HomeMy WebLinkAbout09-2208~ ~
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t!a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues Civil Action
Boyertown, PA 19512, :
Plaintiff, No, ~ 9 ~ ~ ~ (~ ~ C ~ v i ~ `~ ~~~
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312,
Defendants.
NOTICE PURSUANT TO 42 PA C.S.A. &27371
TO THE DEFENDANT:
If you have been incorrectly identified in the attached pleading or if there exists any other legal
basis to have the judgment evidenced by the attached documents stricken, you may petition the court to
strike the confession of judgment pursuant to Pennsylvania Rules of Civil Procedure 206.1 through 206.7
and 2959. A copy of Rule 2959, which relates to striking or opening a judgment, is attached hereto. The
petition must be filed with the Cumberland County Court of Common Pleas located at 1 Courthouse
Square, Carlisle, Pennsylvania. The filing procedures for the Cumberland County Court of Common
Pleas are governed by the Cunberland County Local Rules of Civil Procedure. In the event you are
incorrectly identified in this action and you obtain an order striking the judgment, you will be entitled to
recover the costs and reasonable attorney's fees incurred by you in securin rder.
By:
Shahan G. Teberian, Esquire
Attorney I.D. No.: 69407
260 South Broad Street
Philadelphia, PA 19102
Attorneys for the Plaintiff
PHILI 836324-I
Rule 2959. Strikin off or Oaenine Judgment Pleadines Procedure
(ax 1) Relief from a judgment by confession shall be sou t b
subparagraph (2), all grounds for relief whether to strike offthe 'ud~ y petition. Except as provided in
a single petition. The petition may be filed in the county in which ~ ud or to open it must be asserted in
any county to which the 'ud J gment was originally entered, in
J gment has been transferred or in any other county in which the sheriff has
received a writ of execution directed to the sheriff to enforce the judgment.
(2) The ground that the waiver of the due process rights of notice and hearing was not
voluntary, intelligent and knowing shall be raised only
(i) in support of a further request for a stay of execution where the court has not stayed
execution despite the timely filing of a petition for relief from the judgment and the presentation of prima
facie evidence of a defense; and
(ii) as provided by Rule 2958.3 or Rule 2973.3.
(3) If written notice is served upon the petitioner pursuant to Rule 2956.1(cx2) or Rule
2973.1(c), the petition shall be filed within thirty days after such service. Unless the defendant can
demonstrate that there were compelling reasons for the delay, a petition not timely filed shall be denied.
(b) If the petition states prima facie grounds for relief the court shall issue a rule to show cause
and may grant a stay of proceedings. After being served with a copy of the petition the plaintiff shall file
an answer on or before the return day of the rule. The return day of the rule shall be fixed by the court by
local rule or special order.
(c) A party waives all defenses and objections which aze not included in the petition or answer.
(d) The petition and the rule to show cause and the answer shall be served as provided in Rule
440.
(e) The court shall dispose of the rule on petition and answer, and on any testimony, depositions,
admissions and other evidence. The court for cause shown may stay proceedings on the petition insofar as
it seeks to open the judgment pending disposition of the application to strike off the judgment. If evidence
is produced which in a jury trial would require the issues to be submitted to the jury the court shall open
the judgment.
(f) The lien of the judgment or of any levy or attachment shall be preserved while the proceedings
to strike off or open the judgment aze pending.
(g) (1) A judgment shall not be stricken or opened because of a creditor's failure to provide a
debtor with instructions imposed by an existing statute, if any, regarding procedures to follow to strike a
judgment or regazding any rights available to an incorrectly identified debtor.
(2) Subdivision (g) (1) shall apply to (1) judgments entered prior to the effective date of
subdivision (g) which have not been stricken or opened as of the effective date and (2) judgments entered
on or after the effective date.
KLEHR, HARRISON, HARVEY,
BRANZBURG & E S LLP
By:
Shahan G. Teberian, Esquire
Attorneys for the Plaintiff
PHILI 836324-1
x ~
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512,
Plaintiff,
Civil Action
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312, _
Defendants.
TO: HOYT BANGS
1054 Derwydd Lane
Berwyn, PA 19312
NOTICE
Pursuant to Rule 236 of the Supreme Court of Pennsylvania, you are hereby notified that
a JUDGMENT BY CONFESSION has been entered against you in the above proceeding and
that enclosed herewith is a copy of all documents filed in support of the said judgment.
IF YOU HAVE ANY QUESTIONS CONCERNING THIS NOTICE, PLEASE
CONTACT: Shahan G. Teberian Esquire at this telephone number: (215) 568-6060.
P OTHON RY
PHILI 836324-1
.t~ }
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues :
Boyertown, PA 19512, ;
Plaintiff, ;
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane .
Berwyn, PA 19312, .
Defendants. :
TO: ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312
Civil Action
No, ~ 9 - e2 ~- ~ ~ c f ~~ ~ -~c~'n~
NOTICE
Pursuant to Rule 236 of the Supreme Court of Pennsylvania, you are hereby notified that
a JUDGMENT BY CONFESSION has been entered against you in the above proceeding and
that enclosed herewith is a copy of all documents filed in support of the said judgment.
IF YOU HAVE ANY QUESTIONS CONCERNING THIS NOTICE, PLEASE
CONTACT: Shahan G. Teberian Esquire at this telephone number: (215) 568-6060.
PROTHONOTARY
PHILI 836324-I
a r
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t1a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues Civil Action
Boyertown, PA 19512,
Plaintiff, No, ®~•' ~ ~ 0 ~- c :J~ ~ ~ ~ ~^~
v. .
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312, _
Defendants.
JUDGMENT BY CONFESSION
AND NOW, to wit this ~
~ day of gp n I 2009, a Complaint in
Confession of Judgment having been filed and supporting affidavits having been filed;
JUDGMENT IS HEREBY ENTERED in favor of the plaintiff, National Penn Bank, f/t/a
FirstService Bank, and against the defendants, Hoyt Bangs and Alice P. Bangs, jointly and
severally, in the amount of $17,048,274.49, plus interest from and after Mazch 31, 2009, until the
payment of the judgment, at the aggregate daily rate of $3,014.06901, which aggregate daily rate
is subject to fluctuation as the interest rates in the applicable loan documents fluctuate.
PROTHONOTARY
PHIL1 836324-1
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512,
Plaintiff,
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312,
Defendants.
Civil Action
ENTRY OF APPEARANCE TO CONFESS JUDGMENT
TO THE PROTHONOTARY:
Pursuant to the authority contained in the Warrant of Attorney set forth in the instrument
attached as Exhibit "E" to the Complaint in Confession of Judgment filed in this action, I appear
for the defendants Hoyt Bangs and Alice P. Bangs, and confess judgment in favor of the
plaintiff, National Penn Bank, f/t/a FirstService Bank, and against the defendants, Hoyt Bangs
and Alice P. Bangs, jointly and severally, in the amount, as of March 31, 2009, of
$17,048,274.49, plus interest from and after March 31, 2009, until the payment of the judgment,
at the aggregate daily rate of $3,012.54062, which daily rate is subject to fluctuation as the
interest rates in the applicable loan documents fluctuate.
KLEHR, HARRISON, HARVEY,
BRANZBURG & ELLERS LLP
~_
Dated: , 2009 By: '
Shahan G. Teberian, Esquire
Attorney I.D. No.: 69407
260 South Broad Street
Philadelphia, PA 19102
Attorneys for the Defendants
PHILI 836324-I
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a :
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512, ;
Plaintiff,
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312, ;
Defendants.
Civil Action
No. ~ ~ _ ~ ~- 0 ~- C I ul ~ ~ cr r~
PRAECIPE FOR ENTRY OF JUDGMENT BY CONFESSION
AND FOR ASSESSMENT OF DAMAGES
TO THE PROTHONOTARY:
Kindly enter judgment by confession in the above-entitled action and assess damages in
favor of the plaintiff, National Penn Bank, f/t/a FirstService Bank, and against the defendants,
Hoyt Bangs and Alice P. Bangs, jointly and severally, in the amount, as of March 31, 2009, of
$17,048,274.49, asfollows (all terms shall have the meanings ascribed to them in the Complaint
in Confession of Judgment):
AUGUST 2003 LOAN:
Principal: $ 2,491,914.84
Interest
(as of 3/31/2009): $ 6,741.88
SUBTOTAL:
$ 2,498,656.72
PHIL 1 836324-I
t r
MARCH 2004 LOAN:
Principal: $ 906,859.17
Interest
(as of 3/31/2009): $ 13,807.27
Late Charges: $ 63,480.14
SUBTOTAL: $ 984,146.58
NOVEMBER 2005 LOAN:
Principal: $ 770,195.82
Interest
(as of 3/31/2009): $ 21,673.82
Late Charges: $ 5,451.52
SUBTOTAL: $ 797,320.62
APRIL 2006 LOAN:
Principal: $ 1,470,355.78
Interest
(as of 3/31/2009): $ 40,501.77
Late Charges: $ 6,827.78
SUBTOTAL: $1,517,685.33
JANUARY 2007 LOAN:
Principal: $ 2,046,538.40
Interest
(as of 3/31/2009): $ 68,348.67
Late Charges: $ 8,810.16
SUBTOTAL:
2
$ 2,123,967.23
PHIL 1 836324-I
1 1
MAY 2007 LOAN:
Principal: $ 2,436,752.06
Interest
(as of 3/31/2009): $ 77,625.96
Late Charges: $ 23,767.20
SUBTOTAL: $ 2,538,145.22
MAY 2008 LOAN:
Principal: $ 337,591.24
Interest
(as of 3/31/2009): $ 4,910.46
Late Chazges: $ 4,033.66
SUBTOTAL: $ 346,535.36
OCTOBER 2008 LOAN:
Principal: $ 3,909,150.00
Interest
(as of 3/31/2009): $ 96,767.93
Late Charges: $ 12,211.52
SUBTOTAL: $ 4,018,129.45
TOTAL FOR ALL LOANS: $14,824,586.51
ATTORNEY'S FEES
(15% per Guaranty): $ 2,223,687.98
GRAND TOTAL:
3
$17,048,274.49
PHILI 836324-1
Interest continues to accrue on the Loans from and after March 31, 2009 at the aggregate daily
rate of $3,014.06901, which aggregate daily rate is subject to fluctuation as the interest rates in
the applicable Loan Documents fluctuate.
KLEHR, HARRISON, HARVEY,
BRANZBURG & ELLERS LLP
Dated: n.~. ~ , 2009
Shahan G. Teberian, Esquire
Attorney I.D. No.: 69407
260 South Broad Street
Philadelphia, PA 19102
Attorney for Plaintiff
4
PHIL 1 836324-I
< t
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a .
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512, ;
Plaintiff,
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane ;
Berwyn, PA 19312, ,
Defendants.
Civil Action
COMPLAINT IN CONFESSION OF JUDGMENT
National Penn Bank, formerly trading as FirstService Bank (the "Bank"), by and through
its counsel, Klehr, Harrison, Harvey, Branzburg & Ellers LLP, by way of Complaint in
Confession of Judgment against Hoyt Bangs and Alice P. Bangs (collectively, the
"Guarantors"), avers and represents as follows:
THE PARTIES
1. The Bank is a banking association and has an address of Philadelphia and
Reading Avenues, Boyertown, Pennsylvania 19512.
2. The Guarantors are each adult individuals and citizens of the Commonwealth of
Pennsylvania, and each have an address of 1054 Derwydd Lane, Berwyn, Pennsylvania 19312.
PHILl 836324-1
BACKGROUND
3. ~ On August 21, 2003, the Bank made available to Horsham Valley Airways, Inc.
("HVA") a loan of up to the original principal amount of $1,250,000.00 (the "August 2003
Loan"), and HVA agreed in that certain Promissory Note (Multiple Advance) dated August 21,
2003 and in the original principal amount of $1,250,000.00 (the "August 2003 Note"), to,
among other things, repay the August 2003 Loan to the Bank. A true and correct copy of the
August 2003 Note is attached hereto, incorporate herein, and marked as Exhibit "A."
4. On May 7, 2007, the amount of the August 2003 Loan was increased to
$2,250,000.00, and HVA executed and delivered to the Bank a Commercial Variable Rate
Revolving Or Draw Note dated May 7, 2007 and in the original principal amount of
$2,250,000.00 (the "$2,250,000 May 2007 Note"). A true and correct copy of the $2,250,000
May 2007 Note is attached hereto, incorporated herein, and marked as Exhibit "B." See also,
May 7, 2007 Loan Agreement attached hereto as part of Exhibit "I."
5. On October 23, 2008, pursuant to the terms of a Note and Loan Modification
Agreement (the "October 2008 Agreement"), the amount of the August 2003 Loan was again
increased, this time to $2,500,000.00. A true and correct copy of the October 2008 Agreement is
attached hereto, incorporated herein, and marked as Exhibit "C."
6. On March 11, 2004, the Bank made a loan to HVA in the amount of
$1,700,000.00 (the "March 2004 Loan"), and HVA agreed in that certain Promissory Note
dated March 11, 2004 and in the original principal amount of $1,700,000.00 (the "March 2004
Note"), to, among other things, repay the March 2004 Loan to the Bank. A true and correct copy
of the March 2004 Note is attached hereto, incorporated herein, and marked as Exhibit "D."
2
PHILI 836324-1
7. As partial consideration for the Bank to make the March 2004 Loan to HVA, and
as additional security therefor, the Guarantors agreed, in that certain Suretyship agreement dated
March 11, 2004 (the "Guaranty"), to act as the full and unconditional, joint and several sureties
of all obligations owed by HVA to the Bank, whether then existing or thereafter arising, and
whether arising out of or relating to the March 2004 Loan or otherwise. A true and correct copy
of the Guaranty, authorizing the entry of judgment by confession against the Guarantors, is
attached hereto, incorporated herein, and marked as Exhibit "E."
8. On November 8, 2005, the Bank made a loan to HVA in the original principal
amount of $1,100,000.00 (the "November 2005 Loan"), and HVA agreed, in that certain
Commercial Fixed Rate Promissory Note dated November 8, 2005 and in the original principal
amount of $1,100,000.00 (the "November 2005 Note"), to among other things, repay the
November 2005 Loan to the Bank. A true and correct copy of the November 2005 Note is
attached hereto, incorporated herein, and marked as Exhibit "F."
9. On Apri121, 2006, the Bank made a loan to HVA in the original principal amount
of $1,982,000.00 (the "Apri12006 Loan"), and HVA agreed, in that certain Commercial Fixed
Rate Promissory Note dated April 21, 2006 and in the original principal amount of
$1,982,000.00 (the "April 2006 Note"), to, among other things, repay the April 2006 Loan to
the Bank. A true and correct copy of the Apri12006 Note is attached hereto, incorporated herein,
and marked as Exhibit "G."
3
PHILI 836324-1
10. On January 4, 2007, the Bank made a loan to HVA in the original principal
amount of $2,200,000.00 (the "January 2007 Loan"), and HVA agreed, in that certain
Commercial Fixed Rate Promissory Note dated January 4, 2007 and in the original principal
amount of $2,200,000.00 (the "January 2007 Note"), to, among other things, repay the January
2007 Loan to the Bank. A true and correct copy of the January 2007 Note is attached hereto,
incorporated herein, and marked as Exhibit "H."
11. On May 7, 2007, the Bank made a loan to HVA in the original principal amount
of $4,650,000.00 (the "May 2007 Loan"), and HVA agreed, in that certain Term Note dated
May 7, 2007 and in the original principal amount of $4,650,000.00 (the "$4,650,000 May 2007
Note"), to, among other things, repay the May 2007 Loan to the Bank. A true and correct copy
of the $4,650,000 May 2007 Note (together with related Loan Agreement) is attached hereto,
incorporated herein, and marked as Exhibit "I."
12. On May 15, 2008, the Bank made a loan to HVA in the original principal amount
of $742,000.00 (the "May 2008 Loan"), and HVA agreed, in that certain Commercial Variable
Rate Promissory Note dated May 15, 2008 and in the original principal amount of $742,000.00
(the "May 2008 Note"), to, among other things, repay the May 2008 Loan to the Bank. A true
and correct copy of the May 2008 Note is attached hereto, incorporated herein, and marked as
Exhibit "J."
4
PHII.1 836324-1
.
13. On October 23, 2008, the Bank made a loan to HVA in the original principal
amount of $4,000,000.00 (the "October 2008 Loan"), and HVA agreed, in that certain Term
Note dated October 23, 2008 and in the original principal amount of $4,000,000.00 (the
"October 2008 Note"), to, among other things, repay the October 2008 Loan to the Bank. A
true and correct copy of the October 2008 Note is attached hereto, incorporated herein, and
mazked as Exhibit "K."
14. Pursuant to its terms, the Guazanty secures, among other things, repayment of all
amounts owed to the Bank by HVA, including, without limitation, all amounts owed by HVA to
the Bank on account of all the Loans (as defined below) and arising out of all the Loan
Documents. See Exhibit "E" at Sections 1(c) and (2).
ADDITIONAL DEFINITIONS
15. The August 2003 Note, $2,250,000 May 2007 Note, October 2008 Agreement,
any and all documents executed in connection therewith or pursuant thereto, and any and all
amendments and/or modifications of any of the foregoing, are referred to collectively hereinafter
as the "August 2003 Loan Documents."
16. The March 2004 Note, the Guaranty, any and all documents executed in
connection therewith or pursuant thereto, and any and all amendments and/or modifications of
any of the foregoing, are referred to collectively hereinafter as the "March 2004 Loan
Documents."
17. The November 2005 Note, any and all documents executed in connection
therewith or pursuant thereto, and any and all amendments and/or modifications of any of the
foregoing, are referred to collectively hereinafter as the "November 2005 Loan Documents."
5
PHILI 836324-1
18. The Apri12006 Note, any and all documents executed in connection therewith or
pursuant thereto, and any and all amendments and/or modifications of any of the foregoing, are
referred to collectively hereinafter as the "Apri12006 Loan Documents."
19. The January 2007 Note, any and all documents executed in connection therewith
or pursuant thereto, and any and all amendments and/or modifications of any of the foregoing,
are referred to collectively hereinafter as the "January 2007 Loan Documents."
20. The $4,650,000 May 2007 Note, any and all documents executed in connection
therewith or pursuant thereto, and any and all amendments and/or modifications of any of the
foregoing, are referred to collectively hereinafter as the "May 2007 Loan Documents."
21. The May 2008 Note, any and all documents executed in connection therewith or
pursuant thereto, and any and all amendments and/or modifications of any of the foregoing, are
referred to collectively hereinafter as the "May 2008 Loan Documents."
22. The October 2008 Note, any and all documents executed in connection therewith
or pursuant thereto, and any and all amendments and/or modifications of any of the foregoing,
are referred to collectively hereinafter as the "October 2008 Loan Documents."
23. The August 2003 Loan Documents, March 2004 Loan Documents, November
2005 Loan Documents, Apri12006 Loan Documents, January 2007 Loan Documents, May 2007
Loan Documents, May 2008 Loan Documents and October 2008 Loan Documents are referred to
collectively hereinafter as the "Loan Documents."
24. The August 2003 Loan, March 2004 Loan, November 2005 Loan, April 2006
Loan, January 2007 Loan, May 2007 Loan, May 2008 Loan and October 2008 Loan are referred
to collectively hereinafter as the "Loans."
6
PHILI 836324-I
THE DEFAULTS
25. The March 2004 Loan matured on Mazch 15, 2009. See Exhibit "D" at Section 1.
26. HVA failed to pay the March 2004 Loan upon maturity.
27. This failure to pay the Mazch 2004 Loan upon maturity is a default under the
terms of both the Mazch 2004 Loan Documents and all the other Loan Documents.
28. The August 2003 Loan is a demand obligation, and filing of this action constitutes
sufficient demand, even absent the other defaults that permit the Bank to declare all amounts
owing under the terms of the August 2003 Loan to be immediately due and payable.
29. HVA is also in default of its obligations pursuant to all the Loan Documents for,
among other things, its failure to make payments on account of all the Loans (other than the
August 2003 Loan) pursuant to the terms of the Loan Documents as and when due thereunder.
30. I-VA's failure to make payments on account of each of the aforesaid Loans also
constitutes a separate default pursuant to the terms of all the other Loan Documents relating to
the other Loans.
31. The Guarantors are in default of their obligations pursuant to the terms of the
Guaranty for, among other things, the Guarantors' failure to cure the defaults of HVA under the
terms of the Loan Documents.
32. The defaults of HVA and the Guarantors (collectively, the "Defaults") have
continued for more than fifteen (15) days.
7
PHILI 836324-I
33. As a result of these defaults, and pursuant to the terms of the Loan Documents, all
amounts due thereunder are accelerated (the "Acceleration")
34. As a result of the Defaults and the Acceleration, there is, as of March 31, 2009,
immediately due and owing to the Bank from the Guarantors, jointly and severally, the sum of
$17,048,274.49, as follows:
AUGUST 2003 LOAN•
Principal: $ 2,491,914.84
Interest
(as of 3/31/2009): $ 6,741.88
SUBTOTAL: $ 2,498,656.72
MARCH 2004 LOAN:
Principal: $ 906,859.17
Interest
(as of 3/31/2009): $ 13,807.27
Late Charges: $ 63,480.14
SUBTOTAL: $ 984,146.58
NOVEMBER 2005 LOAN:
Principal: $ 770,195.82
Interest
(as of 3/31/2009): $ 21,673.82
Late Charges: $ 5,451.52
SUBTOTAL: $ 797,320.62
8
PHIL,I 836324-1
APRIL 2006 LOAN:
Principal: $ 1,470,355.78
Interest
(as of 3/31/2009): $ 40,501.77
Late Charges: $ 6,827.78
SUBTOTAL: $ 1,517,685.33
JANUARY 2007 LOAN:
Principal: $ 2,046,538.40
Interest
(as of 3/31/2009): $ 68,348.67
Late Charges: $ 8,810.16
SUBTOTAL: $ 2,123,967.23
MAY 2007 LOAN:
Principal: $ 2,436,752.06
Interest
(as of 3/31/2009): $ 77,625.96
Late Charges: $ 23,767.20
SUBTOTAL: $ 2,538,145.22
MAY 2008 LOAN:
Principal: $ 337,591.24
Interest
(as of 3/31/2009): $ 4,910.46
Late Charges: $ 4,033.66
SUBTOTAL:
9
$ 346,535.36
PHILI 836324-1
OCTOBER 2008 LOAN:
Principal: $ 3,909,150.00
Interest
(as of 3/31/2009): $ 96,767.93
Late Charges: $ 12,211.52
SUBTOTAL: $ 4,018,129.45
TOTAL FOR ALL LOANS: $14,824,586.51
ATTORNEY'S FEES
(15% per Guaranty): $ 2,223,687.98
GRAND TOTAL: $17,048,274.49
Interest continues to accrue from and after March 31, 2009 at the daily default rate of: (a}
$467.23403 on the August 2003 Loan, (b) $163.73846 on the March 2004 Loan, (c) $208.59470
on the November 2005 Loan, (d) $418.64297 on the April 2006 Loan, (e) $616.80393 on the
January 2007 Loan, (f) $741.17875 on the May 2007 Loan, (g) $58.60959 on the May 2008
Loan, and (h) $1,080.44563 on the October 2008 Loan.
35. Neither the Guaranty nor any of the other Loan Documents has been assigned and
the Bank is the current holder thereof.
36. Judgment has not been entered pursuant to the warrant of attorney contained in
the Guaranty in this or any other jurisdiction.
37. The judgment on the Guaranty is not being entered by confession against any
natural person in connection with a consumer credit transaction.
38. No conditions precedent to the entry of judgment against either of the Guarantors
on the Guaranty remain unperformed.
10
PHILI 836324-1
39. The warrant of attorney in the Guaranty is less than twenty (20) years old.
40. The provisions of 41 P.S. §§ 101, et seq., are not applicable to this action because
each of the Loans was made fora "business purpose" and/or is not otherwise within the scope of
that statute.
41. The provisions of 35 P.S. §§ 1680.401c, et seq., are not applicable to this action
because, inter alia, the properties securing the Loans are: (a) not one-or two-family owner-
occupied residences, (b) are encumbered by more than two mortgages, and/or (c) are not
otherwise within the scope of that statute.
WHEREFORE, National Penn Bank, f/t/a FirstService Bank, respectfully requests the
entry of judgment in its favor and against the defendants, Hoyt Bangs and Alice P. Bangs, jointly
and severally, in the amount of $17,048,274.49, plus interest from and after March 31, 2009,
until the payment of the judgment, at the aggregate daily rate of $3,014.06901, which aggregate
daily rate is subject to fluctuation as the interest rates in the applicable Loan Documents
fluctuate.
KLEHR, HARRISON, HARVEY,
BRANZBURG & ELLF.RS LLP
Dated: J , 2009
Shahan G. Teberian, Esquire
Attorney I.D. No.: 69407
260 South Broad Street, Suite 400
Philadelphia, PA 19102
Attorneys for the Plaintiff
11
PHILI 836324-1
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DATED: _.~-fit'-Cl.
FOR VALUE RECEIVED, without defila[bn, the utdeni
NATIONAL PENN HANK, a mdoml bars ~• hereinafttr inferrM m u 'Borrower.' hrrdrl. p m
Penttylvarda 19512, hereirnfter referred t0 ~ ~odadon luviug iR principal o~ loq~ a PhNufel WY m the ordu of
ACID NO/loo ~ . ~ Dritsipal sum of ~' sad ~~ Arm. BoYatowo, Barks Cower,
rearining unpaid hereunder from trttre b time from the DOS. tilxtber whh iraaest on
date htacof at the rate se forth herr3a. 1°I' aM W P+iacipl amourrts
This Note b a rmldpk advance Dote. The Borrower shall
kram and W varttes mode by Bartle m ~' ~ PrhtciPal sum sa forth above or, If lee, dte aggregate mid
P~relPal amotmt shah be outsmod Bmrotver pttmraat t0 fhb i!ttrR, u any time of from dine to drrc, oa w aEkr the date hereof, gh~jey ~1 a'OOYOt of W
Ing when demand for payment b node by the Back, or when WYtnett[ b othetwbe due u urrpaid
FaPbadon Dace and abstat the oecurrenee of any Default
hereurder, prorkled dut the aggregatt Borrower maY borrow. ~~ ~n• prior [o dre
unpaid neP+Y in accordatttx whh the terms hereof snd inborrow
p~p>V atnoum onhmrding a[ airy Tune Mull not exceed the principal sum :ra8d above. Arty borrowing
Ixteund°r. odter dun through Traaury Worksudon, which sha0 tpt up'I¢e la full the
• prixipd sum sated Wove troy nm be lus then
'Expindon Date' shW be ON D8lWlID Dom (i 1,00000
Borrower mart pay in fuR and . or s~ other daft u troy baaRer De ). The
reduce to ~ zero h'f atnottnts due std ow at>L,`ed '~ io wrhing by Borrower and Bank.
( 3 0 ) ootneerrdve batarrce the ouamd hrg urder this Note for a
® nontotsxudve ^ days in each 12- Period of THIRTY
1. Reoevmmr rrrr~ PWod lea m the Expiration Date.
- of pr{rteL.gl +vt + Principal an¢ ituges[ shall 1K re
PRINCIPAL PaYSCHLS UPON D ~ ~ ~~ ~ Beak u foibwa:
DAY OF SACK MONTg, Ig NO DB~1LID~ gNpR~gp=~RBBBTffiPN ?lADB Y O!l T88 STS
~-ATB OIITSTANDINQ AND DNPAID PRINCIPAL Affi)UN•p OF ALL LOADT$ ANDrADVANC88
i pr ~ ~ ~ ~ DZ'IPAID AND ACt3lUgD ~'BRSST THB'12EON. SHALL BE
IRATION DATB.
~ THH LVBNT ANY PRINCIPAL OR 3TNSHT IS MADE B$TNSSN
STATI?O~N'p DATE AND PAYN8N•r DIIB DATS~IT WILL 88 R
2•SfOHTELY BILLING, BFLSCTED IN YOIIR HEXT
WYrtrenb ~ Y+~ henanda arc ~~ in lawhd nwray of the Uffied Suter of America at nay baotcing oflgte of Hank in Immeel,ce!
~~ fart m mtaes[ due on the un
D1Ymenh obeli be applied on atxoum of tither charsq, pad hdana of prircipal. second to unpaid prise' and final Y available fuodc. All
2. Rasa ....r r.y.,, ~ . '~ iY the rcttuiader oP such
Edon of I~ m die outstanding std
days io the then currant caleadir year that ~~ principal balance of this Note shall be rstlarlated for the
l~pal ie outstanding. based ywu a year of three huMred sixty (360) days and aba0 be tttxua! camber of
TH8 LOAN 9HALL BF,7-R IpT87t88T AT TH8 FLOATING i~ at the following ntt:
PSRCiiIRT (O.0009t) PSR ARNWf IN ffiC$SS OF T88 ffiL8 ST RATB OF NO/1000
OSFTRBET PRIidB~RSffi J T88 PRINa RATE' PDBLIS88D I!7 TTRREB . PRl~ RATB. THS 6fALL
T>38 1gALL RATE IS
RATB' IF IiSORg O71RIII1L ON Tffi APPLICABLB A 2fDN8y RI1T83' SECTION
TIr~. TBAN OHS IS PIIHLIS$ED A8 SIICH RATB OR THE HIGBSST ~pg;~
IF THS 1fALL STR88T 1dAY C1iA2tG8 ~~ T~ TO
~fPISB NOT PUBLISH FOR ~Ep TO SS PIISIrISHBa OR fiOSS O}P 9TRIR8 OR IS
PRIM RATB'r TH8 B~ NAY II98 ERIOD OF TIhtB OR IF IT C8A88S TO PUBLISH A
AIiY SOLAR PDBLI8H8D PRIbb>8 OR BASE RATB.
