January 25, 2008
By:
Herbert P. Henocr on, II, Es4-
55 West High ?tre t
Elizabetlitown,?P 17022
(717) 367-2800
I.D. # 56304
Attorney for Petitioner
VERIFICATION
I have read the foregoing and hereby affirm that it is
personal knowledge, information and belief. This verification is
18 Pa. C.S. Section 4904 relating to the unsworn falsification to
Dated: January 25, 2008
i
yne M. Pecht
i correct to the best of my
subject to the penalties of
i
CERTIFICATE OF SERVICE
I hereby certify that on the A- f- day of Jet?I!?
correct copy of the foregoing document upon the following by Firs,
addressed as follows:
Kurt Althouse, Esquire
Bingaman, Hess, Coblentz & Bell, P.C.
Treeview Corporate Center
2 Meridian Boulevard, Suite' 100
Wyomissing, PA 19610
2008, I served a true and
ass Mail, postage pre-paid,
II,
e,,k,
?<?
c?
HAR'
SAVINGS
BUSINESS LOAN ACF
in- awl
References in the shaded area are for Landers use o* and do not limit the ap
THIS M SIi1IS36 WAN AGREENIKNT bftftn National Health Systems, Inc. ("IIId
executed on the following teams and conditions. Borrower has received prior con
coolmerrtot loan or loans and other enanctal eecommodoons hiciudirig gose whk
this Agreement. Al such loans and financial secommodatoha, together with all f
Borrower, are referred to In this Agreement Individually as the "Loan" and a ivi
(a) In granting, renewing, or extending any Low, Lender Is retying upon Borrok"rh
in this Agreement, (b) the prattling, renewing, or adanding of any -Loan by Lender
discretion; and (c) all such Loans *01 be and shall remain subpol to the foWng
TERM. This Agreement shall be offective as of January 29. is", and shall continue tb
performed in full and the penes terminate this Agreement Inwrfllng.
DERNITIONS. The blowing words shelf have the following meanings when used -in th
shell have the meanings attributed to such terms In the uniform Commercial Coda. A
money of the United States of America.
Agreement- The word *Aweemenr means ft eusiness Loan 11 ma, together Withall erxhibits and schedules attached to lhuslnew Loan
ENTI
LIn Bank
n street
111
P 17106
to
scar"
l Savings ft* ("!,ender") Is made and
ari
i
F Lender or ho applled to Larder for a
nay
de oil emy exhitfli or sedtedute attired to
re!cal ndal accommodelons from Lender to
as the f
Borrower understands and agrees that:
rp affM s, end soraementa, as set forth
It time subject to Lender's sole )udgreent and
rifle add a of No Agraemeni.
after un tedness of Borrower to Lender has boon
Terms not otherwise defined In this Agnomen!
r dollar amounts shall moan amounts in lawful
Agreement may be amended or modified from
n lime to dma.
Borrower. The word Morroweee means National Health Systems, Inc.. The wor4 'sarrowrm" also holude% as applicable, all sutIsidlariios and
affllates of Borrower as provided below In the paragraph tided "Subsidiaries and
CERCLA. The word "CERCLA" means The Compreherehre Environmental R05p0na
CollaWd. The word "Collateral" means and includes without pmutatlon all proparh
real or personal property, whether granted directly or Indirea, whether granted now
Interest; mor"ga, dead of trust, assignment, pledge, chattel mortgage, chattel kin
Den, charge, Ran or tills retention contract, lease or consignment intended as a
whether created by law, contract, or otherwise.
ERISA. The word 'ERiSA means the Employee Retlremanl Income Security Act of
Event of Default. The words "Event of DefaulC' mean and include without Imrall
'EVEN'S OF DEFAULT'
Granler. The word "Grantor' means and includes'wlthovt Irnitadon each and at
Collatsral for the Indebtedness, including without limitation all Borrowers grankv
Guarantor. The word Tluarafte means and includes without ilmltation each a
connection w11h anylndabledness.
Indebtedness. The word 9ndebtedness" means and Includes WOW Imllalton
of BORdwer to Lac der, or any one or more of them, as well as ON claims by Lender
hereafter exlsift voluntary or Involuntary, due or not due, absolute or can!
Indivldue0y or jointly with others; whether Borrower may be obligated as a
indebtedness may be or heree><ftee may become barred by any statute of Dmfta
become otherwise unsntorceable.
Lender. The word "Lender" means Barris Savings Bank, its successors and assig
Loan. The word 'Loan" or "Loans" mom and Includes without timitadon any
Lender to Borrower, whether' now or hereader eodaft, and however
accommodations descrilbad herein or described on any exhibit or schedule atblch
Note. The word "Note" means and Includes without Imitation Borrowara pro
in favor of Lender, as wall as any substitute, replacement or refinancing note or n
Permitted Liens. The words "Permitted Clam' mean: (a) (tens and sacudty I a
Norm for taxes. assessments, or simllar charges either not yet dua or bring
warehousemen, or canters, or other ft Dens arising in the ordinary course of b
purchase money liens or purchase money security Inlerests upon or In any
business to worts indebtedness outstanding on the date of INs Agreement a p
god "Indebtedness and Liens ; (e) llens and securfly Ind whtc)r, as of the' E
the Lender In writing; and (f) arose flans and security Interests wtfich In the
with respeal to the net value of Borrowers assots.
Related Documents. The words "Related Documents' mean and Include h
agreamants, sn*onmanlai agreements, guaranties, security agreements,
documents, whether now or hereafter axisling, executed In connection with the In
and Liability Act of 1980, as amended.
and rise's ranted as collateral security for a Loan, whether
ar ltd ow r*, and wh9bw granted U the fora of a security
t Jadarls I . , equipment trust, concillional-sale, trust naceipl,
ally talk::, or any other security or lien inlerast whalsoevar,
r, as' nceo.
of the rrts of Default set forth below In the section titled
of the pamom or entities granting a Security Interest in any
rh a Sacu interest.
all of the g arantors, sureties, and accommodation parties in
cans, er wilt all other obligations, debts and liabilities
dnet er, or any one or meta of them; whether now or
qul tmliqufdefed; whether Borrower may be cable
rotor, su;W or otherwise; whether recovery upon such
and w er such Indebtedness may be or hereaftar may
rd all dom atolai bans and financial accommodations frorr
sad, inoW without IimilaUon those loans and fhanc>a
b tits meet from lima to time.
r note or n , K any, evidencing Borrower's Loan oblgationa
thmefbr.
sits saouurt ind"cinere oWed'by Borrower to Lender; (b
lasted in ood faith; (c) Dons of materiatmeri, mechanics
OR sec ring obligations which ere not yet delinquent; (d
N y d or held by Borrower In the crdinagr course o
muted b klo wW under the paragraph of this Agreemen
r of tr nt. have been di ckW to and approved Ir,
tea an knmaterial and IrrsWiDeant monetary amour
all prom'isaory notes, credit agreements, lost
trust, and all other Inslrumants, agreements arc
Security Agreement. The words "Sacudtyy Agreement" mean and Include withou Nnddon any agreements, prangsa% covenants, enangemenls
undershandings or other agreements, whether created by law, contract, or of , 9*lanci hg, governing, representing, or creating it Socurit.
0-29-1999 BUSINESS LOAN AGR
Loan No 8877000682 (Cofttlnued)
Page 2
Interest,
Securfhr Interest. The words "Security Interest" mean and Include without Ilmitatbn a type oil colt ter al security, whether in the farm of a lion,
charge, n110194ge, deed of trust, assignment, pledge, chattel mortgage, chattel trust, ot's Aen? eq mant trust, conditional sale, trust rocelpt,
Pon or Me retention contract, lease or consignmetd kdsnded as a security device, or any other urity or Ilan interest whatsoever. whether
created by law, contract, or otherwise.
SARA. The word'SAHA" means the Superfund Amendments and Realdttorisation Act of 1988 as now f?ereaffer amended.
CONDITIONS PRECEDENT TO EACH ADVANCE. Lenders Obligation to make.tho Initial n Adva nd each subsequent Loan Advance under
this Agreement shag be subject to to Milliment to Lender's satistaebbon of ati cer the do sot f' in Ihls Agreement and in the Related
Documents.
we" Documents, Borrower shell provide to Lander In form satisfactory fo Larder th
Security AQreomenis granting to Lender security ktferasls In the Collateral, (e) Finanoln
evidence of Insurance as required below; and (e) any other documents required undo
WlttWut Amftalfon any guaranties described below.
Borrower's Aultwrlmtton. Borrower shag have provided in form and substance a
authortift the ocecution and delIvery of this Agn mmnt, the Note and the Related
documents and Irehimerd5 as Lender or its counsel, In their sate discretion, may require.
Payment of Fees and bcpseses. Borrower shall have paid to Lender all fees, charges,
spedfi6d in this Agreement or any Related DocumarrL
this
amends for the Loan: (a) the it*, (b)
erfedtng Lande's Security Interesls; (d)
it or by-Lender or its counsel, including
nder properly certified resolutions, duly
rd such other authoiallons and other
to
other
Representations and Warranges, The representations and warranties sat forth in 1h Agreemai
document or oelfili acts doihrered to Lander under ft Agreement are hue and contact.
No Event of Default. There shall not exist at the lime of any advance a condigon hlch would
Agrgemerrt-
tees which are than due and. payable as
In the Related Documents, and In any
an Event of Default under this
REPRESENtATIMIS AND WARRAWME9. Borrower represents and warrards to Lander, as of the data this Agreement, as of the ditto of each
dlsbur9ement of Loan proceeds, as of the date of any renewal, recension or modifies on of any can, and at 1 times any Indebtedness exlsls:
Orgenitadton. Borrower is a corporation which is duly organi>tad, validly etts6reg, and in cod stares under the laws of the Commonwealth of
Pennsylvania and is vddly e?dsting and in good standing In all states in. which is :4 ng b mess. Borrower has the full power and
attftUOrily to own Its properties and to transact to businesses in which fl Is pnjsenly a e proposes to erlgagUtV Borrower also Is
duly rigged as a foreign corporation and Is In good standing in all states In which the fell to so qua would have a material adverse effect on
As businesses or financial condition
AuttroRmatlon. The execution, delivery, and performance of this Agreement and an Relit
delivered or parformed py Borrower. have been duly authorized by aH necessary action b
any other person, ragulatory authority or governmental body; and do not conW with, res
pri of its articles of incorporation or organtrailon, or bylaws; or any agreement or o
govemmmthd regulation, court decree, or order applicable to Borrower.
