HomeMy WebLinkAbout08-53831
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
THE LEGACY BANK, a division of
FIRST NATIONAL BANK OF
PENNSYLVANIA
CIVII, DIVISION
Plaintiff
vs.
CARING HANDS CHIROPRACTIC
WELLNESS CENTER, INC.
and KRISTEN J. KERR
Defendants
NO.: p$ - b~3 Cavil Term
CONFESSION OF .TUDGMENT
Pursuant to the authority in the Warrant of Attorney contained in the aforesaid Note and
Guaranties, copies of which are attached to the Complaint filed in this action, I appear for the
Defendants and confess judgment in favor of Plaintiff and against Defendants as follows:
$87,000.00 Note
Principal $55,946.46
Interest to 8/29/08 $ 4,974.26
Late Charges $ 1,765.71
Attorneys' Fees (15% of the total 9 402.96
amount due)
TOTAL
$72,089.39
with interest on the principal sum ($55,946.46) from August 29, 2008 at the contractual rate.
$15,000.00 Note
Principal $9,379.81
Interest to 8/29/08 $ 392.61
Late Charges $ 193.40
Attorneys' Fees (15% of the total 1494.87
amount due)
TOTAL $11,460.69
with interest on the principal sum ($9,379.81) from August 29, 2008 at the contractual rate.
$25,000.00 Note
Principal $20,557.04
Interest to 8/29/08 $ 1,504.64
Late Charges $ 358.28
Attorneys' Fees (15% of the total 3 362.99
amount due)
TOTAL $25,782.95
with interest on the principal sum ($20,557.04) from August 29, 2008 at the contractual rate.
GRAND TOTAL $109,333.03
with interest on the principal sum ($85,883.31) from August 29, 2008
JAMES, SMyI'I~.,pIETTERI~~ CONNELLY LLP
BY:
Scblt A. squire
PA I.D. # 5 50
Kimberly A. onner, Esquire
PA I.D #89705
Attorneys for Defendants
Pro Hac Vice
P.O. Box 650
Hershey, PA 17033
(717) 533-3280
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
THE LEGACY BANK, a division of
FIRST NATIONAL BANK OF
PENNSYLVANIA
CIVIL DIVISION
Plaintiff
No.: ~8 - r3~3
vs.
CARING HANDS CHIROPRACTIC
WELLNESS CENTER, INC.
and KRISTEN J. KERB,
TYPE OF PLEADING
~iv~l Tee
CIVIL ACTION -COMPLAINT
IN CONFESSION OF JUDGMENT
Defendants.
TO: DEFENDANT(s)
YOU ARE HEREBY NOTIFIED TO PLEAD TO THE
ENCLOSED COMPLAINT WITHIN TWENTY (20) DAYS
FROM VICE HEREO//F OA~R A DEFAULT JUDGMENT
MAY AdAINS'i~Yn[ L
FII.ED ON BEHALF OF:
The Legacy Bank, a division of First National Bank
of Pennsylvania, Plaintiff
COUNSEL OF RECORD FOR THIS
PARTY:
Scott A. Dietterick, Esquire
Pa. I.D. #55650
Kimberly A. Bonner, Esquire
Pa. I.D. #89705
I HEREBY CERTIFI' THAT THE ADDRESS
oFTHE PLAINTIFF ts: JAMES, SMITH, DIETTERICK &
532-534 Main Saeet CONNELLY LLP
Johnstown, PA 15901
AND THE D ANT(S): P.O. Box 650
Caring Chiropractic Wellness Center, Inc. Hershey, PA 17033
a9o9 ~~ sl~t~li ~, Mechanicsburg, PA i7oss(717) 533-3280
41 Ga;~ve„~I~Ifnics~are, PA 17055
AT~RT
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
THE LEGACY BANK, a division of CIVII, DIVISION
FIRST NATIONAL BANK OF
PENNSYLVANIA
Plaintiff NO.:
vs.
CARING HANDS CHIROPRACTIC
WELLNESS CENTER, INC.
and KRISTEN J. KERB
Defendants
CIVIL ACTION -COMPLAINT IN CONFESSION OF TUDGMENT
And now comes The Legacy Bank, a division of First National Bank of Pennsylvania, by
its attorneys, James, Smith, Dietterick & Connelly LLP, files this Complaint in Confession of
Judgment as follows:
1. The Plaintiff is The Legacy Bank, a division of First National Bank of
Pennsylvania, which has its principal place of business at 532-534 Main Street, Johnstown,
Pennsylvania 15901.
2. Defendant, Caring Hands Chiropractic Wellness Center, Inc., ("Caring Hands") is
a Pennsylvania corporation authorized to conduct business in the Commonwealth of
Pennsylvania with an office located at 4909 Louise Drive, Suite 102, Mechanicsburg,
Pennsylvania 17055.
3. Defendant, Kristen J. Ken, ("Kerr") is an adult individual residing at 413 Garden
Drive, Mechanicsburg, Pennsylvania 17055.
4. On or about July 2, 2003, Cazing Hands, executed and delivered a certain
Promissory Note in favor of Plaintiff in the original principal amount of $87,000.00 ("$87,000.00
Note"), which Note authorized the confession of judgment against Caring Hands. A copy of said
$87,000.00 Note, which copy is a true and correct reproduction of the original $87,000.00 Note,
is marked Exhibit "A", attached hereto and made a part hereof.
5. On or about July 2, 2003, as security for the $87,000.00 Note, Kerr executed and
delivered a certain Commercial Guaranty in favor of Plaintiff ("$87,000.00 Guaranty") wherein
Kerr absolutely and unconditionally guazanteed payment and performance under the $87,000.00
Note, which $87,000.00 Guazanty authorized the confession of judgment against Kerr. A true and
correct copy of said $87,000.00 Guazanty, which copy is a true and correct reproduction of the
original $87,000.00 Guazanty, is mazked Exhibit "B", attached hereto and made a part hereof.
6. On or about February 12, 2004, Caring Hands, executed and delivered a certain
Promissory Note in favor of Plaintiff in the original principal amount of $15,000.00 ("$15,000.00
Note"), which Note authorized the confession of judgment against Caring Hands. A copy of said
$15,000.00 Note, which copy is a true and correct reproduction of the original $15,000.00 Note,
is mazked Exhibit "C", attached hereto and made a part hereof.
7. On or about Februazy 12, 2004, as security for the $15,000.00 Note, Kerr executed
and delivered a certain Commercial Guaranty in favor of Plaintiff ("$15,000.00 Guaranty")
wherein Kerr absolutely and unconditionally guazanteed payment and performance under the
$15,000.00 Note, which $15,000.00 Guazanty authorized the confession of judgment against
Kerr. A true and correct copy of said $15,000.00 Guazanty, which copy is a true and correct
reproduction of the original $8715000.00 Guaranty, is marked Exhibit "D", attached hereto and
made a part hereof.
8. On or about April 8, 2005, Cazing Hands, executed and delivered a certain
Promissory Note in favor of Plaintiff in the original principal amount of $25,000.00 ("$25,000.00
Note"), which Note authorized the confession of judgment against Caring Hands. A copy of said
$25,000.00 Note, which copy is a true and correct reproduction of the original $25,000.00 Note,
is marked Exhibit "E", attached hereto and made a part hereof.
9. On or about Apri18, 2005, as security for the $25,000.00 Note, Kerr executed and
delivered a certain Commercial Guaranty in favor of Plaintiff ("$25,000.00 Guaranty") wherein
Kerr absolutely and unconditionally guaranteed payment and performance under the $25,000.00
Note, which $25,000.00 Guaranty authorized the confession of judgment against Kerr. A true and
correct copy of said $25,000.00 Guaaanty, which copy is a true and correct reproduction of the
original $25,000.00 Guaranty, is mazked Exhibit "F", attached hereto and made a part hereof.
COUNTI
CONFESSION OF JUDGMENT UNDER $87,000.00 NOTE
AND $87,000.00 GUARANTY
10. Plaintiff hereby incorporates by reference its averments in Paragraphs 1 through 9
as if set forth fully herein.
11. Neither the $87,000.00 Note nor the $87,000.00 Guaranty has been released,
transferred or assigned.
12. Judgment has not been entered against the Defendants on either the $87,000.00
Note or $87,000.00 Guaranty in any jurisdiction.
13. Defendant is in default under the aforesaid $87,000.00 Note and $87,000.00
Guaaanty for failure to pay installments of principal and interest when due.
14. The judgment is not being entered by confession against a natural person in
connection with a consumer credit transaction.
15. The itemization of the amount due, including interest and attorneys' fees as
authorized by the $87,000.00 Note and $87,000.00 Guaranty, is as follows:
Principal $55,946.46
Interest to 8/29/08 $ 4,974.26
Late Charges $ 1,765.71
Attorneys' Fees (15% of the total 9 402.96
amount due)
TOTAL $72,089.39
with interest on the principal sum ($55,946.46) from August 29, 2008 at the contractual rate.
WHEREFORE, Plaintiff as authorized by the warrants of attorney contained in the
$87,000.00 Note and the $87,000.00 Guaranty, demands judgment against the Defendants in the
amount of $72,089.39 with interest on the principal sum from August 29, 2008 at the contractual
rate.
COUNT II
CONFESSION OF JUDGMENT UNDER $15,000.00 NOTE
AND $15,000.00 GUARANTY
16. Plaintiff hereby incorporates by reference its averments in Paragraphs 1 through
15 as if set forth fully herein.
17. Neither the $15,000.00 Note nor the $15,000.00 Guaranty has been released,
transferred or assigned.
19. Judgment has not been entered against the Defendants on either the $15,000.00
Note or $15,000.00 Guaranty in any jurisdiction.
20. Defendant is in default under the aforesaid $15,000.00 Note and $15,000.00
Guaranty for failure to pay installments of principal and interest when due.
21. The judgment is not being entered by confession against a natural person in
connection with a consumer credit transaction.
22. The itemization of the amount due, including interest and attorneys' fees as
authorized by the $15,000.00 Note and $15,000.00 Guaranty, is as follows:
Principal $9,379.81
Interest to 8/29/08 $ 392.61
Late Charges $ 193.40
Attorneys' Fees (15% of the total 1494.87
amount due)
TOTAL $11,460.69
with interest on the principal sum ($9,379.81) from August 29, 2008 at the contractual rate.
WHEREFORE, Plaintiff as authorized by the warrants of attorney contained in the
$15,000.00 Note and the $15,000.00 Guaranty, demands judgment against the Defendants in the
amount of $11,460.69 with interest on the principal sum from August 29, 2008 at the contractual
rate.
COUNT III
CONFESSION OF JUDGMENT UNDER $25,000.00 NOTE
AND $25.000.00 GUARANTY
23. Plaintiff hereby incorporates by reference its averments in Paragraphs 1 through
22 as if set forth fully herein.
24. Neither the $25,000.00 Note nor the $25,000.00 Guaranty has been released,
transferred or assigned.
25. Judgment has not been entered against the Defendants on either the $1525000.00
Note or $25,000.00 Guaranty in any jurisdiction.