2a' . If dire is m 13vera of Defauk under fhb Noce. the Lender may. in la dLsctetioa, intaease the '
pe=ta~t L3 %1 above dte pnrem m„ OA the
O1Wm"m hnerex rate ?.ends b peraritted to ch uaerest arc on this note m: Th_~
3• L Chat a If the Borrower defies ht the +rge by law, whichever h less.
Jaya abet the same rhaB become due, then paymem of any WYsnau of principal rrndJtu interrst, or nay Part d+ereof, for o
amapra of such late die Bank a]u0 ~ entitled m pollee[ a rare charge equal m Per~d of fiftern (IS)
~YorrnttN SEVENTY-FIVE ANp ND/ItN) SEVEN AND ND/1DO0 percrmt (7.000 %) of the
4. Pre meat, Each Prepaymem sha0 6e a ~Q CS 75.00 ). whichever b greater.
remainder of such wytmrr, if pplied lust m the payttrem io fidl of other
and for my inasoa Borrower t1W1's1uN be applied m the redtxdoo of the urywhi ova peyabie hereunder, then b accroed imereat and dte
>~' mY Pordon or portbra of the ken evklentxd u a ~Ymrot Premium Addendum k aruched hereto
such pinpaYmmt, a prepaymrnt pseadruu (tpe ~prepaYmerrt premiwo` to _bY m~ Nott, then the Borrower shall
pramurn
of demand ~ herein W Wdbe applkabk m auY PrePSymem of f ~ ~~~t ~~rm ~"I~~ co^a~+'e absrnt tmndest~~amdud herao and
~' ~ acceleration r~ De~ o~~ • to ~ ~~~ ~ Boat's co~llitaal aQ qty eruct ~. Ncfudi~ whhout lirrdutionPru~a resu r1
Borrower, any other
proceeding. ng or as a rani[ of soy acdon [area in a judreul, ,. ~v~e~`~' Dina caused by th,
p~Yattra premium Addesdum h b trot E ~ anY ocher legs
S. ~_` This Note b the Note inferred ro in aDrceuxnt between
ouY~ameMrdt ~ '°Y kran asreemera„commitmdrt truer, line of credit Borrower, Bank and any eatery e:ewaed in wanepioa with this Note,
Borrower aM/or roPD1c+o<n[ed• renewed sad extruded from time m dmea ~ ~~tS• agrenneau and/or othu docamenratbn (u dm same
6. ~ ~' d execute nay such ag[eemrnt or other tk>cumet¢ shall not affect die vai~~ra• and/or "RNattd Do ). The fa0urc of
tthry of th4 Nott. cumeouaon
The ttrms and eondidena of fhb Note mgetha with the ttrras and r»tditiom of the Lose A
whkh are incorporated herehr by refrlence u if ea forth io full. contain the entire nudersttrdi .
~ evidence heinby. Such and Lreemeot and the Related Documenntion,
7. _ °a+°dktg may not be amended, roodifled "g betwern the Borrower ecd ~ >~ w.kh respect to the
ankings of the Borrower vanca nude
a~~m0^a~ngs of>>b Borrower m the ~f ~e Loan Amt aomd ~ A~~ mkt inWrsusm m this Noe~e and for all pryer ~
ant, whedttr rntered inn crow, Dacnmenud°4 'Od for soy sad all other 1 mss'
' brttrat, rrotgage and/or other liew anti tighu in all of the eollateral~ anArhamfher, the Borrower aekmw ndeboedne°' obligadoos
Docttmrnution• The Halt shall have no security destribed in ~ Lwo kdgea that k has Fronted to Bank a
security intarsst of the Bade iu the Banks wgamora~g~ m dq Borrower. or m any. endorser, ~~nt am/or in the Related
gue+andes or m resort m e6e same is nay particular oNer.and spry' ~ rddtdon, the Bank sban tpt ~ mr' suttty or other parry, to per@ct spy llrn or
~~ }O o~ll anY collattrel or srxuriry or
8. Default ettd Raja Tye oaumetk. of any defauh or erpd of default De
ataVw the faihue of Borrower m comply with any of the terms of this Nola shalt wo,timte a~De(juu~f ~ under t5ia Npm.
Agreeasnt, trader airy Related Documeoutlon.
The following sbap abo txaostltute a Default of and ands. drb Note:
(a) Failure of the Borrower m pay ssben due, or on demand. aB or any part of the priaclpal ns ittttrest, of Chit Note;
Ag7eement and Related DoQt~tloo std
(b) Palate of the Borrower w my ~m ~ of dx agtxneop. u~~i~s. ~ditioas w °bli8-tloas of t6a Noce. dte loan
sad ~0 Bade whetlaar eaterxd iron poor m, concnrtera ~. ar wbsequem m the data ~w writing. or any odw agrepttaat baaeea the y
{c) Death rx ~~°' 1O ~Y
inrompeseace ottlte Borrower of any wrcry, rtm iadirtlual;
wffu soy laud
(d) If for a~ su ~shaB become went w usuhle ~ y ~ ~ ~, ~rc w became due, w lacy pgipoa or
for the benefit of aedhon, w shall spank it under mY Provtsi~ of a tpm w than ~ a colon
aPPiY fw w waseaT m fhe appolnutsoc of a receiver, astsse or ut~~br ~r~ • w s~ maw m astigomeot
(e) The entry n~~~ngment w t!x i~ut~e of say execution, aaaduaeat w garnishment poc,ed~s a6,~st Hotrower w say mtgY:
(t) if as _ wammy [Wade in this Note w
~~ ~ wDeS~alt by Borrower of smell P~ m be w m bare bees false of erroaeaus ~co ~ ~ Nom w if any alostmtion suppled by the
(h) Pollute of Borrower or any wtrety m fitmbh fmatrcyl~ ~ ~ whetter as msker. ro-maker, eadotses, 8uanamr, suety w taxpgYer;
(>7 It the Bottnwet or ~UOn u spy be reuotpbly «gttested by the Beak;
exchange, w aaostar of W oa~at [hares oaf ~~~ of ~ dO'o~O~ mugp. txmaolidadon w ~~
stock w alter cLain~ootpotam~ eaota:ntre, w t w outer dotamtenyyon m ofir4lhate such ~gp wet or aqy stttay Wesuaat m a pang t~the
Q) The Bade is good faith 6Hfeves that the ewer or any sarety ie a Aarmetship, any e6mge is me p 4 uehattge w
(k) The sak of p1Ot~ °f PaYmeat w pationnaace of this Note b impahed; and/or
aayptopetty wttkhooaswtttes
Whm such a :txauity w ~1as4a1 ~ ~ paYmmt of fhb Noati srhhout rya Wnrept of the Beak.
Default ocaus, the Book, u its option, may dalare the cadre _
cltargu, eatr atsl expemu Provided for htattia, the Lora _ °OPsb bs>suee of principal of this Nots,
Ilpoa the Doeommptlm payable without aodce
rcsPat m ~ ° ~ ~ ~wHasend ands of a De6mlt the Book shag ha~~ f ~ ~ ~ ~~ sad ~reoa std aB ocher
Baat~ txttrily n deaeribed or
remedies ate provided for is this Note. is dre provWed for fa Ule Loa Agreement and/or the Poe[ m dtb Nota tad wh6
otntrrenee of a Detwf L'oa° in any of the Reasd RHasd Daatmeapmq ahlc6 righp sad
4 say obfii8truoa of the Bank m make loans or adrarvrig txtead aedh m ~~owu sh.i! intmedrteeh, ~ ~ 4w. Upon the
9• Waiter. The mtdetslgned hereby wairea
of the notice io coaoection why delir P~°mmett[ for ~yttteat, demand. ttotiee of noapaymem. tmtlce of
"~ atry right or remedy ahaY not 6e taken m wary ~ o ~a~~ t °r ~ of ~ ~ ~ of rtes Nose. sad all
~~~ ~ dro za>tt wf~'mmt of fhb Non:, The faihae by the Beak m exercise
m be 1~~Y glum if mailed postage psep,jd to ~ address appearing ht the Bank's Y tea[ DefaNt. All notlas n the Boiroaet shall
egatly hoard tmreby. camels. The Bortosver imm~da dris Note m 6e a sealed ~ttruogar and
!0. Holder. The retrseoces m •HSnk• htteia slap be deemed m 6e references m any subsequem
11. Ie;^r sad 4~ r t t.r.u• . aaneferee or other holder of this Note.
oNlectlvUdta Nom shop 6e joim soli several aadrt tA~rc comprise `^OBotrower haem shall opee^ml'. rbe IbhHhy of each and every Irerwa or rotary having
fueoces m ~~ refert:acer m the sale
rsigned, both hrdlviduuly and
12. vim' a Law This Nom shall be rimed m ~~ wtt6 dte domeatie iaeema! laws of the Cotstumasvealth of Pentnylvaab, without mferonce
m any conflict of lams provbbne, u a Nos made, delivered sad m 6e wholly performed within rite Cotoaroawtahh of Pmoaylraab.
Comnma upi~ys of Becks Camay, pemsylvan[n, ors t!x UpiadorStuet Distriaa~ undo or with respaet m ells Nos wID be msaotted in dte Court of
uncottdt y wbmhs m the juriadictioa of each atrch Court for each purpose, Court for the Pastern District of Peaarytvana, sad ~~~ and
14. (•Anfeaaloa Of I~.m Y
----`_ 1'he Boarower hereby aroracabi
elsewhere m appear for sad rnnfess Y mdmriaee the Prothoaotrry or any atmraey of any court of terntd >n Pmrtry
eaPensn for whidr Bo ~B~t sgaimt the Borrower for tqy and all amauntr urrpeid heramder, mgetlrer with ]vaola or
Bawer b liable urdv this Nos. sad mgetha with fora of txxtme) in the reasonebk ampant of fifseea ~ other charges. cons and
Coregoiag (but is m event less than S1,000.OOpod castr of wit, releasing all errors sad wairhtgall tightr of ~~ (IS A.) of sH of dre
of execudon sad tkem ~ ~~~ it shall sot be tscessary m file the original u a canna of am ~1. H a ~ of fhb Nos, verified by affidavit,
braefi[ of all uempdon laws now w hereafher in effect. No si ~• ~ Bwrosser Iteteby waives the right m say spy
doenred m exhaua this power. whetlsr of not m ogle uwcise of this wamnr sad wet m
undimiaiahed sad as ~ Y ouch uerdse stp11 be held by any court m 6e invalid, voidable or void, but t6b 1~6amat shag be
Y exerebed from time m time u often u the Beat shag elect unW all came due hgetttrda shall have been ~~ shall ~~
rgotiarw m awns afser earY of jadgmmt herptoder. Paid is full. lamest shag
~ Jadgmem tam of ioterot order ~' mofessioa, default, or odrerwbe, u the higher of the prcra(lhrg ram of inlets[ ruder dtis Nos, or
applicable taw.
15. NOT1l;E. THIS NOTB CONTAINS. AT PARAGRAPH 14. A WARRANT OF ATTORNEY TO CONFESS IUDGMENi' AGAINST TILE
BORROWER. IN ORANTINC, TFHS WARR~T OF ATTORNEY TO CONFESS JUDGMENT AGAB~IST THB BORROWER, THE BO~OyirER
HEREBY I(NOWINGLY, INTENTIONALLY AND VOLUNTARILY, AND ON THE ADVICE OF SEPARATE COUNSEL, OP THE BORROWER,
UNCONpiT10NALLY WAIVES ANY AND ALL RIGHTS THE BOR]OWER HAS OR MAY HAVE TO PRIOR NOTICE AND AN OPPORTUNITY
FOR HEAREiG UNDFdl TfIB Rp,Sp~.NB CONSl'J1VftONS AND LAWS OF THli UNITEp STATES, THB COMMONWEALTH OF
PENNSYLVANIA, OR OF ANY OTf1ERSTATE
EORROWF.R HORSIiAM VALLI3Y I-IgyfAYS, INC.
PRES 8'NT
Address: 450 CARfiDgp~ DR
Attest:
IiORSHAMr PA ' 19044
Witness:
gARTSDIN
f$ PRBBIDISNT
~o
~_
o~
v
~ m
4i
1a9s vATtTaALg Sa,aso coo.
00
t PriAapcs: tv~ n~.~ ~ -
arc°.
as/o~/o7 ~ altaD-Mn
co~nMERCraL ~ .
VARIABLE RATE
REVOLVING OR
DRAW NOTE
2,3~aD
-• • °- ._......,, ocrmwar Promises tD pay to ttb order of IJmder, the pdnolpal amount W .. • .
~ Dnpeid pdralpd amount of er loans or advances made by Lends to Dolitus (_~ . a 5 O.ObO 60 ~ ff ~ ~
i the manner dasodbad below, urdA aB amounts owl BOQOWOr under true tiDle, Plus klbrast on tlts tNlpsld Prfnci ) aggregate
interest, thml th unpaid pr41dpa1 and than to r'e under this Note are paid In fuN. AM amounts rerxdYed by Lsltdsr shall be Pd balance at the rata and kl
pennilbd by bw. ^^~ ~ dt~ss and expenses, or in arty otlter ordaT u dst~m6ted epPlfad that to accrued unpaid
REYDLVIMG OR DRAW FEATURE; ® This Note by i-cadet, In Lender's Bois discretion, as
i erdiged m borrow possesses a revoMnp feature. U n sort
a draw feature. ~ to ttp fuN prindpd amount Df ffle Nlob and to repay and rsbonDw flOln ffrrls bth tune dudr~ip~e farm of the in this Note, gorrow®r shag be
ma rat be ro ~ sadsfaoUorl of aN oondldons set forth to this Note, Borrower shall ba onYMW to drrav one a more times under tONotec ~~otteesn
I Y bDROwed. The a~propste amount of such draws strap not expad the hItl
~ Irlformstlon with roped to any IOanS Or advances under this Note siwil be rsDOrded andr~~ amoum of this Nob. Y P yment
i ooralusiw of the pdndpd and irdereet owed by Borrows under Sus Nate urusss there bm~~ ~ lender in ffs internal records
date and amount of an loan or mabrtsl error in such and such records shell be
loans or adVanws to Y advance shad not Ilmk ar offwrwbs aftsd the obSpatiorq pf fM records. Tha Landx'e hiltlro to record the
hours, peth°r wrth all interest aoputnp thereon. Borrows atlas bs entltbd to i Sorrowsf undw ~° NOt° to repay the ~nodPal amount of tM
nspatd w obWn a Dopy of the records dudnp Lender's business
i thCOND(iIONS FOR ADYANI:ES; M no Cwertt of Detsudt has occurred ands ihra Note, Bonovrer shah b@ entlged to' borrow monies ands this Nots (aub)aot ib
IlTdtatlorn desodhsd a6cre)) under the fotlowirig i:anditlons:
it S1EB ADVANCE A>7THO7tIZATIDN AND ZNnB!l~rITY AC;•Rgffi~NT,
' INTEREST RATE: This Note hoe a varlabb rate feature. 7~te t~
Mbred shop be computed on the bade Di Linn aCtval l aumb ~' on ~ ~e rapt °hr~~ time tD thne if the krdsx Rate IdentlRed below dt
'~ payaWs at a weiabls rats spiral fo _ 0.000 % r annum O4~ f ~ a over s Par year. Irderoet Dn this Note shill be dlculated
per annum. Any change In 1M hrtereet rats the kldcx Rob, 'this irutid interest rats on this Note sfurl be._ 8,_ a 50 %
T1tB DAY OH RACH fO6ultlny from a ohsnpe N Uta Index Rob wB dQ elfecSw on:
. CSirLN6)S •IN TH6 VrALL STRLt;T P&INS RATE.
i RATE LOYRTATIONS: Sub)ect to ~ap,P~able law, the minimum IMerart rate
this Note ahaN not exceed --~' a-_% ~ annum, or if I on fhb Note sbeY be n/a % ps annum. The msxhnum interest rate on
~ charSe bylaw. The maximum tab increase at arty onetime will bed ~ ff n a irtnlm rate b ~ htdoated, the meadmum interest rase Lender Is
I INDIX RATE Ths Mdex Rata %• The mexknum rate decease at any one time wAl be a a~ %
i far thb Note ahaS be:
T~ a~tm' RATS• PIISLIStTgD IN TJ~ staDNEY ~TgS^ S>;CTION OP Tl~ tt7LLL STR88T
i pS78LD ON T>SES APPLICABL3 DATE OR T8$ xIGSSBT epRII~ &ATT• IP NDRB THAN ONS'I5
! S the trrdax Rata la rodeffnad oror baoome~ aVdlepb ~Y ~~ ~N TI1sS TO Tllt$.
DEFAULT RATE ff there b an Event of Dgfau ~ then Lender may sabot aratlter index which b srlbstertUally similar. .
l k ultdsr tlua Note, the Lands ma , to Itc discretion, Increase the iritsreet rata on this Nord to: _~_
or the m um teat rate Lends 6 permitted >o charge by law,
PAYMENT SCHEDULE: Borrower shall a the la less.
P Y prlndpal and Interest axcrduyl to the following schedule:
I On Demand.
i •
I ,.-
WARNING: READ BEFORE SIGNING - YOU AftE WANING IMPORTANT RIGHTS
C~ tF GtECKEp, AS A MATERIAL RtDUCEMpfT TO LENDER TD
j ATTORNEY OR THE ppE>TNgpTARY OR CLda( OF ANY COURT INN TH ODEN(~D SY TFt18 NOTE, BORROYVCR n1REVOCABIY A
i IN ANY ACTON irJiDUGI{r gy LEND@!!M7'EA gpRR~~.B Off NWFALTH OF PBaNB'YLVANIA, OR EL6EYrFt UTM~'S AND EMPOWERS
FORALL. BUMS WE UNDER T-ea NC1E ORANY AULT UNDER TteS NOTE OR ANY OTitBR LOAN E~ TO APPFJR AS ATTORNEY FOR
AND ATTORNtY F1S:S, TOaEMEp WfTH R11'EREBT ON ANY OTt16i LOAN DOCUMENT. ANDFORALLACCRUED DOCUMENT; AND TO CONFESS JUDrireBlT
I TMUCH JUpT UrrT1L Tf~ fi1LL AMOUNT DUE LENDER 1 ~~M A7 TtiE RATE OF INiErFgT ~EGFIED IN THE ~ ON THOSEAMOtAd1'S, C05T OF SUri,
I AlrrtlOpTY QRAtfi'ED H9iFJN MAV eE Df ~rUAU-Y REOOy~, THE NOTE, OR A Copy VEW ~~'~'F~ DEFAULT; F,pOM THE ENTRY OF
DUE LENDER ERCism AS NEEDEp FEtoM T1ME TO TIME, AS OFTEN AS NECE FAD ~ i1FFDAVR, WILL BE A SUF}7CItalT WARRAtTf.
BORROWBt SsARy, UNTIL RECEIPT ~ PAYMENT ar•R1LL OFALL SVNa
IOIOWINGiLY,1NrEN110NALLY ANO VOLUNTARILY, AFTER CONSIATATION WITH INDEPF110ENT CD _
TO DUE PROCESS teORRDNIER HAS OR MAY HAVE tJNpt71 THE CONSTITUTIONS AND LAWS OF THE UNITED STAB ANDNCgO~NDRIONALLV WANES ANY AND ALL RtAtM
~ BORROWER FURi~liEli UNOERgMND8'TtIAI(UPON art REQUIRED UNDErt MPU4~aLE UW WRH RESPECT TO THE t7tEC~(171pN~0 ~ANY~OONFE~BSEO~.RIpOMtM.
RLaDInR~ UNDER ANO SELL ANY OF BOAROryprS Dy ~ ~~ ~ JUOt+T1ENT, THIS wANER
OPPORiLxirlY FOR HEMIN4 IXCt?'T ANY NOTICE ANp/OR HEAPoNCi
APPI.ICABIJ= LAW NRrtt RE3PEC7T0 THE EXECUTION OF THE CONFE89ED JUDGMENT, IN ORDER TO SATISFY tNtpq SC-CURE ALL SUMS DUE,Y ~E
~ THE PERSONS SIGNING aBOW ACIpIOW~ THAT THEY NAVE 8610, UNDEitsT
I PROVISIONS ON THE REVS SIDS AND tiiF{THER ACpaONIlEpriE R~pT OFAtI ~r AND AGREE TO TF£ TERMS AND CONDmONS OF THIS N
IN WITNESS WHERHDF, iM ralderNptrd has EXACT LbPY OF THIS NOTE aT~ INCLUDING THE
/tiw cawed agar slsYUnlsnt to Ds slaclase ae s sealed ksirurners Nb ~tti _~y ~ ~y. 80.07
60RttOWER $O12S$AM VAL%8Y A>atWAYSr INC. BoRROW~e •
~ix>3sxnENT lid)
BoRROwErt .
eoaaowEir
fs~9
BORROWER;
(~~
BORROWER . ~ ~ .
~SBeI)
'. BORROwQL
(S~~
60AFiOWER
one Installment, any paAhl ......_.. _.. _ __._._ ._..,,~.,, _._-.
ProPaYment wit nd afied the due dab or the Ilft101att p¢ ~'-' •••~~ ~ .•~•••••• ~..v.y' "_°"• '••••' w~^.ura irwre uiedr
Iorrower and LaMar. fl this Note is prepaid in full, there will 6e ~ aubsaquent utsbllment, unhas agreed to, in wding, by
QA Prepayment penalty d : ^ A rrtktlrrrurrr finance charged S
LATE CHARGE: if a payment h received more then 15
u aid late paYmenr;(JS____,__.®- 7.00 ~ Ia[e. Borrowerv~ be dferped a kte d~arge af: ^
less, as pertnkled bylaw. No more than one lab oh e % d the rmpdd his peyrmM or 575.00 ~"--~ of tlts
erg wll be -------. whichsVer le ®greater
unposed on any single payment or portbn o} any payment.
SECURTry To secure the payment and perfonrtance d ob
d9h4 title, and kdarest in afl monies, inshumeMs, eavin ~~~ t^O^R°d under this Note. gormwar prank Candor a aeaidty intaraat in sk d t3orrowar's
aeoouMs aub)ect i<t tax penalise k so asei Os. checking, share and other atxxarMS d ~dl^8 ~ ~h. trust aeoou~ end other
are oleo secured tty the colaterol p!1°`~ that aro now or in Ste takes in Lender's
seoudty instrument s aeo ~~ i^ a^Y ie~ky instrtrrrterd(s) exeotded In oonneolon wiflt ikI s Note. aM~ thse~i~iB~arrs under This Note
() urine this Note or aN d Iforrotver's oblgattons, deaorthed M any other
CHtcC1C PROCESSING fEE: fl a dteck for payment b rotunted b Lerxler for
dreddng account), Lander wit aseeas a check Procaseinp lee of S D~a ~ s whigt ahalls~~e~~beoarrce them are uuad~ettt funds In Borrowar'a
RENEWAL' Q 0 dtedrod, Ws Note is a IPrd dance.
renewal, but not a catkfaoilen, d Loam Nrrmbx
t. EYElft"9 OF DEFAULT. Art Elrertt d Osfaukwilt occur under th&ANob AND CONp07pNS .
to ssatae this idoea: In the event thsi Borrower, mY guarantor or ery dher third
faik to tttshe party p1a M co
arty payrnsnt on lfrls Nob or arty other In d8 D lateral
(tt) tale to perform "r9r oblpaBon or browhes arty warranty m Lander when drre;
(c,~ P~Ida or ~uaasap any tf y ~ thts ar• arty oMer hrdsb6sdn~ a ~ ~ d In tide Note. any securdy irmtrumeM, or arty outer presets or
((~a11 c~on~s, or transfers rights~~ ~ s~~° or r~rrae^f~°n th pa p-ovldad to Lander;
ar,y m any tlrasrol securing tfYs Nees tvtthoul the ~.,, aPPrwat of tender,
(e) has a artdshraspeok or srrbjeeta such odlateral to ~sehure, oonfhoatlon or condenatatlorr destroys. loses or damages such oolatetal b
aeouro8fris t~btam q ~~m°M' tax Iwy. attachmard or flan entered or mnrad apatrat gorro~, ~, O~aMor, or any third patty Pladputp oolaferal to
Cry die; bseomea ~Y d thou property,
d creditors, tals~pMayPMeM, k ~SOlred or termlrtated, amass to operate ks buslnecs, becomes ursohrem, makes an n
(p faik io prarida LendK avtdance of artlsfaao dam' or bttmmos 1ha subject of any banlaupboy, insolvency or debtor rehabiltation~ msnt for the benefit
(h; has a majority d its outedandl trot ryfinartcW condilon; Proceeding;
majority wmershlp ae d'ths doh d>M etwwflon o<ttrit Noes; w ed or conveyed >o arty Person or entity othx Chart any Parson ar antky that has the
l9 txtleae LaMar 1o deem iieelf insecure due m s dprdfloartt deelrre in the value d arty reel or personal Properly se~4trrinp Paym,M d tMs Note, or Landes
N Clots faflh, belsvee kte P~Psct of payment or
2 RIGHTS OF LENDFJI ON EVENT OF I7EFAULT. H the a~rao Ins an (Evan(d d.
folloaring romedbs whhout notlsa. or demand (except as required bi' Defauk order tlrk Note, Lender wifl 6e anflled 1o axe
(s) !b dechro tM pdncipal amount plus accrued Interest under 1h~b Nate ant ell other ra6° one or more d the
payable b ful, such aeanteretbn ahal be auto present and future obll
to cork ~ oin8 o~p+tlorrs d Borroy rMtt7lh a wlkfawrfl0 ~ ~nt of Lbhuk is a flltng under Qte pBenuntPtcN todrrowar immediately due and
o m ease mekktp artvartosa under this Nob ar ~prooesa;
e to r~qq d mY oollaterol in cry martr~uro~r e0roameM between Oorrower and Lender,
(Q to al, Iswroi~crolMrbieisede~ ant mabe available toNy ~ti at a sae
(g) ro set-oft Barourer's ~dkpeso d ery ooflatsgl and oolect cry defids b~~ ~O^8~' °om~enient to Borrower and Lander;
mtdrtbined wWt Lander, ~ one against arty amourtls due to ~ `~ or wkhout rosartirrp iD legal emcees,
(h) to exerdse ell othp rtghta avalabls to ~`~" inatt~e. b'rt not flmitad to, maNOq lrtsatrmeMs, and deposk amounts
L.erMar'a r Lander under any other rrrkbrr aprmment or
ights are oumulatlva and maybe exardsed togNhar, ttppflnble taw.
avdlabb at common law holudktg, but rro f imi6ed te, the ' and !n any order, L,srrder's remedies under 1Ms
8. DEfliAND FEATURE ~ ~~ d ml"Off Paragraph era in addkion b these
in Lender's sole and absoktb d'uc ~~r ~ ~a a darttand feature. Center's dght to demand Paymettf, at
any dsfauk has oawrrod, arty time. and hnm tens to time, shat be
4. FINANCIAL INFORMA710N. Bomower wpl H al times
socordance wflh gensraly aoxpted aeoouMing prMxgp'es ar~id wAed lust m Lsnd ~aM account in which foil, true and Dotted entries ehal be made in
°OPY d the ennuai finartahl sfatsmerrh d ~ (~~pt
sudr fiscal year and QQ the rolabd htoome Borrowx r ~ to suds fiaaal yev, such stetemsMS~ indude~ UMis bahnn sheet d Borrower as at thee eM~d
such ceNfied publb ecmuntartta sa may be refabmeM d rMek,ed aaminga and atiblTteM of cash ~ d Bo
mR1O• a eaPY d Borrotwr's Income tax returns and alsoy ~bbOtOry to hander. Borrows( dso agrees !n delhar !n ROw°r for such tiacd Year, Prepared by
5. MODIFlCATION AND W ,from time to time, each olhsr fmandal iMwmakon with ~°r within fikeat (15) days after filing
ANEA. The modfiaNon w mY d Borrower's o respect to Borrowx as Lend Y 9
witting signed ~ Awaiwr on one Y ~ `¢ ~~ °~°flona or dNay erorot^eer~ stns uMer thlc Note must be oorNalned kr a
obiigedlorn or ri oooeslarr w8 not
k Lender am oorrstllUb a Waiver or1 any other ooomton. Borrower d is rlglda vriltout oausktp a wahror d those
its righb apskrat cry co-bono~war~~HeR bfls to sxsrdse, intpaka or rehrsm arty d the obdgations be obl0atiorts under thh Nde shat nd be afhebd
InetrurrtenU marked 'Paid b Ful' opt W yet a colateral a any dher ProPartY saaaUfg the ~^0 tO a^Y oo-bormMtsr or puarartlor or arty of
payment as iul ~adO"'. LsMR maY accept eM apply attacks and dA 9
bound by that language and wuhout waiving nny dgJ~°S pnyr~~ ~ a~ junta OID^ °f the oblgatlona incurred under thb (does, without halo
6.3EVER,g9k_ITy, fi any Provhbn d ktls Idols h irnald, plegal a unerlfaromble, $re~ uMer tfds Nob.
in any way be afbded or Impaksd ktereby, veldly, legdky, and enfioresabt6ly of the remalNn
7. ASSHiNMEHi: borrower agroes not to assign d Bo p provisions shall not
Lender, which consent may be wdhheid rtowar's d9~ remedies o< obllgatlona described to thk Nde
deeonTted in thxi Noes ~ LaMa I~ sole dhrtrekon. Borrower agrees that Lander Is emlNed to aeq without the prior wr)tbn consent d
wthout nolce to or the Prig oortseni d Bomtwar. 9n some or all d ih
e. NOTICE Any notice or other comma dghte and remedies
addresses desalted 4r Chia Nate of such oth teas as » or Lender under this Wots
9. APPLICABLE LAW. Into ~°s ~Y oats In wdflrtg from time to tlm~etl ~ In writlng and sent to the parley at the
compensate Lander for ary~dafaudk orpb saw ~ ~ ~~e4 °D^tP°^Dab Lander for the
of peaasv~ na by Bonowsr of ihs~ oondidons ~ ihk tht~~°~shall bed governed by^tha laiwe of thewatiat~e
d_~....ovi ny Al otter farms _
located in PeIInBV yaaia --'-- . lJnlass aPPrrcabla law provides Wharwise, gorroW r oomeMs t ~ mM ~' the Iaws of the state
selected by Lander, in Ua dlsorelon, In the avard d a )uriarsctton and venue of any court
10. COLLECTION COSTS. To the extort legal Prooeedlrtp under this Nola.
Larder, wt~ are ~~ ~ i~sndN~in copes l^'~~ ~8r~~de ksyrnd ~consukam~ ~a ~° ~ ~' (nctuding, but not limked io, fees and
but rest flmked to, ell foss ant costa lneurred~appsel in b M due or eitfaoing arty dOht or rom ) tetretl»r or rat such akomsy or agent is an employee of
1 Y. MISCBLIANEOUS. This anlovpeoy, end for poatjudpmerd Dole ~~~• whether or not auk b brought, induding,
the essence. Borrowar/throNots wsiv sew ~~~ ° ~ ed at az~y addra~ssl' eO~IWre1' or Iws(nsss purpoeea. Ronowar and Lender agree that time Ice of
Person who endorses prea ntment, demand for ~s10^abd by Lander and In lawful lkrried
Pth ~ apaMst anyone else sister. reoeedtrtg eprdnst Ilonowsr a ~ prr~on ~I reface ~ and furlAer WaNp any~jig~ Bomtwer ~ r~to
under this Note aft ba jtdrk andteave~M POn the t,eks, suooessors and aalyns of Honowsr and Lender, k them h m~orea ~sn muds al of the
requestW ktformslon eoncsmi thfe Nob ma be rc Borrower ttr~r oblstpning
hereof ~ proper legal prooesa, Ttua Note repreaeMS the conlPisee and inieprated~utnd rstaonrd ninl grbePtw~n Borro~wcr and Le der raeardn g ~ bons
72 JURY THIAL WptVER (Fpfp~ AHD BORROWER
BASED UPON, THIS NOTE OR THE COLLATERAL SEt:11RIN0 THIS NOTE
HEREBY WANE ANY AlOHT TO A TRWL BY JURY IN ANY CIVIL ACTION ARISING OUT OF, OR
13. ADDITIONAL TERMS:
588 AITACHF.p ADDBNDUM A. ADDBNDUIt A TO IBIS NCTE IS PART OF THIS NOTB A$ IF
CONTAINBD IN THg "PAYMSidT SCHBDiTLB" PARAGRAPH OF THIS NOTS.