Fl wxM iMOt'tndNon. Each 5nancid stalemed of Borrower supplied to tender truly and
of the date of the statement, and there has been no malarial adverys change in Borrower's
recent financial statement supplied to Lender. Borrower has no material contingent obllgatic
Ltgd Effl+ct. This Agreement constitutes, and any ftrumert or agreement nrt omd he
constitute, legal, valid and binding obligations of grower enforcuble against Borrower in e
Fropertles. E=0 as contemplated by this Agreement or• as pre0ously disclosed in Borro
accepted by Lerdar. and except for property tax liens for texas not presently due and
Borrowers properties tree and clear of all Security traps, and has not a mouhed any secu
propertles. AA of Borrowers properties are tilled in Borower's legal name, and Borrower h
other name for at feast the fast Ave (a) years.
fWardous Substances, The terms "hazardous wask," "hazardous substance,' Odisposal
Agreement, shale have the same meanings as set forth In the MMCLA," IWIA," the Hsza
1801, at seq? the Resow a Conservation and Recovery Act, 42 U.S.C. Section q901, at si
regulators warrants that: adopted (Dupursuant to any of the ri the he Oadod of Bloc ins ownership of disclosed t and acknow
there i
tnealmart, dtsposel, release or threatened release of any hexsrdous waste or subsfenoe
properties. (b) Bon'owar has no knowledge of, or reason to behave that fifers has bean M
disposal, release, or threatened release of arty hazardous waste or substance on, under,
occupants of any of the properties, or (N) any scum w threatened ittigaWn or claims of
Neither Borrower nor any tenant, contractor, agent or other authorized user of any of the pi
dispose of, or releara airy hazardous waste or substance on, under, about or from any of Ih
in compgahas with aq applicable federal, stale, and local taws, rag"llons, and ordinances,
ordinances°desodbed above. Borrower authorizes Lander and lb-Agents to enter upon 1
Lender may deeeo appropriate to determine compliance of the properties with lhls sedlon
Lander shall be at Sorrower's eocpettse and for Lenders purposes only and shall not be corn
of Lander to Borrower or to arty ~ person. The representations and warranties eontat
l >g Its propartes for t axodous waste and hazardous substances. Borrower hen
Lander for Nay or conhibuocrt In the event Borrower becomes We for deenup or
Indemnify and hold harmless Lender against any and all cairns, tosses, Ifablines, damages,
Indirectly sustain or sulfer mstAng from a breach of this section of the Agreement or as
storage, disposal, release or threatened release of a hazardous waste or subsume on i
Agreement, including the obligation to lndetnnlfy. shall survive the payment of the Ind
Agreement and shall not be affected by gender's scWtaillon of any Interest in any of the prof
Utlgatlon and Claims. No litigation, claim, Investigation, adminietratlve proceeding or 0
Borrower Is pending or threatened, and no other avant has occurred which mey mafart
propeties, other then litigation, claims, or other events, if any. that have been disclosed to at
Documents y Bormw, to the Want to be exacutod,
Born , o not require the consent or approval of
in a of, or odraflt le a default under (a) any,
rr Ins n binding upon Borrower or (b) any law,
Zalety osed Sormwer's flnartclel condition as
al+ .c Won subsequent to tfep'dale of the most
sxcepf as osed in such financial statements.
nder to given by Borrower when deltmed wig
xdo"Me fhek respective term
s finariclei temrelis or In writing to Lender and as
abta, owns and has good title to all of
docu or financing statements relating to such
not used, filed a financing statement under, any
'? " d "threatened release." as Used In flits
U MM
fi
Trurspariallon Act, 49 U.S.C. Section
or oth er pl ble stale or Federal laws, rules, or
fed p? Lm der In writing, 0o rower represerb and
been no , generation, manufacture, storage,
any on,' under. about or tram any of the
f use, tion, manufacture, storage, traatrrrent,
wt or tha properties by any prior owners or
land y person taking to such nletlars. (d)
do g xe, 96MMK manufacture, stare, treat,
any such activity shall be conducted
ucfing ut Imitation those laws, regulations and
'o 'make such Inspections and tests as
the nt. Any Inspections or tests made by
Id to any mWonslblgty or Ilabil y on the part
herel based on Borrowers due dEpenoo in
(a) and waives any future claims against
er u any such laws, and (b) agrees to
ptNles, nd which tender nwY directly or,
0 of any tgme generation, manufacture,
. The provisions of this soctlon of the
x1nex a the termination of expiration of this
es, by foreclosure or otherwise.
notion Ono uding those for unpaid texas) against
adven tafy Ifed awrowoft financial condition or
dtnow ledg d by lender In wrlHnit.
•01-29-1999 BUSINESS IRAN AGREIMENT Page 3
Loon No 89 7000682 (Continued)
Taus. To the best of Borrower's knowledge, ell tax returns and reports of Bori'mm that are or required to be filed, have been feed, and all
taxes, assessments and other governmental charges have been paid In full, except t ose preen being or to be contested by Borrower in good
faith In the ordinary course of business and for which adequate reserves have been rovlded.
Lien Priority. Unless otherwise previously disclosed to Lender In writing, Borrower has not {ant into or granted any Security Agreements, or
permitted the Bing or attachment of any Security Interests an or affecting any the Ced+ dkedly or Indlrecdy souring repayment of
Borrowers Loan and Note, that would be prior or that may in any way be super at to L nd Security Interests and rights In and to such
Collateral.
Binding Effect. This Agreement, the Nola, all Security Agreements directly or indirs
of the Related Documents are binding upon Borrower as well as upon Soma"
enforceable In accordance with their respective terms.
Commercial Purposes, Borrower Intends to use the Loan proceeds solely for busing
Employee Benefit Plans. Each amp" benefit plan as to which Borrower me
applicable requirements of law and regulallons, and (h no Raportabla Event nor Pr
respect to any such plan. (1) Borrower has not withdrawn from any such plan a
terminate any such plan, and (1v) two are no unfunded liabilities other than than pi
Location of Borrower's Offices and Records. Borrower's place of business, or Bo
place of business, Is located at 1104 Ferowood Pave, Camp Hill, PA 17011. Unless
also Mae office or ofaces where liorower keeps its records concerning the Collateral.
Year 2000. Borrower warrens and represents that all software ulLmd In the condua
compafibilty for operation to hands colander dales h Ong on or agar January 1, Wall
same manner and with ft same lunclonality as the soflware does respecting caloill
Borrower warrants and represents that the data"•related user interlace functions, dat
of fie software include the indcallon of the century.
infonnatton. All information heretofore or contemporaneously herewith furnished by
this Agreement or any lransoetion contemplated hereby Is, and all information harer
true and accurate in every material rsapect on the data as of which such Information
Incomplete by omitting to stole any material fast necessary to make such Information
Survival of Repraseelatons and Wanrardles. Borrower understands and agrees tl
Me above representations mind warranties In ahdend rig Loan Advances to Borrower
and warranties shag be continuing in nature and shall remain In full force and effect
full, or until this Agreemant shall be terminated In the manner provided above, whialm
AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, while IM
Litigation. Promptly Inform Lander in writ of. (a) all material adverse changes
threatened litigation, claims, Investigations, adminlstradve proceadhhgs or similar
materially affect fie financial condition of borrower or the financial condillon of any G
Flnencld Records MWrhln Ila books and records In accordance with generally all
and permit Lender to examine and audit Borrowers books and records at d reasons
Flnanclal Sistemente. Furnish Lander with, as soon as avdablo, but In no event
Borrowers balance sheet and Income statement for the year ended, compiled by a c
reports required to be provided under this Agreement shall be prepared In accordar
a consistent basis, and cer00ed by Borrower a's being he and corrad.
Addttlond Irtform0m. Furnish such additional Inforrnalion and statements, Ills
kweniory schedules, budgets, forecasts, lax raturns, and other reports with respect
Lander may request from time to lime.
Insurance. Maintain fire. and other risk Insurende, public tlabilHy Insurance, and i
Borrowers proporfies and openllom, In form, amounts, coverages and with insura
upon request of L WmmWK r, wa deliver to Lender from time to time the policies or curl
stlpuialons that coverages wkil not be fanoWbd or drniNshed wBhout at least thir
policy also shell Include an endasememt provtdng that coverage in favor of Lender I
of Borrower or any other parson. In connection with all polloles covering assals b
Loans, Borrower will provide Lender with such loss payable or other endorsements a
Insurarm Reports, Furnish to Lender, upon request of Lender, reports on each f
may reasonably, request, including without Ilmitalion the following: (a) the name of tt
(d) the properties insured; (a) the than current properly values on the bells c
determining those values; and (Q the explnallon data of the policy. In addition, upc
Borrower will have an Irtdependenf appraiser satisfactory to Lander determine, as
Collateral. The cost of such appreisal Buell be paid by Borrower.
payment of Borroweft Loan and Note and all
representatives and assigns, and are legally
ss orcotrimairclal related purposes.
have rry bialy compiles In all material respects with all
hiblted ra n (as deenad in ERISA) has occurred with
Inltiatad s to do so, 01) no steps have been taken to
hvlously to Lander in writing.
owees executive office, M Borrower has more than one
6 r designated otherwise In wrning this location Is
of Borr
owe' business will have appropriate cwpab IMM and
and all Info . n pertaining to such calendar dates, in the
dar da
* 1161 ng on or before December 81, 1999. Further.
111
and
-acids, atarralaled program Instnhcuors and functians
O
3 to der for the purposes of or in conned lorh with
Nei, fum he by or on behalf of Borrower to Lendar will be.
i dated ad; and none of such information Is of will be
of mislead
at Lend , Independent invasligaibn, Is mlying upon
Borrov?hor ! agrees that the faegoing nrprsserdatlorhs
unto such M as Borrowers Indebtedness shat be-paid In
her Is the In to occur.