26. Defendant is in default under the aforesaid $25,000.00 Note and $25,000.00
Guaranty for failure to pay installments of principal and interest when due.
27. The judgment is not being entered by confession against a natural person in
connection with a consumer credit transaction.
28. The itemization of the amount due, including interest and attorneys' fees as
authorized by the $25,000.00 Note and $25,000.00 Guaranty, is as follows:
Principal $20,557.04
Interest to 8/29/08 $ 1,504.64
Late Charges $ 358.28
Attorneys' Fees (15°Io of the total 3 362.99
amount due)
TOTAL $25,782.95
with interest on the principal sum ($20,557.04) from August 29, 2008 at the contractual rate.
WHEREFORE, Plaintiff as authorized by the warrants of attorney contained in the
$25,000.00 Note and the $25,000.00 Guaranty, demands judgment against the Defendants in the
amount of $25,782.95with interest on the principal sum from August 29, 2008 at the contractual
rate.
WHEREFORE, Plaintiff, as authorized by the warrants of attorney contained in the
$87,000.00 Note, $87,000.00 Guazanty, $15,000.00 Note, $15,000.00 Guazanty, $25,000.00 Note
and $25,000.00 Guazanty demands judgment in its favor and against Defendants in the total sum
of $109,333.03 with interest on the principal sum ($85,883.31) from August 29 2008 at the
contractual rate, and brings said instrument to Court to recover the said sum.
& CONNELLY LLP
BY:
Attorneys for Plaintiff
P.O. Box 650
Hershey, PA 17033
(717) 533-3280
THIS IS AN ATTEMPT TO COLLECT A DEBT, AND ANY INFORMATION OBTAINED
WILL BE USED FOR THAT PURPOSE.
Kimberly A. Bonner, Esquire
PA I.D #89705
EXHIBIT "A"
tLS tirrwll Fhtgn°et Mministrrrtbn
U.S. Small Business Administration
~~ Nora
SBA Loan # LDP 639731 4010
SBA Loan Name Caring Hands Chiropractic Wellness Center, Inc.
Date Ju.ty 2, 2003
Loan Amount 87,000.00
Interest Rate WSJ Prime + 2.75%
Borrower Caring Hands Chiropractic Wellness Center, Inc.
Operating
Company
Lender The Legacy Bank
1. PROMISE TO PAY: ':
In return for the Loan, Borrower promises to pay to the order of Lender the amount of
Eighty Seven Thousand and NO/100"*""*'*'"*"""'••'"'"«*'*' Dollars,
interest on the unpaid principal balance, and all other amounts resluircd by this Note.
2. D);FINIT[ONS:
"Collateral" means any property taken as security for payment of this Note or any guarantee of this Note.
"Guarantor" means each person or entity that signs a guarantee of payment of this Note.
"Loan" means the loan evidenced by this Notc.
"Loan Documents" means the documents related to this loan signed by Borrower, any Guarantor, or anyone who
pledges collateral.
"SBA" means the Small Business Administration, art Agency of the United Ststes of America.
SBA Fare 1 a7 (08/03!02) Verson 4.1 Pam ~~
Bankers Systems, Inc., St. Cloud, MN
3. PAYMENT TERMS:
Borrower must make all payments at the place Lender designates. The payment terms for this Note are:
The interest rate on this Note will fluctuate. The initial interest rate is 7.000% per year. This initial rate is the prime
rate on the date SBA received the loan application, plus 2.75°~. The initial interest rate must remain in affect until
the first change period.
Borrower must pay a total of 6 payments of interest only on the disbursed principal balance beginning one month
from the month this Note is dated and every month thereafter; payments must be made on the same calendar day
in the months they are due.
Borrower must pay principal and interest payments of $1,392.00 every month, beginning seven months from the
month this Note is dated; payments must be made on the same calendar day in the months they are due.
Lender will apply each installment payment first to pay interest accrued to the day Lender receives the payment,
then to bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal.
The interest rate will be adjusted quarterly (the "change period").
The "Prime Rate" is the prime rate in effect on the first business day of the month in which an interest rate change
occurs, a published in the Wall Street Journal on the next business day.
Tha adjusted interest rate will be 2.75% above the Prime Rate. Lender will adjust the interest rake on the first
calendar day of each change period. The change in interest rate is effective on that day whether or not Lender
gives Borrower notice of the change. The initial interest rate must remain in effect until the first change period
begins.
Lender must adjust the payment amount at least annually as needed to amortize principal over the remaining term
of the note.
If SBA purchases the guaranteed portion of the unpaid principal balance, the interest rate becomes fixed at the rate
in effect at the time of the earliest uncured payment defaul#. If there is no uncured payment default, the rate
becomes fixed at tt-e rate in effect at the time of purchase.
All remaining principal and accrued interest is due and payable 7 years from date of Note.
Late Charge: If a payment on this Note is mare than 10 days late, Lender may charge Borrower a late fee of up to
5% of the unpaid portion of the regularly scheduled payment.
Loan Prepayment:
Notwithstanding any provision in this Note to the contrary:
Borrower may prepay this No#e. Borrower may prepay 20 percent or less of the unpaid principal balance at any
time without notice. If Borrower prepays more that 20 percent of the Loan and the Loan has been sold on the
secondary market, Borrower must:
a. Give Lender written notice:
b. Pay all accrued interest; and
c. If the prepayment is received less than 21 days from the date Lender receives the notice, pay an amount equal to
21 days interest from the date Lender receives the notice, less any interest accrued during the 21 days and paid
under subparagraph b., above.
attached page.
SBA F°rtn 747 (08/03/02) Version 4.1 Page 2/B
Bankers Systems, Inc., St. Cloud, MN
A 147: Note Page 2 Continuatiof~
Continuation of "..."
If Borrower does not prepay within 30 days from the date Lender receives the notice, Borrower must give
Lender a new notice.
Page 1 Bankers Systems, Inc., St. Cloud, MN
4. DEFAULT:
Borrower is in default under this Note if Borrower does not make a payment when due under this Note, or if Borrower
or Operating Company:
A. Fails to do anything required by this Note-and other Loan Documents;
B. Defaults on any other loan with Lender;
C. Does not preserve, or account to Lender's satisfaction for, any of the Collateral or its proceeds;
D. Does not disclose, or anyone acting on their behalf does not disclose, any material fact to Lender or SBA;
E. Makes, or anyone acting on their behalf makes, a materially false or misleading representation to Lender or SBA;
F. Defaults on any loan or agreement with another creditor, if Lender believes the default may materially affect
Don•ower's ability to pay this Note;
G. Fails to pay any taxes when due;
H. Becomes the subject of a proceeding under any bankruptcy or insolvency law;
1. Has a receiver or liquidator appointed for any part of their business or property;
J. Makes an assignment for the benefit of creditors;
K. Has any adverse change in financial condition or business operation that Lender believes may materially affect
Borrower's ability to pay this Notc;
L. Reorganizes, merges, consolidates, or otherwise changes ownership or business structure without Lender's prior
written consent; or
M. Becomes the subject of a civil or criminal action that Lender believes may materially affect Borrower's ability to
pay this Note.
5. LENDER'S RIGHTS IF THERE IS A DEFAULT:
Without notice or demand and without giving up any of its rights, Lender may:
A. Require immediate payment of all amounts owing under this Note;
B. Collect all amounts owing from any Borrower or Guarantor;
C. File suit and obtain judgment;
D. Take possession of any Collateral; or
E. Sell, lease, or otherwise dispose of, any Collateral at public ar private sale, with or without advertisement.
G. LENDER'S GENERAL POWERS:
Without notice and without Borrower's consent, Lender may:
A. Bid on or buy the Collateral at its sale or the sale of another lienholder, at any price it chooses;
B. Incur expenses to collect amounts due under this Note, enforce the terms of this Note or any other Loan
Document, and preserve or dispose of the Collateral. Among other things, the expenses may include payments
for property taxes, prior liens, insurance, appraisals, environmental remediation costs, and reasonable attorney's
fees and costs. if Lender incurs such expenses, it may demand immediate repayment from Borrower or add the
expenses to the principal balance;
C. Release anyone obligated to pay this Note;
ll. Compromise, release, renew, extend or substitute any of the Collateral; and
E. Take any action necessary to protect the Collateral or collect amounts owing on this Note.
SBA Form 147 (08103/02) Version 4.1 Page 31a
Bankers Systems, Inc., St. Cloud, MN
7. WHEN FEDERAL LAW APPLIES:
When SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations.
Lender or SBA may use state or local procedures far filing papers, recording documents, giving notice, foreclosing
liens, and ocher purposes. By using such procedures, SBA does not waive any federal immunity frbrn state or local
control, penalty, tax, or liability. As to this Note, Borrower may not claim or assert against SBA arty local or state law
to deny any obligation, defeat any claim of SBA, or preempt federa! law.
8. SUCCESSORS AND ASSIGNS:
Under this Note, Borrower and Operating Company include the successors of each, and Lender includes its successors
and assigns.
9. GENERAL PROVISIONS:
A. All individuals and entities signing this Note are jointly and severally liable.
B. Borrower waives all suretyship defenses.
C. Borrower must sign all documents necessary at any time to comply with the Loan Documents and to enable
Lcndcr to acquire, perfect, or maintain Lender's liens on Collateral.
D. Lender may exercise any of its rights separately or together, as many tithes and in any order it chooses. Lender
may delay or forgo enforcing any of its rights without giving up any of them.
G Borrower may not use an oral statement of Lender or SBA to contradict or alter the written terms of this Note.
F. If any part of this Note is unenforceable, all other parts remain in effect.
G. To the extent allowed by law, Borrower waives all demands and notices in connection with this Note, incltrdirtg
presentment, demand, protest, and notice of dishonor. Borrower also waives any defenses based upon any claim
that Lender did not obtain any guarantee; did not obtain, perfect, or maintain a licit upon Collateral; impaired
Collateral; or did not obtain the fair market value of Collateral at a sale.
SBA Form 147 (06J03~2) Version 4.1 Pegg 4J6
Bankers Systems, Inc., St. Cloud, MN
10. S'['A'I'E-SPECIrIC PROVISIONS:
WARRANT OF AUTHORITY TO CONFESS JUDGEMENT. Upon default, in addition to all other remedies and rights
available to you, by signing below I irrevocably authorize the prothonotary, clerk, or any attorney to appear in any court
'~ of record having jurisdiction over this matter and to confess judgment against me at any time without stay of
execution. I waive notice, service of process, and process. I agree and understand that Judgment may be confessed
against me for any unpaid principal, accrued charges due on this Note, plus collection costs and reasonable attorneys'
fees up to 15 percent of the judgement. The exercise of the power to confess judgment will not exhaust this warrant
of authority to understand that my property may be seized without prior notice to satisfy the debt owed. I knowingly,
intentionally, and voluntarily waive any and all constitutional rights I have to pre-deprivation notice and hearing under
federal and state laws and fully understand the consequences of this waiver.