~~ _
~' ~~~
ADDENDUM A TO PROMISSORY NOTE
1ZIIS ADDENDUM A IS DATID THE SAME DAY AS AND LS MADE A PART OF THE NOTE AS iF
CONTAINID IN THE `1NfEREST RATE" AND 'PAYMENT S®ULE' PARAGRAPHS OF THE NOTE
WTF,RF,ST RATE:
THIS ~ SS ~rBEAR INTEREST AT A VARIABLE INTFRFS~p RATE PER ANNUM g(2UAL
PUBLISHED IN TT-IE "MONI;Y~RATES° SECTION OFOF THE R~ RATE ~ THE PRII~ RATE"
APPLICABLE DATE, OR THI; HIGHI~aT `~RTT~ RA ~~ JOURNAL ON THE
AS SUCH RATE MAY CHANGE FROM TIME TO Tfi.~ IF MORE THAN ONE ~ PUBLLSIB?D;
CEASES TO BE PUBLISHED, OR GOES ON Tom' ~ THE WALL STR EIr'T JOURNAL,
ANY PERIOD OF TIIvIE, OR IF TT OR IS OTT->ERWISE NOT PUBLLSI~,D FOR
MAY USE ANY SIIvlIIAR PUBLISIED pRIME OR 8~9.SE RATS ~~,~ ~~ THE LENDER
BEGINNING APRII. 30, 2008 AND EACIi FISCAL yEA,R EIJD
TIER 1: ff D/W AT FYE ~.0 TO 1 THE RATE WILL BE WSP +.50"/0
TIER 2: IF D/W AT FYE >_ 2~ TO I AND < 3.0 TO I TILE RATE WILL BE WSP + .25°~
TIER 3: ff D/W AT FYE tl,i TO 1 THE RATE WILL BE WSP.
PAYMENT SCHEDULE:
PRWCIPAL PAYABLE UPON DEMAND, WITH INTEREST PAYABLE MONTHLY ON THE i~
DAY OF EACH MONTH IF NO DEMAND HAS pI2EVI0USLY BEEN MADE II~REFORE, THI;
AGGREGATE OUTSTANDING AND UNPAID PRINCIPAL AMOUNT OF ALL LOANS AND
ADVANCES HEREUNDER, TOGETHETt WTTFT ALL UNPAID PRINCIPAL AND INTEREST
'IIIF.REON, SHALL. BE REPAID NO LATER THAN THE DUE DATE.
STATEMENT' DATE AND PAYMENT DUE DATW~, BEE REFLECTED IN YO
MONTHLY BIC.I.LAIG.
BORROWER: HORSHAM VALLEY AIRWAYS, WC
$Y~ H T BANGS, PREDIS T
ADDSNDUl4 A TO COt~RCrar• VARIABLE RATS BSVOL'VZNG OR DRAW HOTS
This Addendum A is dated the same day as sad is Wade a part of the Note as if contained is
the "Payment Schedule^ paragraph of the Note.
Payment Schedule: principal payable upon demand, with interest payable monthly on the 5th day
of each math. If ao demand has previously been made therefore, the aggregate outstanding
prim is Paaldand interest~therte~ shall bears id aolatere sunder, together orith all unpaid
principal or interest adjuatmeat is made be~taaen statement dateeaadeduaetdate~it xi11 be nay
reflected in your asst mathly bi113ag. -
BORROWER: HORS 2 VALLEY 9AY3, INC.
- BORROWER;
r r
PRSSIDSNT
BORROWq} '
BORROWER;
BORROWER:
BORROWER:
BORROWER:
Yl1Sfe39 6 Hivluitl f'vnoWv
.91a ~6/0/Rfj p188) 897-0789
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NOTE AND LOAN AGREEMENT MODIFICATION AGREEMENT
NOTE AND LOAN AGREEMENT MODIFICATION AGREEMENT made this 23" day of October,
2008, by and between HORSHAM VALLEY AIRWAYS, INC., a Pennsylvania Corporation, with its principal
place of business a1450 Caredean Drive. Horsham, Perxesylvania, 19044 (-Borrower"} and FIRSTSERVICE
BANK. A DIVISION OF NATIONAL PENN BANK, with offices at 320 West Street Road, Warminster,
Pennsylvania. 18974 ('Bank"},
BACKGROUND
1 ~ On or about May 7, 2007, Borrower and Bank entered iMo a loan agreement which included
three loans. one of which was a Line of Credit ('Line of Credit Loan"} in the maximum amount of Two Million
Two Hundred Fifty Thousand Dollars (S2.250.000.00).
2. In connection with the Line of Credit Loan. Borrower and Bank executed a Loan Agreement
dated as of May 7. 2007 ('Loan Agreement').
3. In order to secure the Line of Credit Loan. Borrower executed and delivered to t3ank, among
other things, a Commercial Variable Rale Revolving or Draw Note dated May 7, 2007 in the amount of Two
Million Two Hundred Fifty Thousand Dollars (52.250,000 00) {'Lme of Credit Note').
4. The Line of Credit Loan was further secured by, m " alia, a first lien on the business assets
and personal progeny of the Borrower pursuant to a security agreement {"Security Agreement'}executed and
delivered to the Bank by the Borrower.
Agreements") executed and deli wired by the Guarantors. Hoyt angseand Alice Bangs husband and wif ty
e.
i3. The Loan was lurther secured by. in er alia. a Collateral Mortgage executed and delivered by
the Guarantors to Bank, which mortgage encumbers the Guarantor's real estate located at 450 Caredean
Drive. Horsham Township, Montgomery County. Pennsylvania. designated as Tax Parcel No. 36-00-01720-
00-8 ('Mortgage-).
7 The Loan Agreement, Note, Security Agreement, Guaranty Agreements, Mortgage and all
other documents executed andlor delivered in connection with the Line of Credit Loan are hereinafter referred
to individually as a -Loan Document" and collectively as the "Loan Documents'.
t3 Borrower has requested that the Bank increase the maximum amount available under the
Line of Credit Loan from Two Million Two Hundred Fifty Thousand Dollars (S2,250,000.OD) to Two Million Five
Hundred Thousand Dollars ($2,500,000.OOjard extend the expiration date to December 31, 2008_
9. Bank has agreed to amend the Note and Loan Agreement to reflect such increase, provided
Borrower complies with the conditions set forth m this Agreement.
AGREEMENT
NOW THEREFORE, INTENDING TO BE LEGALLY BOUND HEREBY and in consideration of the
mutual covenants and promises contained herein, Borrower and Bank agree as follows.
'1 • The maximum principal sum of the Note is hereby increased from Two Million Two Hundred
Fifty Thousand Dollars ($2,250,000.00) to Two Million Five Hundred Thousand Dollars (S2,500,000.0p).
2• (a) The maximum Borrowing Availabi8y as set forth in Sector 3.01 of the Loan
Agreement is hereby increased from Two MiNion Two Hundred Fifty Thousand Dollars (S2Z50,000.00) to Two
Million Five Hundred Thousand Dollars (S2.500,000.00).
(b) The Termination provision of the Loan Agreement is hereby changed to read as
fdlows•
"Termination: The Line of Credit Loan shall be made available to the Borrower,
absent default under any of the Loan Documents ~ an Event of Default hereunder, until December 31.2006,
and shag be subject to the Bank's review at that tune, Any extension of Ihis facility beyond December 31,
2008 shall be at the Bank's sole discretion."
3 The reference in the Loan Agreement to `Line Of Credit Neste' as set forth in Section 3.05 of
the Loan Agreement and all other references to `Line of Credit Note' contained therein shall refer to the Line of
Credit Note as modified by this Agreement. AN references in the Loan Agreement to `Line of Credit Loan"
shall refer to the Line of Credit Loan as modified by this Agreement.
4. As a condition of Bank entering into this Modification Agreement, the Guarantors shall
execute a Mortgage Modification Agreement increasing the principal amount of the Mortgage to Two Million
Five Hundred Thousand Dollars (S2,500,000.00).
5. As a further condition of the Moddcation of the Loan Agreement by Bank as set forth herein,
Borrower shall deliver to Bank executed Acknowledgments ofthe Guarantors consenting to the modfications
of the Line of Credit Loan as set forth herein.
Borrower hereby represents and warrants that as of the date hereof:
(a) No default or event of default exists under the Loan Documents. including the Note,
Loan Agreement, Security Agreement, Guaranty Agreements, Mortgage or any other loan Document, and
there exists no condition which, but for the passage of time or the giving of notice. or both. would constitute a
default under the Loan Documents, includirx~ the Note, the Loan Agreement, the Security Agreement. the
Guaranty Agreements, the Mortgage or any other Loan Document;
Note, the Loan Agreementh, the Security AgreemeM~the GuaranBy Agreerrnent~t'he Mortgage or army othee
Loan Documents.
~• Except as expressly modified and amended by this Modification Agreement, the Note, Loan
Agreement. Security Agreement, Guaranty Agreements, Mortgage and other Laan Documents shah remain in
full force and effect pursuant to their respective terms. This Modification is not intended to tie nor sha11 it
constitute a novation of the Note or any other Loan Documents or the indebtedness and obligations evider>~
thereby, as the case may be, Borrower hereby ratifies, confirms and approves the Note, Loan Afpeement,
Security Agreement Guaranty Agreements. Mortgage and other Loan Documents, as modified by this
Modifiration Agreement, and the indebtedness and obligations evidenced and/or secured thereby and
Borrower agrees that the same shall constitute valid and binding agreements of Borrower, enforceable in
accordance with their respective terms. AI! references to the Loan Documents contained in the Note, Loan
Agreement, Security Agreement, Guaranty Agreements, Mortgage and any other Loan Documents shall be
deemed to refer to such documents as amended by this Modification Agreement.
8. Borrower hereby represents, warrants and reaffirms to Bank that it is the intention of the
parties to this Modification Agreement that all existing collateral security held by the Bank shall continue to
serve as collateral for the Note and any other liabilities due the Bank by the Borrower pursuant to the Nde and
other Loan Documents. and until the Loan is paid in full, the sec~uity interests held by the Bank shall otherwise
continue in full force and legal effect.
9. This Modification shall take effect on the date of delivery of fully executed Modifrcadon
documents to Bank.
10. All provisions of thrs Agreement shah be binding upon and inure to the benefd of the parties
hereto and their respective heirs. administrators, successors and assigns. This Agreement shall be governed
by and construed in accordance with the laws of the Commonwealth of Penns vania.
acknowledges receipt of a true copy of this Agreement. N Borrower hereby
11. THE BORROWER ACKN0INLEDGES THAT THE LOAN DOCUMENTS CONTAIN
AUTHORIZATIQN TO CONFESS JUDGMENT AGAINST THE BORROWER, THAT AT THE TIME THE
BORROWER EXECUTED THE LOAN DOCUMENTS IT CONSULTED, AND IN CONNECTION WITH THE
EXECUTION OF THIS AGREEMENT IT HA5 CONSULTED, LEGAL COUNSEL WITH RESPECT THERETO,
AND THAT THE BORROWER UNDERSTANDS (AND AT THE TIME IT EXECUTED THE LOAN
DOCUMENTS IT UNDERSTOOD) THAT THE EXERCISE BY BANK OF THE CONFESSIONS WILL RESULT
IN THE ENTRY OF A JUDGMENT AGAINST THE BORROWER AND THE SALE OR ATTACHMENT OR
EXECUTION UPON THE PREMISES WITHOUT PRIOR NOTICE OF THE OPPORTUNITY FOR HEARING.
12• Except to the extent modified herein all other terms and condi[ions of the Note and Loan
Agreement shall remain in full force arui effect.
IN WITNESS WHEREOF, INTENDING TO 8E LEGALLY BOUND HEREBY, the pa-ties hereto have
executed this Modification Agreement as of the day and year first above written.
'Borrower" HORSHAM VALLEY AIRWAYS, INC.
ay: ~ ,~
Name: oyt Bangs -• (SEAL)
Title: President
"bank' FIRSTSERVICE BANK, A DIVISION OF
NATION~AL~PENN BANK
/:=
ey (SEAL)
Ne e: Ronald Hartman -
Tit Senior Vice President
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Division of ifatiarwl Pattn gs~
• PROMISSORY NOTE
S. ~ ~o0 000 00
• DATED: i3-//-0
FOR VALUE RFC
NATIONAL PENN HANK, a natiotrl ~ ~~ +ekrred m as "Borrowv,• hereby promises b
Pe~sy Ivania 19512. ~i aaociadon having im prlacipal offices looted u PaY b the ordex of
NO/100 hC1~ referred m o "Badc,• We pry nos of ° aOd Ar~• awn. B«b eotmty.
remalwng unpaid 6eretmda from time b time from the date hereof u the rate set forW herein. bgetlmr wirL otoatu on any and a® .prhteipal amounm
1. Reoavtnea of PrLtsioal t...::
Principal nerd t+tmrest shag 6e repaid by Bocrowar m Beck u follows:
5~~(Z~ T~DiSSC'DTIVB 1~7TgLy aL1~T FAYlI~iTS ON ACCOIINT OF PRINCIPAL,
DOLLARS Al60DNT OF FO)J]i1Tg~ THOIIBApD
($14,166.66) PLII8.71CCRII>m ALID ~ SIZTYB~IZ ADID 66/100
if'~ FINAL PAY1pOiT OF~ ODD $ ~ DAY OF SS(~i f~p~g ON fG/~5 -p~
~' TO SS DIIS' AND PAYABLE ON PB11sTCIPAL PLUS ~ ALL 11CCRIISD AND 1fITH A
OJ v?-~S_o9 DNPAID INTEREST,
CC
~ a1Oppa~ WY ~baeutdert ~ payable to Lwfu1 money of the Udttd. Sates of America at an
WY~nm ahaB 6e aecrtttd ittoeeat due on the Y bWcing otlioe ofBadc tn'
PaYmeno shall be applied oo account of other ~d ~>ance of Pritrapal. second m 1Oi1O~v~Y arsilable foods. All
charges. unpaid priacipai std fitupy the rematakr of [arch
2. ~ 11Od~~' of Ineen~
days in the thin current taltmdar year that principd is ~ and unpaid principal 6aLnce of this Ntae shalt be
A P8R RATE ia[. hamd upon a year of three hurdred sixty (360) days and ahall~l~ a~We fo0owing ~bu of
~' TD SANK'S ynvratar:
(~ 250~k)~~ TI1<~ TO TI7dH AT HA7lit AS tT8 PRA gIITB) PLIIS ]~50~000 (P~C~gltp
StyCH yt-vranrg RATE OF INT>'~EST TO
TO TIIi~,'BFFECTIVE AS OF TB$ DATE OF EAC$ 8 A~ITICALLY FyION TI1d8
~ IN BANK t 3 PR1]d$ RATE.
2a. Ihfault •t. V there is an Sven[ of
I+mcem (z7b) about: We ~a°k u'~a [hie Noo:, the Leader maY. m i~ discn:ekn, it~p~ ~ .
current note not: OR truxirmtm itnett•st tat Leodtx u l~aabed b mbrest nb on this Nom m: Three
3. Lab ~-.. defaults io the. Y Wcheveriakts.
~`- T<~ Bamwa payttteu of cbu8e b law;w • , -____
data after the same ahaB ltecottte due, Wen the a°Y paymem of principal atdhtr '
amatm of attch hue ~k shall be tuttitled m tnlltxt a late rynrge [[goal m ~ B°Y Part thtxeof, br a period of fifoeert (1~
RYmem or
4. a ~ ~ Wspaymtmt scull be a ~- I~Ollan (S 7 Oo ). whichever is grcarn,~n ~--1'~1Z%) of the
Rrnd~er of such py~al, if any. s1u1! be applied m ~ ~t m ~ wYmttu in fitU of odor charges paYaplt:
arty. mama Btarorser shdl _ tttxbn of the wgwld prt~Pal bahtftee. If a then m atx:med inseresr and We
tncotporated hereto, deeenninationm Ptrgwy~°t ~"uO'laemt ata;ordanoe wkh the ~ ~ BOr7D~ slWlmpay b the Hank, mgeWer with
Pnpaymertt
provided for ~' ~ Book as m
of~m haetn ahsll be appliwWe b an ~ atnottd of the Prepayrneu p~ shall be cottelustve~m Addeodum athched lteruo aM
Hann, the ,Borrol~ on fon• sale or tiestrnotioo of die Hankws~cot~latend orb ~« ~• indod~ -itot•Otio uwa rtottlt
ptotxediog, ~Y. or dating or as a testtit of arty action yk~ dry' or oWawite, aotwiWstattding wheWer cwts~
A ~Ymettt Addrndum is judiclsl, banlanpoey, gorl. or any otherht the
5. Loan Aanr•..~..r $ ~ as-- ate hereto. `'~
'--°~-_ Thin Nee is the Nab
atrwtdad. modified, b a4Y loan a ~~ b to ~' aY+amem 6emveen Borrower,
aapple reoe. tvmmtnaent Ie1Rr, lamer agreement, taffy ~+tte+tm any' [artery exocuted in anactioa w~ ~ ~
Ho1fO`rrr aO~Or a~ ta[[[tty b extxub extemed from time b time. the "Lttaa BO~Or o~ doeutrter,~ u the y be
~Y ash alpeetomt or other doattttem scull rot affect • ~~ ~'a°d ~mt:matbn~. The Shute of
6. Imp- ,. The Porgy ~ w>bldon of this Noce mgeWer with We ~d~' of this Nob.
ittdebtedttt~~ bc+No ~ mfrlence as if set Aert6 in Cu)(, ,~ln ~ ¢~ ~ rorditiom of We Loan Agttxatertt and the
7. hereby Such a+dastinding may not be ametded, modifiW~n u~m~ between the Borrower and the Hank wiai ~merttation,
o~~ of the Bortttwer Vida dtis Note, any fnmrc lane ~ ~ ~ ~Y ~Y axecttbd by the patties heretl m the
and R of the Bo We Lan Agrmaertt std ~ Pmsusnt b This Note sod for all [abet indehtedttess,
mower b We Hank, wheWer [rotated tom Rtdabd
~~ ~~• age and/or other °Oq'. heremfore or herafler ~ and ~ ~' std aB other itdebeedttess, abligaWatc
motion- The Bad[ shall bave m liana ~ ~m to al! of the wlhtetal std ' ~ Borrower atilotowledgrx that k has gta»bd m Bank a
orarotteaort m tht: b ~ B~•~CO~~ t~Dn~'~Y• Io~~. or m ~. "'~' or odtA awn ~~ bt tt1E RElahd
acme in anY partiodar order. ~on. tlta Back shall not be perry.. to perreet ,,,y ties or
regairod m
and/or dr ~ m ~ ~ o soy dtfilult or t:vmt of default ('Defiuk ~l 7°y eouataa7 or stxatriry or
The followhtg shall tc4o tmpsppa . anY f the firms oC this Nose ~ ttttdtx the Loan Agri. ntder an
Default of aM under this Nob: shad cotmtlhtb a Default of sad [[[tier Wie Note. Y Related I)owmentation,
(a) F+Bure of the Borrower orgy +r6eo due, or on denurtd, ap err arty part of the pone.
(b) FaOme of the
sat Related Dowt> ~~' to obrerve or perform arty of the ~ or iO~4 of this Nob;
std Wn Ba~~ q~ ~d 0m prior m, mat ~ o mm orb ~B. ouod ' ~ ~ a or obligations of Wier None. the Loan
fence of the Honower err dab hercoF ~"'~+ We Borrower, any surety
(d) Tt the Hon'orrer or arty, mom, tdtall iDY sm~• flan htdividtnl;
~ bmeflt of ctedlrots~ aPP1Y for coon nkKttt~v ~ pra~O ~ ~' slam or Fednal >~~ or i t>ve, or sha11 file a vohttttuy petition or
appohtttttenr of a receiver, ttussee a cttsmdian for hs assveo , statute, or ahap tmJoe aq asaignatent
tit-~nN~Pam~ant--vim--_.
(e) 1'he entry of ~1'.Ndlpneat or the '
(>7 If
H >mY rtbn err warta»ry tmde in othia Nose soy a>lachmeat or L+tnhhtrtertt ProcKdittgs agabttt BorrotMer or any
orrower or~ y~y~y b ~ ~ ~ Psove ro 6e ~ su Inve been Fihe or !n connection witlt this Noce or if an ~Y~
(h) Farlute e~ Borrower of arty o6ligatioa m Bank or m any third pat ~ 1v~ material respect Y IaOortna~t avpp-ied b), the
(i) if the Btarowa or a ~ ~ to fiunr:h firvnefai infamatlon u rot be fir' co-tnaka, eadorsa, guaranmq surcry or ~rir
excltaoge, or transfer of cell ~ setrcry 4 a cotpotuion, dte insdmtion of toy d~ ~b1Y rc9uested by fhe Bauit:
t:mck or ~ °°f ~1~, article or o9ea doaem~pn m ol'ac0ipse su ~ B ~~ro~~ n~'~Yr Putsuent to a ~~~s. or the
(0 The BWt io good ttti~ a if dte Borrower err any strrety y a ~8er, wmolidadon, dissohrtion P>N of exchange or
(W The oak of any ptppaty which ~ ~ > of pU'mem or yaformtnce ~, N~°ge inp ~~: 7Op~ation. exchange or
When such a Detarrh oeen[i, ~ ~ ~Y ~ rolWetal mtiR wri>mt of this Noce: witlroor dre eonsept of the Bank.
a~ ~ Provided for lsaefn, thel,oan~q ~ ~ ~I~e of prlnrq>al of tlris Note,
upwt the Bonowa. Upon ~ wd/or any of the Rehsed Dow • °OP+tId lmereat thereon a~ all other
reaped m sU of the HaNc•s eo0aseral am ~'tence of a Delimit, the Bank ahaB have all of the ~ttnon ~~Y due sad wri61e widrout notice
remedies are psoy~ for io thh Note, kLomdeutitxd w ~~ fDr ~ the Loart ~igrneoten ~ ~r `~ ro+Pact m this Nose and wiW
oo~eatx of s Defaedt. ,ny obligation of the Bank m k ~ of the Rdaeed Doromemations and/tu °~• which dghra and
Fees. Coats. Exomrs ~ g_ -' res. Borrower ~~ pcsend aedit m the Btarowa sbW ~~ provided for by law. Upoo the
tion, whh the preparation, rrwiew, txgotntb Me ~avtiond delivery and ~ uPwses of Banud~B widtaet iimiatbn: All costs and
of appraitah aced • exxneiom and ittcreasq m any et the oitantion of tick Note, the I,wa Age and the Rdatesl
~aPPraiult of real or person! forcgojng CAB. without limintioa, arm
ckaraace c~°~ °i Hank dextta advisable); All bases, cow ~ u~a in eo ~ s~ due hereunder and d>e ~, o etc ~ ~
right to remedier tinder this Nose, the Loan Agr~m aadla the noatioa whh the rofotextaeat, Protxtion and r
o~ ~ f >lanlc Cm4 widtout limita~uonn a~e~ ~ ~ n~ ma of accounonb and ~app~aer~vice fare ting~so odx r[~ts or
and cell such razu m which the uectrtloa and de0very of ~ Nose, ~ ~N)' ~ Am' and all stattrp and
Dxumeenaation. Ba+~ rnY become subject as a resuh Ag-eeraeat and the
10. slue. The of the holding of the Nose. loan Agreetaent and/or the ReLred .
of the notice m ro uadasrgrted hereby waive psaertmoent for PaYrrtent, demand, _
any right or rermd
~ Y r1tW tin be tarn m o~• ~"h or ettforce~nt off the lMYamnc of this Nom, ~ ~ pmt of dais Noe. and all
ad°guatelY 8iven if mailed postage lrre-paid tp ~ address ~ ~ f°r the scent or any su6segttem DePaul The faihue by the Hank m exaciae
m be legally bound aPParing is the Brink's records. The Borro All notices m the Botrowa shall
11. Holds. T1t~ `~ Iraeoett this Note m be a sealed tnawment and
12. Joint ~ "~`trnces ro "Bank' herein shell be deemed to be rcfaertces le any
extxvkd Chia Noce shall beLiab~i ff ~ uadersig~ romprise trore rhea one subsegtted usigrtee, hamEeree or other holds of
ro,4 joint a~ uvaal person or entity, the liab,'h'ry of each and'ev Ibis Note.
Y and all rcfetetttxs m Borrower herein shall be deemed rcRrcacet m the undersd~ Person or entity having
13. Go- vet This Nom shall be tied, both individually and
m any coafiitt of lava eo~t~d in accordance with the domntic internd laws of the Corrtmonwealdr of Penn Iv
14. lw~itdicdoa. ~ m• u a None made, defivtred art to be whoOY Performed within the Commonwealth of Y 8°k• wkbout rcferettce
Common Pleu~of ~~wa ~ 1D1' suit, actlon or Patmylrania.