AgheertIwnt In effecw Borrower wlil:
i Borrvwaft financial condllon,..eucd. (b) All redoing and al
actions mi ng Borrower or •arry -GWmnior • which oouk
principles, applied on a consistent bask
or than ninety (90) days after the and of each fbeel year
lied OublIO acoourhiant aetiefadtory to Lender. All finencts
wlth`gane?ally accepted acccuning principles, applied or
RMIlles, agings of receivables and payablas
9nandal condllon and business gxrakms W
ti not t
which
which
Guaranties. Prior to disbursement of any Loan proceeds, furnish executed 4u0r8rd * of the
named below, on Lender's forms, and in the amounts and under the conditions spd4d out In
Gihaerentors
Weyne M. Pecht
C. Martin ddton
Other Agraements. Comply with all terns and condlllons of al other agreements,1
other party and notify tender immediately in writing a! any dahault in connection with
Loan Proceeds. Use an Loan proceeds solely for the following spoft purposes: N
Tahoes, Charges and Liens. Pay and dwherge when due an of Its htdebledness
twur, governmental charges, Was and Ilan, of wm y kind and nature, imposed ul
date on which penalties would attach, and all lawful delms that, if unpaid, might 1
e as Lender may require with inspect It
onably acceptable to Lander. Borrower
In
In form senefacto y to Lender, In ludIN
ritten notice to Lander. Each irsuranci
In any way by any ad, on,on or dafau.,
st far the
ds or is offered a swAft intere
e.
olicy showing such information as Londe
sks Insured: (c) the amount of the pok
has been obtained, and the manner c
(however not mane aen than annuaffy:
al cash value or replacement cost of An
in favor of Lender, executed by the guarantor
guaranties.
herealler Odsling, between Borrower and er
agreamarhla.
1s, inducing without limitation all essessmerit
or ft-properiles, fncome, or proms, prior to It
or charge upon any of SorrmWe properde
67-29.1909 BUSINESS LOAN AC
Loan No 8877WD682 (Continued)
Income, Of profits. Provided however, Borrower will not be requkhed to pay and d
long as (a) the tsgatify of the same shaft be Contested In good faith by appropriate p
books adequate reserves with respect to such contested assessmsnt, taxc, charge,
accounting practices. Borrower, upon demand of Lender, will furnish to Lender evide
Irons and claims and will authorize the appropr(ete gawrnmentat official to delver to
taxes, charges, levies, liens and claims against 8onnwees pmparilm. Income, or p
Performance. Perform and comply with all terms, conditions, and provisions set forth
manner, and promptly notify Lender If Borrower teams of the occurrence of any avant
or under any of the Related Documents.
Operatons. Maintain executive and management personnel with substantially the tea
and management personnel; provide written no** to Lender of any change In
In a reasonable and prudent manner and In compliance with afi .epplbeble federal,
respecting its Properties, charters, businesses and operations, Including without lfmRafio'
with sA minimum funding standards and other requirements of ERISA and other laws apt
lnspedkwL Penml employees or agents of Lander at any reasonable tune to inspect ai
other properties and to examine or audit Borrowaf`s books, eocount% and records an
accounts, and records. If Borrower now or at any time hereafter malntalns any reoordr
and computer software programs for the generation of such records) In the possession
no* such party to permit Lander hoe access to such records al all reasonable times
request, all at Borrower's expense,
Complleace Cerlltfents. Unless waived in wrMng by Lender, provide Lander at Most
proceeds with a Certificate executed by Borrowers chief flnancisl officer, or other oil
representations and warranties set forth In this Agreement are true and connect as of the
date of the Certificate, no Event of Detauft aft under this Agreement.
Environmental! Comptia x e and deepens. Borrower shat[ comply In all respects with
statutes, regulations and ordinances, not cause "permR to exist, as a result of an inten
the part of any third party, on property owned and/or occupied by Borrower, any 4
environment, unless such envtronwanlat actiuityy Is pursuant to and In compliance with tbb
state or ftfil governmental authorllfes; shall tannish to Lander promptly and in any evero
notice, summons, llar. citation, dtrectiva, letter or other communication from any govarnrr
or unintentional nation or omftsion on Borrower's part In Connection with any envito
environment and/or other natural resources.
Addttlonal Assurances. Make, execuls and deliver to Lender such promissory notes, i
sfatemenis, instruments, documents and other agreements as Lender or its agornays ern
and to perfect at Security Interests.
Page 4
e any essmenl, tax, charge, levy, ten or Claim so
?eedt (b) Borrower shag have estabbhed on fts
ry, fie n In accordance with ?neneAy accepted
V of of the assessments, taxes, charges, WMs,
riders
l e a written stalement of any assessments.
this fi t and to the Rotated Documents to a timely
dch co an Event of DekLM under this /4ireeenerrn
e q uall1c r rs and euperienoe as the present exaeuM
and ment personnel; conduot is business WWm
to and Paws, ordinances, rules and regulations
i, co a with its Americans WHh Disabilities Act and
tlkxeble war's employee benefit plans,
Y and ah total for fie Loan or Loans and Borrowers
I to make In and memoranda of Borrower's books,
pndudl6g out Ilmfiailon computer generated recorrts
of a thI d , Borrower, upon mquesl of Lander, shah
uhd to Lander with copies of any records it may
annually} an at the time of each disbursement of Loan
car or acceptable to bender, aerdfytng that the
date of Moats and further coMMng that, as of the
Arohme protection federal, state and local taws,
or ?nrdn n, net action or ornMon on Its pert or on
nrrrr?intal activity where damage may result to the
9tldra a permit issued by the approprtata federal,
fiNhagek o + )mstdays after =*f thereof a rumenlaf concerning any Inlonfat any
loW
s/ whether or not there Is damage to the
of trust, securfly agreements, financing
uostt to evWoncw and secure the Loans
REV Or AWITIOMAI. OOSTS. If the imposition of or any change in any law, rule,
any thereof by arty court or administrafi+re or govemmerrtal authrarliy, (Indudfng any request or lotion on
joy nct;fav< , or the Interpretation or application of
the tome of law) shall impose
modif
or
make applicable any texas (am W U.S. federal, state or local Income or trenchtse taxes Imp
mr0mments or other obligations which would (a) Increase the cost to L.endar for excianding d ontal
mstn ing ,
y
. reserve requirements, CBpital adequacy
credit 6C11111 a to which this Agreement
relates, (b) reducs the ammft payabis to tender under this Agreement or ftre Related Dorm
' , or c) unc the fide of return an Lender's caplial
as a Coneequenea of Lender
s obligations with nespecl to the credit far+ des to which this
additional amounts as will compensate Lender therefor, within fnw (b) days after gender's
accompanied by an w0anatton of such im
osition
d
h
l
i
l nt
n d n*W
' then 8arrowar agrees to pay Lender such
such payment, which demand shal be
p
or c
OW an
a ca
cu
a
on In reasonable
which explanation and calculations shelf be condushre in the absence of manifest error. defier al
the additional amounts payable by Borrower,
NEGATIVE COVENAM. Borrower covenants and agrees with Lander that while this
written consent of tender. nt Is in , Borrower shall not, without the prior
ledabledriess and Ltarts. (a) Except for trade debt Incurred in the normal course of bust ark Ind ladness to Lander contemplated by this
Agreement, errata, Incur or assets indebtedness for borrowed money, including capital
transfer, mortgage, assign, pledge, lease, grant a security liftest In, of encumber any , p( )
Ewro*Ws t as allowed as a.Pe "rued Lien, self,
assets. or (c) self with rowungo any of
Borrowers amounts, axospi to Lender.
CondMdty of Operations. (a)' Engaga in arty business seff w subsfaMiaay different th
cease operations, liquidate, mange, transfer, acquire or consolidate vAh any other entity, C those l in
nee hbh Borrower Is presently, engaged, (b)
. change Its name
dissohve or tranoW
or sell Collateral out of the ordinary course of business, (c) pay any dividends oft Bo
provided, however that notwithst mfr the Weems, but only so long as no Ew d elf (
t has occu ,
than dividends payable in Its stock),
and Is continuing or-would result from
the Payment of dividends, it Borrower Is a "Subchapter S Corporation" (as defined In the 1
may pay cash dividends on Its stock to Its shareholders from time Ic time in amourtl5 mar R$vsn
to, a Code of 1986, as amlendedh Swam
Is fie stwWwldsm to pay Income retires
and make estimated income tax payments to salty their tiabifitias under federal and state
of a Subchapter S Corporaion because of their owrc mhip of shares of stock of Borrower, w whirr
(d) p solely from their stalus as Shareholders
or retire any of Borrower's outstanding
shares or after or an and Borrower's capfiet structure.
LOane, AcgglOMM and Quarardlim (s) Loan, invest In or advance money or s.9set,, (
enterpr(se or a", or (C) Incur any obligation as surety or guarantor other tha
i
th
d b purrcha to or acquire any interest In any other
n
n
e Or ry CCU of usloass.
CESSATION Or ADVANCES. It Lender has mods arty commitment to make any Loan to B
agreemanl, Lander chap have no oblgaflon to make Loan Advances or to disburse Lows p err, who
it (a) nder this agreement or under any other
or any Guarantor is In default under
the terms of this Agreanwnt or arty of fie Related Documents or any attwr agreement that a
any Guarantor becomes insoMent, files a Patton In bankruptcy or simllar proceedin
s
or Is ad' r or a 6
d tar has with tender, (b) Ronower or
lu
t
l
l
g
,
change in Borrower's financial condition. In fie financial condition of any Guarantor, or in th go
a
e value ; (c)
p
cre occurs a malor
e
adow
Collateral securing any Loan; (d) any
Quarantor seeks, claims or Won wise Attempts to Ama, modify or revoke such Guarantors guar
Lender In good faith dooms belt Insecure; even though no Event of De%Ult strati have occurred. s ly of L n or any other loan with Lander, or (e)
ANNUAL PAYOUTIANNUAL RMEW. The Note is subject to a 30-day Payroul during each fwc
a tsriod of ftV (30) consewilve days. The Loan commitment will expire on Decernbar al al ash of W?rc
. M. 'the time the balance must be paid In ft A for
L nder will ,allow the Loan annually for
renewals and exctenmlorw, such renewals and a twnslons to be granted predicated on the
adherence to the Loan Agreement and/or Inan ne&-j rformanbe the company and/or Individuals and
01-20-1999 BUSINESS LOAN AC
Loan No 8877000682 (Continued)
ADDITIONAL. RELATED DOCUMENTS. The tern "Related Documents" shall also Ind
19W, which shall survive closing, and the provisions thereof are incorporated herein by
TAX RETURNS AND FINANCIAL INFORMATION. Borrower will submit to Lander thi
compiled by a oodffled public accountant satisfactory to Lender no later than ninety
required to be provided under this Agreement shall be prepared In accordance with gi
basis and certitled by Borrower as being true and correct.