By signing immediately below, I agree to the terms of the CONFESSION OF JUDGEMENT section.
Krl J. Kerr, r si e t
7/2 ~z~3
DATE ~-
SBA Form 147 {08!03102) Version 4.1 page yJg
Bankers Systems, Inc., St. Cbud, MN
11. BORROWL~R'S NAMG(S) AND SIC,NATURE(S):
By signing below, each individual or entity becomes obligated under this Note as Borrower.
Caring Hands Chiropractic Wellness Center, Inc.
July 2, 2003
7?le ~U81~'il aO1'~iAi7 D~ fliCi +~tste~trilr~
~rNtl~at ~ of this Hate hes been
t~sfes'rt;Icf ih.:• ~ i=4~is~t~t1 Haider tot' ~eNaev
,Autiic~x~€
315 -~!f
~...,...e.,~.
~r
SBA Form 147 (08/o3/Q2) Vers+on 4.1 P89e 616
Bankers Systems, Inc., St. Cloud, MN
EXHIBIT "B"
US BmaU Flusinmu AdroU ratl~
U.S. Small Business Administration
~:
UNCONDITIONAL GUARANTEE
SBA Loan # LDP 639731 4010
SBA Loan Name Caring Hands Chiropractic Wellness Center, Inc.
Guarantor Kristen J. Kerr
Borrower Caring Hands Chiropractic Wellness Center, Inc.
Lender The Legacy Bank
Date July 2, 2003
Nate Amount 87,000.00
1. GUARANTEE:
Guarantor unconditionally guarantees payment to Lender of all amounts owing under the Note. This Guarantee remains
in effect until the Note is paid in full. Guarantor must pay all amounts due under the Note when Lender makes written
demand upon Guarantor. Lender is not required to seek payment from any other source before demanding payment from
Guarantor.
2. NOTE:
The "Note" is the promissory note dated July 2, 2003 in the principal amount of
Eighty Seven Thousand and N01100***'*'*****"********""***** Dollars,
from Borrower to Lender. It includes any assumption, renewal, substitution, or replacement of the Note, and multiple
notes under a line of credit.
3. DEFINITIONS:
"Collateral" means any property taken as security for payment of the Note or any guarantee of the Note.
"Loan" means the loan evidenced by the Note.
"Loan Documents" means the documents related to the Loan signed by Borrower, Guarantor or any other guarantor, or
anyone who pledges Collateral.
"SBA" means the Small Business Administration, an Agency of the United States of America.
SeA Form 748 (10198) Previous editions obsolete. Pege tJb
Bankers Systems, Inc., St. Cloud, MN
4. LENDER'S GENERAL POWERS:
Lender may take any of the following actions at any tune, without notice, without Guarantor's consent, and without
making demand upon Guarantor.
A. Modify the terms of the Note or any other Loan Document except to increase the amounts due under the Note;
B. Refrain from taking any action on the Note, the Collateral, or any guarantee;
C. Release any Borrower or any guarantor of the Note;
D. Compromise or settle with the Borrower or any guarantor of the Note;
E. Substitute or release any of the Collateral, whether or not Lender receives anything in return;
F. Foreclose upon or otherwise obtain, and dispose of, any Collateral at public or private sale, with or without
advertisement;
G. Bid or buy at any sale of Collateral by Lender or any other lienholder, at any price Lender chooses; and
H. Exercise any rights it has, including those in the Note and other Loan Documents.
These actions will not release or reduce the obligations of Guarantor or create any rights or claims against Lender.
S. FEDERAL LAW:
When SBA is the holder, the Note and this Guarantee will be construed and enforced under federal law,. including SBA
regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice,
foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Guarantee, Guarantor may not claim or assert any local or state law
against SBA to deny any obligation, defeat any claim of SBA, or preempt federal law.
G. RIGHTS, NOTICES, AND DEFENSES THAT GUARANTOR WAIVES:
To the extent permitted by -aw,
A. Guarantor waives al] rights to:
1) Require presentment, protest, or demand upon Borrower;
2) Redee-n any Collateral before or after Lender disposes of it;
3) Have any disposition of Collateral advertised; and
4) Require a valuation of Collateral before or after Lender disposes of it.
B. Guarantor waives any notice of:
1) Any default under the Note;
2) Presentment, dishonor, protest, or demand;
3) Execution of the Note;
4) Any action or inaction on the Note or Collateral, such as disbursements, payment, nonpayment, acceleration,
intent to accelerate, assignment, collection activity, and incurring enforcement expenses;
5) Any change in the financial condition or business operations of Borrower or any guarantor;
G) Any changes in the terms of the Note or other Loan Documents, except increases in the amounts due under the
Note; and
7) The time or place of any sale or other disposition of Collateral.
C. Guarantor waives defenses based upon any claim that:
1) Lender failed to obtain any guarantee;
2) Lender failed to obtain, perfect, or maintain a security interest in any property offered or taken as Collateral;
3) Lender or others improperly valued or inspected the Collateral;
4) The Collateral changed in value, or was neglected, lost, destroyed, or underinsured;
SBA Form 14a (10/88) Previous editions obsolete. pa98 y3
Bankers Systems, Inc., St. Cloud, MN
{" ;`
5) Lender impaired the Collateral;
6) Lender did not dispose of any of the Collateral;
7) Lcndcr did not conduct a commercially reasonable sale;
8) Lender did not obtain the fair market value of the Collateral;
9) Lender did not make or perfect a claim upon the death or disability of Borrower or any guarantor of the
Note;
] 0} The financial condition of Borrower or any guarantor was overstated or has adversely changed;
11) Lender made errors or omissions in Loan Documents or adminish~ation of the Loan;
l2) Lender did not seek payment frotn the Borrower, any other guarantors, or any Collateral before demanding
payment from Guarantor:
t 3) Lender impaired Guarantor's suretyship rights;
14) Lender modified the Note terms, other than to increase amounts due under the Note. If Lender modifies the
Note to increase the amounts due under the Note without Guarantor's consent, Guarantor will not be liable
for the increased amounts and re}ated interest and expenses, but remains liable for all other amounts;
I S) Borrower has avoided liability on the Note; or
16) Lender has taken an action allowed under the Note, this Guarantee, or other Loan Documents.
7. DUTIES AS TO COLLATERAL:
Guarantor will preserve the Collateral pledged by Guarantor to secure this Guarantee. Lender has no duty to preserve
or dispose of any Collateral
8. SUCCESSORS AND ASSIGNS:
Under this Guarantee, Guarantor includes. heirs and successors, and Lender includes its successors and assigns.
9. GENERAL PROVISIONS:
A. ENFORCEMENT EXPENSES. Guarantor promises to pay all expenses Lender incurs to enforce this Guarantee,
including, but not limited to, attorney's fees and costs.
B. SBA NOT A CO-GUARANTOR. Guarantor's liability will continue even if SBA pays Lender. SBA is not a
co-guarantor with Guarantor. Guarantor has no right of contribution from SBA.
C. SUBROGATION RIGHTS. Guarantor has no subrogation rights as to the Note or the Collateral until the Note is
paid in full.
D. JOINT AND SEVERAL LIABILITY. All individuals and entities signing as Guarantor are jointly and severally
liable.
E. DOCUMENT SIGNING. Guarantor must sign all documents necessary at any time to comply with the Loan
Documents and to enable Lender to acquire, perfect, or maintain Lender's liens on Collateral.
F. FINANCIAL STATEMENTS. Guarantor must give Lender financial statements as Lender requires.
G. LENDER'S RIGHTS CUMULATIVE, NOT WAIVED. Lender may exercise any of its rights separately or
together, as many times as it chooses. Lender may delay or forgo enforcing any of its rights without losing or
impairing any of them.
H. ORAL STATEMENTS NOT BINDING. Guarantor may not use an oral statement to contradict or alter the written
terms of the Note or this Guarantee, or to raise a defense to this Guarantee.
I. SEVERA$ILITY. If any part of this Guarantee is found fo be unenforceable, all other parts will remain in effect.
J. CONSIDERATION. The consideration for this Guarantee is the Loan or any accommodation by Lender as to the
Loan.
SBA form 148 (10188) Previous editions obsolete. Pege 315
Bankers Systems, lnc., St. Cloud, MN
10. STATE-SPECIFIC PROVISIONS:
WARRANT OF AUTHORITY TO CONFESS JUDGEMENT. Upon default, in addition to all other remedies and rights
available to you, by signing below I irrevocably authorize the prothonotary, clerk, or any attorney to appear in any court
of record having jurisdiction over this maNer• and to confess judgment against me at any time without stay of execution.
I waive notice, service of process,-and process. I agree and understand that judgment may be confessed against me
for any unpaid principal, accrued charges due on this Note, plus collection costs and reasonable attorneys' fees up to
15 percent of the Judgement. The exercise of the power to confess judgment will not exhaust this warrant of authority
to understand that my property may be seized without prior notice to satisfy the debt owed. i knowingly, intentionally,
and voluntarily waive any and all constitutional rights I have to pre-deprivation notice and hearing under federal and
state laws and fulty understand the consequences of this waiver.
By signing immediately below, I agree to the terms of the CONFESSION OF JUDGEMENT section.
J. Kerr
DATE
SBA Form 148 (10!98) Previous editions obsolete. Page 4!5
Bankers Systems, Inc., St. Cloud, MN
I L GUARANTOR ACKNOWLEDGMENT OF TERMS.
Guarantor acknowledges that Guarantor has read and understands the significance of all terms of the Note and this
Guarantee, including all waivers.
12. GUARANTOR NAME(S) AND SIGNATURE(S):
By signing below, each individual or entity becomes obligated as Guarantor under this Guarantee.
J. Kerr
July 2, 2003
SBA Form 148 {70198} Arevlous edilbns~obsolete. Page 5I5
Bankers Systems, Inc., St. Cloud, MN
E~:HIB IT "C"
1
LbAN NUMBER LOAM NAWIc ACCT. NUMBER MOT fE INITfALS
1001-77559 Caring Hands Chiropractic 02/12/04 RM
Wellness Center, Inc.
NOTE AMOUNT INDEX Iw/Msrgini RATE MATURITY DATE LOAN PURPOSE
516,000.00 Wall Street Journal Prime plus 8.75% 02/12/11 Commercial
2.760%
Creditor Use Only
PROMISSORY NOTE
iCommsrolel -Draw -Variable Rate)
DATE AND PARTIES. The date of this Promissory Note iNote) is February 12, 2004. The parties and their addresses are:
LENDER:
THE LEGACY BANK
2600 Commerce Drive
Harrisburg, Pennsylvania 17110
Telephone: {7t7) 44t-3400
BORROWER:
CARING HANDS CHIROPRACTIC WELLNESS CENTER, INC.
a Pennsylvania Corporation
4940 Ritter Road Suite 104
Mechanicsburg, Pennsylvania 17066
1. DEFINITIONS. As used in this Note, the terms have the following meanings:
A. Pronouns. The pronouns "I,' 'mo," and "my" refer to each Borrower signing this Note, individueliy and together with their heirs, successors and assigns,
and each other person or legal entity {induding guarantors, endorsers, end sureties} who agrees to pay this Note. "You' end "Your` refer to the Lender, with its
participants or syndicators, successors and assigns, or any parson w company that acquires an Mterest in the Loan.