'rorondmonlly attb>ahs m the ~ ~'i~a. orb U ~ Brenta Dislrtc'~t C~iott for theme ~~ ~~ ftxe w1B 6e i+tsdmted in the Court of
trfeasioa of i'od........a of each such Eastern Dit Ivania,
_-~_~ The Bnrtpaer ~ ~°. Ply a^d Irrevocably and
ercPerrsa for which Btumwer Lnlieyk~d~ °Balnst tlx Borm~w~Y authoi ~ ~ )~ ~, o~~y anomny of any court of eecord ;n peonylvania or
~~~ ~t inn under dm Noce, std mgadter wMt tea o f ~ hereurda, mgesha with soy other
evert leu Irian 51,000.00}od costs of nit, rd COU1~1 io the rasornbk araooat of fifteert clwga, costs and
shall have been filed in such eukg all errors and trailing Ill rights of Percent (!S ~) of all of the
of atacudon sad the benefu o> f'fO~E, h ahaB rtot 6e raxeayry m file the original u a _ appeal. If a wpy of this Nose. verified by affidavit,
deemed m exhaust this eJttlnp°On lam now a herafeer in eftea. No single exert' ~ ~ The Borrows hereby waives the right m my my
power, whnder or not arty such uerciae shall be hell warrant 8°d Power m ronfess Ndgnwtt shall be
n°d10ll°hhcd and may 6e exercised from time m time u oflea u the Bank sha11 ~ any court m be invalid, voidable or void, but this
rootinne m stave af4:r entry of jttdgmrnt hereurder tdeu until all stun due P9wa shall rontirate
~ judgmem race of ht~eaz utda ' by ronfasipa, default, or othawix, u ~ hereueda aball dare ban paid in full. Interest shall
16. NO'pt~ ~S NOTE ONTAWS, A ~ ~Of tiny be eraer~ is !ko of the tuigiml~r of the preva0ing tare of itttcrest tt»~r this Note, or
BORROWER. IN G AT PARAGRAPIi 15, A WARRANT OF ATTORNEY TO CONFESS ~pG
HHREBY BNOWHVGLY~ING THIS WARRANT OF ATTORNEY TO CONFESS JUDGMENT AGABYST MENT AGAINST THE
UNCONDIT~NALLY WAIV~HS~,gNYON ~Y AND VOLUNTARII.Y. AND ON THH ADVICE OF SEPARATE t;OUNS~~ F THB BORROWER
FOR HSARBiG UNDER THE RESPE(,'f1yE ~~ THE BORROWER HAS OR MAY HAVE TO PRIOR NOTICE AND AN p ~RROWER,
PEI'1NSYI.VANIA, OR OF ANy 01'HF.R STATE. ST1'I'U7TONS AND LAWS OF THE UNITED STATES, l'PORTUNITY
80RSSA>`1 V Tt~. COMMONWEALTH OF
BORROWER: ALLEY AIRiPAYS, INC.
HOYT 3
PR83 SNT
Address; 450 CARgDBAN DR
Anesr.
HORS819M PA 19044
Witness:
]S i3AR 'D4iN
CS' PRBSIDF,NT
E
~°
o_
o
~ m
y
~~~e~ce ~5f'a$k
Drvrion Gf Watiotsal Perpr Bank
~.~++~a+1 IWftt
THIS ttxcrted m as 'Sltretyahip') is made .
day of f~~ ~~'f ~~'~r~. jG~ upon 1be Oetmt ind CO®djtipna l~1kr tit forth On tltla
induct NATIONAL PENN BANK, a ~mpomlS~ (u ~ d~tned) B~18NDII~Cr TO BB
~B »moc6tiam. ha ' a LE(3AI.LY BOUND HERHBY, and ~ oNer m
Pennsylvania 19512 (6eRimfta alerted to as the.Bank7, m exteIId ~ ~ '~ of Philadelphia and ~8 Avepna, Boyertowp,
Pt>DCipal De60or (u herelmfler defaced).
TERMS AND CONDITIONS
I. D>;FiNTITONS As used herein ttie fo0owin; mrprs sbt0 have the followbg
(a) 'Person' shall mean avd 'mclode an iMivWoal,
nature whatsoever. P. corporatioq unmomporated astociaApp and spy Other legal entity Of any
(b) 'Prmc-Pa1 Debmr• means HOR
having an address of 45 CARSD>;7-N DR
HORSHAM PA 19044
abaohttec)or con' ~ Debmr's Liabcllh~'a m Bank" datl man apd ipelude
trpgent, sole. Joint or several, of any nature whatsoever, inclu ~Y ~ ~ existltcg aM fimcre )iabiliaia, whether ditxt or '
transactions arising of the Principal Debtor m the Bank. d°1L' withom lindatiein, ~dta~mifiaAon liab8ibes, and am of
(d) 'Surety shall man arh of the following: HOYT HANGS aad ALICE P . HANGS
having an address of 1054 DERFlYDD LAiAB $SRyfyN PA 19312
2. S~1RS1•YSHIP OBLIGATION The .
sprety for. the perfattuace, hcclpdipg, but not Ihnitedh m the ~~~~ly ' COVtl°°B• a'atrams and gnarmtea m ~e Ba°k and
~sleratan~°G°adefaplq, pal the Pcincipd Ddpor's ~#b~ m Bank. 1'he Stirery (>~ ~ b the ~' or
any sod all _
PmPnh' of any metre w ~ LAtrds and the Bank aaepas $p:uMy morlpge, jnd • Ndg~Ot snd:s anNar ins
SmttYshiP is a eon-inping SO~Ys~p and abailS bed ~bY aipea b 6e harts by auh seam a~ c°MiG°os as m ~ Oa 7° ~
of the Principal Debmr's Liabilities m Hank were ortp~ budmg upp° ~ ~~' tegardlat of how hag before or after d ~• This
3, T itRR r•r•o ~ hereof spy
. The apuauu of the SLtery's liability m the Bye Ituesuder shall be »nlimhed,
SSrrnyship, if marked. pips any amopmt due or which ma
insaumem and/or doccmcap dvidepchcg prim Debmr g betxpne due on aCCOppt of except sa ~OY~ °1 ~Ph 3(a) of this
otherwise m any of Principal Debmr's Lis ~~ 1> 1D ~ ktpB of ach and every eve
b0ipa m Bapk in arch manner and m such order a Ace Y aPP1Y apY PaY~pt by Principal Debtor, Stpety or
(a) The Bank,my data
Amoupr of the Sureties liability m the Bank herdpcder shall be Imtited m N A
t_'=~ 4• LII~IITATION OF SUR_ S LiABIL77y Notwt •
tl ~~p~ment, me habclpy of the Smety shill pot n any titm ext~ soancoug m the o°ntra*Y coined In stet Sutery Agramat o< in
eo0ectipp of any of the Pturcipd Delaor'a Liabc7itia m the Badr ~oem~ ~ P~ m ~c Penoml -et~ttrse~agaimt
A'e~pr mry e~ aamont of dx Priocipal Debeor't i.iabr7itia m am°°nt. whicL is the later of (a) S
° ` apl' portion of the by law, uppp Ate sale bf any property or oAcaTVise, Bhad_ec ~ wing effdx b any lm7meata or taedia tvhm~w,ry
~tisfactipp or discharge portion of Aa; Loan, w~~' ~~ ~ vohttmry PRPaYment, of ffie Spray Aut neiUter n the laYount
satisfxd, except m ~e ~n if any, Au ~s liability htreppder mpg the Principal DebbYs~ ftom aey ` ~ darned m
sc ch paymepr• satisfacAop or discharge dull be ~ an ~txm ~ ~ Pnoctpal Debtor's Liablittm m' Bank ttma~pg 6ELp ~ aDd Y
D.bmr't Liabgitia m ace Bapk, a: aforaaaid. The fore ------_or lest lhan the ~WH ester giviDge~t m
Aft-euctent ». wlehout IimiaAop, $O°'g hmruppp dull sot limit A¢ Smetyt liabll ouuand~g ~ ancOUM of Ate
mMga~ ar °~ ~°~' inoereat l6~ to Are Bank ~' ~ appliable, tmouna due tla Bank on mew ~ alter tatpu doe upder
security for this Surety qg ~Y't behalf in rnaaecaon wiec ~,
5. UNCONDITIONAL LIABliny N
is :rbsohtm and uncopdidoml apd abaH not be~aNeomd~ ~ ~~°~ m ~ QOp~l' cormdned in this
any Person, hccltdhrg but tut limited m the Principd Debtory wai' by Raton of (a) any fagure by the B~apk~•~~' ~ of the Stnery hereppda
8 ~ which tmy be attempted m 6e oMaitced or (c) the lack t~f pior errfo~~ of any tutme wl~soeva (b)invala~dhyri p{uayY~c4
Priacipd.pebmr; any sprery, or is
R9ave, acd the ~ >~Y °f ~Y mpcre w!>moever. To fhe extdd ~ ~°°°' hrchtdlag• bat tut lhpitM m the
beaeftt of all,Llarw.,s. now or heraPoer ~ effect glvhcg the Stuety the right b by law, the
atty tech prior etdorcapept as afotestd. The
or rluYment of ~,ttyt p~blig, ''11on 1 shall in no wa aftxt t~ Ihbflily o~em ~Y ~Y m mdc6tg damated on Ate SuretyPnfornance
~ 6. The Smety hereby wawa aB Y Surety 6erander.
inaofany1°f> ~~g btu ~ ~1D• °~~ (t) of ~~ w~ttoever wltb retp~ m his
Surrxy htxeby cotuaa m tle
rapett m the Prhtt:gul De~r~ ~.°r fiilure m pke, fio~et [iate~m o~meo~~~ nodce ao th~eoa ~Ofr d~u mason. The
~Womiaa, Irdolgeu~a, waive g ~t rat [re~g limited m ~~Ba r`~Od~ fleets limited m wish
6„'n,~ °aes ~"~i~~ Omi~iedbroy aIl "~ L aondheraf0~ln et7fect is ~ pa 1 herto°1O°dupt~t~dioae
aecotmt of me ncipal lkbmr's
of execution end exemption of ~t my acAon~ ~ ~ S~ ° ~ ~ , amend (b m~ ~ dellepaymepes mepe on
~- ~.~NT OF cTep~Y m etcforce Ace 1ia60ity of the Surety hatlmder. akat P by law, all right m say
-~- I° ~_ to a0 other Liability of Ute
3 of tha Smetyahrp, Ace Smery also ~Y herdcnder and aatwi8uurdm
~' kgd std casts of bonds) arlach ~mbe "Bank ap demand all rnsa and expeota Cmchd' g the ~• if tmy, set forth m p~ERph
B ~ hemuda, and/or Ate eosY of tepnstestionyof lateral held~~~ ~,~ ~ ~ ~ ~bi<da to
secure Prnrecpd Debtor atd/~ Sway m Ate
------~e-"!at-orw Wnn paxc
8. ACCBL.IItiTION OF LL4BIL
_ _ r^4S B'
~r~+~Ja~6ia b Baalc (or ~~~ ~ dema~s orL ab7Nea to BWC ~ ~ , ~~g bat tot
a~~anl and ate, the Boat shall have ea irmrrAyoe ~' the B~t~i it the Baat•s oPdoa~be~e ~1ODa. all of me Pr1~a~to
now or hereafter to the
y a~*Bank t ~ ~~~: and the Beat is hereby &'veata lien on tma ~ ~ b the Syq~ m 6e iaouedy~ tW due
tttcladtng, but tot Iiada:d m 1»on a seated m the Beat Pursuant m a h' hwerest in any aadg ~ rlaht of iemff
as it has by atry agramem or bey la~w~ ~ init7est ht say deposit, tors[ or agency accortaod Pox ~1001~ •~ of ~
9. N Mme fights m ouch property
CATION. So to u the
~ ProP~Y of ffi~ ent[tle ~ Ste. byP~prog~aor somtlu~ti ~ not 6eea paid in full. ao Payateat tl~sme~.
Principal Debsor. ghn of me Baal, m nay PaYmeat by the 1'rm~ cipal Dehdr~~ omf'
30. A
supplr~ry ~~~ a0d°0d lieu o orr _P ~ or an ottmr surety ~
_ ~,~ but _ iaramor of the
lbereof m rtermimm nosh oprev~ constrttedmm~be and S~~ora~strbaeY guaraNpr ]us
11. ~NO D~y~ ~~ e~ O0t m ~ in Iiw
require tTe~sp mNu ~~ ~ ~ the coNn*Y 1~reia co~ippd,
odrerw9se °~mg ooombted in thfs
12. `"~ uWit of atry astute ahat:oever m ~ for t~of Prt~~j ~~ m
8~der OVhen the sane so
u~ in s mtmber tdutl he ~• words of nay geaa need hr
held m taNrde the plural, and vK.e4rer~, ~ sLad be
Beak or ty (ere is a e _ rtada this Snreryship shall 6e strtflcieut if
13. ~ S~ „F ~ aoticca git~ea Iraaoasli or bl' tcgiSkrW or m ~ other
may pwvlde is g m time m time- tnPecave address set Porch heremabove, or at such odtery ~~ arlified tmu7 m the
14. a~~ as the Bank m Surety (as is appixabtc)
and refwwce unify . The caption or heading of ach paragrgplr herein are trot put of this
Strretyshry, but are iateadea for Purposes of ittPotrnatioa
15. CJ3. If any provision, or
Part thereos~ ems' 1~ thereof, of this rs is conliict with
and in otdc m effectuate ~ . >ad1 oral void m the ratknt that it may be r"~ arry smmk W OthC' rrtle of 4w, then sorb
Iti. .S~TlD7T Bak ~ ~o~ ~foregoio6. the Provision of this Suretyship ate dechted ~q~m~~ the ramiaiag Pruvispas~~hawf,
~ rrgy,~°r ~B my °f P~Cipal Deb's lL~- ~a m ~ ~ ~ ~IKn or suatri4' moerat of Bank +n aaY ooBahral
Debbr, of Principal Debtor's Liabilities m Beak. nor shall m '~~ m rnrahall +my caBase[al fur Ibis Staetyshrp
Spy, any odor anrety or guaranmr of Back ~ regrthed m ttxott m aq• au ~
Principal DebmYS LiabOitia m Bent or ~PoP or lt~Y or m ream[ to the
~rwns,~tnc~ira~~US' 13;s ~s~ shalt ioute m the ~ taoperty thereof in nay particular order.
mg any bankhtg intimtion or • betrefit of the Beak. its _
pe sofaal a~ad j d shop be binding upon the Su~rayhaad the S~luety'a at~~ppr~y~ 1 Debtru gr 1u Bank or
urety, sad adegwk ~vseo~n,r~ a~~ becomc ate. t~ eahse arS1„ety akdl 6egtllon' and other
s RPrr~dva, bum
hetramder tt6a11 tot 6e ~lY board hwtdver of the nit m exer~crse fire same or a~nyPo~ ~0~~ ~ ~~ Bank so knt as is
iasCntaent and m be 1 eteby. All issues aria' right at nay other time. say right
Pennylvanm. THE LiAB11,ITy OF EACH OP TBE IND1vIDU~igTS~AND EIVTICIF.S Cp~deOsrmioed by the ° ~~i~
AND SBVERAL.
18. pgl6Lat:Y O r RTSIIHC SURETY >~ SHALL BE JOINT
B-TGATION
so ere mat Bank fast The '~°e1Y tradaamda that because [hie is a _
tltat Bank sell ~"r'r~ Payment tiom the Priocryl ~'ruYshiP and not a guaraatY of eolla:tioa the
Payment from ~ Stu ~~ ~y of them ~ the Principal Debror~o~r that B'IIYanic appl ant' depositsmade by ~•~~mr~ ~ or
19. RNING LAW. The ~
of Penny ann. wt out tefereuce m any op~~ ~~c°nah"°d and enforcedm atxondaace with the domesdq inarrtal laws of ~ ~a~Po
pro atom. and ma be ttttdified, amended or waived only io
2tl• CONFacernut OF ~, wricttg signed by dre Bank.
Fmtho T~ Stacty (sad each of
more th~one) forytl~e arn~ot3irtt for~whi h of [[turd m appear for and ~jud~~t the' if mote than one) ' y~toarphavu the
m BBank m~ S1,000.OOj,with eoeb of~w and R togemv ~mof m me amou~i~t ofrfri~yn or name of fPti~xip'a~Dehmrs L~iyd'~ea
Proceeding, h ahaN tint be rrtxea leans of stmts. Tf a copy hereof vetifiod by al8davlt Petccat (1576) of the Podia ouch
by confeuion, default, or otherwiq~e, at the h~i arlglaal s8 9 wturaot of atloriteJ.. Lrteteat shall cotltimte m shall have bees
rate of interest order applitsbk law. To the a~ram! >be prevat7mg rase of rat Hader the Principl Debmr's Liabtlid~ ofJ~B~
and aq eaaapdon lava >mw or effect ~ ~ by kw, The Stuety waives the right m any stay of Edon Boat, or the judgment
J~gment grained herein, whether ohe~r not m _ gk atucLve of the fore~ina warravt mall be doomed m exhaust ~ ~ beneTrt of any
nndlttdaished and may be aterclted trntn~ b ~ often as the ~ ~ Cotnt o ~ ~~• void, or voidable, bur the power ~pto conies
SAY ptrrauam tu this Stitretyship shall have been paid in full. A copy hereof t~ tx eak[M im lien of~drc origwi'or tFnt rosy become payable true
ACZAINS~ THIS SUREI'YSH~ ~NTAEIS, AT PARAGRAPH 20, A W
SURELY ~Y ~ . IN GRANI7NC T1IIS grARRANI. OF ATTORNgy TO SOP ATI`ORNgy TO CONFESS )UDG~p
THE SURETY. UNCONDiTT~OIdQALLYN~ A~ ~LUNTARII.Y. AND ON THg~~t,D ~ OP SEpARATB COUNSgI' ,~O
OMMOONWB,~LTHOFPBNNSAGNIA pRO ~~~'T1~G CONST1TCTfi~ p~NS ANDOLAW p~~TO PRIOR NOTICE AND
_ OTHER STATE. UNIl$D STATES. TAE
executed oa ~~aF, and INTBNDING TO BE LEGALLY BOUND HERFBy, the Smyq,, pas ~~ or m~ this
Y Yuv first above writtza. Suretyship m be
»us~ Name (U Corporation)
Attest:
L.S.
By:
By:
By:
By:.
IlVDIVIDUAL ACI~IOWLEDGMENI'
STATE OF - si D
ss.
COUlY1Y OF __ ~~ .
On tL$,_ l-// _ da ,~ ~~
r ~, ~ before me the mdersigned offkxr pera~py appeared
satp~Orily P..,..M.~ .., ~ ~_ _ s~_ _
_ ,._.•••~ ~c nudes are sut>scnroed m the within known to me (or
therein contained, a~ desire the same m be ~~ and acknowledged that thry executed the tame Ibr the pntposea
rtxorded u such.
IN WITNESS WHEREOF, I have hereumo set my hand and official seal.
~MM~'F-Ai.TH OF PENNSYLVANIA
Notarial Seal
del[ T ~;~ ~~m~ CLc Notary Public
ices hme 4 2 1`fY Covartiwion Bxphes: ~ d
llkmbar, Pemaylvada Asaocia6otr of Notaries ~ v~~
CORPORATE (PAR'I7VERS131~ ACKNOWLEDGMENp
SPATE OF
COUNTY OF ~ ~~
Oa this ~l day of ~~
.~.~., before me, the undersigned officer, Perwrrally appeared
himself m lx dre
~of • who aclorowledged
(paroaeahip) end that he u such
~ ,being to ~ . a corporation
purposes therein r:ontained by signing the name of the co = + ~d the fomgoing IttstrttmeM for the
rptrrauon (partnership) by himself u J
~ WfTNFSS WHEREOF, 1 have hert:unto ut my hand acrd official seal.
COMMONWEALTH OF PENNSYLVANIA
_ N.•tareer Seal
Twp Moo m} Public U Dory blic
~ioo ~ ~Im~ 4 20 ~
f+l~nher, Parrsyhrartip gsaogary~ of Nomdes MY Commission Expire: (} _, _ - / Z dv
I herby certify that ~ precix and compltae Post office address of the widn-named Bank is Naronal Penn ISanR, Philadelph~ and Reading Avernus.
Eoyertown, Pennsylvania 19512.
SPATE OF
COUNTY OF
ss.
RECORDED on this -~_day of
Couoty, is • in the Offer of the Recorder of Deeds in and for said
above written. BOOk --------- Vol. ~_pa~ -_ Given mtder
my hand and seal of office, the deae
Reorder of Dads
-------._.___.J~Fe23J._ttaavral.P~nnBVac_m+97- -.
F
inu ...............F:.mss,..:~:x:.:::;;;::».:;>_::Y
I VALLEY ::^.:::'.°Y: <
., . AIR>TAYS, INC.
- COMMERCIAL
FIXED RRFE
,...
PROMISSORY
3.:.~F ~~.~... NOTE
450_CAREDSAN DBIVte :."`k>`.;."^•~ ..
l,loo,ooo.o0 11/os/os 11/oe/lo
-- oN ssLL HELICOPTER t4ITg PNC ~~ ~38D4 ~
PROMISE TO PAY: For veltre rooeived,
9orrower Promises fo pay to tlw order of Lender the pdrrolpal amount of Oae 1lsi-llioa Oae Hundred
ink b the unpaid pdnafpel bdanoe at the rate and in the manner described ~~ ~ -~-`~~
Y Lander shall bs applied lkst to ~a+'. urdU all amounts 'Q`om-) Pius
aoortred, unpaid kroerost, then b unpad pdncf ~ under thk Note are pyd in iWl, Ali arr~unta
as datanninsd by Lender, in Lender's sole dlsaetlon, as permitted by kw. P~. and then to any late charges and expenses, or in an
INTEREST RATE; pt~M tdfeU ~ cortt _ Y otharorder
on thk Nob shall be Puted on the basis of the a r„, i +- of Aav
ala+kted and payable at the flxsd rate of 7 0 y r a c n a
DFfAUIT RATE tl there k an % per annum. P~ year. Interest
P 1~1T Event of Default under this Nets, the Lender may. in its
TE ~ dkoretion, increase the irltereat refs on this Note fo:~$8
or the maximum interest raM lender h: permitted to charge bylaw, .
PAYMENT SCHEDULE: Borrower shall pay the "~r*~ k lass. ,
Prindpal and imerast ao~rding fo the fotlowf
ymen ng schetlule:
08,P2p05 is of Principal in the amount of -
priaci sad coatiauiag at aumthly time ~t9,166.67 plus accrued interest b
Pal balaaea plus accrued interest is d~aand~a eafter. A final a e3iaaiag December
p yable on November pg~~t of the unpaid
ZOZO.
PREPAYMENT: Thk Note ma be re
Ote in Y P Paid in part ar in full on or before its mate '
Borrowerand~ls d Par'tlal propayment vn7l not affect the due •date or the amp dp~f ®~ a^ent~ionstailma~- 8 this Note contains more than
® Prepayment this Note !s prepaid in full, them vriU be Q A minimum finance qr n~ unless agreed !o, in writing, by
A penaky of
SEE PREPA a~O of S
~T PREMIIIM ADDENDTJiT TO PROMISSORY NOTE.
LATE CHARGE tl ap~ym srrt k rsoshrsd mots than 15
un dd hde paymer,k fps days Iota, Borower vdtl bs charged a Isle charge ot:
f less, as permlt~ted~6y ~ 7.0 0 % of the unpaid Isle ~ % of the
law. No moro then one late oltarge will bs Imposed on Payment or 275.00
any sirtgls Payment or portion of arty paym t ~'~'~ k ®graatar
SECURfTY: To secure tlts payment and Perfortnara:e of
right, title, end interest in M monies, inshvments, obUgatlans hfarrrad under this Nato, Borrower
aooourrts eub)sat to tax psnaltip tl so assigned that ~ngs~ ~~~' Sara a~ other accounts of BOA • Lander a security irrtsrest in aN of Borrower's
sassed by the collateral dasalbsd in any secu ~"' a in the future in Lender's (xduding IRA, Keogh, trust aa,ounta and other
insDument(s) secudng tlde Nok or all of Borrower's obtlga~m~~) executed in ~~~ ~ °OntrDl'(~ tl checked, the obUgatlone under this Note are
connectlon with this Note;3hd any collateral desaibed in any other seourfly
CHECK PROCESSING FEE; U a check fo- payment k rotumsd m Lender for any reason (for exam e,
checking aoccurrt), Lender wfU assess a check
prooeaaing tae of i a/a f~ because them are krsuflk~eM funds in Borrower's
-_.._, whkh shall bs added to the Principal balamx.
RENEWAL• n e ~,...re.,
fhk Nob k a renewM, but not a satlafactlon, of Loan
INCLUpPKi THE ~'..._ -.~.... READ. U --- --..._..~..., ... ~+.,u~r To sA - ---. ~ .......+.. nrwwNi
OR SECURE ALL tiUIM3 D E
IN YVRNESS VVhIEflEOF, uthe mdsreiDnsd hRE~SE SIDE, AND FURT}IBt ACIWOWLEpGE RE(~T OF AN t7cACT S D THIS NOTE
/have caused this instrument 1o be ex COPY OF THIS NOTE.
~DwER: g0 VAL swledasasealedinstrumsntthis 8th days( November, 2005 ,
AIRI+PAYSr INC.. B0
nORROWER;
(Seal)
eoRROwF.re
(Baal)
90RROWER: -
(SeaQ
BORROWErt .
(Seel)
BORROWER;
(sea-)
8 :~
(Baal)
PRESTO (~~
aDRROVVER:
]. EtfENT3 OF DEFAULT. An Event of '~ISfi6 AND CONDT11ONS
searre.ltds Note:
~th~ th will oxur under this Nate !n the evegt that gorto~Y guarantor or any other third P led '
(a) fads to rrtake any P~mtt on thk Note w ~' P gut9
(b) talk to perform any oilier indebtedness to Lender when due;
present w fitturs written agrsmnem
()Provides or any ~~~ nr r~ega~rdlrrg thk or any other indabtsdn ~~r in thk Nuts, any aecurtly inatnrmeret, or any othw
r.atuse ary false w mislead Borrower th Lender;
(~ selk, ~ Mg tdpnaturo w ropreasn~on to 6e provided to Lender;
mtfateraln~ or ltensiers dghb in arty cdlatsrol Ito sMzure, ration ~ approval of Lender; destroys, loses w damages such
(e) has a gamjs~ ~~ rotpao~ w aubjede such
em, )trdemem, tax bvy, attachment w ben trntered w ~~~''
mpataral to secure this Nob or arty of their properly; 8Brt'ed against Borrower, any guarantor, or arty third party Pledging
(f) dies, bemrrtsa legagy Incompetent, k dksoHsd a tmminated, ceases to operate ha business, becartea ~ makes an asst
benefit of wsditoro, fails to pay detrts as they become due, or bemmea the eub)ect of any bankru
proceeding' PbY, insolvency w debtorg re abilttatio~n
(g) faNs to provide Lender evidence of satisfacicry tlnandal catditlon;
~) ~ rnakm~Y of its outstanding votirp taecudy~ ~, transferred or conveyed to
°Wn°~iP as of the dale of the etrscu0on of tide Note; a am paroon cr °~ other than any person or eMlty that has
(~ causes Lender ib deem IbsH insecwe due ib a si
Lender in good faith, bsflaves the prospect of pay~~t decline in the vdua of any real w personal properly securi
2 RIGHTS OF Parfwmanos k Impaired, n9 paymeM of thk Nob, or
~(a~ a~~i~Dw~~ ~i~NT ~ ~ ULT. I(yr ~k~~nt~ Defauk under thk Nob, Lender will ba enfltlsd to axerdae one or moro of the
(except ee ui
~ Nrtotart Pius amroed krterest under this Note and a0 other
.and Payable M iup, such amsbrotbn shad bs aWomeflo and knmediste if the Event of Defauk k ~1B ~~ations of Bortowar immediately due
(b) to tx>hect the outstanding obligations of earrower tMtlt w without rem flRng under the BanMuptcy ~~
(°) tD Poaasasion of oes under this Nola or any cttlx ~mneM 6etwesnbigortowe and Lender,
(~ fo take any mflaterel h
(e) to requtro Borrower to ds any manner pemdtted by law;
liver and make available 1n Candor any mllateroi at a place roasonably convartlent to Borrower and Lander,
(f) to sell, Leese w othenwise dkpose of any mllaterol and co8ect any dafldency balance yr~ or whhout reaorNng to legal
(g) to set-of( torrowers obligaflona egairrst any amourrts due to Borrower in
maimained with Lender, and °I'~9~ but not limited to, monies, inetrume~
(h) to exerdae aN othsrdgitts avallaWe to ,and depodt accounts
lender's ri hb are Lender under any other wdt6en agreamertt ar appNcebls Isw.
g curtrulativa and may 6e exerdaed together, aePerstely, and In arty order. Lender's remedies under this
those availabb at common kw, including, but not Nmibd to, fire rigid of setoff.