RIGHT OF SETOFF. Borrower grants to Lender a contractual security Interest In, ar
Lander RA Borrowers right, this and Interest In and to, Borrower's accounts with Lends
without limitation an accounts held jointly with someone also and all accounts Borrows
accounts, and all trust accounts for whurh the grant of a security Interest would be
permitted by applicable taw, to charge or Setoff all sums owing on the Indebtedness
adminlstrativery freeze all such ai ocunts to allow Lender to protect Landers charge and
Page 5
Lender's I ommltment Letter to Borrower dated January 12,
arantors nandal statements and signed federal test returns
days aft or the end of each fiscal year. All Anancal reports
illy ace bed accounting principles, applied on a eonstslent
I hereby Igns, conveys. dellvers. ptedgos, and transfers tc
(whether c cidng, savings, or some other account), including
may open 1 the future, o dudfng however all IRA and Keogh
rohlbiled b law. Borrower aunuabm Lender, to the. eaten:
oohed any nd all such accounts. and,at Lenders option, tc
stuff rights rovided on this paragraph.
ANTS OF DEFAULT. Each of the following shall constitute an Event of Default untthls Agreern rd:
Gefatdt on Indebtedness. Failure of Borrower to make any payment when due o the Loons.
Other Default& rallure of Borrower or any Grantor to comply with or to pert when due any otter term, obligation, covenant or condlflor
contained In this Agreement or In any of the Related Documents, or failure of Bo rower to' oo ply with or to perform any other term, obligation
covenant or bondillon eonlalnad in any other agreement between Lander and B err.
False Statements. Any warranty, representation or statement made or Wished Ii Lander by r on behalf of Borrower or any Grantor under thi:
Agreement or the Related Documents is false or misleading In any material respect at the Urns ads or furnished, or becomes false or misleadinj
at arty time thereafter.
DefectIve ColiateraNsatlon. This Agreement or any of the Related Documents
Security Agreement to create a valid and pertechad Security interest) at any time an
insolvency. The dissolution or termination of Borrowers accidence as a going bull
for any part of Borrowers property, any assignment for the benefit of creditors,
proceeding under any bankruptcy or insolvency laws by or against Borrower.
Creditor or Forfeihfre Prooeeft9e. Commencement of foreclosure or !oriel
repossession or any other method, by any creditor of Borrower, any creditor of any
any govemmental agency. This includes a gamtshmaut,'attechmoO, or levy on or r
Events Affecting Guarantor. Any of the prececAng events occurs with respect to a
or becomes incompetent, or revokes or disputes the validity of, or Ikbtlity under, an,
Change In Ownership. Arty change In ownership of twenty-ttve percent (25%) or r
;eases to in full force and eReet (Including failure of am,
for aryl . .
Tess, thel in of Borrower, the appointmart of a receive
any typo of cmdttor workout, or the commencement of on;
we proceedings. whether by judicial proceeding, self-help
Irantor fgaft at any collateral securing the indebtedness, or b
any of v+or's deposit accounts with Lendec
y Guarantor of any of the Indebtedness or any Guarantor die
Guaranty of the Indebtedness,
of this odmmon stock of Borrvwwr.
Adverse Change. A matelot adverse change. occurs in Borrowers financial condition, o? Lander,bWWL= the.prospect of payment c
performance of the Indebtedness Is Impaired.
Insecurity. Lander, in good faith, deems itself Insecure.
EFFECT OF AN EVENT OF DEFAULT. If any Event of Dafaulf shall occur, except
Dooumer*,, all commitments and obligations of Lender under this Agreement or the
terminate. (Including any obligation to make Loan Advances or disbursements), and, at I
and payable. all without notice of arty kind l0 Borrower, except that In the rase of .a
tnal. In addition.
t as may be prohib
an by tender i
an obligation
re a default and to rpoanrtse its dghLs and remedies.
MiSCBIANEOUS PROVISIONS. The following miscellaneous provision are a part of t
AatendntanIL This Agreement, together with any Related Documents, consilt ules t
matters set forth M Ihls Agreement. No alteration of or amendment to this Agreenrr
party or parties sought to be charged or bound by the alteration. or amendment.
Applicable Low. This Agreement hoe been delivered to Lender and accepted W
a lawsuit, korrawer agrees upon Lender's request to submit is the Jurla&6
Permsyivarda, Lender and Borrower hereby welve the right to arty Jury trial In
Lander or .borrower against gte other. This Agreement shelf be govuaner
Contmonwesflh of Perursylvente.
Caption Heedlnps. Caption headings In this Agreement are for convenience pur
provisions of this Agreement.
Multiple Parties; Corporate Auhtmully. AN obogodons of Borrower under this Agree
shall mean each and every Borrower. This means that each of the persons signing I
Consent to Loan Parttclpeilon. Borrower agrees and consents to Lender's sale c
interests In the Loans to one or more purchasers, whathar related at unrelated to Le
to any one or more purchasers, or pole ttW purchasers, any information or knowledt
relating to the Loan, and Borrower hereby waives any rights to privacy it may have v
and all notices of sale of participatlon Inlemsts, as well as all notices of any repurct
the purchasers of any such participation interests will be catsidamd is the abaolu
rights granted under the paritcipallon agreement or agreements governing the sat
rights of offset or counterclaim that R may have now or later against Lender or
unconditionally agrees that eliher Lender or such purchaser may enforce Barrow
Insovency of any holder of any Interest In the Loans. Borrower further agrees that It
Interests Irrespective of any personal claims or defenses that Borrower may have age
Costs and F)Waes. Borrower agrees to pay upon demand all of Lender's aw
here at . provided In oft Agreement or the Relate
dated boc monk or any other agreement immediately w
ider s op n, all Indebtedness Immedlelsly will become du
C2vent iof ult of the type described In the "fnsotvenc!
nder alhap We all the rights and remedies provided in th
d by a0pll tow, all of Lenders rights and remedies she
pursue a remedy shall not saduds pursrtit of any otht
Borrower of arty Grantor shill not affect Lender's light 1
soft u landing and agreement of the parties as to th
shall be oftotive unless given in writing and signed by it
Lsndel to CommonNeelth of Pennsylvaril101l there
01 he of Dauphin County, Ilse Commonwealth t
sty ad "# , or counlarc?m brought by eifh?
by end co ad In accordance with the Iwo of It
only so are not to be used to Interpret or define It
shall joint and several, and AN references te Borrow
Is ble for aMmbligallons In Oft Agreement
transGlr, w now or later, crone or more parilcipatl,
ter. L9 mazy tide. without any tirnttation whstsaevr
Lender ma have about Borrower or about any other man
h respect such matters. Borrower additionally waives a
Pa of such rlldp flon interests. Borrower also agrees P
owners of uch Interests In the Loans and will have an t
of such p don Interests. Borrower further waluos
going any purchaser of such a participation interest a
's obligation under the Loans Irrespective of the failure
purchaser any such participation interests may enforce
st Lender.
without limitation attorneys' fear, Incurred
01--79.1999 BUSINESS LOAN AG
Loan No 8877000682 (Continued)
connection with the praparatlon, eueoupon, enforh:ement, modification and coffeotson
pursuant to this Agreement. tender may pay someone else b help copeot the Loans
amount. This includes, subject to any limits under applicable law, Lender's attorneys` f
lawsuit, including attorneys' tees for bankruptcy proosadirps (including efforts to m
any anAdpoted post-judgment collwilon stir Am. Borrower also will pay any court
Notices. All nolkres required to be ghen under this Agreement steep be given In ova
bylaw), and shop be effective when achrally delivered or when deposited with a nap
States malt, tlr9f daAk postage prepaid. address(a to ft party to whom the no>see is
change Ns address for rK*m under tilt Agreement by gMng formal written notice to it
to change the paWs address. To the odenl pemftd by applicable law, a there is mor
notlce to allBorrowers. For. notice purposes, sorrower wK keep Lender Informed at all I
Goverabpity. If it rouuit of oompelerd Mis"on finds any pnwision of this Agm4m
cimmsfance, such finding shop not render that provision Invend or unenforceable as to
oitan ft provision shall be deemed to be modified to be within the Ilmlls of enformobtil
so modified, B shall be sVWmn and all other provisions of this Agreement In all other real
Subsidleries and Attifl oks of BerTower. To the exclant the cor4wd of any pmvhkns
Ilmhgapan any reprasentahon, warranty or covenant, the word "Borrower" As used herel
Natwithslanding the ioregolng however, under no circumstances shall this Agreement 0
flnandal aocommodalim to any xubsrdtary or affi to of Sarrower.
Succe ms and Assraas. All covenants and agreements contalned by or an behaN of
inure to the betels of Lender, ft successors and assigns. Borrower shall not, however,
any Iderest therein, without the prior wrtlfen correent of Lender:
Surhrhral, All warronttes, repracant Dorm and rwnanis made by Borrower in this Agree
Sorrower to Lender under this Agreement shall be considered to have been rated upor
doWbry to tender of the Related Documents, regardless of any investigalon made by Ler
Time is of fire govence. Time is of the essenoe in the performance of this Agreement.
Waiver. Lander shop not be deemed to have waived any rights under this Agreemer
Lender. No delay or omission on the part of tender in exercising any right shali operate
Lander of a provision of this A reement shah rid prejudsos or constitute a waiver of Land
provision or any other provision of this Agreement No prior waiver by Lender, nor a
between Lender and any Grantor, *A consYhrse a waiver of any of Lenders rights or o
inure transactions. Whenever the consent of Lender Is regrred under this Agreement,
shell not constitute continuing consent in subsequent instances where such card" Is re
withheld in. the sole discretiot of Lender.
BORROWER ACKNOWI.>EAGES HAVING READ ALL TIC PROVISIONS OF THIS
ITS TERNS. THIS AGREU ENT IS DATED AS OF JANUARY 20, IM.
THiS AGREEMENT HAS BEEN SIGNED AND SEALSD BY TfIIE UNDERBIGNED.
BORROWER;
Wailonal qh swysb SS, I
Wayne If PeCK at
LENDER:
Harris Savings
Authorized OfAcer
Page 6
i this Agree nt of in connection with the Loans made
nd to this Agreement, and sorrow witi pay that
n and Lend lapel eVenses, whether or -not there is a
or vacate a automatic stay or Injunatlon), appeals, and
In addltbn eA other sums provided by law.
may be se by telefaCsimife {unless dheuwise required
y recap overnight Courier or deposited In the UnINd
be pivion a the address shown above. Any party may
other spwmng that go purpose of the nuke is
than one 8 , noffoe to any Borrower will constitute
xo$ of er's current address(es).