B. Note. Note refers to this document, and any extensions, renewals, modifications and substitutions of this Note.
C. Loan. Loan refers to this transaction generally, including obligations and duties arising from the terms of all documents prepared w submitted for this
transaction such as applications, security agreements, disclosures or notes, end this Note.
D. Property. Property is any property, reel, personal or Intangible, that secures my performance of the obNgatlona of this Loan.
E. Peroent. Rates end rate change limitations are expressed as annualized percentages.
2. PROMISE TO PAY. For value received, I promise to pay you or your order, at your address, or at such other location as you may designate, amounts advanced
from time to time under the terms of this Note up to the maximum total principal baance of 31b,000.00 lfhincipal}, plus interest from the date of disbursement, on
the unpaid outstanding Principal balance until this Note matures or this o6figatfon is accelerated.
Ail advances made will be made subject to all other farms and conditions of this Loen,
3. INTEREST. Interest will accrue on the unpaid Principal balance ofi this Note et the rate of 8.76 percent {Interest Rste) until Mey 12, 2004. Then, Interest will
accrue on the urrpaid Prindpal balance at a rate based on the then current index value as described in the Variable Rate subsection. This tntareat rata (Second Phase
Interest Reta) is subject to all provislona described in that subsection.
A. Mtareat After Default. if you dadare a dafsult under the terms of this Loan, including fw failure to pay in full et maturity, you may incr~se the Interest Rate
payable on the outstanding Principal balance of this Note. In such event, interest will accrue try"the following manner: In the event of default for whk:h Lender
does not accelerate the Loan, including failure of borrower to provide the financial statements as required hereunder w under the loan agreement, the applicable
interest rate to the Loan for a period beginning three (3{ days after written notice of such deteult end ending upon the curing of sold noticed default, shall
increase three percent (3%} during the period which noticed deteult continues. Such default interest rate shall apply to the outstanding principal balance of the
Low. Upon the oudng of the noticed default, the Interest rata on the Loan shell revert to the initidly agreed upon interest reta effective on the date on which
the deteult is cured.
6. Maximum Interest Amount. Any amount assessed or collected as interest under the terms of this Note or obligation will be limited to the Maximum Lawful
Amount of interest allowed by state or federal law. Amounts collected in excess of the Maximum Lawful Amount will be applied first to the unpaid Principal
balance. Any remainder will he refunded to me.
C. Statutory Authority. The amount assessed or eoNected on this Note is authorized by the Pennsylvania Simplification and AvaiiabNity of Benk Credit Act {Pa.
Stet. Ann. title 7, 4 322).
D. Accrual. During the scheduled term of this Loan interest accrues using an Actua11360 days counting method.
E, Varlehie Rste. The Interest Rate may change during the term of this transaction.
{11 index. The Second Phase Interest Rete will ba based on the folowing index: the highest base rate on corporate loans posted by at least 76% of the
nation's 30 largest banks that The Well Street Journal publishes as the Prime Rete.
The Current Index is the moat recent Index figure available on each Change Date. You do not guaranty by selecting this Index, or the margin, that the
Interest Rate on this Note wiH be the same rata you charge on any other loans or class of loans you make to me or other borrowers. If this Index Is no
longer available, you will substitute a simper index. You will give me notice of your choice.
t21 Change Date. Each date on which the Interest Rata may change is called a Change Date. The Interest Rsta may change-Mey t2, 2004 and daily
thereafter.
(3) Cak:uretion Of Change.. On each Change Oate, you will calculate the Interest Rate, which will be the Current Index plus 2.760 percent. The result of
this calculation will be rounded up to the nearest ,126 percent. Subject to any limitations, this will be the Interest }fate until the next Ctrange Date. The
new Interest Rats will become effective on each Change Date. The Interest Rate std other charges on this Note wHl never exceed the highest rate or
charge allowed by law for this Note.
141 Effect Of Variable Rate. A change in the Interest Rate will have the following effect on the payments: The amount of scheduled payments will change.
Caring Henda Chiropractic Wellness Canter, Inc.
Pennsylvania Promissory Note
PA/4fkachura00726200004288011022004N .
°1998 Bankara Systems,. Inc., St...Cloud, MN E er " .. . .
~: t
4. ADDITIONAL CHARGES. As additional consideration, I agree to pay, or have paid, the fees and charges listed o„ ..te APPENDIX: FEES AND CHARGES, which M
attached to and made part of this Note. 1 understand end agree that some payments to third parties as part of this transaction may also involve money retained by
you or paid beck to you as commissions or other remuneration.
5. REMEDIAL CHARGES. In addition to intareat or other finance charges, I agree that I will pay these additional teas based on my method and pattern of payment.
Additional remedial charges may be described efaewhare In tMs Note.
A. Late Charge. If a payment is more then 10 days Isla, I will be charged 5.000 percent of the Amount of Payment. I will pay this late charge promptly but
only once for each late payment.
8. GOVERNING AGREEMENT. TMs Note is further governed by the Commercial Loan Agreement executed between you end me es pert of this loan, es modified,
amended or supplemented. Upon execution of this Note, I represent that I have reviewed and em in compliance with the terms contained In the Commercial Loan
Agreement.
7. PAYMENT. I agree to pay this Note in 84 inatalimant payments. I wiN make 3 payments of accrued interest beginning March t2, 2004, and then on the 12th
day of each month thereafter until May t 2, 2004.
Then, l agree to make 81 installment payments. A payment of 5231.81 will be due June 12, 2004, and on the 12th day of each month thereafter. I wtN make 12
scheduled payments of this amount. The scheduled payment emouM may than change every 12 payments thereafter. Changes in the Interest Rete will not effect
the scheduled payment amount dudng these periods. With each scheduled payment change the payment amount wNl be adjusted to reflect changes in the Interest
Rate and the remaining term of this Note. In addition, changes to the scheduled payment amounts ere subject to changes in the Interest Rata ea described in the
Variable Rate subsection of this Note. A final payment of the entire unpaid balance of Principal and interest will be due February 12, 2011.
Payments wilt ba rounded to the nearest 6.01. With the final payment I also agree to pay any additional fees or charges owing and the amount of any advances you
have made to others on my behalf. Payments scheduled to be paid on the 29th, 30th or 31st day of a month that contains no such day wiB, instead, be made on
the lest day of such month.
Each payment I make on this Note wilt be applied first to interest that Is due then to principal that is due, end tina8y to any charges that I owe other than principal
and intareat. If you end I agree to a different application of payments, wa will describe our agreement on this Nota. Tha actual amount of my final payment will
depend on my payment record.
B. PREPAYMENT. I may prepay this Loan in full or in part at any time. Any partial prepayment will not excuse any later scheduled payments until i pay in full.
9. LOAN PURPOSE. The purpose of this Loen is to provide permanent working capital.
10. ADDITIONAL TERMS. Tha loan secured by this lien was made under a United States Small Business Administration ISBA) nationwide program which uses tax
dollars to assist small business owners, if the United States is seeking to enforce this document, than under SBA regulations:
When SBA is the holder of the Note, this document and aq documents evidencing or securing this Loen will be construed in accordance with federal law.
Lender or SBA may use local or state procedures for purposes such as filing papers, recording documents, giving notice, foreclosing liens end other purposes. By
using these procedures, SSA does not waive any federal immunity from local or state control penalty tax or liability. No Borrower or Guarantor may claim or assert
against SBA any local or state law to deny any obligation of Borrower, or defeat any claim of SBA with respect to this Loan.
Any clause in this document requiring arbitration is not enforceable when SBA is the holder of Tha Note secured by this Instrument.
This loan will be cross-collateralized with the existing UCC-1 filings used to secure Commercial Loan i+100118632 as evidenced by a Promissory Note dated July 2,
2003 in the amount of $87,000.00.
11. SECURITY. This loan is secured by separate security instruments prepared together with this Note as follows:
Document Name Parties to Document
Security Agreement -Caring Hands Chiropractic Wellness Caring Hands Chiropractic WelMess Center, Inc.
Center, Inc.
12. ASSUMPTIONS. Someone buying the Property cannot assume the obligation. You may declare the entae balance of the Note to be immediately due and
payeWe upon the creation of, or contract for the creation of, any ben, encumbrance, or transfer of the Property. However, I may sell or similarly dispose of any
Property that is Inventory.
13. WAIVERS AND CONSENT. To the extent not prohibited by law, I waive protest, presentment for payment, demand, notice of acceleration, notice of intent to
eccelerote and notice of dishonor.
A. Additional Walwra By Borrower. In addition, I, and any party to this Note and Loan, to the extent permitted by law, consent to certain actions you may take,
and genereNy waive defenses that may be avNlable based on these actions or based on the status of a party to this Note.
11) You may renew or extend payments on this Note, regardless of the number o/ such renewals or extensions.
12) You may release any Borrower, endorser, guarantor, surety, accommodation maker or any other co-signer.
f3) You may release, substitute or impair any Property securing this Nota.
14) You, or any institution participating in this Note, may invoke your right of set-off.
f5) You may enter into any sales, repurchases or participations of this Note to any parson in any amounts end i waive notice of such sales, repurchases or
participations.
It3- l agree that any of us signing this Note ae a Borrower is authorized to modify Ufa terms of this Note or any instrument securing, guarantying or relating
to this Note.
171 1 agree that you may inform any party who guarantees this Loan of any Loen accommodations, renewals, extensions, modif~ations, substitutions or
future advances.
B. No Waiver By Lender. Your course of dealing, or your forbearance from, or delay in, the exercise of any of your rights, remedies, privileges or right to insist
upon my strict performance of any provisions contained in this Note, or other Loan documents, shah not ba construed ea a waiver by you, unless any such
.waiver is in writing and is signed by you.
14. APPLICABLE LAW. This Nota is governed by the laws of Pennsylvania, the United States of America end to the extant required, by the laws of the jurisdiction
where the Property Is located. 1n the event of a dispute, the exclusive forum, venue and piece of jurisdiction will be in Pannaylvanla, unless otherwise required by
law. Any provision that appoints you ea en agent is not subject to the provislans of 20 Pa.C.S.A. Section 6801 et seq. (Chapter B8; Decedents, Estates and
Fiduciaries Code. ey exercising any of your rights under this Note, you do so for your sole benefit.
Caring Hands Chiropractic Wellness Center, Inc. -
Pennsylvania Promssory Nate Initials
PA/4fkachura00726200004288011022004N 01996, Bankers Systems,,lnc., St.•Cbud, MtJ F_ic~er~.° age 2
{
18: JOINT AND MJDIVIDUAL LIABILITY AND SUCCESSORS. My obligation to pay this Loen is independent of ,... obligation of any other person who has dso
agreed to pay it. You may sue me alone, or anyone else who is obNgeted on this Loan, or any number of us together, to collect this Lost. Extending this Loan or
new obligations under this Loan, will not affect my duty under this Loen and I will still be obligated to pay this Loen. The duties end benefits of this Loan will bind
and benefit the successors end assigns of you and me.