~ DEMAND FEATURE P~9raph are In addition to
shell be in Lender's sole ~ aysd~ ed' thk Note conlaina a demartq feature. Lartder's right to demand PaYmeM, at any time, and from time to time,
a. FINaNCiaL tNFDRManoN. • whether w not any default has oax,rred.
in accordance with Bortows- wql at afl times keep Proper-hooka of record and amount In which Lull, true and correct amdes shall be made
gen°f°i!y acoepbd amounting princlplea and will deliver 1o Lender,
Borrower, a copy of the annual flnmwid abtamems of Bortower rol vAMin ninety ~ days after the and
Borrower as at the end of such fiscal Year and r the alktg !b such fwcd ~ar• such atabrttartb >p include ~ each fleoal year of
for such fkoal year, prepared ~) related income statement, starsrrnsrd of rotaktsd seen' (i) the 6slance sheet of
Lander MAfidn ~ wdt omtlfled publle acoountrurb as may be ro ~° and statement of oaslt flow of Borroaer
fAben (15) days after flBng same, a copy ~ Borrower's Income tax eels to Lender. Borrower ako agrees to deliver to
with reaped >o Borrower as Lender may request, m time b time, such other flnandal iMorrnation
!i MODfFICdg11ON AND WAVER. The modification or waiver of
a writing signed by Lander. Lender may perform cf aay °f eorrarer's obMgagcns or.Lender's fights under this Nob must be mnbined fn
those oblgatons w fights, A waiver on one ~ eo-roaror'a otdtgatione w delay w fall to'exerdae arts, of its r his
ocoasion wip not waiver at '8 wititout causln a waiver of
riot be affedaq if Lender amends, compmmi:es, exdt conatltrrte a ~Y °b°r Borrower's obi g
w guarantor or any of its rights against ~9uarartk~ i~a rois~~~Wrira w releases arty of the oblgatons y i~~gm~~, emote shall
and apply chsdro and ~ co-bort°war waver
other,insyumerda marked `paid in FuN• or witit 8 similar phr~ odtiter P-oPe-tY waxing the obligations, Lender may accept
Incurted under this Note, without befog bound by that language and sarxibing n payment as full seti
& SEYERABILITY. Nan ~O~ watvrng arty fights to af8~n of the o611getions
Y Provialon of this Note is invalid, illegal w unenforceable, the valid ~~~ ~ ap amourKs owing under this Note,
shah not in arty way be affected or impairod thereby. hY, legal
ity, and enforceatNlHy of the rorrtairttng Pr~lslons
7. ASSIGNMENT. Borrower agrees not to aas(gn an of
ooneem of Lender, vrftidt consent Y Borrower's rights, remedies w obligations described In thk Mote
dehb and romedles d m°Y be withheld by Lender in its sole dlacretlon. eorrotver agrees that Lender is entitled to ~~ the Pgor written
E NOTICE ~~ in thk Note without notice 1o w the prior consent of Borroaror. assign some or all of its
Any notice or other conimunicatlcn to be provided to
addresses daaatbed in this Note.or such otiteraddroas as the parttes~~r w Lender render this Note shall be in wrtdn
9. APPLICAB may designate in wriWt9 from time to time. g and sent to the parties at the
LE Law htereat, including rata
for making the Ilns of ,fees and dtarges which oompsrtaate Lender for the
thk Note, shall be credit available to Bortower, or which °OrnPmtsab Lender for an etdarteion °f `YGdit to Borrower under this Note or
9ovarrted by fedwaf law mid the laws of the ebb Y defauh or breach by Borrower of the terms and conditions of
of this Note ahap be govemeq by the laws of a °f-~~- s<rlY--a~"-ia
Urdass applioabla law th state of ~~av_ yy~n ~ a All other tonne and mnditiwts
provides othenske, Bcn°w°r °°ns°rtts to the judadloNon and unless otherwise preempted by federal law.
s°kcteq by IJSnder, in ks dlsaetion, b the evem of a I venue of any mart Jocated In eases liraaia
10. COLLECTION egal Prmeeding under this Nob.
COSTS. To the extent permitted by law, Borrower a
fees and coats of attorneys and other agerrta ndudln 8roes to Pay Lender's tease
' ~ amPl%roe of Lendm, (I g wflhout limitation pmalegak, clerks noble fees and meta, including, but oat limited to,
whroh are inaxred by Lender in ooNecti and coneukards), whether or not such
writ k brought,. indud'urg, but not limited to, ap fees ~ a^Y amount due a enforcing soy g9ht or rome attomsy or agent k
11. MiSCE and rash Irtcrrrred Pn speed, in ban dY under thk Note, whether or not
LLANEOUS. This Note k being executed I°uPtoY~ and for Poalyudgment colledbn adfona.
Borrower and agrees to make ail purposes. Gorr
time k of the essence. Bortower cress thk Note Paymems to Lender atdarry ~e~ ~~gnated ~ °We- and Lander agree that
any Person who end ~~ by Ldndsr and in lawful United
fight io requiro Lender to proceed agahtat +xtYone eke 6 Pfessrttrttem, demand for Psymem, natloe of dishonor end ~Ot currency.
include all of the parties signing this Nola, Preeeeding against Borrower or said Protest and further waive: srry
moro than one Bomprver their obll and this Note shaft be binding upon the hales, Person' ~ roferencea to Borrower in this Note sitaU
_ gatlons under thk Nuts shell be joirrt and suoC°ssors and soigne of Borrower and Lender. N there la
~~ ~D dbelvvesn Borrower anmd ~ avertable when requested by proper several. Mtfonnation mncsming this Note may ba ro
undsrobndin °8at txocess. Thla Mots Ported to credit
12 JURY TRWL WgryER, LEND radar regarding the tsrRra hereof. 1OPfeaerrts the cotrtpiete and in
OF, OA BASED U ~ AND BORROWER HERE&Y WAryE tegrated
pON, THIS NOTE OR THE COLLATEpgL SECURING THI~ RO7 ~ TO A 7'AIAL BY JURY IN ANY CML ACTION ARISING OIIf
13. ADDI71ONAL TERMS:
---- ----
tPPA00ytJ p _. - _ _.
John rt. ttnlene Co, p/u/Oq raper agr~yp ...
P. PAYMENT PREM~~ ADDENDUM
TO
PROMISSORY NOTE
Borttrspu; HoxsHltx vALLEY aixvrAYS, Ixc.
Date of Note: November Og, 2005
PrintipalAmount of Note: 51,100, 000.00
In the event that a>ry portion of ptiadpai of the Note is r d for an
P~
notice of the amount (the prepayment Y reason whatsoever, Leads
that would have been paid m the fature~m~ deteratiaed ~ the Leader to be the e[tesa of a the ~9 ~~ to Borrower a written
computed on a monthly basin Leader by the Borrower oa sur]i () Pmt value of the interest payateara
Note t ~~ ~ interest rate in effect under the Notpe own the ~ o f f P~°~al, thrs present value calculation being
arm on the total amount of PrnPaymont for a period equal to the rem . .
j,~da. if ~~ ~ 1 Prepaid; over (b) the reseal value of the interest paymmte that
~ were ro prepaid prindpa) at an interest rate equal to the rate would be paid in the futu°mre~ot
P 1.5 0 0 96 (Reinvestmatt Rate - RIR), thin Pr'~t value calailatioa c Payable on US. Treasury issues
rc'D~S totes-rn, US. Tteaaury issues refers to those U.$, beIDg omputed on a monthly basis, for a
date of the note. The above should not be less ~~ i~u with a maturity date in the same month and ~~ °4uW to the
than 19b of the original loan amount. year as the maturity
The following acampte
An osatitple of the~~be dfirectly ~h~~ to r~eemiN e orthe Borrower formula is set forth below, for >7tusp-ative purposes only.
Formula
T~arnple:
13XAMPLE OF PRBPAYIvI>NT pR (ppp) CA.L~C[fI.AT10N
PPP = A _ g
A = N12 ~~6 x Prepaid Amount x PVF ~
1 B ` ~- x Prepaid Amount x PVF
PVF =Present Value Factor = 1 - 1+ l2
,
N =Remaining Tam in Months R1R/12
RIIt = Raavatm~t Rate = US. Treasury Rate corresponding to the remaining team plus 1.5 0 0
P~ = 1 += =63.66
.009167
A = • ~ x (5585,576.00)x63.66 =5403,84249
Assume a loan of s 5600,000.00 priaapal amount with an amortization period of twenty Cm) years. The interest rate is thirteen
Pmt (1396) fsod rate Per annum for tea (10) years with a monthly payment of 57,029.45. The loan is prepaid at the cad of the
1996 is acne and onahalf balantx of 5585,576.00. The data of PnPaYruemt is August 15,1988. U.S.
Pmt (9S%), therefore the RIR = 9.5% + iS% = 11.0%. ~e~'rn' Rate for August 15,
B =~ x (5585,576.00)x63.66 =5341,712.87
PPP = A _ B =5403,84249 -5341,712.87 =562,129.62
written notia~enl Premium apedfied in such written notice shall be duo and payable by the Borrower to Laider
. upon de]iveay of such
limi tion~a~s a~exuit of deman shaIl ~ ap~liwble to a~ prepayment of ptmapal whatsoever and for whatever reason, indudirrg, without
Lender, the Borrower or d' aeon upon~ddault, foreclosure, sale or destruction of Collateral or otherwise, sad whether caused by
by nay other person or anti with the escception of the fopotvittg;
The PrepayAen+ Premiuw vill only be assessed if the loan is ref nanced by ano+her
financial inn+i+u+ion.
'~ initial
this Note) t~'n which thePr Bo~rrowa ~ ~Gcable whaa a prePaYutent ocptts dating a S^esr (yaat definod
amount of this Not P an aggregate amoant which exxeds a s~rm anniversary dates of the of
Note. ~ accludarg the total amount of all scheduled payareata equal to two percent (296) of the original ~~
zagtrirad during such year under the repayment provisions Of this
T~ ~Paym~t Premium shall apply durjag the faed rate period only and any extensions thereof, unless otherwise stated.
BORROWED HO H1tM V`~ i'-IRifAYS, INC.
BoRROweR:
H~
PRBSID
BORROWER;
BORROWER:
BORROWER;
BORROWER:
80RROWER;
-----.-- BORROWER:
G
m
o .
o
v
~ m
a
HORSHAM VALLEY AIRWAYS, INC.
450 CARSDF~7-N
$1,982,000.00
04/21%Oti. I 04/Z1/11
..COMMERCIAL
FIXED RATE
PROMISSORY
NOTE
PROMISE TO PAY: For value received, Borrower promises. to '
1S TNO ~ PaY to the order of Lender the pdnaipsl amount of One' Millioa Niae
interest on the un aid no - 0
P Pdrldpal balance at the rate and in the mflnnar desodbed below, uniU all amourrts owir`I Dollars ~~? 00~--) Plus
recehrod by Lender shall ba appped first 1o acCUed, unpaid Irrter 8 under this. Wote are
as determined by Lender, En Lender's sole ~t.'then to unpaid principal, and than fo Pdd in ~b• All amounts
distxXetion, as pennkted by law. am ~ charges and expenses, or in any other order
INTEREST RATE: Interest shall be com u th
on this Note P led Orl ihs basis of a ++_ ~ n~bp~ o f ~
shall be calculated and payable at the taxed rata of Z 0 s °° '' ~ ~ n a
DEFAULT RATE K there M en Evert of % per annum- par Year• Interest
p OPS THS Defauk under this Note, the Lender may, in its discretion, Increase the interest rate on this Note to: THREg
CURRgNT NOTE
or the maximum interest rate Lender is permitted to charge by law, whichever is less, ---
PAYMENTSCHEDULE: Bortower shall pay the principal and Interest according to tho following sdledule: ,
Z006aa"ad continui.n cipal is the amount of $1ti,516.67 plus accrued
principal balance gat monthly time intervals thereafter. A finallnaerest begianin
plus accrued interest is due and payable oa Apri1p21~,eZOllf the un ~d 21'
p
PREPAYMENT: This Note may be Prepaid in part or (n full on or before its
one installment, any partial prepayment will not affect the due dab maturity date® with ^ witltout penalty, M this Note
Borrower and Lender' k this Nob is Prepaid fn full, tllere or thO amount of any subsequent. Installment, unless contains more than
®A PrePaYment penalty of : will be Q A minimum finance charge of $ agreed to, In wdting, by
SEE PR~PAYMENT.YREMIUM ADD81~mUM ~ PROMISSORY NOTE, •
LATE CHARGE: ff a a ent Is received more than 15
lab paymerlk ; 7 .00 days Iata, Barrowsr will be charged a late charge of:
less, as permitted~y law. No more th % ~ the w S
an one late charge will be im F~ lab Payment or 75.00. ~ % of the
posed on any single Payment or portion of any payment, whEchever is ®greater
~ Z. fie, arld In cure the payment and performance of obligations Incurred under this Moto, Borrower ' •
tsrest tp alt monies, instruments, savings, dleclcing, share and other acawrlria of Bo ~~ Lender a seta iAb
aocouMs aubJad to tex penalties if so assigned) that are nob, or in file future in Lender's ~ rest in all of Bortowerk
elm secured by the odlateral described in rrower (axduding IRA, Keogh, trust accounts and other
Instrument(s) securi a^Y saduriry Insburnent(s) executed in oonnecb~ ~oontrol.Q~ ~ ~1~~ dbp~ions under this Note era
ng this Note or all of Borrower's obligations. ~, Y escdbed to any other security
CHECK PROCESSING FEE ti a check for payment is returned to Lender fir any reason (for example, because there are Insuffident funds in Borrower's
chedang account), Lender will assess a check processing fee of f n/a
----_~_, which shall be added to the prindpal balance,
RENEWAL; ~ k checked this Note is a renewal, but not a
satisfaction, of l
IF CifEC1CED, AS A MATERIAL INDUCFJNENT TO LENDER TO LOAN
ATTORNEI' OA THE PR07}toNOTARY OR ~~ THE'
f:L1cR1C OF ANY COURT W THE G'O
AGAINST BORROW@j ~ g~j~G D~ U~~ T~ NOTEOOR ~~OTHER~OAN
ANO ATTORNEY FMS, TOGETTIER Wfr}t IN1'Bf£ST ON ,~,~ JUDOMEN7; AT THE I
DUE LENDER DTHE FULL AMOUNT DUE LENDER IS ACTLyyyy REt:EIVE{
THE ffERE1N MAY. BE EXERCISED AS
_ _ NEEDED FTtOer r.... m
Number
IEI'lCEU fly THiS NO'T7 BpRppyy
NWEALTH OF P6JNS11VAN1^ OR I
:R THIS NOTE l$i ANy OTIgR LOM
OF iNTFAEST~SpECIREp a'I THE N
IIS NOTE, OR A Copy VERIR® 81, ~
i AS-OFTEEN AS NECESSARY UNTIL
D~n
WD TO CONFreee
DRNEY Fpq
JUOtiMEfrT
ST !~ SUIT,
wAIiRANL
FALL SUMS
"=w•• n~+tu~7YYI.EDGE THAT EY - --- ----~- •••'"•u• ~, m uROER TO SATISFY OR SEtYMEALL SUMS p~E n newRlN
INCLUDING THE PROVISIONS ON THE ~~ RE4D, LENDERSTAND, AND qG TO TERMS AND CONDITIONS OF THIS NOTE
IN WITNESS WHEREOF, the underai nodl SIDE, AND FURTHER ACKNOWLEDGE RECE3PT OF AN EJCACT COPY OF THIS NOTE
9 /have caused this instrument to be executed as a sealed insbtrmeM this 21st
BoRROwER, HORSHAM VALLEY day of Aoril, 2006
AIRWAYS, .INC. 'BORROWER: .
B
H ~ (Seal)
PI2$SIDE - ~ (Sean
BoRROwER:
. BORROWER;
(Seen
BORROWEr~
($Oai)
BORROWER:
(Seal)
BORROWER;
(Sew
BORROWER
1. EVEWTS OF DEFAULT. An Event of ~ ~ TERMS AND CONDITIONS ~ . -
ootlateral to secure this Note:
Defauk Will occwr under Phis Note in the event that Borrower, any guarantor or any other third party pledging
(a) fats to make arty Payment ort this Nots w any other indebtedness to Lender when due;
(b) fails .to Perform any obligatlon .or breaches an .
present or future written y 1N8iT8nh' w. covenant to Lender contained in this Note, any security instrument, or any other
agreement regarding this or an other indebtedness of Borrower to Lander,
(e) provides or causes an false w'm Y
Y isleadin9 S•Qnature or representation to be provided to Lender,
(d) sells, conveys, or transfers rights in any collateral securing this Note without the written
collateral in any rrtateda! ed; or sub aPP~al of Lender, destroys, loses or damages such
(e) has a 9emishmen ;eSP ]eats such colateral to secure, confiscation w cdndemnation;
t, judgment, tax levy, attachment or Gen entered or served against Borrower, any guarantor, or any third PAY Pledging
collateral to secure this Note or arty of their property; .
(fl dies' becomes IegellY incompetent, is dissolved or terminated, ceases to operate its business, becomes insolvent, makes an assignment for the
benefit of croditors, fails to pay debts as they become due, w bedtimes the subject of any bankruptcy, insohrency or debtor rehabilitation
procead'mg;
(g) fats 1o provide Lender evidence of satisfactory ftnandal condition;
(h) has a majority of its a+ffitanding voting aewritles sold, transferred w conveyed to any parson or entity other than any parson or entity thflt has
tits mejorky ownasllip as of the data of the execution of this Note; w
(~ causes Lender to deem itaek inaewro due to a signkicertt decline in the value of any real or persona( property securing Payment of this Note, or
Lender in good faith, believes the prospect of payment or performance is impaired,
2 RIGHTS OF LENDER ON EVENT OF DEFAULT. H there~la an Event of Default under this Note, Lender wGl be entitled to exercise one or more of the
totlowing remedies wthout notice or demand (except as required ny law):
(a) ~d eclare the prindpal amount plus accrued interest under this Note and all other present and future obligations of Borrower immediately due
Payable in full, such acceleration shall be automatic and immediate k the Event of Defauk is a filing under the Bankru
(b) to collect the outatandMg obligations of Borrower wkh w without resorting to judidal process;
{c) to Deese ma PthY Code;
kjrr9 advances underthk Note or any other agreement between Borrower and Lender,
(d) to take possession of any colleteral;in arty manner permitted bylaw;
(e) to requirg Borrower'to deliver and make available to lender any collateral at a piece reasonably convenient 1o Borrower and Lender,
(f) to sell, lease or otherwise dispose of any collateral and collect any deftclency balance with or without resorthrg to legal process;
(g) to setoff Borrower's obligations against any amounts due to Borrower including, but not Ifmited to, monies, instruments, and de
'maintained whir Lender, and
th) to exercise aG other rights available to Lender under any other wdtten pO~ accbunts
Lender's righffi are cumulaWe and maybe ex6rdsed together, se scat agreement or applicaf~fe law.
those avaGaWe at comlmon law, incluging, but not limited.to, tits P ~~ and in any order. Lender's remedies under this era re
riyM of setofi. P 9 Ph are in addition to
3. DEMgND FEATURE ~ k chacked,'this Note contains a demand feature. Lender's
shah ba in gender's sole and absolute discretlon, whether or not any default has occurred~ht tv demand payment, at anytime, and
4. FlNANCIAL INFORMATION. Barrows frorrr time to time,
in accordance with generally accepted arxountln
f will at alt times keep proper books of record and account in which full, true and correct entries shat be made
Borrower, a rxrpy of the annual financial statementsnof iBorrower relating for m~ ftde~r, within ninety (gn) days after'the end of each fiscal year of
Borrower as at the end of such fiscal year and (ii) the related.lncoma statement, statement of retained estatemenffi to include
for such fiscal (i1 the balance sheet of
Year, prepared by such certlfied public accountanffi as may be reasonab antings acrd statement of resit How of Borrower
Lender within fifteen (1S7 days after filing same, a copy of Bortower's income N sstrsfadory th• Lead°r. Borrower also agrees to deliver to
with reaped to Borrower as Lender may roquest, tax returns and also, from time to fame, such other financial information
5. MODIFICATION AND WAIVER, .The modification or waiver of any of Borrower's obligations or Lender's tights under this Note must be wrrtained in
®writing si8ned by Lender. Lender may perform any of 9ortower's obligations or delay or fail to exercise any of iffi rights wthout causin a
g waiver of
not beoa lffected if Lender amendw srv~rmpromise~saexr r~rang fai~lsrto exerccise ~m °n any other oxasion. Borrower's obit atkns
or guarantor or any of its rights against an Paha or releases any of the obYrgationa baton in tpw this Note shall
and apply checks and Y CO"b°rr°wer, guarantor, the oollaterel or any other ro g g any CO'boROwer
other instruments marked "Paid in Full' or with a similar hrasa P ~~ seaxing The obhgapons. Lender may accept
Inoun'ed under this Note, without being bound by that language and without waiWng any dgh~bi a a paymem as foil saUafadion of ifm obllgayotts
6. SEVERABILI7Y. tl any provision of this Note !s invalid, illegal or unenforceable, the valid le a1~aM of aN amourms owing under this Note.
shall not in any way be affected or impaired thereby. ~', 9 ky, and enforceabGity of the remeinin
~k 7. ASSIGNMENT Borrower agrees net to assign any of Borrower's tights, remedies or obligations deson'bed g Provisions
`~a, consent of Lender, which consent may be withheld bjr Lender in its sole discretion. Borrower agrees that Lender is entitled to assign some of all,of iffi
b~~fighffi and remedies described In this Note without notice to or tfte prior consent of Borrower,
8. NOTICE Any notice w other communication to be provided to Borrower or Lender under this Note shall be in writing and sent to fire
addresses described In this Nate or suds other address as the parties may designate in writing from time to time.
9. APPLICABLE LAW. Parties at the
ktterest, including rates, fees and charges whidi compensate Lender for the extensbn of rxedk to Borrower
for malting the Ifne of credk available to Borrower, or which compensate Lender for any defauk or breach by
this Not°, shall be governed by federal taw end the taws of the slate of.~~r3sv1 under this Note or
Borrower of the temrs and conditions of
of this Note shall be governed by the laws of the statrof~svlvanla_~ia ,All other terms and conditions
Llnlesa applicable law provides otherwise; Borrower conserrts to the jud~ictlon and venue of a court to ~ ~ unksa titherwtse preempted by federal law.
selected by Lender,.in its discretion, in the event of a legal proceed] m' sated in Fenn3vlvania
10. COLLECTION COSTS. To the eMent permitted by law, Borrowe9 agreeatlto pr yt Lender's reasonable fees
fees and costs of attorneys and other agents Qnduding without Gmketion, paralegals, decks and consultants , and ~~' indu
an em to ding, but not limted tc,
p yea of Lender,~tvhidl are incurted by Lender in,colleding tiny amount due or enfordn )whether or not such attorney or agent is
suit is brought, including, but not limited to, all fees and costs incurred on appeal, in bankruptcy, andd forg oat ursmady under this Note
, whether or not
11. MISCELLANEOUS. This Note is being executed primarily for commercial, agr(cukural, or business ui figment coGeotlon actions.
time is of the'essence. Borrower aH ea to make all a e P rposas. Borrower and Le
Borrower and an P Ym ms tb Lender at any address designated py Lender and in lawful lJnitsd nder agree that
P yment, notce bf dishonor and protest and further W81ves any
rigMto require Lender to proceed again anyone slaws pe or,; pero~tlin9 against Borrower or said person: All references 1o Borrower in tfi'rsNote shall
• Include all of the parties signing this Note, and this Note shall be, binding upon the help, spccesson and essigna of Borrower and Lender. H theta is
more than one Bortower their obftgationa under this Note shall be' joint and several. Information conrxming this Note may be reported to credk
reporting agendas and will bs made available when requested by proper legal process. This Note represerrts the complete and Integrated
understanding between Bortower end Lender regarding the terms her4b}.
12 JURY TRIAL WgIVEp LENDER ANb BORROWER HEREBY WANE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT
OF, OR BASED UPON, THIS MOTE OR THE COLLATERAL SECURING THIS NOTE
13. ADDITIONAL TERMS:
Borrower: HORSHAM 'VALLEY AIRWAYS, INC.
Date of Note: April 21, 2006
PnncipalAmount of Note: 51, 982, 000.00
_ ~l~ ~l
in the event that anq portion of principal of the Note is r •
notix of the amount (the "Prepayment Pranium' determined ~d for a~ reason whatsoever, Lender maq deliver to Boaower a written
that would have been paid is tha future to Calder by the B over on such to be the excess of (a) the present value of the interest payments
computed on a morrthtq basis applying the interest rate ' P~Paid Portion of prurapal, this pre~mt value calarlation b '
Note tam on the total amount of rm ' al m ~~ under the Note on the date of prepayment for a period equal to the remain~mg
Lander if Lender were to reurvest tlu PrePazd, Duet ro) the present value of the interest payments that would be paid is fire future to
lus pRI~R aid~prindpat at an interns[ rate equal. to the rate payable on US. issues
P 1.5 0 p _ 96 (Rsarvcstmeat Rate _ .lYeasurq
ranainin~ note term. U.S. Tr ) Pint value calprlatlon being compute on a monthly basis, for a
date of the: note. The above ahao d not b~e,~~ ~ % of the on'g~n ryoal ~~owunt_a maturity date.in the same month and Prod equal to the
year as the maturity
An emmple of the calculation of the Prepayment premium under the foregoing formula is set forth below, for r7lustrative
The following ecample may not be
direct]y applicable to the Note or the Borrower. purposes only.
I3XAMPLE OF PREPAYMENT PREIuIIUM (PPP) Ct1LCUTATION
Formula:
PPP=A_B
,e~ = Note Rate x Prepaid Amount x PVF '
12 R1R
1 B ° ~- x Prepaid Amount x PVF
PVF =Present ValueFador a 1' 1+
12
N =Renaming Term in Months RIIt/12
RIIt = R~'estment Rate = U.S. Treasury Rate corresponding to the
' rema+--^~^gtamplus 1.500
Example: Assume a loan of s 560p,000.00 prinapal amount with an amo
. .percent (1396) faed rate Pa annum for tea 10 rtization period of twenty (20) years. The interest rate is thirteen
secoad~year when it has a balance of 5585 6.OO~s with a monthiypapment of 57,029.45. The loan is prepaid at the end of the
1996 is nine and one-half ~ The: date of pmpayment is August 15, 1988. U.S. Tr
Percent (9.5%), therefore the, RIR = 9S% + 1S% = 11.0%. ~nrY Rate for August 15,
PVF = 1 _ 1
=63.66
.009167
.13
'4 = ~ x (5585,576.00) r 63.66 =5403,842.49
B =~ x (SSSS,s76.oo):63.66 =5341,712.87
PPP = A _ B =.5403,842.49 -5341,712.87 =562,129.62
The Prepayment Premium sP°aEiad in such written notice:. shall be due and
written notice. ~
payable by the Borrower to Lender upon deliv
aY of such
The Prepayment Premiwn shall be ~licablc to a~ Prepayment of
]imitation, as a resrlt of demand, aaelaatton upon default, foreclosur prmdp~ whatsoevea end for whatever reaso
Lender, the Borrower or by any other w sale or deatrtrction of CoLateral or otherwise, n' m~~' ~O~
Person or entity; with the arxption of the following. and whether caused by
The Prepeyaient Premium vill only apply if refinanced by another financial insti+ution.
~~ initial
The Prepayment Premium shall be applicable when a prepayment occurs d
amounttoF ~ ~~ the Borrower prepays an aggregate amount which equal to two
this Note, ezdu urmg a Y~r (~ ~n~ anniversary dates of them of
Note. ~ the total amount of all scheduled payments required d such percent (2%) of the origeral prmapal
This Pr °~ Y~* under the repayment provisrons of this
epaymeat Pramium shall apply during the fated rate period onlq and atry extensions thereof; unless otherwise stated.
BORROWER HORSHAM VALLgy AIRWAYS. ZNC,
BORROWER:
PRlI ~rG3S
BORROWED
BORROWER; '
BORROWER:
BORROWER:
racn,rA Y1VI14tV 1' YiiL' M1 UM ALLL~'1VL UM
TO
'PROMISSORY NOTE '
ureroavw Nra rx7ea
PREPAYMENT PRENIITJM ADDENDUM
TO
. PROMISSORY NOTE
Borrower: HORSBAa[ VALLgy AI>ZWAYS, INC.
Date ofNota April 21, 2006
P'mciPalgmouat ofNote: S 1.982, 000.00
Borrower may P~PaJ' Pupal Portions of this Note in
P~~1 amount of this Note (e>:duding any payments made m~Year in an amount not to ¢o~ ~o pesoent (2%) of the oxi~ai
~Pnmium. If Borrows prepaga principal portions of thin Note in any- on Loan Year ~onnt ~ ergs ~edfied in the Note),
the Note , ~ amount of this Note (dt~rdasg ~ payments made during aurA Past (2%) of
whethea' vohmtarily or after the oowrrprrce of a yaar in accordance with and at the times
'Prepayment Prcmium'~ determined bq Lendw to be equal to th~e~k licabl p~ to Borrower a written notice of the a o~imt~the
The foll '. ~ ~ of the ezcesq amount so prepaid
~ PlePa9m~nt P~~ty Par~aph is is erect: .
As used herein, the term (i) 'Loan Year" shall mesa •
commencing on the date of this Note and each su ~ period: of twelve ~ months, with the Scat
(n) Applicable Peieenta , bsequeat Loan Year comm~cing on the reapecrive anniveasary of the date ofh Note and
four Loaa~Y ~ shaII mesa Svc percent (5%) with respell to :all prepayments made
( ) P ~ For the ]ast four Loan Years, the Applicable Percentage shall durmg ~y Loan Year offier than• the last
1% er Byway of esam le begin at four percent (496) and shall d
percent (5%) during the first Low Ye~ar',~(b) [ma paceat ~~ ote ~a swea ytsrs, the Appliwble Percentage shall bee ~ bu~e (a~ ~e
Year; (d) four percent (4%) during the fourth Loan Year, a durmg the second Loan Year; (c) five percent (5%) the third Loan
the sixth Loan Year; and (P~ one Percent (1%) during the aw~th Lean yoe~art ~~') dm~ ~e fifth Loan Year, (f) two p ~t (2%) during
sunk written notice.