In
Z pd or unenforceable as to any person or
y
F
l
e nt or dimumstanc:es. If feasbie, any such
or r
valld
i?p, wever, if the oflending provision oannot be
shall a in valid and enforceable.
f this Acres makes I appropriate, Including wRW
i than I aA sub0di em and apAlates of Borrower.
aormmWh W require Lender to make any Loan or other
ewer sh I bind its suocessors and assns and shall
the right to assign Its rights under ttis Agreement or
*M or in certificate or other Instrument delivered by
by Lander ahd will mxvlve ft making of 9% Loan and
ter or an LeOw% behalf.
unless sac waterer Is g%,W in wilting and signed by 41 Ls a waiver such right or any other right. A waiver by
ea dghl aftoWbe to demand sMol compliance with that
y Course of Iwo-Ing between Lander and Borrower, or
any ob?a? 1 of sormower or of any Grantor as to any
ha granting such consent by Lender in any Instance
Iuked, and fn all cases such. consent may be granted. or
LOAN AGN?EWIT, AND BORROWER AGREES TO
w
STATES RESOURCES, CORP.,
assignee to Sovereign Bank,
successor by merger to Harris
Savings Bank,
PLAINTIFF
V.
WAYNE M. PECHT,
DEFENDANT
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
07-6115 CIVIL TERM
ORDER OF COURT
AND NOW, this ?Z9 day of January, 2008, upon consideration of
the attached petition, IT IS ORDERED:
(1) A Rule is issued upon the respondent to show cause why the
petitioner/defendant Wayne M. Pecht is not entitled to the relief requested.
(2) The respondent shall file an answer to the petition within twenty (20) days of
service.
(3) The petition shall be decided under Pa.R.C.P. 206.7.
(4) Discovery shall be completed within forty-five (45) days of service of the
answer.
(5) The petitioner/defendant Wayne M. Pecht shall file a brief in this chambers in
support of the petition within fifty (50) days of the service of the answer. Any party
opposing the petition shall file a responsive brief in this chambers within seventy (70)
days after service of the answer.
(6) Argument shall be conducted in Courtroom Number 2, Cumberland County
Courthouse, Carlisle, Pennsylvania at 11:30 a.m., Monday, April 28, 2008.
(7) The petitioner shall provide notice of the entry of this order to all parties.
,r' .
Court,
EdgaF B. Bayley, J.
Xrt
Althouse, Esquire
r Respondent
,tlerbert P. Henderson, II, Esquire
For Petitioner
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IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to
Sovereign Bank, successor by merger to No. 07-6115
Harris Savings Bank,
Plaintiff
VS.
WAYNE M. PECHT,
Defendant
CERTIFICATE OF SERVICE
I hereby certify that on the 25 h day of January, 2008, I served a true and correct copy of
the Petition to Open and/or Strike Judgment Confessed Under Suretyship Agreement upon the
following by facsimile and First Class Mail, postage pre-paid, addressed as follows:
Kurt Althouse, Esquire
Bingaman, Hess, Coblentz & Bell, P.C.
Treeview Corporate Center
2 Meridian Boulevard, Suite 100
Wyomissing, PA 19610
Date: January 25, 2008
Herbert P. Henderson, II, Esquire
rz
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238 Attorneys for Plaintiff
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to NO. 07-6115
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
VS. CIVIL ACTION - LAW
WAYNE M. PECHT,
Defendant CONFESSION OF JUDGMENT
PLAINTIFF'S ANSWER TO PETITION OF DEFENDANT
TO OPEN AND/OR STRIKE JUDGMENT
Respondent/Plaintiff, States Resources Corp, assignee of
Sovereign Bank, successor by merger to Harris Savings Bank, by and
through its undersigned counsel, Bingaman, Hess, Coblentz & Bell,
P.C., hereby answers the Petition of Petitioner/Defendant, Wayne
M. Pecht to open and/or Strike Judgment:
1. Admitted.
2. Admitted.
3. Admitted in part and denied in part. It is admitted
that judgment was entered against the Petitioner in this Court
pursuant to a Commercial Guaranty Agreement existing between
Petitioner and Respondent, said Agreement having been assigned to
Respondent by Sovereign Bank, successor by merger to Harris
Savings Bank. It is denied that judgment was entered against
Petitioner on October 22, 2007. Judgment was actually entered
against Petitioner on October 17, 2007.
4. Denied. Petitioner refers to a document that speaks
for itself and therefore no responsive pleading is required.
5. Admitted in part and denied in part. It is admitted
that Petitioner was president of National Health Systems, Inc. at
the time of the execution of the note and guaranty. All other
averments are denied as Respondent is without sufficient
knowledge or information sufficient to form a belief as to the
truth of the remaining averments.
6. Admitted in part and denied in part. It is admitted
only that Petitioner executed a promissory note, dated January
29, 1999, in his capacity as president of National Health
Systems, Inc., in favor of Harris Savings Bank. Respondent is
without knowledge or information sufficient to form a belief as
to the truth of the remaining averments and they are therefore
denied.
7. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 7 of the Petition.
8. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 8 of the Petition.
9. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 9 of the Petition.
10. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 10 of the Petition.
11. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 11 of the Petition.
12. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 12 of the Petition.
13. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 13 of the Petition.
14. Denied. The allegations contained within paragraph 14
of the Petition constitute conclusions of law to which no
response is required. To the extent that a response is required,
the personal guarantee of Petitioner is valid and there is no
basis for modifying the judgment held by Respondent.
15. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 15 of the Petition.
16. Denied. Respondent is without knowledge or information
sufficient to form a belief as to the truth of the averments of
Paragraph 16 of the Petition.
17. Denied. The allegations contained within paragraph 17
of the Petition constitute conclusions of law to which no
response is required. To the extent that a response is required,
the amount of the judgment is supported in law and fact and there
is no basis for changing it. Respondent has properly entered
judgment against Petitioner and it is entitled to collect the
total amount due as of the date of the entry of the judgment,
including all applicable attorneys, fees.
WHEREFORE, Respondent, States Resources Corp., assignee to
Sovereign Bank, successor by merger to Harris Savings Bank,
respectfully requests that this Honorable Court deny the Petition
of Petitioner, Wayne M. Pecht.
New Matter
18. On or about January 29, 1999, National Health Systems,
Inc. executed and delivered to Harris Savings Bank, a Promissory
Note in the original principal amount of $400,000.00, (the
"Note"). A true and correct copy of the Note is attached hereto as
Exhibit "A" and is incorporated herein by reference.
19. To secure the Note, on or about January 29, 1999, the
Petitioner executed and delivered to Harris Savings Bank his
Commercial Guaranty and Disclosure for Confession of Judgment
(collectively, the "Guaranty"), whereby he authorized Respondent
to enter judgment by confession in the event of default under the
Note. A true and correct copy of the Guaranty is attached hereto
as Exhibit "B" and is incorporated herein by reference.
20. Sovereign Bank, successor by merger to Harris Savings
Bank, assigned the Note to Respondent by instrument dated June
29, 2007, a true and correct copy of which is included in Exhibit
"A". Respondent has not assigned the Note and is the holder
thereof.
21. National Health Systems, Inc. defaulted in its
obligations under the Note by virtue of its failure to make
payments when due.
22. Petitioner defaulted in his obligations under the
Guaranty by virtue of his failure to make payments when due.
23. The Guaranty permits the entry of judgment by
confession against the Petitioner upon default.
24. The Guaranty provides for attorney's fees of 10% of the
principal balance due.
25. Judgment was not entered by confession against a
natural person in connection with a consumer transaction because
the debt evidenced by the Note was for commercial purposes.
26. Judgment was not entered on the Note or Guaranty in any
jurisdiction prior to Respondent filing the Confession of
Judgment against Petitioner.
27. Respondent properly entered judgment against Petitioner
based upon the Guaranty that Petitioner executed in favor of
Respondent.
28. The Guaranty states that Petitioner would be liable
under the terms of the Guaranty for as long as it remains in
force.
29. Petitioner has not provided any evidence to support his
assertion that his obligations under the Guaranty or the Guaranty
itself were ended.
30. Petitioner alleges, without evidence, that certain oral
agreements were reached between Petitioner and the prior lender
wherein it was decided that Petitioner's obligations under the
Guaranty would end on May 25, 2007.
31. The Guaranty states on page 2, in the Miscellaneous
Provisions section, under the definition of "Amendments" that "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."
32. No written amendments to the Note or Guaranty were made
to memorialize the new alleged agreement of Petitioner and the
prior lender, nor was any other document prepared to ratify
Petitioner's alleged release from the Guaranty.
33. Petitioner has not provided any basis to open or strike
the judgment.
WHEREFORE, Respondent, States Resources Corp., assignee to
Sovereign Bank, successor by merger to Harris Savings Bank,
respectfully requests that this Honorable Court deny the Petition
of Petitioner, Wayne M. Pecht.
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By. -=4-? /- in , , , C-d2
Kurt lthous Esqui e
Attorneys for Plaintiff,
States Resources Corp.
Date: L11y100
VERIFICATION
Robin Oberg, an adult individual, verifies that he is an
officer of the Plaintiff herein, and that he is authorized to make
this verification on Plaintiff's behalf, and that the facts set
forth in the foregoing Answer and New Matter of Plaintiff are true
and correct to the best of his knowledge, information and belief.
He makes this verification with a full understanding of 18 Pa.,
C.S. Section 4904, which relates to penalties for unsworn
falsifications to authorities.
'Robin Oberg
Date:
HARRIS 6
I SAVINGS BANK
PROMISSORY NOTE
Principal Amount: $400,000.00 initial Rate: 7.750% Date of Note: January 29, 1999
PROMISE TO PAY. National HkdW Systems, inc. ("Borrower") promises to pay to Heats Sm*W Hank ('Lender"h or order, In WN" money of
the United States of America, on demnW, the prk+cipd amount of Four Hundred Thousand & 04x100 Dollars ($400,000.Qd) or so much as may
be outstanding, W 90w vM Ordered on No unpaid outstanding principal bdahce of each advance. Interest shell be calctkted iraA the date
of each advance unill repayment of each advance.
PAYMENT. Borrower WO pay this loam immediately upon Lan iWil, demand. In addition, Borrower will pay regular Mon" paynenta of an
accrued unpaid' to e It due as of each payment date, beginning March 1, 1999, with all subsequent uNerest ptypents to be due on tie ferns
day of each maallh either that. The annual interest rate for Mir Note Is computed on a 36MM basis; that Is, by applyin the ratio of the annual Interest
rate over a year of 360 days, multiplied by_.fhe outstanding principal balance, multiplied by the actual number of days the principal balance Is
outstanc1cg. Borrower will pay Lender at Lender's address shown above or at such other place as tender may desigrab In writing. Unless otherwise
agreed or required by applicable taw, payments will be applied first to accrued unpaid iMareA then to principal, and any remaining arraunt to any
unpaid collection costs and fate charges.