1B. AMENDMENT, BJTEtiRATION AND SEVERABILITY. This Note mny not be mrrended or modified by oral agreement. No amendment or modificadan of this Note
Is effective urdese made ~ writng and executed by you and me, This Note is the complete and Hnet expression of the agreement. If any provision of this Note is
unenforceable, then the unenforceable provision will be severed and the remaining provisions will stNl be enforceable.
17. INTERPRETATION. Whenever used, the singular includes the plural and the plural includes the singular. The section headings are for convenience only end ere
not to be used to Interpret or define the terms of this Note.
18. NOTICE. FINANCUIL REPORTS AND ADDITIONAL DOCUMENTS. UNess otherwise required by law, any notice wiN ba given by dsliverir-g it or mailing It by first
class mail to the appropriate party's address listed in the DATE AND PARTIES section, or to any other address designated in writing. .Notice to one party will be
deemed to be rrotlce to all parties. I wNl inform you in writing of any change in my name, address or other application information. 1 agree to sign, deliver, end file
any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obNgations under this Loan and to confirm your
Nen status on any Property. Time is of the essence.
19. CRED17 INFORMATION. I spree to supply you with whatever infarmation you reasonably request. You wiN make requests for this information without undue
frequency, and wiN give me reasonable time in whkh to supply the information.
20. ERRORS AND OMISSIONS. 1 agree, if requested by you, to iully cooperate in the correction, If necessary, in the reasonable discretion of you of any and ell loan
closing documents so that all documema accurately describe the loan between you and me. 1 agree to assume aN coats including by way of illustration and not
limitation, actual expenses, legal fees and marketing bases for felting to reasonably comply with your requests within thirty (301 days.
WARRANT OF AUTHORITY TO CONFESS JUDGMENT. Upon defwlL In addition to eN other remadkts end rights walhiWs to you, by signing below 1 Irrevocably
authwhs the prothonotary, clerk, or arry attorney to appear in any oourt of rocord h:vk-g Jurisdiction over this maitar end to corrfeas Judgment against ms at any
time without stay of execution. 1 waive notice, service of process, and process. I agree and understand that Judgment may be confessed against rra for any unpaid
principal, accrued Interest, and accrued charges due on this Note, plus cogsctlon costs and reewnebb attorneys' fees up to 16 percent of the Judgment. The
exercke of the power to confess Judgment wNl not exhaust tMs warrant of authodty to confess Judgment and may bs done as often as you elect. 1 Furtl»r
understand that my property may be seized without prior nodce to satisfy the debt owed. I knowingly, IntsntbnaNy, end voMrtarily waive any and all conatitutlonal
fights I have to pre-deprkratbn nottca end hearing u»der federal end stets laws and fully understand the consequences of this waiver:
By signing ImmedieNly below, 1 agree to the terms of the CONFESSION OF JUDGMENT section.
Caring Hands C iropractic WeNne s Center, Inc.
Kr J. err, e
21. SIGNATURES. By signing under seal, I agree to the terms contained in this Note. I also acknowledge receipt of a copy of this Note.
BORROWER:
Caring Hands C Iropractic Wellness enter, Inc.
(Seep
Kris .Kerr, Presi t
Gering Hands Chiropractic Wepneas Canter, Inc.
Pennsylvania Promissory Nots Initials
PAI4fkachura007262000042fi60110220C74N x1996 Bankers Systems; inc.; St. Cloud, MI3: F aer ° _, :. ,. age 3
APPENDIX: FEES AND CHARflES
As described in the ADDITIONAL CHARGES section of the attached Note, I agree to pay, or have paid, these additional fees end chsrgea.
Norrcafundable Fess and Charges. The foNowing fees era earned when collected and wGi not be retunded if I prepay this Note before the scheduled maturity date.
SBA Guaranty. Atn! S6~1 Guaranty fee of S 100.00 payable from separate funds on or before today's date.
Psoksging Fes. A~nl Psckaging Fee fee o/ 8100.00 paysble from separate funds on or before today's date.
I understand end agree that some payments to thbd psrties as part of this transaction may also involve money retained by you or paid back to you es commissions
or other remuneration.
Gering Hands Chiropractic WaUneas Cantor, Inc.
Pennsylvania Prombaory Note Initials
-PA/4fkachura00725200004288011022004N mt9gB Bankers Syatema; Inc,;.St;::Cloud, MN E:c.~er"' _ _ age 4
EXHIBIT "D"
' GUARANTY
tContinuing Debt -Unlimited)
DATE AND PARTIES. The date of this Guaranty is February 12, 2004. Tha parties and their addresses ere:
LENDER:
THE LEGACY BANK
2800 Commerce Drive
Hsrdsburg, Pennaylvenie 17110
Telephone: (717- 441'-3400
BORROWER:
CARING HANDS CHIROPRACTIC WELLNES6 CENTER, INC.
a Pennsylvania Corporation
4940 Ritter Roed Suite 104
Mechanicsburg, Pennsylvenla 17066
GUARANTOR:
KRISTEN J. KERB
413 Garden Drive
Mechanicsburg, Pennsylvania 17066
1. DEFINITIONS. As used in this Guerenty, the terms have the fo8owing meanings:
A. Prenourta. The pronouns "I", "me' erxi "my" refer to all persons or entities signing this Guaranty, individuaNy grid togethx with their hews, successors and
assigns: "You" end "your" rofer to the Lender, with its parNdpenU or syndiceto-sy auccesaore and assigns, or any parson or company that acquires an Interest
in the Debt.
B. Note. "Note" raters to the document that evidences the Borrower's indebtedness, and any extensions, renewals, modifications and substitutions of the Note.
C. Debt. "Debt" refers to debts, Ifebilities, and obfigetiona of the Borrower (including, but not limited to, amounts agreed to be paid under the terms of any
notes or agreements secwing the payment of any debt, loan, liability or obligation, averdrefts, letters ofcredit, guaranties, advances for taxes, insurance, repairs
and storage, and all extenalona, renewals, refinancings end modificatona of these debts) whether now existir-g or created or Incurred in the Future, due or to
become due, or absolute or contingent, including obligations end duties arising from the terms of ail documents prepared or submitted for the transaction such
es applications, security agreements, disclosures, the Note, and this Guaranty.
D. Property. "Property" means any property, real, personal or intangible, that secures performance of the obligations of the Note, Debt, or this Guaramy.
2. AGREEMENT TO GUARANTY. For good and valuable consideration, the receipt and su(fici~cy of which fa hereby acknowledged, and to induce you, at your
option, to make loans or engage in any other vansactions with the Borrower from time to time, I absolutely and uncondiNonagy promise to pay and guaranty the full
and prompt payment of the following Dabt when due {whether at maturity or upon ecceleretion-, including without limitation, all principal, accrued interest,
attorneys' fees and collection costs, when allowed by law, that may become due from the Borrower to you in collecting the Debt and in enforcing tMs Guaranty end
all other agreements with respect to the Borrower.
3. SPECIFIC AND FUTURE DEBT GUARANTY. 1 absolutely end unconditionally agree to all terms of and guaranty to you the payment and performance of each and
every Debt, of every type, purpose and description that the Borrower either individually, among al! or a portion of themselves, or with others, may now or at any
time in the future owe you, including, but not Nmitad to the folbwing described Debt(s): A promissory mote or other agreement, No. 1001-77669, dated February
12, 2004, from Caring Hands Chiropractic WeNness Center, Inc, fBorrower- to you, in the amount of $16,000.00,
You may, without notice, apply this Guaranty to such Debt of the Borrower es you may select from time to time.
4. EXTENSIONS. 1 consent to all renewaa, extensions, modifications and subatltutions of the Dabt which may be malls by you upon such terms and conditions as
you may see fit from time to time without further notice to me end without Ilmitatfon as to the number of renewals, extensions, modificstiona or substitutions.
6. UNCONDITIONAL LIABILITY. i am unconditionally liable under this Guaranty, regardless of whether or not you pursue any of your remedies against the Borrower,
against any other maker, surety, guarantor or endorser of the Oabt or against any Property. You may sue me alone, or anyone else who is obligated on this
Guerarrty, or sny number of us together, to collect the Debt. My liability is not conditioned on the signing of this Guaranty by any other person end further is not
subject to any cotxlitlon not expressly sat forth in this Guaranty or sny instrument executed in connection wkh the Dabt. My obligation to pay according to the
terms of this Guaranty shall not be affected by the iNegaNty, invaNdity or unenforceabiFty of arty notes or agreements evidendng the Debt, the violation of any
applicable usury laws, forgery, or any other circumstencea which make the indebtedness unenforceable egaMst the Borrower. 1 will remain obligated to pay on this
Guaranty even if any other person who Is obligated to pay the Debt, including the Borrower, has such obligation discharged In bankruptcy, forecbsure, or otherwise
discharged by law.
B. BANKRUPTCY. IE a bankruptcy petition should at any lima be fNed by or against the Borrower, the maturity of the Debt, so far es my liability is concerned, ahaN
be accelerated and the Dabt shah be immediately payable by me. I acknowledge end agree that this Guaranty, and the Dabt secured hereby, wNl remain in fWl force
end effect at all times, notwithstanding any action or undertakings by, or against, you or agairrot any Property, in connection with any obligation in any proceeding in
the United Stetea Bankruptcy Courts. Such action or undertaking includes, without limitation, valuation of Property, election of remedies or impositan of secured or
unsecured claim status upon claims by you, pursuant to the United States Bankruptcy Coda, as emended. In the event that any payment of principal or interest
received and paid by any other guarantor, borrower, surety, endorser or co•meker is deemed, by final order of a court of competent jurisdiction, to have been e
voidable preference under the bankruptcy or Insolvency laws of the United States or otherwise, then my obligation will remain ae an oblgation to you and will not be
considered as having been extinguished.
7. REVOCATION. 1 agree that this is an absolute and unconditional Guaranty. I agree that this Guaranty wNl remain binding on me, whether or not there ere any
debts outstanding, until you have actually received written notice of my revocation or written notice of my death or incompetence. Notice of ravocaCron or notice of
my death or incompetence will not affect my obligations under this Guaranty with respect to any Debts incurred by or for which you have made a commitment to
Borrower before you actually receive such notice, and e!I renewals, extensions, refinancings, and modifications of such Debts, I agree that It any other person
signing this Guaranty provides a notice of revocation to you, 1 will aWl be obligated under this Guaranty untN I provide such a notice of revocation to you. If any
ocher person signing this Guaranty dies or is declared incompetent, such fact will not affect my obligations under this Guaranty.