The payment Premium. spedfied in such ~~ notice shall be due and payable bq the Borrower to the Lender upon deliver], of
]imitatiorl,~ ~~ f d~tn shaII ~ applicable to say Prepayment of: nn '
d, acceleration upon defaul force] P . °~ whatsower and for whatwer reaso
Leader, the Borrower or by any other ~ osure, sale or destruction of Collateral or oth n, mdudmg,.without
person or entity; with the aception of the~following; ~°~+ ~d ~~er caused by
The ~'ePaysient Preaium wtll only be assessed if the loan is refinanced by another financial institution.
' ~ initial
'T'his Prepayment Premium abaIl aPPh' during the iced-rate period o
ASS sad ~ extensions thereof, unless otherwise stated.
~~WER HORS8ADS VAL AIRWAYS, INC.
BORNOWEFt
D
H YT S
PR83ID ~----•--
BORROWEFe
BORE
BORROWER:
BORROWEi{
BORROWER;
BORROWER;
aarmoti tas ra/m
ff
HORSNAN VALLEY 112R1PAY5, INC.
Or N.tlOnal tens simlr
p~iq az~iii vs;tx ~•~~
~iDffit"
129s ~ 7.eso ~-~~$a:,aooooo.oo
DRZV>i
01/04/07 0l/04/12~ ~ a
COMMERCIAL
'FIXED RATE
PROMISSORY
NOTE
- - - - - zvi.ve7
PROMISE TO PAY: For value reoelved, Borrorysr Promises to to the order
- Pte' of Lenderthe pdndpal amount of Tvo 1[illion Tp0 Stmdred
interest on the unpaid principal balance at the rate and in the Dotlaro (j _2.200 000 00
rocelved by Lender shell bs manner desadbsd below, untll all anpunte owbg under this Mots are ) Plu
applied flM to aoauad, unpaid Interest, then to unpaid pdnd paid in full. AN afnount
as determined by Lander, in Lender's sale diecreflon as a Pd. and than to any late charges and expenses, or in any other orde
INTEREST i'tATEh . P minted by taw.
inthrost shalt be oomputbd on the basis of f~he a -* +al numb r
on the I~fote ahdl be calculated anal ~ ° £ '~ oo a a airs
DEFAULT RATE; fl theta h PaY~k of the flxsd rate of - ~ 8 0 % par annum. Per Year. intares
pgx ~ TJgB Event of DefauR under this Note, the Lander may, in Its disoretlon, klorease the intsrast rate an this Note to: ~$&
RATS
or the maximum interost rate Landx is permittrd to charge by ~v whichever lc leas. -
PAYMENTSCHEDULE: t3orrower shall paythe pdndpal and interest axording to the followin .
ymea 9 schedule:
intervals thereaftex.97A~finalg•a~~ Feb
rusty 04, 2007 and contiatiin at monthly time
is due and payable on Janufery p4~Yyp y.°f ~e ~~id Principal balance plus accrued interest
PREPAYMENT: This I~bts may ba Prepaid in part or in fup on or before Rs
ores khataliment, any Partial propayment will. not affect the due date ar the amp d~0® with ~ wMhout p°na~'' B thla Note co
Borrower and Lender. ff this Note Is Prepaid in full, them wUl be °~ °f any su ~~ more that
®APfePaymant bSO~°n< installment, unless agreed to, in writing, bf
Penalty of : Q A mirdmum finance dtarge of j
SEE PREPAY1w181~1T PRffidI(DQ ADDENp~ TO PRODQSSORY NOTE.
~~ C~ PaYm ~aymerrt la race Borrower
paid it~tadi"Elj ~ moro than 15 days lets,
~J less, es Perm ~ ba d-ar8ed a late
y law. No more than one Isla charge wik be imposed onnt the unpaid late Payment or j7~5 , p 0 ~ ~ whichever is ®g~~
any aingk payment or poryon of any payment. rO
SECUR(Ty: To securo the Payment and Performance of obp
fight, ytls, and Interest in aA monies, irretrumerda, savings, gadora inourad under thh Noss, Borrower groom Lender a aeahdhr -
acoowrts, suth)set to tax PenaNies H so assigned) that aro now or• sharo and otlhsr aai:ounts of Bo int°rost to aA of Bonuwer'
abo $ecurod by the collateral deagibed in ~ futuro in Lender's rrowsr (~duding IFS Keogh, trust accounts and othe
instrument(s) securing this Noss w ail of Bo ~Y seourily Instrument(s) executed in oonnectlonwiyro th ~~ ff checked, the obiigayons under this Note an
rrower'a ob~gatlorhs. deny conaterd descdbed in any other aecudh
CHEp( PROCESSING FEE N a check for payment fe -elumed to Lander for any reason (for exam
drecdng aocour~, Lender wRi assess a check Pmoessing fee of j a/a be~~
----__, which ihall be added to thi there are InauHident funds to Borrower'r
RENEIIIfAL• I 1 if nha.J.~.~ this Pdndpal 6atance,
Note is a renewal, but not a
Number
INCLUDING THE - ----• -'..~•• wwwen r, rN DRDERTO SA718r-Y OR ~ yrytl~ ~E R HEARIPN
PROVISIONS ON THE T AG
IN WITNESS VhiEREOF, the undarolgnsdE ~~ AND S OF THIS TE
/have caused thts i ACI~IOWLEDGE ~~ ~ ~ E9CAf.T COPY OF THIS NOTE,
aoAAOwEA: HORSBAg VAyygY YS, II~iC. nsbumsnt lc be executed as a sealed instrument yes 4th day of Jaaua_~ 2 0 07
.`~ l ~ eoRporvEte ----_.
soAAOwrrt:
(Seal)
BOAROWEA:
(~~
BORR01AIFii:•
90AA0„IEA:
. - (seal)
BOAROwg~
{Seal)
BORROyy~
. - -- (Seal) i
1. ~EN7'S OF DEFAULT. An Event of D'6, ~~ AND CONDI770N3
colaterol to secure thh ..`rlt will otxxrr under thin Note in the event that Borcowed''
(a) fags to Note: arty gueronlor or
~e arry Payment on this Note or any other In any other third Party.pledging
. (b) fags to perform any obligation w debtedneas to Lender when due;
preeerrt or tulle wnthn breBChes any wazrenty w cweruvrt to Lender contained in thin Wole,
c agreement regarding this or any other Indebtedness of Borrower to Lender
()Provides or otuaea any false or mist ~ a°a'~r' 1i~mank w any other
(d) sails, cenveys w ~~ adlrrg aignaturo or rePreeentatlon to be provided to Lender, '
collateral in arty material ~~ ~ any cdlateral waxing thin Note without the written approval of Lander; destro
(e) has a gamisiarre f eap°°~ w aubjeafa such collateral to seiwre, oordiscahon w wtxiemnation; ~• loses w damages such
nt' ~m°nt' ~ Iat'Y. atbechmsnt w parr entered or served +r9dnst g°rc°„,er, ~y ®uarantor, or
edlaferatl to secure thh Note w any of their properly;
(~ dies, becomes IegagY incompetent, is dissolved w tens any third party pledging
bsnefk of credMws, fafle to Inafed, ceases to operate its brrslnsss, becomas.lnsolvept, makes an
Prceeeding; P8Y debts as they become due, w becomes the subject of any 6artlou assignment for the
PthY, insoh'mtoy or debtor rehabilitatlon
(g) fags to provide Lender evidence of satsfadory financial oonditlon;
(It} has a majority of ks outstanding votlng securltles sold. tronsfe
the majorky ownership as of the date read or conveyed tv any parson or entity other than any person w anti
(} causes Lander io deem Itself insecure due to a gnkicantthdeogrre; or ty that has
Lender in good faith, begevss the In the value of arty real or personal Property seoudn
2 RiGfffS OF Pr~ct °f Payment °r Performance Is impaired. 8 Payment of this Note, w
UJ~tDEp ON EVENT OF DEFAULT. f6there is an Event of Defauk under this Note, Lender wql be entitled to
toilowing remedies veitltout notice or demand (except as
(a) to dedare the'pdndpai amount us required by law): exercise one or more of the
and Payable in full, such eooeleratton accrued Interest under this Note and all other present and future obligations of Borrower Immediately due
(b) to collect the o shall be arrtomat~ and Immediate k the Evstrt of Default is a filing under the Bankru
utstanding obggationa of Borrower with or without reaortlng to Judicial process; Prot fie'
(c) to cease making advances under This Note or any other agreement between Borrower and Lender,
(d} to take posseselon of any collateral in arty manner pennkled by law;
(e) ~ require Borrow®r to deliver and make available to Lander any collateral at a place reasonably oonvenlent m Borrcwar and Lander
(f) to sell, lease w otherw(se dispose of any colateral and oogect any defldency balance with w without resorting t° legal process;
(g) to set-off Borrower's obligations against any amounts due to Borrower induding, but not limked to, monies, instruments, and deposit accounts
maintained with Lender, and
(h) to exerese ell ether rights available to Lander under any other wrlken agreement w applicable law,
Lender's rights are cumulative and maybe exerolsed together, separat
those available aT common law, Induding, but not gmited to, the right of stet-off,ln ~Y order. Lender's remedies under this
Paragraph are in addkion to
3. DEMAND FEATURE ~ k ohedred; this Note contains a demand feature. Lender's dght to demand payment, at any tlme and from time to time,
shag be in Lender's sde and absolute diacretbn, whether or not any defauk has oaxrrred.
b FINANCIAL INFORMATION. g°rrower yvlq at eU omen ke ro
in accordance with generally accepted aaountln ~ P Per books of record and acceunt in which Lull, true and correct entdes shag be made
Borrower, a co 8 prindples end will iJellver to Lender, within ninety (g0) days after the end of each ftaoai
py of the annual ftnarrdal statements of Borrower Mating to such ftacxl year, suds statements to induda (r) the b+rlance street o/
eorcower as at the end of such flscel Year of
for such ftscai Year and pi) the related income atatemarrt, statement of retained eamirgis and statement of Dash flow of Bomower
Year. Prepared by audt certiftad public accountants as may be reasonably satisfactory to Lender. Borrower also
Lender wkhin fifteen {1~ days Aker filing same, a copy of Borrower's income tax rehrms and also, from time fo time, such other flrtandal Information
with respect to Borrower as Lender ma agrees to deliver to
y request
5. MODIFICATiON AND WAiyEp, The modiflrxtlon or waiver of any of Borcower's obligations or Lender's rights under thin Note must be contained in
a wdtlng signed by Lender. Lender may perform any of Borrower's obligations ar delay w fail to exeroise any of its rights without cau
those obligations or rights. A waiver on orro occasion wiq not constkute a waiver on any other ocroasion.
not be affected k Lenderamends, com romises, ex ain9 a waiver of
P drat, es, fails w exercise, fm sire or releases an of theobligaBona bgelo ns under this Note shell
or guarantor w arty of its ri his g P y
9 against any °o-borrower, 9uararnor, the oollaterai or any other a ngln9 l° any co-borrower
and apply ohedrs and other instruments mazked 'Paid in Fuq' or P-oA ~ Og the obligations. Lender may axept
incurred under this Note, with a similar phrase despibing a Payment ~ full satiafactlon of the obggations
wkhout being bound by that language and without waiving any rights to Payment of aq amounts owing under thin Note.
& SEVERABILITY. Harry provision of this Note is invalid, illegal or unerdorosa6lo, the validity, legality, and enforceability, of the romaini
shalt not m any way t1e akected or impaired thereby,
ng provisions
7. ASSIGNMENT. Borrower agrees not to assign any of Borroaror's rights, remedies or obligations dearxibed in this Note wiffxxrt the prior written
consent of Lender, which consent maybe withheld by Lender in ks sole disaetlon. Borrower agrees that Lender is entitled to assign some or all of its
rights end remedies described in this Note without notice to w the pdor consent of goer
8. NOTICE Any notlce or other communicatlon to be provided to Borrower or Lender under this Note shall bs in writing end sent to the
addresses described in this Note orsuch other address as the pertles may designate in writing from time to tlme.
parties at the
9. APPLICABLE LAW. Interest, induding rates, fees and charges whkh compensate Lander for the extension of credk to Borrower under this Note or
for making the line of credk available to Borrower, or which compensate Lender for any defauk or breach 6 Borrower
this Note, shall be governed by federal law and the laws of the state of *+++ ~ ~ ,..1 a Y of the terms and condkions of
of this Nom shall be governed byr the Paws of the slats ofp~n p~ ~a All other bermes and condltkxls
Unties applicable law provides otherwise, Borrower consents to the . unhaa otherwise preempted by federal law.
selected by Lander, in ks discretion, In the event of a 1 ~ ' ludadlotion and venue of arty court located in p s3'lvaaia
10. COLLECTION COSTS, To the extent ~ proceeding under this Note,
fees end costa of attorneys ared other Perrrrkted ~ law,Borrower gees to pay Lenderh reasonable fees and costs, induding, but not limited to,
a9anta Qnduding without gmitatlon paralegals, dadrs and consultants ,
an employee of Lender, whfah are Incurred by Lander in cogsding any amount due or errforoing any riglrt way under this Nola, whNher~not
suk is brought, induding, but not limited to, ail fees and cesta inourced on appest, in banivuptoy, and for posRjudgmaM ookeotlon adiona.
11. MISCELLANEOUS. This Note la being executed primarily for eommarolal, agrioukural, or business purposes. Borrover and Lander agree that
time is of the essence. Borrower agrees to make all payments to Lender at any address designated by lender and in lawful Unkod States Curren
Bortowar and any person who endorses this Note wah'es Presentment, demand for payment, notlce of dishonor and protest end further waives an
right to require Lender to roceed ai ~~
P ag net anyone else beforo roceedin a alnst Borrower or said rocs. Aq referenrxa to Y
indude qll of the parties signing This Note, and this Note shall be bindi B upon the heiro,'succesaore Borrower in this Note shall
more than one Borrower their obggatbna under this Note shell be Dint and a^d assigns of Borrower and Lender. k there k
reporting agendas and will be made available when ro uated f several. Irrf°rmatlon concerrdng this Note may be ieported to credit
underetanding between Borrower and Lender q ~' Proper legal process. This Note ropreaenta the complete and integrated
regarding the terms hereof.
12 JURY TRIAL WAVER. LENDEp AND BORROWER HERF_BY WAiyE ANY RIGHi TO A TRIAL BY JURY IN ANY CML ACTION ARISING Ol1T
OF, OR BASED Uppfl, THIS NOTE OA THE COLLATERAL SECURING THIS NOTE
13. ADDITIONAL TERMS:
TO
PROMISSORY NOTE
Borrower: HORSH1lM VALLgy ~I&t'P11YS, IaTC:"
:~
Date of Note: January 04 2007
Pr'isapalAmountofNote: sa,a00,000.00
In the eveatt that any Portion of _
notice of the amount (the ~a~ of the Note is prepaid for ally reason whazaowet ,
Pteauu n czoess of a the a ~ deliver to Borrvwwer a written
that would have beam paid future ~ ~ determined by the Lender to ba the
Leader by the Borrower on such () Pmt value of the intoreat payments
computed oa a monthly basis applying the i~~ rate in effect Pfd Peron of pringpal, thin present value alenhttion being
Note term on the total amount of under the Note on the date of prepayment for a period equal to the remaining
Lender if header warn to remvest~t~ Yazd' over (b) the present value of the interest Payments that would be paid is the future to
P~ 1.500 _9b PmPaid prmcapal at an interest rata to the rata
(R~estmeat Rate _ gig), ~ P?~ ~ ~~ation bnutg~ P°7'able on u.S. Treasury lasses
remaudrug note tens. US. Treasury issues refora to those US. OD~~ on a monthly basis, for a prriod equal to the
date of the note: The above should not be less than 1% of the ~~ ~~ a ~~ ~~ ~ ~ same month and
original loan amount year as the maturity
An sample of the calcutatioa of the Ptapaymcnt Premhmr under the fo
The following exempla ~, not be dir !Og°v-g formula is set forth below, for r7lushative
ectly applicable to the Note or the Borrower- purposes only
F.XAIdpLB OF PRSPAYMEi[1p PREM1iTM (ppp) CALCULATION
Formula;
PPP=A-B
A = Note Rate RIR
1'--2 -- a Prepaid Amount x PVF
B = -IZ-- x Prepaid Amount z PVF
PVF =Present Value Factor = L - 1
--~- Lam- i2
N = R t RIR/12
emaining Team in Months
RIR =Reinvestment Rate = U.S. Treasury Rate oo~pvnding to the
remaining term phu 1.500
~u: Assume a loan of a s600,000,Q0
Percent (~%) feed rate printapal amount with an amorticatioa period of
Per annum for ton (10) years with a monthlypayfIIent of ~~ (~) Y~ The interest rate is thirteen
second year whey it has a balance of SS85,S76.00. The date of 57,029.45. The loan is prepaid at the cad of the
1996 is nine sad oatrhalf percent (9.5`$), therefore the P~~eat is August 15,1988. US. Treasury Rate for A t
RIR = 95% + 1S% = 11.0%. 'r8~ 15,
PVF = 1 1 +_-- =63.66
.009L67 '
. A = ~ a (SSSS,576.00) a 63.66 =$403 842.49 _ .11
' B - ~ x (5585,576.00) z63.66 =5341,712.87
PPP = A _ B =5403,84249 -5341,712.87 =562,129.62
The Prepayment Premium specified in
written notice. each written notix shall be dun and Payable by the Borrower to
The Prepayment Pr Lender upon delivery of such
limitation, sa a remit of d~ ~ bh ~m to a~ prepayment of
Lender, the Borrower or by a d'd'o ~ °II . oa default, forecloaue, sa~ ~°~~ o eL~~ for ~ataver reason, including, without
Person or entity; with the erception of the following; aal or otherwise, and whether caused by
The Prepayment will only be assessed if the loan is refinanced by another financial institution.
/~~ Initial
The Pr
this Noty) m ~~~ ~ applicable when a Prepayment oaurs d
Notount of this Note, exdndiag the to~t~a~mount o°!~ scheduie~ ~~ ~s~~~m~equa~ to pmt ~ dazes of the mai~~ of
This Pr P~ents requirod during such Sroar under th~r) of the Provisions of '
epayment premium ahaII epayment
aPPl3' during the feed rate period ~ and any etteagans thereof, unless otherwise stated.
BORROWIR 80R8131tM QALLBY
uRiifltY3, INC.
BOF
H YT B11W
PR88ID8r
BORROyy~
BDAROWER:
BOHRp1NER
BORROyyE~
BORpOW@q;
aaerorew tits >sJm
L
r
,,
19
'1 •~
.. ~
u
i
FIRSTSERVICE BANK -
A DNISION OF NATIONAL PENN BANK
0
c5
2• Payment Schedule.
(a) Beginning one (1) month from e-d'at of this Note, and thereafter on the same
day of each. succeeding month, for a period of thirty- (35). , onths, Borrower shalt repay the princi al
sum together with interest on the unpaid balance of pnncipai~a.e fixed rate of p
successive month 7.96% per annum in equal
y payments each ~n the amount• of Fifty-Six Thousand Five Hundred Eighty-Eight
Dollars and Sixty Cents ($56,5Ej8..60), and a fipal payment on~the Maturity Date equal to the remaining
balance of any unpaid principal together with all accrued, unpaid interest and all other monies due
hereunder and under the Loan Documents. If not sooner paid, the entire unpaid principal balance
together with all accrued but unpaid interest and all other charges due hereunder shall be due and payable
without further notice on the third (3rd) anniversary of this Note ("Maturity Date"}. -
(b) The annual interest rate for this Note•is computed on a 365/360 basis; that is, by
applying the ratio of the annual interest rate over a year of three hundred sixty (360) days, multiplied by the
outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.
(c) All payments will be applied first on account of interest, thereafter on account of
principal and thereafter on account of any other unpaid charges due Lender.
(d) Borrower acknowledges and agrees that although the monthly payments of principal
and interest have been calculated on the basis of an amortization over ten (10) years, the entire remaining
unpaid principal balance together with all accrued, unpaid interest shall be due and payable, on a balloon
basis three (3) years from the date hereof. THIS 1S A BALLOON OBLIGATION. THE REGULARLY
SCHEDULED PAYMENTS OF PRINCIPAL AND INTEREST WILL NOT FULLY AMORTIZE THIS LOAN BY
THE DATE WHEN THE REMAINING UNPAID BALANCE OF PRINCIPAL AND ALL ACCRUED BUT
UNPAID INTEREST BECOMES DUE AND PAYABLE IN FULL.
3. Pre____ ayment,
In the event Borrower in an one ear
prepays an aggregate amount which exceeds a sum equal t dtwo pe cent (2 %) of theaorigtnal princ pal
amount of this Note, excluding the total amount of all scheduled payments, the Lender may deliver to
Borrower a written notice of the amount (the "Prepayment Premium") determined by the Lender to be the
difference between: (a) the present value of the interest payment that would have been paid in the future
TERM NOTE
May 7, 2007
~' INTENDING TO BE LEGALLY BOUND, and for• value received, the undersigned, whether one or
~~ more persons, partnerships, corporations or other entities (jointly and severally "Borrower") agree as
~ •~foliows:
~° •• 1 • Obligation.
Borrower promises to pay to the order of FIRSTSERVICE BANK, a Division of
• NATIONAL PENN BANK ("Lender"), at any of its banking offices, the principal sum of FOUR MtLLiON
SIX HUNDRED FIFTY THOUSAND DOLLARS ($4,650,000.nO) together with interest in accordance with
the payment schedule set forth below.
, r
,'
%~.
)
to the Lender by the Borrower on such prepaid portion of principal; this present value .calculation being
computed on a monthly basis, applying the interest rate in effect under the Note ~on the date of
prepayment for a period equal to the remaining Note term on the total amount of principal prepaid; and (b)
the present value of the interest payments that would be paid in the future to the Lender, if the Lender
were to reinvest the prepaid principal t the U.S. Treasury Rate pies one and one-half percent (1.50%) fQr
a period equal to the rerneining Note erm.
The U.S. Treasu Rafe shall be the interest rate payable on U.S. Treasury issues vvith a
maturity date in the same month and year as the maturity date of this Note. The above notwithstanding,
the prepayment premium shall not be less than one percent (1 %) of the orl~inal loan amount.
Notwithstanding anything to the contrary, this Prepayment Premium shall only be.
_:assessed if this Note is refinanced by another financial institution/
. 4• Late_ C_ h_ aroe, .
If any payment which is to be made hereunder is not paid within fifteen (15) days after the
date when due, the Borrower shall pay to the Lender a late charge of seven cents ($0.07) for each dollar
which is so overdue, but not less 'than $75.00, for the purpose of defraying the expense incident to
handling such delinquency. This provision shall not be deemed to affect or lengthen the time to cure any
default hereunder.
5. Collateral.
As security for~aii indebtedness to Bank now or hereafter incurred by Borrower, under this
Note, Borrower grants Bank a lien upon and security interest in any securities, instruments or other
personal property of Borrower naw or hereafter in Bank's p ssession and in any deposit balances now or
hereafter held by Bank for Borrower's account and in aA proceeds of any such personal ro e
P p rty or
deposit balances. Such liens and security interests shall be independent of Bank's right of setoff. This
Note and the indebtedness evidenced hereby shall be additionally secured by any lien or security interest .
evidenced by a writing (whether now existing or hereafter executed) which contains a provision to the
effect that such lien or security interest is intended to secure (a) this Note br indebtedness evidenced
hereby or (b) any category of liabilities, obligations or the indebtedness of Borrower to Bank which ,
includes this Note or the indebtedness evidenced hereby, and all property subject to ariy such lien or
security interest shall be collateral for this Note.
ti. Set-OfF. .
Note and for the due carnY for the payment of this Note,and any renewal, extension or modification of this
now existing or hereafter ontra ednof Borrower,eBorrowe~r agrees that Lender~shal! haveta -1eecome due,
a security interest in and a right of set-off against any and all present,. future and after-acquired funds,
monies, balances, stocks, bonds, notes and other property at any time in the hands of Lender in which
Borrower has an interest, except that Lender shall have no right of set-off against, no lien upon or security
interest in any IRA or any other retirement account which is deemed distributed if pledged as collateral
under applicable law:
~Defauit.
Upon the happening of any of the following events, each of which shat) constitute an
Event of Default hereunder, all liabilities of Borrower to Lender, at the option of Lender, shall become
immediately due and payable:
'~ ~ r_ ~
{a) Failure of Borrower to pay the principal or interest on this Note• when due or on
any renewal, extension or other modification of this Note or failure to pay when due any•interest or
installment on any other obligation of any nature whatsoever owing to Lender;
(b) Failure of Borrower or any Guarantor (as defined in the Loan Agreement
accompanying this Note) to pertorm any obligation owing to Lender under this Note or any agreement with
Lender or breach of any representation, warranty, covenantor agreement herein contained or contained in
any other agreement now or hereafter entered into between Borrower or any Guarantor and Lender;
(c) Failure of any business organization in which Borrower or any Guarantor has an
ownership interest, to perform any obligation owing to Lender under.any note, mortgage, loan agreement or
.any other agreement with Lender or breach of any representation, warranty or•covenant therein contained or
hereafter entered info between such business organization and Lender,
against Borrowerdor any Guarlanto~f the akin ~ b Borrow~p or insolvency proceedings of any kind by or
benefit of creditors, the suspension of businessyby Borrower or any Guarantor orathe deatht ofrany
principal, shareholder, officer or member of Borrower;
(e) The institution ~ of any legal or equitable proceedings against Borrower or any
Guarantor;
(fl The entry of a judgment against Borrower or any Guarantor;
(g) The issuance of any writs of attachment or execution against Borrower or any
Guarantor;
(h} The furnishing of materially false informatiort'Fieretofore or hereafter by Borrower
or any Guarantor to Lender or the refusal by Borrower or any Guarantor to provide material information
hereafter,
(i) Any change in the financial condition of Borrower or any Guarantor which causes
Lender in good faith to believe that performance of the obligations herein is impaired or doubtful;
(1) The occurrence of any event of default as defined in the Loan Agreement or.in
any other Loan Document.
(k) The guaranty of any Guarantor ceases to be:effective for any reason or the death
of any Guarantor.
(I) The dissolution, merger, consolidation, or the sale or change in control (as control
is defined in Rule 12b-2 under the Securities Exchange Act of 1934) of Borrower, or transfer of any
substantial portion. of any of Borrower's assets, or if any agreement for such dissolution, merger,
consolidation, change in control, sale or transfer is entered into by Borrower, without the written consent of
Lender.
Notwithstanding the foregoing, if any Event of Default, other than a default in payment, is
curable and if Borrower has not been given a notice of a breach of the same provision of this Note within
the preceding twelve (12) months, it may be cured (and no Event of Defautt will have occurred) if
Borrower, after receiving written notice from Lender demanding cure of such Default: (a) cures the default
within thirty (30) days; or (b) if the cure re wires more than thi
which Lender deems in Lender's sole discretion to be sufficient30o cure the defaultyand' thereafter
continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical.
3
---- ---
.
I )
_..
. _ _..
8• Remedies UDOn Default..
Should any event of default occur and not be cured in accordance with Paragraph 7,
(a) the entire unpaid balance of the principal sum with interest accrue~~/lthereon at the
rates hereinbefore specified to the date of said default, and thereafter at the rate of 396/above the rate
extant on the date of default (the °Default Rate's and all other sums due by Borrower hereunder or under
the Loan Agreement, shall, at the option of Lender, and without notice #o Borrower, become due and
payable immediately.
(b) Lender may forthwith appropriate and apply on account of the amount payable
hereunder, any and all funds, monies, or sums deposited with Lender to the credit of Borrower, or liquidate
and sell any collateral in the hands of Lender in which Bo-rower has an interest, except that Lender shall
have no power to appropriate or liquidate any IRA or any other retirement account which is deemed
distributed if pledged as collateral under applicable law.
(c) !n addition, Lender may attach, levy or execute upon and sell any other assets of
Borrower and exercise any other rights or remedies available to Lender under the Uniform Commercial
Code, any other applicable law, or under the Loan Agreement or any collateral or security documents
executed by Borrower or Guarantor in accordance with the Loan Agreement.
(d) ~ Following the date of any default, interest at the Defauit.Rate shall accrue and
compound on the principal balance due and on all interest, charges, assessments, costs and fees then or
thereafter due hereunder. In such case, Lender may also recover all costs of suit and other expenses in
connection therewith (including, but not limited to, costs and attorney fees incurred in any insolvency or
bankruptcy proceeding, or any negotiations related thereto, involving Borrower,oor any other person or
entity if such proceedings shall in any way jeopardize Lender's security or coliat~ral or in any way limit or
impair Lender's ability to enforce a claim againslti any security or collateral provided for this Note), and also
an attorney's commission for collection of 5%• of the full amount due hereon but not less than FIVE
THOUSAND DOLLARS ($5,000.00). .
9• Remedies Cumulative.
The ri9htss and remedies of Lender as provided in this Note shall be cumulative and
concurrent and may be pursued separately, successively or together against Bon'ower• at the sole
discretion of Lander and may be exercised as often as occasion therefor shall arise. Borrower hereby
waives presentment for payment, demand, protest, notice of protest and dishonor and ail other notices or
demands in connection with the delivery, acceptance, performance, default or enforcement of this Note.