VARIABLE INTEREST RATE. The interest rate on this Note Is subject to change from time to Time based on charges in an index which Is Lenders
Prime Rate (Ore 9nd"11 This is the rate fender charges. or world charge, on 90-day unsecured loans to the most ore0wor" corporrufe customers.
This rate may or may not be the lowest rate available from Lender at any given time. tender will tau Borrower the current Index rale upon Borrowers
request. Borrower understands that Lender may make bans based on other rules as well. The interest rate change will not occur more vlbn than
each Day. The Index csurra ty Is 7.750% per armum. The Interest rate to be aped to the unpaid prkhcipd balance of Ills Note will be at a
rate equal to On index, residtbg In an Initial rate of 7.750% per arm=. NOTICE: Under no circumstances will the interest rate on this Note be
more than the maximum tale &Vowed 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 wrI1% relieve Borrower of Borrowers obligation to continue to make payments of accrued unpaid interest. Rather, they will reduce the
principal balance due.
LATE CHARGE. If a regularly scheduled. Interest payment is 15 days or more fork, Borrower will be charged s ooQ% of tie regularly echeduled
payment or $1QA0, whichever Is greater. If Lender demands payment of Mir ban, and Borrower does not pay to loan w11fMn 15 days after
Lender's demand, Borrower also wilt be charged either 5J=% of the scmn of the unpaid principal plus accrued unpdd Merest or $10AQ,
whichever is greater.
LENDER'S RIGHTS. Lender may hire or pay someone else to help coileot this Note N Borrower does not pay. Borrower also will pay Lender that
amount. This ihduudes, subject to any lmils under applicable law, Lender's atameys' fees and Lenders legal expenses whether or not there Is a
lawsuit, Including attorneys' tees and legal expenses for bankruptcy proceedings (indurdkV efforts to modify or vacate any automatic stay or b*ncMn),
appeals, and any anticipated posyudgment od lec#on services. It not prohibited by applicable taw, Borrower also will pay any court costs, In addition
to all other sums provided by law. If judgment is entered in connection with this Nola, interest will continue to accrue on this Note attar judgment at Qhe
interest rate applicable to ft Note at the time judgment is entered. TMs Note has been delivered to Lender and accepted by Lender In the
Commonwealth of Pennsylvania. N there is a lawsuit, Borrower agrees upon Lender's request to submit to the jurtsdkdlon of the courts of
Doi" Cainly, the counWeldin brought Lender Borrower against the offer This Note shah be governed by arid construed accordance w h
the Sews of the ComrnomNeallh of Pennsylvania.
RIGHr OF SETOFF. Borrower grants to Lender a contractual security interest in, and hereby assigns. conveys, delivers, pledges, and trandhers to
Lender at Borrowers right, titre and interest in and to, Borrowers accounts with Lander (whether checking, savings, or some other account), Including
without Nmtiallon all accounts held jointly with someone else and all accoutres Borrower may open in the future, amduding however all IRA and Keogh
accounts, and all trust accounts for which the grant of a security Iterest would be prohibited by law. Borrower authorizes Lender, to the extent
permtifed by applicable law, to charge or setoff all sums owing on this Note against any and all such accounts, and, at Lenders option, to
administratively freeze all such accounts to allow Lender to protect Lenders charge and setoff eights provided on this paragraph.
LINE OF CREDIT. This Note evidences a revolving line of credit Advances under this Note may be requested orally by Borrower or by an authorized
person. Lender may, but need not, require that all oral requests be confirmed in writing. AN communications, ihstruclions, or directions by telephone or
otherwise to Lender are to be directed to !.enders office shown above. The following party or parties are authorized to request advances under the Nne
of credit until Lender receives from Borrower at Lenders address shown above written notice of revocation of their authority: Wayne M. Pecht,
President; OW Bruce E. Seagrist, Secretary. Borrower agrees to be liable for all sums either. (a) advanced In accordanoe with the Instructions of an
autwktzed person or (b) credited to any of Borrowers accounts with Lender. The unpaid principal balance owing on this Note at any time may be
evidenced by endorsements on this Note or by Lenders internal records, including daily computer print-outs. Lender will have no obligation to
advance hinds under this Note it: (a) Borrower or any guarantor is in default under the terns of this Note or any agreement that Borrower or any
guarantor has with Lender, including any agreement made in connection with the signing of this Note; (b) Borrower or any guarantor ceases doing
business or is insolvent; (c) any guarantor seeks, claims or otherwise attempts to limit, modify or revoke such guarantors guarantee of this Note or any
other loan with Lender; (d) Borrower has applied funds provided pursuant to this Note for purposes other than those authorized by Lender or (e)
Lender M good faith deems itself insecure under this Nate or any other agreement between Lender and Borrower.
ANNUAL PAYOUT/ANNUAL REVIEW. The Note Is subject to a 30-day payout during each fiscal year at_which time the balance-must be paid In full for
a period of thirty (30) consecutive days. The Loan commitment will expire on December 31, 1999. The Lender will review the Loan annually for
renewals and extensions; such renewals and extensions to be granted predicated on the performance of the company and/or Individuals and
adherence to the Loan Agreement and/or loan policy.
Borrower: Nations Health systems, inc. (TIN: 2s-is75431) Lender: Harris Savings Bank
1104 Fernwood Drive 234 N. Second Street
Camp Htifl, PA 17011 P 0 Box 1711
Harrisburg, PA 17105
01-29-1999 PROMISSORY NOTE Page 2
Loan No 8877000682 (ConUmel).
SECURITY. AN ookleral (as herein defir" is srr v* for this Note and any renewals, extensions and modiRaallons thereof, and the payment,
performance and discharge of all other present or future indebledrness, obligations and undertakings (whetlner i ndiftel, )oint, sea* direct,
contingent or otherwise) of the Borrower to or for the benefit ot lender, whether arising dh* to Lender under this Note or under any other
agreement promissory nob or undertaillings described m or mtpa^ ?gnhereinafter ofted Into by Bortower ment or any other security document separately Lender e ? cutexeedby? the eIncludes orrower i n n favor of
and Intangible property 0) des
Lender. and (N) in which Borrow has grafted a sewrky kterost to Lender pursuant to this Note.
GENERAL PROVISIONS. lender may delay or forgo enforokp any of its nil or remedies under this Note without kukhg them. Borrower and any
other person who siprs, 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 farms of this Note, and unless otherwise expressly stated in vatting, no party who signs this Note, whether as maker,
guarantor, accommodation maker or endorser, shat be released from Nab&y. Al such parties agree that Lender may renew or ealend (rapealedly and
for any length of Nme) Nis loran, or release any party or quarartor or coAaberel: or Impair. fail to raft upon or petted Leader's security Interest M the
collateral; and tale any other adios deemed necessary by Lender without the consent of or noke to anyoorl M such parties also agree that Lender
may modify this loan wMxKd the consent of or nolko to anyone other than the patty with whom the modNicalon Is made. N any portion of this Note is
for any reason delermi ed to be unenforceable, I will not affect the enforceability of any other provisions of this Note.
CONFESSION OF JUDGMENT. BORROWER HEREBY IRREVOCABLY AUTHORI2ES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY
OR CLERK OF ANY OQUAT 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 FICA. 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 INVEST ON SUCH
AMOUNTS. TOGETHER WITH COSTS OF SUIT, AND AN /ATTORNEYS COMMISSION OF TEN PERCENT (109) OF THE UNPAID PRINCIPAL
BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS WW) 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 SMALL 13E 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 FILL OF ALL AMOUNTS DUE UNDER THIS NOTE. BORROWER HEREBY WAIVES ANY RIGHT BORROWER
MAY DAVE TO NOTICE OR TO A FEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT. EXCEPT ANY NOTICE ANDIOR
iEAIl REOUIRED 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.
f R1OR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROWSI0NS OF THIS NOTE. INCLUDING THE VARIABLE
INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF TM NOTE AND ACKNOWLEDGES RECEIPT OF A COM113LETED
COPY OF THE NOTE.
THIS NOTE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
Natbnlui H9811111 Sy
MK
By. - . ) . 1"Igm?Iii'll1i
Ikuce E. t o"Naw b
LENDER.
Herds Savill Bank
Dr.
AuNWInd O1ftW
Variable Fll Ulm or Oredlt. LASER PRO. Rae. U.S. Pat, 9 T.M. Ont.. Vv. 9.29a 10119N OR ProServil ft. AN rights reserved. IPA-020 F9.29 NATIoNAL.LN C1.oVLi
0 - 0
Allon e
Pay to the order of States Resources Corp. without recourse, representations or
warranties of any kind.
Executed as of this 29`' day of June 2007.
Sovereign Bank
By. thleen y
Its: ice President
DILSURE FOR CONFESSION OF JUDGf*4T
Harrisburg, PA 17105
DISCLOSURE FOR CONFESSION OF JUDGMENT
THE UNDERSIGNED IS EXECUTING, THIS TWENTY NINETH DAY OF JANUARY, 1999, A PROMISSORY NOTE FOR $400,000.00
OBLIGATING THE BORROWER TO REPAY THAT AMOUNT.
A. I UNDERSTAND THAT THE NOTE CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO
ENTER JUDGMENT AGAINST THE CORPORATION IN COURT, AFTER A DEFAULT ON THE NOTE, WITHOUT ADVANCE NOTICE
TO THE CORPORATION AND WITHOUT OFFERING THE CORPORATION AN OPPORTUNITY TO DEPEND AGAINST THIS ENTRY
OF JUDGMENT. IN E70 zun NG THE NOTE, BEING FULLY AWARE OF THE CORPORATION'S RIGHTS TO ADVANCE NOTICE
AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS THAT LENDER MAY ASSERT
AGAINST THE CORPORATION UNDER THE NOTE, I, IN BEHALF OF THE CORPORATION, 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 TENDER'S ENTERING JUDGMENT AGAINST THE CORPORATION BY
CONFFSSI OVIDED FOR IN THE CONFESSION OF JUDGMENT PROVISION.