S. PROPERTY. I agree that any Property may be assigned, exchanged, released In whole or in part or substituted without notice to me and without defeating,
discharging or diminishing my liability. fvh/ obligation la absolute and your failure to perfect any security interest or any act or omission by you which impairs the
Property will not relieve me or my liability under this Guaranty. You are under no duty to preserve or protect any Property until you era in actual or constructive
Kristen J. Karr
Pennsylvania Guaranty Initials
PA/4fkachura00725200004266011022004Y °f998 Bankers Systems, Inc., St. Cloud, MN Ex exx " .age 1
possession. For purposes of this paragraph, you will{. oe in 'actual" possession when you have physical, imr~~ ~ and exclusive control over the Property and
have accepted such control in writing. Further, you wtll only be deemed to be In "constructive" possession when yuu have both the power end Intent to exercise
control over the Property.
9. DEFAULT. I wilt be in default if any of the following occur:
A. Payments. I fail to make a payment in full when due.
8. Insolvency or Bankruptcy. I make an assignment for the benefit of creditors or bscorne insolvent, either because my NablNtles exceed my assets or I am
unable to pay my debts as they become due; or I petition for protection under federal, state or local bankruptcy, insolvency or debtor relief laws, or em the
subject of a petition or action under such laws end fail to have the patitbn or action dismissed within a reasonable period of time not to exceed BO days.
C. Death or Incompstenoy. I die or ern declared legally incompetent.
D. Failure to Perform. 1 fail to perform any condition or to keep any promise or covenant of this Guaranty.
E. Other Documonta. A default occurs under the terms of any other transaction document.
F. Other Agreements. I am in default on any other debt or agreement I have with you.
G. Mtsreprssentatlon. !make any verbal or written statement or provide any financial information that is untrue, inaccurate, or conceals a materiel fact at the
time it fs made or provided.
H. Judgment. I fail to satisfy or appeal any judgment against ma.
1. Forfeiture. The Property is wed in a manner or for a purpose that threatens confiscation by a legal authority,
J. Name Change. i change my name or assume en additional name without notifying you before making such a change,
K. Property Trarrefer. 1 transfer aN or a substantial part of my money or property.
L. Property Value. The value of the Property declines or is impaired.
M. Ensecurity. You reasonably believe that you era insecure.
10. WAIVERS AND CONSENT. To the extent not prohibited by law, I waive protest, presentment for payment, demand, notice of ecceleretlon, notice of intent to
accelerate errd notice of dishonor.
A. Additional Waivers. In addition, to the extant permitted by law, l consent to certain actions you may take, and generally waive defenses that may be
available based on these actions or based on the. status of a party to the Dabt or tfus Guaranty.
(1} You may renew ar extend payments on the Debt, regardless of the number of such renewals or extensions.
12) You may release any Borrower, erufarser, guarantor, surety, accommodation maker or any other co-signer.
13) You may release, substitute or impair any Property securing the Debt.
14) You, or any €nstitudon partkapating in the Debt, may invoke your righE of set-off.
(6) You may enter into any sales, repurchases or partlcipations of the Debt to any person in any amounts end I waive notice of such salsa, repurchases or
participations.
IB! I agree that the Borrower is authorized to modify the terms of the Debt or any instrument securing, guarantying or relating to the Debt.
17) You may undertake a valuation of any Property in connection with any proceedings under the United States Bankruptcy Code concerning the Borrower
or me, regardless of any such valuation, or actual amounts received by you arising from the sale of such Property.
(8} I agree to consent to any waiver granted the Borrower, and agree that any delay or lack of dAigence in the enforcem~t of the Debt, or any failure to
file a claim or otherwise protect any of the Debt, in no way affects or impairs my liability.
19) I agree to waive reliance on any anti-deficiency statutes,.through subrogation ar otherwise, and such statutes kr no way effect or Impair my li~ility. In
addition, I waive any right of subrogation, contribution, reimbursement, indemnification, exoneration, and any other right I may have to enforce any
remedy which you now have or In the future may have against the Borrower or another guarantor or as to any Property.
Any Guarantor who is an "insir~r," as contemplated by the United States 8ankruptey Coda, 11 U.S.C. 101, as emended, meka$ these waivers
permanently. (An insider includes, among others, a director, officer, partner, or other person in control of the Borrower, a person or an entity that is a eo-
partner with the Borrower, an entity in which the Borrower is a general partner, director, officer or other parson in control or a close relative of any of
chase other persons.) Any Guarantor who is not an insider makes these waivers until all Debt is fully repaid,
8. No Waiver By Lendor. Your course of deeNng, or your forbearance from, or delay in, the exercise of any of your rights, remedies, privileges or right to insist
upon my strict performance of any provisions contained in the petit instruments, shell not be construed as a waiver by you, unfeas any such waiver is in writing
and is signed by you.
C. Waiver of Clsima. I waive all claims for loss or damage caused by your acts or omissions where you acted reasonably and in good faith,
11. REMEDIES. After the Borrower or 1 default, and after you give any legally required notice end opportunity to ours the default, you may at your option do. any
one or more of the following.
A. Acceleration. You may make ell or any part of the amount owing by the terms of this Guaranty immediately due.
B. Sources. You may use any and ell remedies you have under store or federal law or in any instrument se6wing the Debt.
C, Insurance Benefits. You may make a claim for any and all insurance benefits or refunds that may be available on default.
D. Payments Made on the Borrower's Behalf. Amounts advanced on the 8orrower's behaEf will be immediately due and may ba added to the balance owing
under the Debt.
E. Termination. You may terminate my right to obtain advances and may refuse to make any further extensions of credit.
F. Set•Ott. You may use the right of set-off. This means you may set-off any amount due and payable under the terms of this Guaranty against any tight I
have to receive money from you.
My right to receive money from you includes any deposit or share account balance 1 have with you; any money owed to me on an Item presented to you o[ in
your posaeaeion for collection or exchange; and any repurchase agreement or other non-deposit obligation. "Any amount due and payable under the terms of
this Guaranty" means the total amount to which you are entitled to demand payment under the terms of this Guaranty at the time you set-off.
Subject to any other written contract, If my right to receive money from you is also owned by someone who has not agreed to pay the Debt, your right of set-
off will apply to my interest fn the obligation and to any other amounts 1 could withdraw on my sole request or endorsement.
Your right of sot-off does not apply to en account or other obligation where my rights arise only in a representative capacity. ft also does not apply to any
individual Retirement Account or other tax-deferred retirement account.
You will not be Noble for the dishonor of any check when the dishonor occurs because you set-off against any of my accounts, I agree to hold you harmless
from any such claims arising as a result of your exercise of your right of set-off,
O. Waiver. Except as otherwise required by law, by choosing any one or more of theas remedies you do not give up your right to use any other remedy. You
do not waive a default if you choose not to use a remedy. By electing not to use any remedy, you do not waive your right to later consider the event a default
and to use any remedies if the default continues or occurs again.
Kristen J. Kerr ~~/
Pennsylvarrie Guaranty Initlels__ ~{~IC./
PA/4fkachura007 2 6 200004 2 86 01 1 02 2004Y °1998 Bankers Systems, Inc., St. Cloud, MN Ex~er~," ~~a""ge~~2
i
12. COLLECTION EXPENSES AND ATTORNEYS' FEES. Un or after Default, to the extent permitted by law, I agr (b pay ell expenses of collection, enforcement or
protection of your rights and remedbs under this Guaranty or any instrtxrtent executed in connection with the creation of any Debt guarantied by this Guaranty. All
fees and expenses will be secured by the Property 1 have granted you, if any. To the extent permitted by the United States Bankruptcy Code, I agree to pay the
reasonable attorneys' fees you incur to collect the Debt guarantied by this Guaranty as awarded by any court exercising juriadictiort under the Bankruptcy Code.
13. WARRANTIES AND REPRESENTATIONS. I have the right and authority to enter into this Guaranty. The execution and delivery of this Guaranty will not violets
any agreement governing me or to which I em a party.
In addition, I represent end warrant that this Guaranty was entered into at the request of the Borrower, and that I am satisfied rsgerding the Borrower's financial
condition and existing indebtedness, authority to borrow and the use and intended use of all Debt proceeds. 1 further represent end warrant that I have not relied on
any -eprasentatione or omissions from you o- any information provided by you rospecting the Borrower, the Borrower's financial condition and existing Indebtedness,
the Borrower's authority to borrow or the Borrower's use and intended use of ell Debt proceeds.
14. RELIANCE. I acknowledge that you are relying on this Guaranty in extending credit to the Borrower, end I have signed this Guaranty to induce you to extend
such credit. I represent and warrant to you that 1 have a dkect and substantial economic interest in the Borrower and expect to derive substantial benefits from any
loans and financial accommodations resulting in the creation of indebtedness guarantied hereby. I agree to rely exclusively on the right to revoke this Gu~anty
prospactivsly es to future transactions in the manner es previously described in this Guaranty if at any time, in my opinion, the benefits then being racslwd by me in
connsctfon with this Guaranty eta not auffieiant to warrant the continuance of this Guaranty. You may rely conduslvety on a continuing warranty that 1 continue to
be benefited by this Guaranty and you will have no duty to inquire into or confirm the receipt of any such benefits, and this Guaranty will be effective and
enforceable by you without regard to the receipt, nature or value of any such benefits.
15. APPLICABLE LAW. This Guaranty la governed by the laws of Pennsylvania, the United States of America end to the extent required, by the laws of the
jurisdiction where the Property is located.
16. AMENDMENT, tNTE0RAT10N AND SEVERABILITY. This Guaranty may not. 6e emended or modified by oral agreement. No amendment or modification of this
Guaranty Ia effective unless made in writing and executed by you and ma. This Guaranty is the complete and final expression of the agreement. If any provision of
this Guaranty is unenfaceable, than the unenforceable provision will be severed and the remaining provisions wiq still be enforceable.
77. INTERPRETATION. Whenever used, the singular includes the plural end the plural includes the singular. Tha section headings are for convenience only a»d are
not to be used to interpret or define the terms of this Guaranty.
18. NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS. Unbsa otherwise required by law, any notke wHl be given by delivering It or malting it by first
class mail to the appropriate party's address pared in the DATE AND PARTIES section, or to any other address designated in writing. Notice to one party will be
deemed to be notice to aH parties, f will inform you in writing of any change in my name, address or other appgcation krtormation. 1 will provide you any tinanclel
statement or information you request. All financial statements and information I give you wHl ba correct and complete. I agree to sign, deliver, and file any
additional documents or certlficatlons that you may consider necessary to perfect, continue, end preserve my obligations under this Guerxtty and to confirm your
lien status on any Property. Time is of the essence.
18. CREDIT INFORMATION. I agree that from time to tkne you may obtain credit intormation about me from others, including other lenders and credit reporting
agencies, arxt report to others (such as a credit reporting agency) your credit experience with me. I agree that you wiq not be liable for any claim arising from the
use of information provided to you by others or for providing such information to others.