The liability of Borrower hereunder shall be unconditional without regard to the liability of any other party
and shall not be in any manner affected by any indulgence, extension of time; renewal, waiver or
modification granted or consented to by Lender. Lender shall not by any act or omission or under any
circumstances be deemed to have waived any of its rights other than any rights waived by Lender in
writing. Any reference herein to Bon'ower shall be deemed to refer to and be applicable to each signer
separately as well as all of them Jointly. If this Note shall be paid by any Borrower, Lender may surrender
this Note and ail security pledged with it to the one so paying. Lender Is hereby authorized, without further
notice, to obtain the signature of additional co-makers and to date this Nofe as of the date on which the
loan is made. .
10. Confession of Judgment.
(a) UPON THE OCCURRENCE OF AN EVENT OF DEFAULT HEREUNDER,
BORROWER HEREBY AUTHORIZES AND EMPOWERS THE PROTHONOTARY OR CLERK OR ANY
ATTORNEY OF ANY COURT OF RECORD TO APPEAR FOR AND CONFESS JUDGMENT THEREIN
------- ---- - ------
4
.- ..
~ ,
AGAINST BORROWER, WITH OR WITHOUT DECLARATION FILED~OR-ANY OF THEM FOR THE
~• -AMOUNT- WHICH FROM THE FACE HEREOF MAY APPEAR TO BE DUE -.HEREIN, .PLUS. THE
GREATER OF 5% OF THE PRINCIPAL AMOUNT OF SUCH JUDGMENT OR FIVE THOUSAND
DOLLARS ($5,000.00) ADDED FOR COLLECTION FEES. BY SIGNING THIS NOTE, BORROWER
ACCEPTS THE COLLECTION FEE AS BEING REASONABLE AND APPROVES SAID FEE. THE
AUTHORITY ANp POWER TO APPEAR FOR AND ENTER JUDGMENT AGAINST BORROWER
SHALL NOT BE EXHAUSTED BY THE INITIAL EXERCISE THEREOF, AND THE SAME MAY BE
EXERCISED FROM TIME TO TIME, AS OFTEN AS LENDER SHALL DEEM NECESSARY AND
DESIRABLE, AND THIS NOTE SHALL BE SUFFICIENT WARRANT.
(b) BORROWER ACKNOWLEDGES THAT THE FULL LEGAL SIGNIFICANCE OF
THE CONFESSION OF JUDGMENT CLAUSE SET FORTH ABOVE HAS BEEN CAREFULLY
EXAMINED BY BORROWER AND BORROWER DOES HEREBY ACKNOWLEDGE THAT BORROWER
HAS SIGNED THIS NOTE KNOWINGLY, VOLUNTARILY AND UNDERSTANDINGLY, AND WITH
KNOWLEDGE THAT, LENDER MAY CAUSE JUDGMENT TO BE CONFESSED AGAINST BORROWER
WITH OR WITHOUT DEFAULT, AND UPON ANY DEFAULT 1N THE OBLIGATIONS OF BORROWER,
MAY CAUSE EXECUTION TO ISSUE AND AS THE RESULT, THERE MAY BE A JUDICIAL SALE OF
REAL, PERSONAL OR MIXED PROPERTY BELONGING TO BORROWER. BORROWER -HAS
ACCESS TO LEGAL COUNSEL AND WAIVES ANY RIGHTS TO HAVE A MORE .DETAILED
EXPLANATION OF BORROWER'S LEGAL RIGHTS UNDER THIS NOTE AND OF THE EFFECT OF
THE CONFESSION OF JUDGMENT CLAUSE.
11. Consent #o Jurisdiction and Venue.
'IN ANY LEGAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER ARISING OUT OF OR RELATED TO THIS NOTE OR THE RELATIONSHIP EVIDENCED
HEREBY, EACH UNDERSIGNED PARTY HEREBY IRREVOCABLY/ SUBMITS TO THE
NONEXCLUSNE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN ANY COUNTY
IN THE COMMONWEALTH OF PENNSYLVANIA WHERE LENDER MAINTAINS AN OFFICE AND
AGREES NOT TO RAISE ANY OBJECTION TO SUCH JURISDICTION OR TO THE LAYING OR
MAINTAINING OF THE VENUE OF ANY SUCH PROCEEDING IN SUCH COURT. EACH
UNDERSIGNED PARTY AGREES THAT SERVICE OF PROCESS IN ANY SUCH PROCEEDING MAY
BE DULY EFFECTED UPON CI' BY MAILING A COPY THEREOF, BY REGISTERED MAIL, POSTAGE
PREPAID, TO EACH UNDERSIGNED PARTY.
12• Waiver of Ju Trial.
EACH UNDERSIGNED PARTY HEREBY WAIVES, AND LENDER " BY ITS
ACCEPTANCE HEREOF THEREBY WANES, TRIAL BY JURY IN ANY LEGAL PROCEEDING
INVOLVING DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING 1N .TORT,
CONTRACT OR.OTHERWISE) IN ANY WAY ARISING OUT OF OR RELATED TO THIS NOTE OR THE
RELATIONSHIP EVIDENCED HEREBY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
LENDER TO ENTER INTO, ACCEPT OR RELY UPON THIS NOTE.
"Borrower"
HORSHAM VALLEY AIRWAYS, INC.,
a Pennsylvania Corporation .
By. (SEAL)
Name: H Bangs
Title: President
-.-.__
~-~
LOAN AGREEMENT
LOAN AGREEMENT, dated as of May 7, 2007 between HORSHAM VALLEY AIRWAYS, 1NC.; a
Pennsylvania corporation with its principal place of business at 450 Caredean Drive, Horsham,
Pennsylvania, 19044 (the "Borrower") and FIRSTSERVICE BANK, A DNISION OF NATIONAL PENN
BANK, (the "Bank"), with offices at 95 North Broad Street, Doylestown, Pennsylvania, 18901. The parties
hereto agree as follows:
BACKGROUND
Borrower hereby requests Bank to extend certain credit facilities to Borrower in the form of two
term loans (the 'Term Loans") and a line of credit for working capital purposes (the "Line of Credit") and
Bank agrees to make such credit facilities available to Borrower under and pursuant to the terms of this
Agreement, with the following basic terms.
Principal Amount of Term i oan Facil' (1)
$4,650,000.00 _ _
Princioal Amount of Annual Line of Credit Facili
$2,250,000.00
Principal Amount of Term Laan Facility l2):
$600,000.00
Reda_yment of Principal and interest on all Notes Principal and interest due and payable under~all
Notes executed and delivered under this Agreement shall be repaid by Borrower to Bank in accordance
with the provisions of Sections 2.02 through 2.05, Sections 3.03 through 3.05 and 4.02 through 4.05
below.
Termination: The Line of Credit Loan shall be made available to the Borrower, absent default
under any of the Loan Documents ar an Event of Default hereunder, until September 30, 2007, and shall
be subject to the Bank's review at that time. Any extension of this facility beyond September 30, 2007 shall
be at the Bank's sole discretion.
The Borrower acknowledges reading all of the terms, provisions, agreements, covenants and
warranties of this Agreement, the Notes, and all other Loan Documents as hereinafter defined in
connection with the Loans, and, in consideration of the Bank agreeing to make the Loans, and intending to
be legally bound hereby, the Borrower warrants, represents, covenants and agrees as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Defined Terms. As used in this Agreement, the following terms have the following
meanings (terms defned in the singular to have the same meaning when used in the plural and vice
versa):
"Affiliate" shall have the meaning as defined in 11 U.S.C, Section 101, except that the term
"debtor" therein shall be. substituted by the term "Borrower"
"Agreement" means this Loan Agreement, as amended, restated, supplemented, or modified from
time to time.
1
,'
__......
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"Aircraft Security Agreements" mean the Security Agreements, including UCC-1 ~ Financing .
Statements and all Federal Aviation Administration ("FAA") documentation to be delivered by the Borrower
under Section 6.02. .
"Bank" means FirstService Bank, a Division of National Penn Bank, unless the context indicates
otherwise.
"Borrower" means Horsham Valley Airways, Inc., a Pennsylvania corporation.
"Borrowing Availability" shall have the meaning ascribed thereto in Section 3.01 (a) of #his
Agreement.
"Business Day" means any day other than a Saturday, Sunday, or other day on which commercial
banks in the Philadelphia area are authorized or required to close under the laws of the Commonwealth of
Pennsylvania. .
"Capitalized Lease Obligations" means any amount payable with respect to any lease of any
tangible or intangible property (whether real, personal or mixed ,however denoted,
required by GAAP to be reflected as a liability on the face of the balance sheet of the lessee, or (2)rbased
on actual circumstances existing and ascertainable either at the commencement of the term of such lease
or at any subsequent time at which any property becomes subject thereto, can reasonably by anticipated
to impose on such lessee substantially the same economic risks and burdens, having regard to such
lessee's obligations and the lessor's rights under the lease both during and at the termination of the lease,
as would be imposed on the lessee by any lease which is required to be so reflected on the balance sheet
of the lessee or by the ownership of the leased property.
"Collateral" means all properly which is subject or is to be subject to the Liens granted by the
Security Agreements and the Aircraft Security Agreements as the context may require.
"Debt" means (1) indebtedness or liability for borrowed money or for the deferred purchase price
. of property or service (including trade obligations); (2) obligations as lessee under Capitalized Lease
obligations; (3) current liabilities in respect of unfunded vested benefits under any Plan; (4) obligations.
under letters of credit issued for the account of any Person; (5) all obligations arising under acceptance
facilities; (6) all guaranties, endorsements (other than for collection or deposit in the ordinary course of
business), and other contingent obligations to purchase, to provide funds for payment, to supply funds to
invest in any Person, or otherwise to assure a creditor against loss; and (7) obligations secured by any
Lien on property owned by any Person, whether or not the obligations have been assumed.
"Default" means any of the events specified in Section 11.01, whether or not any requirement for
the giving of notice, the lapse of time, or both, has been satisfied.
"Environmental Lav-r' means any presently existing or hereafter enacted or decided federal, state
or local statutory or common laws relating to pollution or protection of the environment, including without
limitation, any common law of nuisance or trespass, and any law or regulation relating to emissions,
discharges, releases or threatened release of pollutants, contaminants or chemicals or industrial, toxic or
hazardous substances or wastes info the environment (including without limitation, ambient air, surtace
water, groundwater, land surface or subsurtace strata) or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or handling of pollutants,
contaminants or chemicals or industrial, toxic or hazardous substances or waste.
"ER1SA" means the Employee Retirement Income Security Act of 1974, as amended from time to
time, and the regulations and published interpretations thereof.
2
"FRIBA Athliate" means any trade.or business.(whether or not incorporated) which Together with.
the Borrower would be treated as a single employer under Section 4001 of ERISA.
"Event of Default" means any of the events specified in Section 11.01, provided that any
requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.
"GAAP"means generally accepted accounting principles in the United States.
"Guarantor(s)" mean Hoyt Bangs and Alice Bangs, or either of them as the cantext may require.
"Guaranty Agreement(s)" shall have the meaning ascribed thereto in Section 6.05 of this
Agreement.
"Hazardous Materials".means any contaminants, hazardous substances, regulated substances or
hazardous wastes which may be the subject of liability pursuant to any Environmental Law.
"Head Office" means the principal office of the Bank designated as such by Bank from time to
time.
"Indebtedness" means (a) the $4,650,000.00 Term Loan, the Line of Credit, and the $600,000.00
Term loan and all interest, costs, fees and expenses accrued thereon or in connection therewith, and (b)
all other indebtedness and obligations or undertakings now or hereafter owing by the Borrower to the -Bank
under this Agreement or the Loan Documents, and (c) all liabilities and obligations of the Borrower. to the
Bank of any nature (including any past, present or future advances, readvances, release of collections,
substitutions, extensions, renewals, interest, late charges, penalties, overdrafts and fees of any and all
types), whether such liabilities and obligations are primary or secondary, absolute or contingent, direct or
indirect, sole, joint, several, or joint and several, voluntary or involuntary, similar or dissimilar, related or
unrelated, matured or unmatured, now or hereafter existing, due or to become due, or held by the Bank
for its own account or as agent for others, whether created directly or acquired by negotiation, assignment
or otherwise.
"Lending Office" means for each type of Loan, the Lending Office of the Bank (or of an affiliate of
the Bank) designated for such type of Loan on the signature pages hereof or such other office of the Bank
(or of an afftliate of the Bank) as the Bank may from time to time specify to the Borrower as the office at
which their Loans of such type are to be made and maintained.
"Lien" means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), or preference, priority, or other security
agreement or preferential arrangement, charge, or encumbrance of any kind or nature whatsoever
(including, without limitation, any conditional sate or other title retention agreement, any financing lease
having substantially the same economic effect as any of the foregoing, and the filing of any financing
statement under the Uniform Commercial Code or comparable law of any jurisdiction to evidence any of
the foregoing).
"Line of Credit Note" shall have the meaning ascribed thereto in Section 3.05 of this Agreement.
"Loan(s)" means the $4,650,000.00 Term Loan, the Line of Credit and the $600,000.00 Term
Loan, or any or all of them, as the context may require.
"Loan Document(s)" means all agreements, documents and instruments now or hereafter
executed or delivered by the Borrower (or any other person or entity) to the Bank in connection with the
Indebtedness, and includes {i) the agreements, documents, and instruments described in Article VII of this
Agreement, and (ii) this Agreement, the Notes, the Security Agreements, the Aircraft Security
3
Agreements, UCC-1 Financing Statements, Mortgages, Guaranty Agreements and Subordination
Agreement.
"Mortgages" means the Mortgages to be delivered by the Guarantors, as app{icable, under
Section 6.03 (i) and Section 6.04(i) of this Agreement.
"Note(s)" means the $4,650,000.00 Term Note, the Line of Credit Nofe, and the .$600,000.00
Term Note, or any or all of them, as the context may require.
"Person" means an individual, partnership, corporation, business trust, joint stock company, trust,
unincorporated association, joint venture, governmental authority, or other entity of whatever nature.
"Security Agreements" means the Security Agreements to be delivered by the Borrower under
Section 6.01 of this Agreement.
"Subsidiary' means a corporation in which more than 50% of the issued and outstanding shares
of stock having ordinary voting power (other than stock having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors or other managers of sueFr
corporation is at the time owned, directly or indirectly, or the management of which is otherwise controlled,
directly or indirectly through one or more intermediaries or both, by the Borrower.
"$4,650,000.00 Term Loan" shall have the meaning ascribed .thereto in Section 2.01 of this
Agreement.
"$600,000.00 Term Loan" shall have the meaning ascribed thereto in Section 4:01 of this .
Agreement.
"$4,650,000.00 Term Note" shall have the meaning ascribed thereto in Section 2.01 of this
Agreement.
"$600,000.00 Term Note" shall have the meaning ascribed thereto in Section 4.01 of this
Agreement.
"Term Loans" shall mean the $4,650,000.00 Term Loan and the $600,000.00 Term Loan.
'Term Notes" shall mean the $4,650,000.00 Term Note and the $600,000.00 Term Note:
"Wall Street Prime Rate" means the rate of interest equivalent to the "Prime Rate" published in the
"Money Rates" section of the Wall Street Joumal on the applicable date, or the highest prime rate if more
than one is published, as such rate may change from time to time. If the Wall Street Joumal ceases to be
published or goes on strike or is otherwise not published for any period of time or if it ceases to publish a
"Prime Rate", then the Bank may use any similar published prime rate. .
Section 1.02. Accounting Terms. All accounting terms not specifically defined herein -shall be
construed in accordance with GAAP, and all financial data submitted pursuant to this Agreement shall be
prepared in accordance with such principles.
ARTICLE II
$4.650.000.00 TERM LOAN
Section 2.01. $4,650,000.00 Term Loan. The Bank agrees, on the terms and conditions set forth
in this Agreement and in the $4,650,000.00 Term Note, to make a Term Loan (the "$4,650,000.00 Term
4
Laan") to the Bon'ower in the principal amount of Four Million Six Hundred Fifty Thousand .Dollars
($4,650,000.00), the proceeds of which shall be used by Borrower solely to purchase the assets of
Harrisburg Jet Center located at 106 Airport Road, New Cumberland, Pennsylvania, including eleven (11)
.aircraft and all applicable FAA operating cert~cates and licenses. The Term Loan shall be evidenced by
the execution and delivery of a Term Note in form and substance satisfactory to Bank (the "$4,650,000.00
Term Note") in the amount of $4.,650,000.00.
Sectian 2.02. Interest on $4,650,000.00 Term Note. Borrower shall pay interest to the Bank on
the outstanding and unpaid principal amount of the $4.,650,000.00 Term Note executed and delivered
under this Agreement at the fixed rate of 7.95% per annum.
Interest on the $4,650,000.00 Term Note shall be calculated on the basis of a
year of three hundred sixty (360) days for the actual number of days elapsed.
Section 2.03. Payment Schedule. Borrower shall repay the principal of the $4,650,000.00 Term
Loan plus interest in accordance with the $4,650,000.00 Term Note. The entire remaining prinapal
balance outstanding and all accrued interest of the $4,650,000.00 Term Note shall be due and payable in
full by the Maturity Date set forth in the $4,650,000.00 Term Note. Payments of principal and interest on
the $4,650,000.00 Term Note shall be paid monthly in immediately available funds at the Lending Office..or
such other location as Bank may direct in accordance with the terms of the $4,650,000.00 Term Note.
Section 2.04. Prepayment of $4,650,000.00 Term Note. The $4,650,000.00 Term Note shall
provide that prepayment of the principal balance outstanding shall be subject to the following provision
regarding prepayment if the Note is prepaid prior to maturity:
"In the event Borrower in any one year (year defined by anniversary date of this
Note), prepays ari aggregate amount which exceeds a sum equal to two percent (2%) of the original
principal amount of this Note, excluding the total amount of all scheduled payments,
to Borrower a written notice of the amount the "Pre a ~ the Bank may deliver
difference between: (a) the present value of the interest paymenmthat"wouldrhave been pa da the ~~fe
.to the Bank by the Borrower on such prepaid portion of principal; this present value calculation being
computed on a monthly basis, applying the interest rate in effect under the Note on the date. of
prepayment for a period equal to the remaining Note term on the total amount of principal prepaid; and (b)
the present value of the interest payments that would be paid in the future to the Bank, if the Bank were to
reinvest the prepaid principal at.the U.S. Treasury Rate plus one and one-half percent (1.50%) for a period
equal to the remaining Note term.
The U.S. Treasury Rate shall be the interest rate payable on U.S. Treasury issues~with a
maturity date in the same month and year as the maturity date of this Note. The above notwithstanding,
the prepayment premium shall not be less than one percent (19'°) of the original loan amount.
Notwithstanding anything to the contrary, this Prepayment Premium shall only be
assessed if this Note is refinanced by another financial institution."
Section 2.05. Late Charge. If any payment of principa! and/or interest under the $4,650,000.00
Term Note is not received by the Bank within fifteen (15) days of its due date, the Bank may, without
waiving or modifying any of its rights or remedies, assess a late charge, payable on demand, in an amount
equal to seven percent (7%) of each such payment, but not less than $75.00.
ARTICLE III
LINE OF CREDIT LOAN
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Section 3.01. Line of Credit.
(a} The Bank agrees, on the terms and conditions hereinafter set forth, to make a
loan (the "Line of Credit") to be advanced to the Borrower from time to time, in accordance with the terms
of the Line of Credit Note as defined below, in an aggregate amount not to exceed, at any time, the sum of
Two Million Two Hundred Fifty Thousand Dollars ($2,250,000.00), such amount being referred to herein
as the °Borrowing Availability." In the event that the total amount outstanding under this Line of Credit at
any time exceeds the Borrowing Availability, Borrower shall pay to Bank the amount of such excess
immediately upon receipt by Borrower of written notice that the Borrowing Availability has been exceeded.
(b) Within the limits of the amount set forth in this Section 3.01, and subject to the
provisions of this Agreement, including, without limitation, the Borrower's obligation to pay the entire
outstanding principal balance under the Line of Credit upon demand, the Borrower may borrow, repay and
reborrow under this Section 3.01.
Section 3.02. Notice and Manner of Borrowing.
(a) Any Authorized Person (as defined in Subsection.3:02(b) below) may request an
advance under the Line of Credit by telephonic (confirmed in writing) or written notice to Bank, not in
excess of the Borrowing Availability in the aggregate at any time outstanding, no later than 2:00 P.M:,
Eastern Standard Time, on the Business Day on which the advance is proposed to be made. Upon such
request Bank will credit 8orrower's designated account with Bank or wire such sum upon Borrower's
written Instructions. Upon Borrower`s request Bank will forward to Borrower a written advice or statement
of each advance under the Line of Credit which will specify the manner of disbursement and such .other
terms as may have been agreed to.
(b) Any and all documents required to be executed in conjunction with an advance
under the Line of Credit may be signed by any of the officers or other persons duly authorized by
Borrower's borrowing resolutions as in effect from time to time (each an "Authorized Person"), provided
that a copy of all such resolutions is certified by the Secretary of Borrower's corporation and delivered to
Bank. The Bank shall incur no liability to Borrower or any other person in acting upon any request for a
Loan which Bank believes in good faith to have been made by an Authorized Person as set forth in
Borrower's borrowing resolutions.
Section 3.03. Payment of Line of Credit. The Line of Credit shall bear interest determined as set .
forth in Section 3.04. A!1 outstandirg principal and al! accrued interest shall be due and payable in full on
demand, unless extended by Bank as set forth herein. Prior to demand, and subject to the provisions
hereof, it is contemplated that credit may be extended, repaid and re-extended up to the Borrowing
Availability specified In this Agreement.
Section 3.04. Interest. Interest on the outstanding principal balance of the Line of Credit shall be
computed at a fluctuating rate per annum equal to the Wall Street Prime Rate, subject to the following
adjustments:
Tier 1: If Borrower's Liabilities to Tangible Net Worth at FYE is greater than or equal to
3.0 to 1, the interest rate will be the Wall Street Journal Prime Rate plus .50%.
Tier 2: If Borrower's Liabilities to Tangible Net Worth at FYE is granter than or equal to
2.5 to 1 and less than 3.0 to 1, the interest rate will be the Waif Street Journal Prime Rate plus .25%.
Tier 3: if Borrower's Liabilities to Tangible Net Worth is equal to or less than 2.5 to 1, the
interest rate will be the Wall Street Journal Prime Rate.
Interest on the Line of Credit shall be paid monthly in arrears commencing as set forth in
the Note and thereafter on the same day of each succeeding month in immediately available funds at the
Lending Office of Bank or such other location as Bank may direct in accordance with the terms of the Line
of Credit Note.
Interest on the Line of Credit shall be calculated with respect to each advance under the
Line of Credit from and including the date such advance is made until such advance is repaid in full and
shall be calculated on the basis of a year of three hundred sixty (360) days for the actual number of days
elapsed.
Section 3.05. Line of Credit Note. The Line of Credit made by the Bank under this Agreement
shat! be evidenced by, and repaid with interest in accordance with, a single promissory note of the
Borrower duly completed, in the principal amount of Two Million Two Hundred Fifty Thousand Dollars
($2,250,000.00), dated the date of this Agreement, payable to the Bank (said promissory note as it may
be hereafter amended, renewed or extended, the "Line of Credit Note"). The amount of each advance
under the Line of Credit and payment of principal and interest received by the Bank on account of the Line
of Credit shall be evidenced by the Bank's records, which shall, in the absence of error, be conclusive as
to the outstanding balance of the Line of Credit made by the Bank and interest thereon. __ . .
Section 3.06. Use of Proceeds. The proceeds of the Line of Credit hereunder shall be used by
the Borrower as working capital and for other general corporate purposes, including working capital at the
Borrower's new location in New Cumberland, Pennsylvania.
Section 3.07. Late Fees. If any payment of interest under the Line of Credit Note is not received
by the Bank within fifteen (15) days of its due date, the Bank may, without waiving or modifying any of its
rights or remedies, assess a late charge, payable on demand, in an amount equal to seven percent (7%)
of each such payment, but not less than $75.00.
Section 3.08. Review/Terrnination of Line of Credit. The Line of Credit shall be reviewed by Bank
on September 30, 2007 and thereafter on September 30 of each subsequent year. Upon such review
Bank shall have the right, exerc(sable In Bank's sole discretion, to renew or extend the Line of Credit or to
terminate the Line of Credit effective as of the date of such review. In the event Bank elects to renew or
extend the Line of Credit, all of the terms and conditions contained in this Agreement that pertain to the
Line of Credit and all other Line of Credit Documents, including, without limitation, the Line of Credit Note,
shall remain in full force and effect throughout such period or periods of renewal or extension, unless, and
only to the extent to which, the same shall be expressly altered or excepted in writing and signed by Bank
and Borrower. In the event the Line of Credit is terminated the entire outstanding principal balance of the
Line of Credit Note and all accrued but unpaid interest and all other charges due hereunder in connection
with the Line of Credit shall be immediately due and payable, in full, with or without demand.
Section~3.09. Right of Bank to Demand Repayment under Line of Credit Loan. Notwithstanding
anything to the contrary in this Agreement or any of the other agreements or documents executed -and
delivered in connection herewith, the Bank may at any time in its sole discretion with or without cause and
noiwithstanding that there shall not have occurred a default hereunder, demand payment of the Line of Credit
Loan. The defaults described herein shall not prescribe the conditions under which the Bank may demand
payment or limit in any manner the demand nature of the Line of Credit Note issued pursuant to this
Agreement. Upon the occurrence of any default, which is continuing and which is not otherwise waived by
the Bank, the Bank shall have immediately available to it the rights and remedies set forth under this
Agreement.
ARTICLE IV
$600.000.00 TERM LOAN
Section 4.01. $600,000.00 Term Loan. The. Bank agrees, on the terms and conditions.set forth in
this Agreement and in the $600,000.00 Tenn Note, to make a Term Loan (the "$600,000.00 Term Loan")
to the Borrower in the principal amount of Six Hundred Thousand Dollars ($600,000.00), the proceeds of
each of which shall be used by Borrower solely for leasehold improvements at the Harrisburg Jet Center
located at 106 Airport Road, New Cumberland, Pennsylvania. The Term Loan shall be evidenced by the
execution and delivery of a Term Note in form and substance satisfactory to Bank (the "$600,000.00 Term
Note") in the amount of $600,000.00.
Section 4.02. Interest on $600,000.00 Term Note. Borrower shall pay interest to the Bank on
the outstanding and unpaid principal amount of the $600,000.00 Term Note executed and delivered under
this Agreement at the fixed rate of 7.95°~ per annum.
Interest on the $600,000.00 Term Note shall be calculated on the basis of a year
of three hundred sixty (360) days for the actual number of days elapsed.
Section 4.03. Payment Schedule. Borrower shall repay the principal of the Term Loan plus
interes# in accordance with the $600,000.00 Term Note. The entire remaining. principal .balance
outstanding and all accrued interest of the $600,000.00 Term Note shall-:be due and payable in full by the
Maturity Date set forth in the $600,000.00 Term Note. Payments of principal and interest on the
$600,000.00 Term Note shall be paid monthly in immediately available funds at the Lending Office or such
other location as Bank may direct in accordance with the terms of the $600,000.00 Term Note.
Section 4.04. Prepayment of $600,000.00 Term Note. The $600,000.00 Term Note -shall
provide that prepayment of the principal balance outstanding shall be subject to the -following provision
regarding prepayment if the Note is prepaid prior to maturity:
"If, during the fixed-rate period of the loan, Borrower would pay, in any one Loan
Year, more than two percent (2%) of the original principal amount of this Note, excluding the- regular
payment required under the terms of the Note, the Bank shall charge a prepayment premium equal to the
Applicable Percentage of the excess amount prepaid. The term "Applicable Percentage" shall. mean five
percent (5%) with respect to all prepayments made during any Loan Year other than the last four Loan
Years. For the last four Loan Years, the Applicable Percentage shall begin at four percent (4%) and shall
decrease by one percent (1 %) per year. "Loan Year" shall mean each period of twelve months with the
first Loan Year commencing on the date of the Loan.
assessed if this Note s refinan ed by anothe~financ alnnstitution's Prepayment Premium shall only be
Section 4.05. Late~Charge. If any payment of principal and/or interest under the $600,000.00
Term Note is not received by the Bank within fifteen (15) days of its due date, the .Bank may, without
waiving or modifying any of its rights or remedies, assess a late charge, payable on demand, in an amount
equal to seven percent (7%) of each such payment, but not less than $75.00.
ARTICLE V
PROVISIONS APPLICABLE TO ALL LOANS
Section 5.01'. Method of Payment. The Borrower shalt make each payment of principal and
interest on all Loans made under this Agreement and the Notes and all fees owing to Bank, on the date
when due, in lawful money of the United States, to Bank at its Lending Office or other designated location
in immediately available funds. The Borrower hereby authorizes the Bank to charge from time to time
against any account of the Borrower with Bank any amount so due. Borrower shall pay to Bank promptly
such amounts as may be due if Borrower's deposit account balances are insufficient. Whenever any
payment to be made under fhis Agreement or under the Notes shall be stated to be due on a day which is
8
not a Business Day, such payment shall be made on the next succeeding Business Day, ~ and such
extension of time shall in such case be included in the computation of the payment of interest.