R I FURTHER UNDERSTAND THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGNM NT AGAINST THE
CORPORATION WITHOUT ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE NOTE
ALSO CONTAINS LANGUAGE THAT WOULD PERMIT LENDER, AFTER ENTRY OF JUDGMENT, TO E)MCUTE ON THE
JUDGMENT BY FORECLOSING UPON, ATTACHING, LEVYING ON, TAKING POSSESSION OF OR OTTER WISE SEIZING THE
CORPORATION'S PROPERTY, IN FULL OR PARTIAL PAYMENT OF THE JUDGMENT. HOWEVER, LENDER MUST PROVIDE
NOTICE TO THE CORPORATION UNDER APPLICABLE LAW IN EXECUTING ANY CONFESSED JUDGMENT.' IN E)(ECUTINO THE
NOTE, 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 EJCPRFSSLY AGREE AND CONSENT TO LEND S CUTING ON THE JUDGMENT, IN ANY MANNER PERMITTED BY
APPLICABLE STATE AND FEDERAL LAW. INITIALS: 10
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 NOTE
Pik 2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF IUDOMENT PROVISION IN THE
1??I. NOTE TO MY ATTENTION.
D. I CERTIFY THAT THE CORPORATION'S ANNUAL INCOME EXCEEDS $10,000.00; THAT THE BLANKS IN THIS DISCLOSURE
WERE FILLED IN WREN I INITIALED AND SIGNED IT, AND THAT I RECEIVED A COPY AT THE TALE OF SIGNING.
THIS DISCLOSURE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
AFFIANT:
By:
Wayne . Pecht, President
By:
Bruce E. Seagrist, Secretary
Borrower. National Health Systems, Inc. Lender. Harris Savings Bank
1104 Fernwood Dr. 234 N. Second Street
Camp Hill, Pa. 17011 P.O. BOX 1711
EXHIBIT "B"
282428
COMMERCIAL GUARAN
Guarantor: Wayne M. Peed
3s High Ridge Trail
Mechanicsburg, PA 17OSS
AMOUNT OF GUARANTY. The amount of this Guaranty Is Unlimeled.
CONTINUING UHLIMIM GUARANW. For good and valuable consideration, Wayne M. pwm CGuarwW) absolutely end cMheoh>dttorheNy
gmarantess and promises to pay to Hoards Savings Bands C1.endsr") or 113 order, on daa•nd, Lender tender fire terns end Sides of s*f k^b the
Indebtedness (*a Hard Senn is deMned below) of MONO" Health Systems. Inc- COWW860 b of Lender are conlnnh id
ttds Guarardy. Under lids Guwwft, the Nebuity of Guwantor to unlimited end the obllgailom
DEFINITIONS. The following words shelf have the following meanings when used In this Guaranty:
Borrower. The wad .Borrower' means National Health Systems, Inc..
Guarantor. The wad "Guarantor" means Wayne M. Peohl
Guaranty. The word "GusraW means this Guaranty made by Guarantor for the benefit of Lender dated danaay 29.1999.
Mdebtednu& The wad "Indabtadr oae is used in ft mast comprehensive sense and means and Includes any and at of Borrowers iabiitiss,
obigations, debts, and Indebtedness to Lender, now adsting or herein ier Incurred or created. Including. without knitallm aft loam of i . e
gym ms'
torn, a Costs. debts, t o r or
future Judgments against Borrower, any d tInse hem; ow whether any such Indebtedness Is vduffa Ny or Involuntarily
' and any Pmt
incurred, due or not due. absolute or c or urhignidsted, determined or undatern mKI; whether Borrower may be liable
there, or a Or sese liquidated
individually or Jck?dY with h others, primaadY rily y, or as guarantor or surety: whether recovery on the Inmdebtedness may be or may
become barred or unenforceable against Borrower for any reason whatsoever; and whether the Indebtedness arises from transactions which may
be voidable on account of infancy, insanity, ultra vines, or otherwise.
Lender. The word 'Lender" means Har is Savings Bards. Its successors and assigns.
Related Doccmhaete. The words "Related Doeumerrlr;' mean and Include without bnftftn &I of trust promise" and all Other notes, as nts. assn emend
agmwmls, erwironnermtei agreements, guaamties, nm* agreems mortgages, do ad, documents, whether now at hereafter eodsfing, nmt fed in connection with the Indebtedness.
NATURE OF GUARANTY. Guarantors lability under this and shall be nt Openerh and continuous dua whether for so " as this Guaranty
maturely or aeries by reason remains In _or a
Guarantor Intends to guarantee at all limes the perfamanee made ? ? Indebtedness WE discharge of clmintsh the continuing liability of Guarantor
otherwise, of all Indebtedness. AccardinIft, to indebtedness or any of the Indebtedness which subsaquw* arises a is thereafter k=Fred
In connection with any remaining P °r
•
contracted.
ouRATtoN OF GUARANTY. This Guaranty will take ettecl when received by Lender without the necessity of any acceptance by Lender, or any notice
to Guarantor or to Borrower, and will confirm in full force until all Indebtedness incurred or contracted before reoaipt by Lender at any notice of
revocation shell have been fully and finally paid and satisfied and of other obligations of Guarantor under this Guaranty shelf have been performed In
10
full. If Guarantor elects to revoke this Guaranty. Guarantor may onty do so in writing. Guarantor's written notice of repro cation must be matted ~ revocation Oft
Of Lender, by c~ mail, at it* address of Lender listed above or such other place as Lender may designate writing. Guaranty will apply orgy to advances or new Indebtedness created of actud receipt by Lender of Guarantor's written revocation. For this purpose
and without irritation, the term "row Indebtedness" does not include Indebtedness which at the time of notice of revocation Is contingent, unlfquidd0d.
undetermined or not due and which later becomes absdute, tiquidahrd, determined or due. This Guaranty will continue to bind Guarantor for all
Indebtedness incurred by Borrower or committed by Lender prior to receipt d Guarantors written ratios of revocation, Including any extensions.
rarewals, substiluions or modicaUahs of the Indebtedness. Al renewals, extensions, subsmulions6 and modilicatbre of the Indebtedness granted
alter Guarantor's revocation, are contemplated under this Guaranty and, speoiicalfy we not be considered to be raw IndebMdn?. LT his sum
shelf bind the estate of Guarantor as to hmdebt ciness created both before and after the death or ftgmaty of Guara? .r o this Guaranty in
notice of Guarantor's death. Subject to the foregoing, Guarantor's executor or administrator or other *0 represents
the same manner in which Guarantor might have terminated t and with the same erect. Release of any other guarantor or termination of any other
guaranty of the Indebtedness shall not affect the liabity of Guarantor under Mils Guaranty. A revocation received by Lender from any one or more
Guarantors shall riot aftect the kblfty of anry remaining Guarantors under this Guaranty. It Is ant I d #0 SICU11011110" MW QCW G that r In a1in
aggregate amohat of indebtednness covered by thts Guaranty, end it is spWW4#lg admewledged agreed by
the amount of Indebtedness, even to aero dollars ($0A0), Prior b wd1W FrMedion of its Guarenty by Guxentor shall not constlule a
ternhkaton of this Guaranty. This Guaranty Is binding upon Guarantor and Guarantor's heirs, from lime to Urne rMMOM $0 fong as any of the
guaranteed Irdelfto ss reamaihs unpaid and even though the indebtedness guarenteed may
GUARANTOR'S AUTHOMMTIOff To LENDER. Guarantor authorises Lender, ether before or aft any revocation hereof, wMmd notice or
demand end wMt&A Waning G Amwordoes Nabilty under this Guaranty, from Tine to time: (e) Prior to revocation as set forth efeow, b mice
one or more additional secured or un setwed loans to Borrower, to leuae egcdpment or otter goods to Borrower. or oghWW11W to extend
adddNional oredlt b Borrower: (b) to after, compromise, renew, extend, accelerate, or otuerhhrise change one or more times the time for
payment or other terms of the Indebtedness or any part of the Im Wednese, Including increases and decreases of tha rem of Interest on the
indebtedness; exiendons may be repeated and may be for longer Ilan the original ban term; (C) to take and hold searellt for the payment of
this Guaranty or the idd*Kk ss, and adhange, ardom, waive, subor *w* fall OF decide not b Perfect. and release any such security,
with or wtttout the subsUtaton of new collateral; (d) to release, subW kit, agree not to sue, or dad with any one or more of Borrower's
sureties, endorsers, or other guarantors on any farms or in any mater Lender may choose; (e) to determine how, when and whit aPPNeeton
of payments and txedft slat be made on the Indebtedness; (f) to apply such securely and direct the orderdeedor MOMW of ` 111411`0011,
k"Ong without limitation, any nomjudcial safe permMed by the terms or the controlling midNse security *WON or of trualt, a put of the ? t m) b assign or
discretion may determine; (g) to WN, Transfer, assign, or Arad partclpadions
transfer this Guaranty In whole or In pad.
Exhibit
Borrower. National Heaim systems, Inc. (TIN: 25-1575431) Lender: N BSwings "
1104 Fe"ood Drive P 234 Box Second
Camp ifill, PA 17011 Hardstwrg1711
, PA 17105
01-29-1999 CO MERCIAL GUARANTY Page 2
Loan No 8877000682 (Continued)
GUARANTOR'S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Lender that (a) no mpresentaflor>s or agreements
of any kind have been made to Guarantor which would Imit or quality in any way the terms of this Guaranty; (b) ihie Guaranty is a lsouled at
Borrowers request and not at the request of tender; (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 default under any agreement or other Instrument binding upon Guarantor and do rat result in a violation
of any law, regulation, court dacm or order applicable to Guarantor; (e) Guarantor has not and will not, without the prior written consent of Lender,
sell, lease, assign, encumber, hypotiroate, transfer, or otherwise dispose of all or substantially all of Guarantors assets, or any interest therein; (1) upon
lender's request, Guarantor will provide to Lender financial and credit information in form acceptable to lender, and all such financial Information
which aarenfiy has been, and all future financial information which will be provided to lender is and will be fie and correct In aI material respects and
fairly present the financial condition of Guarantor as of the dales the financial Information is provided; (g) no materiel adverse change has occurred in
Guarantor's financial condition since the date of the most recent financial statements provided to Lender and no evert has occurred which may
materially adversely affect Guarantor's financial ccndlfion; (h) no litigation, darn, Investigation, adnfnistrallve proceeding or similar action (including
those for unpaid lam) against Guarantor is pending or trealened; 0) Lender has made no representation to Guarantor as to the creditworthiness of
Borrower; and N Guarantor has established adequate means of obtaining from Borrower on a continuing basis I formalim regarding Borrower's
financial condition. Guarantor agrees b keep adequately Informed from such means of any facts, everts, or circumstances which might in any way
affect Guarantor's risks under this Guaranty, and Guarantor further agrees that tender shall have no obligation to disclose to Guarantor any Information
or documents acquired by Lender in the course of is relationship with Borrower.