WARRANT OF AUTHORITY TO CONFESS JUDGMENT. Upon default, In addtion to all other remedies and rights available to you, by signing below l brovoasbly
authorize the prothonotary, clerk, or any attorney to appearln any court of record having jurbdlction over this matter end to confess judgntsnt against ma st any
thus without stay of execution. I wive notice, service of process, end process. 1 agree and understand that Judgment may be aonfesasd against me for any urrpaid
principal, accrued interest, end accrued charges due on this Ouarsnty, plus collection coats and reasonable attorneys' (ass up to 16 percent of the Judgment. The
sxerelse of the power Io confess judgment will not exhwst thb warrant of authority to confess judgment and may be done as often as you shot. I further
understand that my property may be seized without prior notice to satisfy the debt owed. I knowingly, Intentionsgy, and voluntarHy waive any and all aonstkutlonal
rights 1 have to pre-dsprlvatfon notbe and hearing under federal and state laws end fully understand the consequences of this waiver.
By signing knmadlatefy below, I agree to lice terms of the CONFESSIDN OF JUDGMENT section.
Kris J. Kerr
Individually
20. 81GNATURES, By signing under seal, I agree to the terms contained in this Guaranty. I also acknowledge receipt of a copy of this Guaranty.
GUARANTOR:
eat}
Krist n Kerr
Individually
Kristen J. Kerr
Pennsylvania Quaranty Initiala~
PA/4fkechura007 2 5200004 2 6601 1 022004Y 01996 Bankers Systems, Inc., St. Cloud, MN Eirl~~er page
EXHIBIT "E"
SBA..
U.S. Small Business Administration
NOTE
SBA Loan # 12566150-06
SBA Loan Name Caring Hands Chiropractic Wellness Center, inc.
Date Aprii B, 2005
Loan Amount 25,000.00
Interest Rate WSJ Prime + 2.T5%
Borrower Caring Hands Chiropractic Wellness Center, Inc.
Operating
Company
Lender The Legacy Bank
I . PROMISE TO PAY:
In return for the Loan, Borrower promises to pay to the order of Lender the amount of
TWENTY FIVE THOUSAND AND OO/1 O0 "''~*"""*rr~a-**~r~~y~iir~N~s~s„N~~~it+~t~*~~-,~~,~~*r~iti-s-r»-ssr~ Dollars,
interest on the unpaid principal balancq and all other amounts required by this Note.
2. DEFINITIONS:
"Collateral" means any property taken as security for payment of this Note or any guarantee of this Note.
"Guarantor" means each person or entity that signs a guarantee of payment of this Note.
"Loan" means the loan evidenced by this Note.
"Loan Documents" means the documents related to this loart~signed by Borrower, anyGuarantor, or anyone who
pledges collateral.
"SBA" rneans the Small Business Administration, an Agency of the United States of America.
SBA form 147 (08!03/02) Versron 4.1 Page 1/8
Bankers Systems, Inc., St. Cloud, MN
3. ° PAYMENT TERMS:
Borrower muss make all payments at the place Lender designates. The payment teirns for this Note are:
The interest rate on this Note wil! fluctuate. The initial interest rate is 8.50% per year. This initial rate is the prime
rate on the date SBA received the loan application, plus 2.75%. The initial interest rate must remain In effect until
the first change period begins.
Borrower must pay a total of 6 payments of interest only on the disbursed principal balance beginning one month
from the month this Note is dated and every month thereafter; payments must be made on the eighth calendar day
in the months they are due.
Borrower must pay principal and interest payments of $418.00 every month, beginning seven months from the
month this Note is dated; payments must be made on the tghth calendar day in the months they are due.
--
Lender will apply each installment payment first to pay interest accrued to the day Lender receives the payment,
then to bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal.
The interest rate will be adjusted every calendar quarter (the "change period").
The "Prime Rate" is the prime rate in effect on the first business day of the month in which an interest rate change
occurs, as published in the Wall Street Journal on the next business day.
The adjusted interest rate will be 2.75% above the Prime Rate. Lender wil[ adjust the interest rate on the first
calendar day of each change period. The change in-interest rate is effective on that day whether or not Lender
gives Borrower notice of the change.
Lender must adjust the payment amount at least annually as needed to amortize principal over the remaining term
of the note.
If SBA purchases the guaranteed portion of the unpaid principal balance, the interest rate becomes fixed at the
rate in effect at the time of the earliest uncured payment default. If there is no uncured payment default, the rate
becomes fixed at the rate in effect at the time of purchase.
Laan Prepayment:
Notwithstanding any provision in this Note to the contrary:
Borrower may prepay this Nate. Borrower may prepay 20% or less of the unpaid principal balance at any time
without notice. If Borrower prepays more than 20% and the Loan has been sold on the secondary market,
Borrower must:
a.^Give Lender written notice;
b.^Pay all accrued interest; and
c. ^If the prepayment is received less than 21 days from the date Lender receives the notice, pay an amount equal
to 21 days' interest from the date tender receives the notice, less any interest accrued during the 21 days and paid
under subparagraph b., above.
attached page.
SBA Form 147 (06/03/02) Version 4.1 pie 216
Bankers Systems, Inc., St. Cloud, MN
S~. _ 147: Note Page 2 Continuation r
Continuation of "..."
If Borrower does not prepay within 30 days from the date Lender receives the notice, Bon-ower must give
Lender a new notice.
All remaining principal and accrued interest is due and payable 7 years from date of Note.
Late Charge: If a payment on this Nate is more than 10 days late, Lender may charge Borrower a late fee
of up to 5.00°/a of the unpaid portion of the regularly scheduled payment.
Page 1 Bankers Systems, Inc., St. Cloud, MN
4. DEFAULT:
Borrower is in default under this-Note if Borrower does not make a payment when dtte under this Note, or if Borrower
or Operating Company:
A. Fails to do anything required by this Note and other Loan Documents;
B. Defaults on any other loan with Lender;
C. Does not preserve, or account to Lender's satisfaction for, any of the Collaternl or its proceeds;
D. Does not disclose, or anyone acting on their behalf does not. disclose, arty material fact to Lender or SDA;
E. Makes, or anyone acting on their behalf makes, a materially false or misleading representation to Lender or SBA;
P. Defaults on any loan or agreement with another creditor, if Lender believes the default may materially affect
Borrower's ability to pay this Notc;
G. Fails to pay any taxes when due;
H. Becomes the subject of a proceeding under any bankruptcy or insolvency law; -
I. Has a receiver or liquidator appointed for any part of their business or property;
J. Makes an assignment for the benefit of creditors;
K, Has any adverse change in financial condition or business operation that Lender believes tray materially affect
Borcower's ability to pay this Note;
L. Reorganizes, merges, consolidates, or otherwise changes ownership or business structure without Lender's prior
written consent; or
M. Becomes the subject of a civil or criminal action thnt Lender believes may materially affect Borrower's ability to
pay this Note.
5. LENDER'S RIGHTS IF THERE IS A DEFAULT:
Without notice or demand and without giving ttp any of its rights, Lender may:
A. Require immediate payment of all amottttts owing under this Note;
B. Collect all amounts owing from any Borrower or Guarantor;
C. File suit and obtain judgment;
D. Take possession of any Collateral; or
E. Sell, lease, or otherwise dispose of, any Collateral at public or private sale, with or without advertisement.
G. LENDER'S GENERAL POWERS:
Without notice and without Borrower's consent, Lender may:
A. Bid o» or buy the Collateral at its sale or the sale of another lienholdcr, at any price it chooses;
B. Incur expenses to collect amounts due under this Note, enforce-the terms of this Note or any other Loan
Document, and preserve or dispose of the Collateral. Among other things, the expenses may include payments
for property taxes, prior liens, insurance, appraisals, environmental remediation costs, and reasonable attorney's
fees and costs. If Leader incurs such expenses, it may demand immediate repayment froth Borcower or add the
expenses to the principal balance;
C. Release anyone obligated to pay this Note;
D. Compromise, release, renew, extend or substitute any of the Collateral; and
E. Take any action necessary to protect the Collateral or collect amounts owing on this Note.
SBA form 147 (08103!02) Version 4.1 Page 316
Bankers Systems, Inc., St. Cloud, MN
~:
7. WHEN FEDERAL LAW APPLIES:
i
When SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations.
Larder or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing
liens, and other pu-poses. By using such procedures, SBA does not waive any federal immtmity from state or local
control, penalty, tax, or liability. As to this Note, Borrower may not claim or assert against SBA any local or state law
to deny any obligation, defeat any claim of SBA, or preempt federal law.
8. SUCCESSORS AND ASSIGNS:
Under this Notc, Borrower and Operating Company include tltc successors of each, and Lender includes its successors
and assigns.
9. GENERAL PROVISIONS:
A. All individuals and entities signing this Note are jointly and severally liable.
B. Borrower waives all suretyship defenses.
C. Borrower tnust sign all documents necessary at any time to comply with the Loan Documents and to enable
Lender to acquire, perfect, or maintain Lender's liens on Collateral.
D. Lender may exercise any of its rights separately or together, as many times and in any order it chooses. (..ender
may delay or forgo enforcing any of its rights without giving ttp any of them.
E. Bottower may not use an oral statement of Lender or SBA to contradict or alter the written terms of this Note.
F. If any part of this Note is unenforceable, al! other parts remain in effect.
G. To the extent allowed by taw, Borrower waives all demands and notices in connection with this Note, including
presentment, demand, protest, and notice of dishonor. Borrower also waives any defenses based upon any claim
that Lender did not obtain any guarantee; did not obtain, perfect, or maintain a lien upon Collateral; impaired
Collateral; or did not obtain the fair market value of Collateral at a sate.
SBA Form t 47 (oaro3/o2) version a. t Pegg q^g
t3ankers Systems, Inc., St. Cloud, MN
10. STATB-SPECIF[C PROVISIONS:
WARRANT OF AUTHORITY TO CONFESS JUDGEMENT. Upon default, in addition to a9 other remedies and rights available to
you, by signing below I irrevocably autharize the prothonotary, clerk, ar any attorney to appear In any court of record having
jurisdictbn over this matter and to confess judgment against me at any time without stay of execution. I valve notice, service of
process, and process. 1 agree and understand that judgment maybe confessed against me for ar~y unpaid prindpal, accrued
charges due on this Note, plus collection costs and reasonable attorneys' fees up to 15 percent of the judgement. The exercise of
the power to confess judgment will not exhaust this warrant of authority to understand that my property may be seized without prior
notice to satisfythe debt owed. I knowingly, intentionally, and voluntarily waive any and all constltutionai rights I have to
pre-deprivation notice and hearing under federal and state laws and fully understand the consequences of this waiver.
By signing Immediately below, I agree to the terms of the CONFESSION OF JUDGEMENT section.
J.
April 8, 2005
SBA Form 147 (08!03102) Version 4.1 Pege b/8
Bankers Systems, Inc., St. Cloud, MN
11. BORROWER'S NAMES} AND STGNATURE(S):
By signing below, each individual or entity becomes obligated under this Note as Borrower.
Caring Hands Chiropractic Wellness Center, Ina
S8A Form 147 (06!03/02) Verson 4.1
AprN 8, 21385
Page 618
Bankers Systems, Inc., St. Goud, MN
EXHIBIT "F"
ns SnMll audaenr /Wmte-Istr,lion
U.S. Small Business Administration
UNCONDITIONAL GUARANTEE
SSA Loan # 12566150-06
SBA Loan Name Caring Hands Chiropractic Wellness Center, Inc.
Guarantor Kristen J. Kerr
Borrower Caring Hands ChlropracUc Wellness Center, Inc.
Lender The Legacy Bank
Date Apri16, 2005
Note Amount 25,000.00
1. GUARANTEE:
Guarantor unconditionally guarantees payment to Lender of all amounts owing under the Note. This Guarantee remains
in effect until the Note is paid in full. Guarantor must pay all amounts due under the Note when Lender makes written
demand upon Guarantor. Lender is not required to seek payment from any other source before demanding payment from
Guarantor.
2. NOTE:
Tltc "Note" is the promissory note dated April 8, 2005 in the principal amount of
TWENTY FIVE THOUSAND AND 00/100 ~aa'~a»s+sf•a•*aaaa~aa»aaaaaaaa+•aiaaa++*a+asaa•aaiaasaa+•+a•asaa+#+ Dollars,
from Borrower to Lender. It includes any assumption, renewal, substitution, or replacement of the Note, and multiple
notes «nder a line of credit.
3. DEFINITIONS:
"Collateral" means any property taken as security for payment of the Note or any guarantee of the Note.
"Loan" means the loan evidenced by the Note.
"Loan Documents" means the documents rclatecl to the Loan signed by Borrower, Guarantor or any other guarantor, or
anyone who pledges Collateral.
"SBA" means the Small Business Administration, an Agency of the United States of America.
SBA Forrn 14a (10198) Previous editions obsolete. Page 1/5
Bankers Systems, Inc., St. Cloud, MN
4. LENDER'S GENERAL POWERS:
Lender may take any of the following actions at any time, without notice, without Guarantor's consent, and without
making demand upon Guarantor:
A. Modify the terms of the Note or any other Loan Document except to increase the amounts due under the Note;
B. Refrain from taking any action on the Note, the Collateral, or any guarantee;
C. Release any Borrower or any guarantor of the Note;
D. Compromise or settle with the Borrower or any guarantor of the Note;
E. Substitute or release any of the Collateral, whether or not Lender receives anything in return;
F. Foreclose upon or othenvise obtain, and dispose of, any Collateral at public or private sale, with or without
advertisement;
G. Bid or buy at any sale of Collateral by Lender or any other lienholdcr, at any price Lender chooses; and
H. Exercise any rights it has, including those in the Notc and other Loan Documents.
These actions will not release or reduce the obligations of Guarantor or create any rights or claims against Lender.
5. FEDERAL LAW:
When SBA is the holder, the Note and this Guarantee will be construed and enforced under federal law, including SBA
regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice,
foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Guarantee, Guarantor may not claim or assert any local or state law
against SBA to deny any obligation, defeat any claim of SBA, or preempt federal taw.
G. RIGHTS, NOTICES, AND DEFENSES THAT GUARANTOR WAIVES:
To the extent permitted by law,
A. Guarantor waives all rights to:
1) Require presentment, protest, or demand upon Borrower;
2) Redeem any Collateral before or after Letxler disposes of it;
3} Have any disposition of Collateral advertised; and
4) Require a valuation of Collateral before or after Lender disposes of it.
B. Guarantor waives any notice of:
I) Any default tinder the Note;
2) Presentment, dishonor, protest, or demand;
3) Execution of the Note; .
4) Any action or inaction on the Note or Collateral, such as disbursements, payment, nonpayment, acceleration,
intent to accelerate, assignment, collection activity, and incurring enforcemet-t expenses;
5) Any change in the financial condition or business operations of Borrower or any guarantor;
G) Any changes in the terms of the Note or other Loan Documents, except increases in the amounts dt-e under the
Note; and
7} The time or pace of any sale or other disposition of Collateral.
G Guarantor waives defenses based upon any claim that:
f) Lender failed to obtain any guarantee;
2) Lender failed to obtain, perfect, or maintain a security interest in any property offered or taken as Collateral;
3) Lender or others improperly valued or inspected the Collateral;
4) The Collateral changed in value, or was neglected, lost, destroyed, or underinsured;
SBA Form 148 (to/98) Previous editions obsolete. Pape ?l5
_ Bankers Systems, Inc., St. Cbud, MN
r !
5) Leader impaired the Collateral;
6) Lender did not dispose of any of the Collateral;
7) Lender did not conduct a commercially reasonable sale;
8) Lender did not obtain the fair market value of the Collateral;
9) Lender did not make or perfect a claim upon the death or disability of Borrower or any guarantor of the
Note;
10) The financial condition of Borrower or any guarantor was overstated or ]tas adversely changed;
11) Lender made errors or omissions in Loan Documents or• administration of the Loan;
12) Lcndcr did not seek payment front the Borrower, any other guarantors, or any Collaternl before demanding
pa}nttent from Guarantor:
13) Lender' impaired Guarantor's suretyship rights;
14) Lender modified the Note terms, other than to increase amounts due under the Notc. If Lender modifies the
Note to increase the amounts due under the Note without Guarantor's consent, Guarantor will not be liable
for the increased amotrrtts and related interest and expenses, but remains liable for all other amounts;
15) Borrower ltas avoided liability on the Note; or
1 G) Lender has taken an action allowed under the Note, this Guarantee, or other Loan Documents.
7. DUTIES AS TO COLLATERAL:
Guarantor will preserve the Collateral pledged by Guarantor to secure this Guarantee. Lender has no duty to preserve
or dispose of any Collateral.
8. SUCCESSORS AND ASSIGNS:
Under this Guarantee, Guarantor includes heirs and successors, and Lender includes its successors and assigns.
9. GENERAL PROVISIONS:
A. ENFORCEMENT EXPENSES. Guarantor promises to pay all expenses Lender incurs to enforce this Guarantee,
including, but not limited to, attontey's fees and costs.
B. SBA NOT A C0.GUARANTOR. Guarantor's liability will continue even if SBA pays Lender. SBA is not a
co-guarantor with Guantntor. Guarantor has no right of contribution from SBA.
C. SUBROGATION RIGH9'S. Guarantor has no subrogation rights as to the Note or the Collateral until the Note is
paid in full.
D. JOINT AND SEVERAL LIABILITY. All individuals and entities signing as Guarantor are jointly and severally
liable.
E. DOCUMENT SIGNING. Guarantor must sign all documents necessary at any time to comply with the Loan
Documents and to enable Lender to acquire, perfect, or maintain Lender's liens on Collateral.
F. FINANCIAL STATEMENTS. Guarantor must give Lender financial statements as Lender requires.
G. LENDER'S RIGI•ITS CUMULATIVE, NOT WAIVED. Lender tttay exercise any of its rights separately or
together, as many times as it chooses. Lender may delay or forgo enforcing any of its rights without losing or
itttpairing any of them.
H. ORAL STATEMENTS NOT BINDING. Guarantor may not use an oral statement to contradict or alter the written
terms of the Note or this Guarantee, or to raise a defense to this Guarantee.
L SEVERABiLITY. If any part of this Guarantee is found to be unenforceable, all other parts will remain in effect.
J. CONSIDERATION. The consideration for this Guarantee is the Loan or any accommodation by Lender as to the
Loart.
SBA Form 148 (10198) Previous editions obsolete. Page 3/b
.. Bankers Systems, tnc., St. Eloud, MN
10. STATE-SPECIFIC PROVISIONS:
WARRANT OF AUTHORITY TO CONFESS JUDGEMENT. Upon default, in addition to all other remedies and rights available to
you, by signing below I irrevocably authorize the prothonotary, clerk, or any attorney to appear in any court of record having
jurisdiction over this matter and to confess judgment against me at any time without stay of execution. I valve notice, service of
process, and process. I agree and understand that Judgment may be confessed against me for any unpakt prlndpai, accrued
charges due on this Note, plus collection costs and reasonable attorneys' fees up to 15 percent of the Judgement, The exercise of
the power to confess judgment will not exhaust this warrant of authority to understand that my property may be seized without prior
notice to satisfy the debt owed. I knowingly, Intentionally, and voluntarily waive any and aN constltutfonat rights I have to
pre-deprivation notice and hearing under federel and state laws and fully understand the consequences of this waiver.
By signing immediately below, I agree to the terms of the CONFESSION OF JUDGEMENT section,
J. Kerr
April 8, 2005
SBA Form 148 (10!98) Previous edkions obsolete. Page 415
Bankers Systems, inc., St. Cloud, MN
11. GUARANTOR ACKNOWLEDGMENT OF TERMS.
Guarantor acknowlcdges that Guarantor has read and understands the significance of all terms of the Notc and this
Guarantee, including all waivers.
12. GUARANTOR NAME(S) AND SIGNATURE(S):
By signing below, each individual or entity bcco-ncs obligatcd as Guarantor undcr this Gua-~antee.
J. Kerr
April 8, 2005
SBA Form 148 (10/88} Previous editions obsolete. Pape 6!5
Bankers Systems, Inc., St. Cloud, MN
VERIFICATION
I, Raymond G. Metz, AVP/Special Assets Officer for First National Bank, depose and
say subject to the penalties of 18 Pa.C.S.A., sec. 4904 relating to unsworn falsification to
authorities that the facts set forth in the foregoing pleading are true and correct to the best of my
information, knowledge and belief.
R mon .Metz
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IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA
THE LEGACY BANK, a division of
FIRST NATIONAL BANK OF
CIVIL. DIVISION
PENNSYLVANIA
Plaintiff
No.: pg - 5383 l.:vw i ~ . ~err~
vs.
CARING HANDS CHIROPRACTIC
WELLNESS CENTER, INC.
and KRISTEN J. KERB
Defendants
NOTICE UNDER RULE 2958.1 OF TUDGMENT
AND EXECUTION THEREON
Notice of Defendant's Rights
To: Caring Hands Chiropractic Wellness Center, Inc.
4909 Louise Drive, Suite 102
Mechanicsburg, PA 17055
Kristen J. Ken
41 Garden Drive
Mechanicsburg, PA 17055
A judgment in the amount of $109,333.03 has been entered against you and in favor of
the plaintiff without any prior notice or hearing based on a confession of judgment contained in a
written agreement or other paper allegedly signed by you. The sheriff may take your money or
other property to pay the judgment at any time after thirty (30) days after the date on which this
notice is served on you.
You may have legal rights to defeat the judgment or to prevent your money or property
from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE
JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE
DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR
RIGHTS.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE
OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP.
NOTICE TO DEFEND & LAWYER REFERRAL SERVICE
Cumberland County Bar Association
32 S. Bedford Street
Carlisle, PA 17013
Phone (717) 249-3166
(800) 990-9108
y Submitted:
& CONNELLY LLP
BY:
Sco(r/A. j,~tte quire
PA I.D. # 0
Kimberly A. Bonner, Esquire
PA I.D #89705
Attorneys for Plaintiff
P.O. Box 550
Hershey, PA 17033
(717) 533-3280
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