GUARANTOR'S WAIVERS. Except as prohibited by applicable law, Guarantor waives any right to require Leader (a) to continue leading money or to
extend other credit to Bom ewer; (b) to nuke any presarfinerrl, protest, demand, or notice of any and. Including notice of any rarpsyment of the
Indebtedness or of any nonpayment related to any collateral, or notice of any action or nonadion on the part of Borrower, tender, any surety, andorser,
or other guarantor In connection with the Indebtedness or In connection with the creation of now or additional loans or obligations; (c) to resort for
payment or to proceed dinectiy or at once against any person. including Borrower or any other guarantor; (d) to proceed directly against or exhaust any
cclatsral held by Lender from Borrower, any other guarantor, or any other person; (e) to give notice of to limn, lime, and pleas of any ptA)k or
private sale of personal property so atty held by Lerider from Borrower or to comply with any other applicable provisions of the Uniform Commerdal
Code; (f) to pursue any other remedy within Lenders power, or (g) to aormrdt 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 at (a) any oche action' or 'anti-deticienwy' law or any other law which may
prevent Lender from brbhgirg soy action, Including a claim for deficiency, against Guarantor. before or after Lenders commencement or completion of
any foreclosure action, afther oxicially or by exercise of a power of sale, (b) Guarantors subrogeton rights or Guam rights to proceed agai st Borrower for burssment, Including without Iknilation, a adversely
loss of
rights Guaranty may suffer by reason of any law Imtling, gte filying, 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 Borrowers Iabl[ly from any cause whatsoever, other than payment In nil
in lapel tender, of the Indebtedness; (d) any right to claim discharge of the Indebtedness on the basis of unjustified impairment of any collateral for the
irhdebtedness; (e) arty statute of Irritations, lt at any time any action or suit brought by tender against Guarantor is commenced there is outstanding
indebtedness of Borrower to lender which is not barred by any applicable statute of limitations, or (f) any defenses given to guarantors at taw or In
equity other than actual payment and performance of the Indebtedness. It 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 relef 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 arty time any deductions to the amount guaranteed under this Guaranty for any Clain 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 waterers set forth above is made
with Guarantors full knowledge of Its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary, b
public policy or law. If any such waiver is determined to be contrary to any applicable law or public policy, such waiver shall be effective only to the
extent permitted by law or public policy.
LENDER'S RIGM 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 tender under this Guaranty and to the extent permuted by law, a
contractual security Interest In and a right of setoff against, and Guarantor hereby assigns, conveys, delvers, pledges, and transfers to Lender all of
Guarantors right, tide 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 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 exercised
without demand upon or notice to Guarantor. No security interest or right of setoff shall be deemed to have bean waived by any act or conduct on the
part of Lender or by any negied 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 shah 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.
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 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 full payment in legal
tender 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 is rights under this
Guaranty.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Guaranty.
Amendments. This Guaranty, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the
maters set forth in this Guaranty. No allocation 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 delivered to tender and accepted by Lender I !nmonwealth of Pennsylvania. If there is a
lawsuit, Guarantor agree anon Lend !asst to submit to the jurisdiction of the courts hm County, Commonwealth of Pennsylvania.
01-29-1999 COMMERCIAL GUARANTY* page 3
Loan No 8877000682 (Continued)
Lender and Guarantor hereby wave the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Guarantor
against the other. This Guaranty shah 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 Lenders costs and expenses, inducting attorneys' fees and Lender's
legal expenses, 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 expenses include Lenders attorneys' 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
vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services. Guarantor also shah pay all court costs
and such additional fees as may be directed by the courL
Notices AN notices required to be given by either party to the other under this Guaranty shah be in writing, may be sent by telefacsimNe (unless
otherwise required by law), and, except for revocation notices by Guarantor, shall be effective when actually delivered or when deposited with a
nationally recognised overnight courier, or when deposited in the United Slates mall, fast 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. All
revocation notices by Guarantor shall be in writing and shah be effective only upon delivery to Lender as provided above in the section titled
"DURATION OF GUARANTY' it 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 Guarantors 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 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 shah 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 tending shell not render that provision invalid or unenforceable as to any other persons or circumstances, and al provisions of lids Guaranty
in all other respects shah remain valid and enforoeabkL 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 excise of such powers shall be guaranteed under this
Guaranty.
Waiver. Lender shah 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 shah operate as a waver of such right or any other right A waiver by Lender of
a provision of this Guaranty shall not prejudice or consti4de a waiver of Lenders 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, shah constitute a
waiver of any of Lenders rights or of any of Guarantors 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 stall not constitute continuing consent to subsequent instances
where such consent is required and in all cases 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 ANYTIME 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 (1504) 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 ACKNOVA.EDGES 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 JANUARY 29,1999.
THIS GUARANTY HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
G
X
Wayne
LASER PRO, Req. U.S. Pet. A T.M. Off., Ver. ales (¢)1 M CF1 ProSer ices, Ina All rights reserved. IPA-E20 NATIONAL.LN C1.OVLI
DISCLOORE FOR CONFESSION OFQDGMENT
Guarantor: Wayne M. Pecht
35 Hipp Ridge Tral
Mechanksburg, PA 17055
DISCLOSURE FOR CONFESSION OF JUDGMENT
I AM EXECUTING, THIS ?'q DAY OF 0Ed ? 19_!J, , A GUARANTY FOR AN U IJMTED AMOUNT.
A. I UNDERSTAND THAT THE GUARANTY CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO
ENTER 0 MOMENT AGAINST ME NI 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. M 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, INCLU NIG ANY RIGHT TO ADVANCE NOTICE OF THE ENTRY OF JUDGMENT, AND i EXPRESSLY AGREE AND CONSENT
TO LENDER'S ENTERIN MENT AGAINST ME BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT
PROVISION. INITIALS: MIN
B. 1 FURTHER UNDERSTAND THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST ME WITHOUT
ADVANCE NOTICE OR A FEARING, 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 APPUCA13L.E 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 BORE EXECUTION ON THE JUDGMENT, 1 AM KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE
RIGHTS, AND 1 EXPRESSLY AGREE AND CONSENT T '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.
UM/ 2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF M MUM PROVISION IN THE
GUARANTY TO MY ATTENTION.
D. I CERTIFY THAT MY ANNUAL INCOME EXCEEDS 110,000; THAT THE BLANKS IN THIS OMMOSU RE WERE FILLED IN WHEN 1
INITIALED AND SIGHED IT; AND THAT 1 RECEIVED A COPY AT THE TIME OF SIGNING.
THIS DISCLOSURE HAS SEEN SIGNED AND SEALED BY THE UNDERSIGNED.
AFFIANT:
(SEAL)
w . POW
LASER PRO, Rey. U.S. Pal.& T.M. Off., Vr. 3.26a (-1)1966 CFI Pr0Servlces.Inc. An rights reswWd. IPA-1330 F3.26 NATIONALLN C1.OVLI
Borrower: National Health Systems, Inc. (TIN: 2r-157S431) Lender: Harris savings Bank
1104 Fernwood Drive 234 N. Second Street
Camp HUN, PA 17011 P O Box 1711
HarrisMug, PA 17105
BINGAMAN, HESS, COBLENTZ & BELL, P.C.
By: Kurt Althouse, Esquire
Identification No. 35238
Treeview Corporate Center
2 Meridian Boulevard, Ste. 100
Wyomissing, PA 19610
(610) 374-8377
Attorneys for Plaintiff
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES, CORP., assignee to
Sovereign Bank, successor by merger to
Harris Savings Bank,
Plaintiff
vs.
WAYNE M. PECHT,
Defendant
NO. 07-6115
CIVIL ACTION - LAW
CONFESSION OF JUDGMENT
CERTIFICATE OF SERVICE
I, Kurt Althouse, Esquire, hereby certify that a true and
correct copy of Plaintiff's Answer to the Petition of Defendant
to Open and/or Strike Judgment was mailed by United States first
class mail, postage prepaid upon the following party(ies):
Herbert P. Henderson, II, Esquire
55 West High Street
Elizabethtown, PA 17022
BINGAMAN, HESS, COBLENTZ & BELL, PC
By : rl- Fy2
Kurt Althouse, Esquire
Attorneys for Plaintiff,
States Resources Corp.
Date: Z 11y1CP
;1
.J
kjD
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES CORP., assignee to
Sovereign Bank, successor by merger to No. 07-6115
Harris Savings Bank,
Plaintiff
vs.
WAYNE M. PECHT,
Defendant
ORDER
AND NOW this day of March, 2008, upon consideration of the attached
Stipulation of Counsel, it is hereby ORDERED and DECREED that the Prothonotary of
Cumberland County is directed to strike the Complaint and Confession of Judgment filed and
entered against Wayne M. Pecht on October 16, 2007 from the record and adjust all indices
accordingly.
All matters and agreements related hereto shall be considered confidential and may not
be released by the parties for any reason whatsoe
oz ?t3i?? OwG
Y
lop
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
STATES RESOURCES CORP., assignee to
Sovereign Bank, successor by merger to No. 07-6115
Harris Savings Bank,
Plaintiff
vs.
WAYNE M. PECHT,
Defendant
STIPULATION OF COUNSEL
This Stipulation is made this 1 3 day of March 2008 by and between Herbert P.
Henderson, II, Esquire, attorney for Wayne M. Pecht, and Kurt Althouse attorney for States
Resources Corp. whom together stipulate as follows:
1. Herbert P. Henderson, II, Esquire does hereby swear and affirm that he is on
behalf of his client, Wayne M. Pecht, authorized to sign and enter into this Stipulation on
behalf of his client.
2. Kurt Althouse, Esquire does hereby swear and affirm that he is on behalf of his
client, States Resources Corporation, authorized to sign and enter into this Stipulation on
behalf of his client.
3. The parties hereto have executed various settlement documents and releases, the
same of which have resolved in entirety a Petition to Open and/or Strike Judgment Confessed
Under Suretyship Agreement entered by States Resources Corp. against Wayne M. Pecht,
the same of which is docketed at the above referenced term and number.
4. The parties agree that in consideration of each party executing said documents
and releases that the Complaint for Confession of Judgment, and therefore, the Confession of
Judgment entered against Wayne A Pecht is void ab intio and shall be vacated immediately.
5. The parties agree, through their respective counsel, that the Confession of
Judgment and Complaint therefore shall be vacated immediately and further agree that this
Stipulation shall be adopted by The Honorable Edgar B. Bayley as an Order of Court.
AND NOW, the parties intending to be legally bound, set their hands and seals the date
first above written.
Herbert P. Henderson, Il, Esquire
Attorney for Wayne A Pecht
6N L
Kurt Althouse
Attorney for States Resource Corporation