Section 5.02. Security for the Loans. As security for the Loans and for all amounts payable
hereunder and under the Notes as well as for all other existing and future liabilities, whether absolute or
contingent, due or to become due of the Borrower to the Bank under any other loans or extensions of
credit by the Bank to the Borrower, the Bank shall have a lien upon, and security interest in, any balance .
belonging to Borrower or any deposit or other accounts with Bank and any other amounts which may be
owing from time to time by Bank to Borrower.
ARTICLE VI
COLLATERAL AND OTHER SECURITY
Section 6.01. Security for all Loans.. As security for all Loans and for all amounts payable
hereunder and the Term Notes and the Line of Credit Note as ~ well as for all other existing and future
_liabllltles, whether absolute or contingent, due or to become due of the Borrower to the Bank under any
other loans or extensions of credit by the Bank to the Borrower, the Bank shall~have a valid, pertected first
lien on and security interest in the following collateral, which together with the collateral described in
Section-6.02 below shall be defined herein as the "Collateral":
(i) All of the personal property and fixtures of Borrower of every kind and nature,
wherever located, whether now owned or hereafter acquired, including, without limitation, all of Borrower's
accounts, equipment, accessions, fixtures, inventory, chattel paper, instruments, investment property,
documents, rights to proceeds under letters of credit, letter of credit rights, deposit accounts and general
intangibles; and all Proceeds of all of the foregoing, including all Proceeds of other Proceeds.
(ii) All proceeds and products of any of the foregoing, including insurance proceeds
and all replacements to any of the foregoing.
To the foregoing ends, contemporaneously with the execution and delivery of this
Agreement, the Borrower will execute and deliver to the Bank. a Security Agreement and UCC-1
Financing Statements (collectively the "Security Agreements") evidencing the Bank's lien and security
interest in the foregoing Collateral.
Section 6.02. Security for the $4.,650,000.00 Term Loan. As security for the $4,650,000.00
Term Loan and for all amounts payable hereunder and the $4,650,000.00 Term Note, the Bank shall have
a valid, perfected first lien on and security interest in the following collateral:
(i) A first lien on and security interest in certain assets of Harrisburg Jet Center,
including eleven (11) aircraft and all applicable FAA operating certificates and licenses as more fully
described on Exhibit "A" attached hereto and made part hereof.
(ii) A(I proceeds and products of any of the foregoing, including insurance proceeds,
and all replacements to any of the foregoing.
To the foregoing ends, contemporaneously with the execution and delivery of #his
Agreement, the Borrower will execute and deliver to the Bank a Security Agreement, UCC-1 Financing
Statements and all FAA documentation (collectively the "Aircraft Security Agreements") evidencing the
Bank's lien and security interest in the foregoing Collateral.
Section 6.03. Security for the Line of Credit. As security for the Line of Credit and for all
amounts payable hereunder and the Line of Credit Note, the Bank shat! have a valid, perfected second
lien on and security interest in the following collateral:
(i) A collateral mortgage ("Collateral Mortgage I") in the amount of the Line of Credit
Loan executed by the Guarantors, Hoyt Bangs and Alice Bangs, covering premises known as 450
Caredean Drive, situate in Horsham Township, Montgomery County, Pennsylvania, designated as Tax
Parcel No. 36-00-01720-008 (the "Collateral Real Estate I"), the improvements and ail fixtures, machinery
and equipment necessary or incidental to the general operation and maintenance~thereof and ail renewals
and replacements thereof or additions thereto, and such other property as the Bank may reasonably
require (collectively together with the premises described in Sections 6.04(i) below, the "Collateral Real
Estate"), all as is more spec~cally described in the Collateral Mortgage I. The Collateral Mortgage I shall
be a second lien on a good and marketable fee simple title to the mortgaged property, free and clear of all
prior liens, restrictions, easements and other encumbrances and title objections except such as may have
been approved in writing by the Bank. Collateral Mortgage I and Collateral Mortgage II (defined below)
are sometimes referred to herein collectively as the "Mortgages".
Section 6.04. Security for the $600,000.00 Term Loan. As security for the $60x;000.00 Term
Loan and for all amounts payable hereunder and the $600,000.00 Note, the Bank shall have a valid,
pertected fourth lien on and security interest in the following collateral:
(i) A collateral mortgage (Collateral Mortgage 11) in the amount of the $600,000.00
Laan executed by the Guarantors, Hoyt Bangs and Alice Bangs, coverin
Street, Stone Harbor, New Jersey (the "Collateral Real Estate 11"), and allnfixtures~ machirneryland
equipment necessary or incidental to the general operation and maintenance thereof and all renewals and
replacements thereof or additions thereto, and such other property as the Bank may reasonably require,
all as is more specifically described in the Collateral Mortgage II. The Collateral Mortgage II shat! be a
fourth lien on a good and marketable fee simple title to the mortgaged property, free and clear of all prior
liens, restrictions, easements and~other encumbrances and title objections except such as may have been
approved in writing by the Bank. '
Section 6.05. Guaranty of Indebtedness. Repayment of all Loans and other Indebtedness of
the Borrower to the Bank shall be unconditionally guaranteed by the Guarantors, each of whom shall
execute and deliver to the Bank a Guaranty Agreement (collectively the "Guaranty Agreements"), in form
and content satisfactory to Bank.
Section 6.06. Financing Statements, Etc. The Borrower shall authorize the Bank to execute and
file, and where necessary join in the execution of, such financing statements ("UCC-1 Financing
Statements"), continuation statements, lien instruments and FAA documentation (in form and substance
satisfactory to the Bank) as the Bank may specify, and shall pay the cost of filing the same in such public
offices as the Bank may designate.
Section 6.07. Insurance. The Borrower and the Guarantors shall each maintain insurance, in
such amounts and with such insurance companies as are reasonably acceptable to the Bank, insuring the
Collateral and the Collateral Real Estate, as applicable, against such risks as are specified by the Bank.
These policies of insurance shall include coverage for fire and physical damage and coverage known as
extended coverage. Each policy of insurance covering any portion of the Collateral or Collateral Real
Estate shall (a) show the Bank's security interest in such a manner that ail payments for damage or loss
shall be paid directly to the Bank, reflecting the Bank as a lender loss payee, and (b) provide that it shall
not be terminated, reduced in amount, or otherwise materially changed, without at least thirty (30) days'
prior written notice to the Bank. Upon request by the Bank at any time, and upon the execution of this
Agreement, the Borrower and the said Guarantors shall each deliver to the Bank satisfactory evidence of
compliance with this Section 6.07. The amount of coverage for insurance required by this Section 6.07
shall at all #imes equal or exceed one hundred percent (100%) of the insurable value of the Collateral or
Collateral Real Estate as applicable.
Section 6.08. Subordination of Borrower Debt to Guarantors. Al! principal payments owed by
Borrower to either or both Guarantors shall be fully subordinated in~payment to Bank, provided, however,
that regularly scheduled payments of interest shall be permitted so long as there is no Event of Default
under this Agreement or any of the Loan Documents. Guarantor shall execute a subordination agreemen#
(°Subordination Agreement') in form and content acceptable to Bank.
ARTICLE Vli
CONDITIONS PRECEDENT
Section 7.01. Conditions Precedent to the Loans. As a condition precedent to the execution
and delivery of. this Agreement and the availability of the Loan, the Bank shall, except as noted, have
received the following agreements, documents and instruments (in form and substance satisfactory to the
Bank and its counsel):
(A) The Notes.
(B) The Security Agreements, Aircraft Security Agreements, UCC-1 Financing
Statements, Mortgages, Guaranty Agreements and Subordination Agreement.
(C) Certified copies of resolutions of the directors of Borrower, evidencing approval of
this Agreement and the Loan Documents, and all other mafters contemplated by this Agreement.
(D) Certified copies of the Articles of Incorporation and By-Laws of the Borrower.
(E) UCC, judgment, lien and tax lien searches with respect to the Borrower and the
Guarantors, in form and content satisfactory in all respects to the Bank, which searches shall reveal
(without limiting the general nature of the foregoing) that the Bank will obtain (i) a first priority security
interest in all of the property set forth in.the Security Agreements and Aircraft Security Agreements, upon
execution of this Agreement, the Security Agreements and the Aircraft Security Agreements, and, as
applicable, the filing of appropriate UCC-1 financing statements, and (ii) a second and fourth lien
Mortgages, respectively, on the Collateral Real Estate I and Collateral Real Estate II, upon execution and .
recordation of the Mortgages.
(F) Certificates of Insurance in compliance with the requirements of this Agreement.
(G) Such other agreements, documents or instruments as the Bank or its counsel
may require to effectuate the purposes of this Agreement and the Loan Documents.
Section 7.02. Bank Commitment Fees. As a condition of each. Loan, Borrower shall pay to
Bank the following commitment fees:
$4,650,000.00 Term Loan $11,625.00
Line of Credit $ 2,500.00
$ 600,000.00 Term Loan $ 1,500.00
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
So long as the Notes or any of the indebtedness shah remain unpaid, whether absolute or
contingent, are outstanding, or this Agreement shall remain in effect, the Borrower represents and
warrants to the Bank that:
Section 8.01. Incorporation, Good Standing and Due Qualification. The Bon'ower is a corporation
duly incorporated, validly existing, and .in good standing under the laws of the jurisdiction of its
incorporation; has the corporate power and authority to own its assets and to transact the business in
which it is now engaged or proposed to be engaged; and, to the best of Borrower's knowledge, is duly
qualified as a foreign corporation and in good standing under the laws of each other.jurisdictton in which
such qualification is required except where failure to so qualify would not have a material adverse effect.
Section 8.02. Corporate Power and Authority. The execution, delivery, and pertormance by the
Borrower of the Loan Documents have been duly authorized by all necessary corporate action and do not
and will not (1) require any consent or approval of the shareholders of such corporation; (2) .contravene
such corporation's charter or bylaws; (3) violate any provision of or cause or result in a breach of or
constitute a default under any law, rule, regulation, order, writ, judgment, injunction, decree, determination,
or award presently in effect having applicability to such corporation; (4) cause or result in a breach of or
constitute a default under any indenture or loan or credit agreement or any other agreement, lease, or
instrument to which such corporation is a party or by which it or its properties maybe bound or affected; or
(5) cause or result in or require the creation or imposition of any Lien, upon or with respect to any of the
properties now owned or hereafter .acquired by such corporation except as contemplated by this
Agreement.
Section 8.03. Legally Enforceable Agreement. This Agreement is, and each of the other Loan
Documents when delivered under this Agreement wilt be, legal, valid and binding obligations of the
Borrower, enforceable against the Borrower in accordance with their respective terms, except to the extent
that such enforcement may be limited by applicable bankruptcy, insolvency, and other similar laws
affecting creditor's rights generally.
Section 8.04. Financial Statements; Accuracy of Information. All information, financial
statements, exhibits and reports famished by the Bon'ower to the Bank in connection with this Agreement
and the bon'owings contemplated hereby are, and all such information, financial statements, exhibits and
reports hereafter furnished by the Borrower to the Bank will be true and correct in every material respect
on the date famished to the Bank, and no such information, financial statements, exhibit or report contains
or will contain any material misstatement of fact or omits or will omit to state a material fact or any fact
necessary to make the statement contained therein not materially misleading.
Section 8.05. Labor Disputes and Acts of God. As of the date hereof, neither the business nor
the properties of the Borrower are affected by any fire, explosion, accident, strike, lockout or other labor
dispute; drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty
(whether or not covered by Insurance) materially and adversely affecting such business or properties or
the operation of the Borrower.
Section 8.06. Other Agreements. • The Borrower is not a party to any indenture, loan or credit
agreement, or to any lease or other agreement or instrument, or subject to any charter or corporation
restriction which could have a material adverse effect on the business, properties, assets, operations, or
conditions, financial or otherwise, of the Borrower or the ability of the Borrower to carry out its obligations
under the Loan Documents to which it is a party. The Borrower is not in default in any respect in the
pertormance, observance or fulfillment of any of the obligations, covenants, or conditions contained in any
agreement or instrument material to its business to which it is a party.
Section 8.07. Litigation. There is no pending or, to Borrower's knowledge, threatened action or
proceeding against the Borrower before any court, governmental agency, or arbitrator which may, in any
one case or in the aggregate, materially adversely affect the financial condition, operations, properties, ar
business of the Borrower or the ability of the Borrower to perfom~. its obligation under the Loan Documents
to which it is a party.
Section 8.08. No Defaults on Outstanding Judgments or Orders. The Borrower.has satisfied ail
material judgments and is not in default with respect to any judgment, writ, injunction, decree, rule or
regulation of any court, arbitrator, or federal, state, municipal, or other governmental authority,
commission, board, bureau, agency, or instrumentality, domestic or foreign.
Section 8.09. Ownership and Liens. The Borrower has title to, or valid leasehold interests in, all
of ifs respective properties and assets, real and personal, (other than any properties or assets disposed of
in the ordinary course of business), and none of the properties and assets owned by the Borrower is
subject to any Lien, except for existing purchase money liens, liens in favor of Bank, or liens permitted
hereby under Section 10.01.
Section 8.10. ERISA. Thee Borrower is in compliance in all material respects with all applicable
provisions of ERISA.. Neither a Reportable Event nor a Prohibited Transaction has occurred and is
continuing with respect to any Pian (as such terms are defrned in ERISA); no notice of intent to terminate
a Plan has been filed nor has any Plan been terminated; no circumstances exist which constitute grounds
under Section 4042 of ERISA enticing the PBGC to institute proceedings to terminate, or appoint a trustee
to administer a Plan, nor has the PBGC instituted any such proceedings; neither the Borrower nor any
ERISA Affiliate has completely or partiaAy withdrawn under Sections 4201 or 4204 of ERISA from a
Multiempioyer Plan; Borrower and each ERISA Affiliate are not subject to any minimum funding
requirements under ERISA with respect to any of their Plans and neither the Borrower nor any ERISA
Affiliate has incurred any liability to the PBGC under ERISA.
Section 8.11. Operation of Business. Borrower possesses all licenses, permits, franchises,
patents, copyrights, trademarks, and trade names, or rights thereto, to conduct its business substantially
as now conducted and as presently proposed to be conducted, and to its knowledge the Borrower is not in
violation of any valid rights of others with respect to any of the foregoing.
Section 8.12. Taxes. The Borrower has filed all -material tax returns (federal, state and local)
required to be filed and have paid all material taxes, assessments, and governmental charges and levies
thereon to be due, including interest and penalties,. except the filing of tax retums or the payment of taxes,
if any, being contested by the Borrower and disclosed to the Bank in writing.
Section 8.13. Debt. As of the date hereof, the Borrower is not indebted under any credit
agreement, indenture, purchase agreement, guaranty, Capitalized Lease, or other investment, agreement
or arrangement except as disclosed in the Borrower's financial statements or as otherwise disclosed to
the Bank in writing.
ARTICLE IX
. -AFFIRMATIVE COVENANTS
So long as the Notes or any of the Indebtedness shall remain unpaid, whether absolute or
contingent, are outstanding, or this Agreement shall remain in effect, the Borrower will:
Section 9.01. Maintenance of Existence. Preserve and maintain its corporate existence and good
standing in the jurisdiction of its incorporation, and qualify and remain qualified as a foreign corporation in
each jurisdiction in which such qualification is required except where failure to so qualify would not have a
material adverse effect.
Section 9.02. Maintenance of Records. Keep accurate records and books of account, in which
complete entries will be made in accordance with past practices of Borrower, using sound accounting
practices, consistently applied, reflecting all financial transactions of the Borrower.
Section 9.03. Maintenance of Properties. Maintain, keep and preserve all of its properties
(tangible and intangible) necessary or useful in the proper conduct of its business in reasonably good
working order and condition, ordinary wear and tear excepted.
Section 9.04. Conduct of Business; Permits and Approvals; Compliance with Laws. Continue to
engage in a commercially reasonable manner in a business of the same eneral
on the date of this Agreement; maintain in full force and effect, its franchises, and olio censer cted by it
trademarks, tradenames, contracts, permits, approvals and other rights necessary to the profitable
conduct of its business (except where the failure to maintain in full force and effect all such franchises,
licenses, patents, trademarks, trade names, contracts, permits, approvals and any other rights would not
have a material adverse effec# on Borr'ower's financial condition, results .of operations or business or
Borrower's ability to perform its obligations hereunder); and comply in all respects with all applicable laws,
rules, regulations and orders (except for such laws, rules, regulations and orders the violation of which
would not, in the aggregate, have a material adverse -effect on Borrower's financial condition, results.of
operations or business or Borrower's ability to perform it obligations hereunder).
Section 9.05. Maintenance of Insurance. Maintain insurance naming Bank as Lender Loss
Payee, with financially sound and reputable insurance companies or associations in the amounts and
covering such risks as set forth herein. ~ -
Section 9.06. Payment of Debt; Payment of Taxes, Etc. Promptly pay and discharge:
(1) All of its Debt in accordance with the terms thereof;
(2) All material taxes, assessments, and governmental charges'or levies imposed
upon it or upon its income and profits, upon any of its property, real, personal or mixed, or upon any part
thereof, before the same shall become in default; -
(3) ~ All lawful claims for labor, materials and supplies or otherwise, which, if unpaid,
might become a lien or charge upon such property or any part thereof;
provided, however, that so long as the Borrower first notifies the Bank of its intention to do so, the
Borrower shall not be required to pay and discharge any such Debt, tax, assessment, charge, levy or
claim so long as the failure to so pay or discharge does not constitute or result in a Default or an Event of
Default under the Notes and so long as no foreclosure or other similar proceeding shall have been
commenced against such property or any part thereof and so long as the validity thereof shall be
contested in good faith by appropriate proceedings diligently pursued and it shall have set aside on its
books adequate reserves with respect thereto.
Section 9.07. Reporting Requirements. Furnish to the Bank:
(1) Within one hundred twenty (120) days after the close of each fiscal year of the
Borrower, financial statements of the Borrower, including a balance sheet and related statements of
income, shareholders' equity, and changes in financial position, all in reasonable detail, together with all
supporting schedules and notes, prepared in accordance with GAAP and on a reviewed basis by
independent certified public accountants satisfactory to the Bank;
(2) Within thirty (30) days after the end of each month, management prepared
financial statements of the Borrower, together with all detail and supporting documents requested by
Bank, aged on a month-end basis only and prepared in accordance with GAAP;
14
(3) Such other information respecting the condition or operations, financial or
otherwise, of the Borrower as the Bank may from time to time reasonably request, including but not limited
to financial projections, tax returns, and listings of assets. Borrower shall deliver to Bank, within thirty (30)
days of filing, but no later than one hundred twenty (120) days after the Borrower's fiscal year end,
complete copies of all federal and state tax returns, each of which shall be signed and certified by
.Borrower to be true and complete copies of such returns;
(4) By May 1 of each year, signed personal financial statements and signed Federal
Income Tax Returns for each of the Guarantors; and
(5) Within thirty (30) days after the end of each quarter, complete accounts
receivable and accounts payable agings of Borrower, in form and content as required by Bank.
Section 9.08. Further.Assurances. Do such .further acts and things and execute and deliver to
-the Bank such additional assignments, agreements, powers and instruments, as the Bank may reasonably
require or reasonably deem advisable to cant' into effect the purposes of this Agreement or to better
assure and confirm unto the Bank its rights, powers and remedies hereunder.
Section 9.09. Cross-Default. Covenant and agree that all existing and future loan obligations of
Borrower shall be cross-defaulted.
Section 9.10. Banking Relationship. Although no compensating balances are required, maintain
its principal depository accounts and banking relationship, including, without limitation, all ,operating
accounts of Borrower, with the Bank.
Section'9.11. Business and Management Continuity. Conduct its business in substantially the
same manner and locations as such business is now conducted, maintain executive management
reasonably satisfactory to Bank and notify the Bank within five (5) Business Days prior to any proposed
change in the officers, directors or shareholders of Borrower.
Section 9.12. Financial Covenants.
measured annually at Bor ower's fis a!~ yearlendl~beginning Apr 130,12008. L abil ti soa a deft 3.v to 1.0,
liabilities less subordinated debt. Tangible net worth is defined as shareholder's a ui ned as total
debt, less all items properly classified as intangible. q tY~ plus subordinated
(b) Maintain a debt service coverage ratio of at least 1.25 to 1.0, measured annually
as of the end of Borrower's fiscal year. The debt coverage ratio is determined by dividing net income, less
dividends and distributions, plus interest expense and non-cash expenses, by al! principal and interest
payments (exclusive of payments under the Line of Credit) due within the applicable fiscal year.
ARTICLE X
NEGATIVE COVENANTS
So long as the Notes or any of the Indebtedness shall remain unpaid, or this Agreement shall
remain in effect, the Borrower will not:
Section 10.01. Liens. Create, incur, assume, or suffer to exist, any Lien upon or with respect to
any of its properties, now owned or hereafter acquired, except:
(1) Liens in favor of the Bank;
15
(2) Liens for taxes or assessments or other government charges or levies if not yet
due and payable or, if due and payable, if they are being contested in good fai#h by appropriate
proceedings promptly initiated and diligently conducted and for which appropriate reserves are maintained
and so long as no foreclosure, distraint, sale or other similar proceedings shat! have been commenced
with respect thereto;
(3) Liens, deposits, or pledges to secure the performance of bids, tenders, contracts
(other than contracts for the payment of money), leases (permitted under the terms of this Agreement), or
public or statutory obligations; surety, indemnity, pertormance, or other similar bonds; or other similar
obligations arising in the ordinary course of business.
(4) Existing purchase money Liens on equipment so long as each such Lien (i) exists
upon the same terms as those existing on the date hereof and (ii) does not secure indebtedness in a
principal amount greater than that outstanding on the date hereof and no additional assets are furnished
as Collateral to secure such Liens.
(5) Liens created and maintained in connection with the acquisition of equipment
after the date hereof, including Capitalized Leases, and attaching only to the property being acquired and
securing amounts not exceeding the purchase price.
Section 10.02. Debt. Create, incur, assume, or suffer to exist any Debt, except Debt of the
Borrower under this Agreement or the Notes and except:
(1) Accounts payable arising in the ordinary course of business.
(2) Indebtedness hereafter incurred in connection with a Lien permitted in Section
10.01 above, including debt for existing purchase money obligations and Capitalized Leases.
(3) Leases of equipment or vehicles from time to time by Borrower used in the
ordinary course of its business except for leases where the lease obligation does not exceed Fifty
Thousand Dollars ($50,000.00).
Section 10.03. Mergers, Etc. Merge or consolidate with, or sell, assign, tease, or otherwise
dispose of (whether in one transaction or in a series of transactions) all or substantially all of ifs assets
(whether now owned or hereafter acquired) to any Person, or acquire all or substantially all of the assets
or the business of any Person.
Section 10.04. Dividends. Declare or pay any dividends; or purchase, redeem, retire, or
otherwise acquire for value any of its capital stock now or hereafter outstanding; or make any distribution
of assets to its shareholders as such whether in cash, assets or obligations of the Borrower; or allocate or
otherwise set apart any sum for the payment of any dividend or distribution on, or for the purchase,
redemption, or retirement of, any shares of its capital stock; or make any other distribution by reduction of
capital or otherwise in respect of any shares of its capital stock, if such dividend, stock purchase, or other
action described in this paragraph would cause or result in the occun'ence of an Event of Default as
defined herein.
Section 10.05. Sale of Assets.. Sell, (ease, assign, transfer, or otherwise dispose of any of its now
owned or hereafter acquired assets except: (a) for inventory disposed of in the ordinary course of
business; (b) the sale or other disposition of assets no longer used or useful in the conduct of its business;
and (c) the sale or other disposition of assets provided the proceeds of sale are used either to pay down
existing term loans owed by Borrower to Bank or to purchase substantially similar replacement assets.
Section 10.06. Guaranties,.Etc. Assume, guarantee, endorse,.or otherwise be or become directly
or contingently responsible or liable, (including, but not limited to, an agreement to purchase any
obligation, stock, assets, goods, or services, or to supply or advance any funds, assets, goods, or
services, or to maintain or cause such Person to maintain a minimum working capital or net worth, or
otherwise to assure the creditors of any Person against loss) for obligations ~of any Person, except
guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business.
Section 10.07. Hazardous Materials; Indemnification. Use, generate, treat, store, dispose of or
otherwise introduce any Hazardous Materials info or on any real property owned or leased by it, except in
an environmentally safe manner through methods which have been approved by and meet all of the
standards of the federal Environmental Protection Agency and any other federal, state or local agency with
authority to enforce Environmental Laws. The Borrower hereby agrees to indemnify, reimburse, defend
and hold harmless the Bank and its directors, officers, agents and employees ("Indemnified Parties") for,
from and against all demands, liabilities, damages, costs, claims, suits, actions, legal or administrative
proceedings, interest, losses, expenses and reasonable attorney's fees (Jncluding any such fees and
expenses incurred in enforcing this indemnity) asserted against, imposed on or incurred by any of the
Indemnified Parties, directly or indirectly pursuant to or in connection with the application of any
Environmental Law to acts or omissions occurring at any time on or in connection with any real estate
owned or leased by the Borrower or any business conducted thereon. None of the aforesaid shall in any
way limit or restrict the right of Borrower to defend claims asserted against it or any of the Indemnified
Parties.
ARTICLE XI
EVENTS OF DEFAULT
Section 11.01. Events.of Default. If any of the following events (each an "Event of Default') shall
occur, subject to all applicable cure periods as set forth in the Notes:
(1) The Borrower shall fail to pay the principal of, or interest on, the Notes fee or any
other amount when due or declared due hereunder within fifteen (15) days of the date'such amounts are
due or declared due;
(2) The Borrower shall fail ~to comply with or pertorm when due any other term,
obligation, covenant or condition contained in this Agreement or in any of the Loan Documents and
Borrower shall not have cured same within thirty (30) days after notice thereof to Borrower;
(3) Any representation or warranty made by the Borrower in this Agreement or which
are contained in any certificate, document, opinion, or financial. or other statement famished at any time
under or in connection with any Loan Documents shall prove to have been incorrect in any material
respect on or as of the date made and the Borrower shall not have cured the effect of such false or
misleading statements within thirty (30) days after notice thereof to Borrower;
(4) A defaulf in the payment or pertormance of any obligation of the Borrower to the
Bank other than under this Agreement or the Notes and such default shall have continued uncured after
the giving of any required notice or past the expiration of any applicable grace or cure period;
(5) A default occurs under any of the Loan Documents and such default shall have
continued uncured after the giving of any required notice or past the expiration of any applicable grace or
cure period;
7
then, and in any such event, Bank may, upon notice to Borrower, terminate this Agreement, and~deciare
all amounts outstanding under the Loans and ail interest thereon and all other amounts payable under this
Agreement to be immediately due and payable; provided that upon the happening of a Default specified in
Section 11.01 {5), this Agreement shall terminate and the outstanding Notes and all interest thereon and all
other amounts payable thereunder shall be immediately due and payable without declaration or other prior
notice to the Borrower. Thereupon Bank shall have all of the rights and remedies available to it .under the
Loan Documents or otherwise at law or in equity. Except as otherwise provided herein, the Borrower
expressly waives any presentment, demand, protest or further notice of any kind.
ARTICLE XI!
CONFESSION OF JUDGMENT
Section 12.01.
(1) 1FA DEFAULT OCCURS~UNDER THIS LOAN AGREEMENT OR ANY OTHER
LOAN DOCUMENTS, BORROWER IRREVOCABLY AUTHORIZES AND EMPOWERS ANY
ATTORNEY OR ANY CLERK OF ANY COURT OF RECORD TO APPEAR FOR AND CONFESS
JUDGMENT AGAINST BORROWER FOR SUCH SUMS AS ARE DUE AND OWING ON THIS
AGREEMENT AND EITHER OF THE MOTES, WITH OR WITHOUT DECLARATION, WITH COSTS OF
SUIT, WITHOUT STAY OF EXECUTION AND WITH AN AMOUNT NOT TO EXCEED THE GREATER
OF FIVE PERCENT (5%) OF THE PRINCIPAL AMOUNT OF SUCH JUDGMENT OR FIVE THOUSAND
DOLLARS ($5,000.00) ADDED FOR COLLECTION FEES. IF A COPY OF THIS AGREEMENT AND
EITHER OF THE NOTES, VERIFIED BY AFFIDAVIT BY OR ON BEHALF OF THE BANK, SHALL
HAVE BEEN FILED IN SUCH ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL OF
THIS AGREEMENT AND THE APPLICABLE NOTE. THE AUTHORITY GRANTED HEREBY SHALL
NOT BE EXHAUSTED BY THE INITIAL EXERCISE THEREOF AND MAY BE EXERCISED BY THE
BANK FROM TIME TO TIME UNTIL ALL SUMS PAYABLE BY BORROWER UNDER THE NOTES
HAVE BEEN PAID IN FULL.
(2) Nothing herein shall prejudice, or be deemed a waiver of, any of Borrower's rights
under the Loan Agreement, the Security Agreements, or the Notes or any defenses the Borrower may be
entitled to pursuant to the Loan Agreement, the Security Agreements, or the Notes or pursuant to
applicable law.
ARTICLE X111
MISCELLANEOUS
Section 13.01. Amendments, Etc. No amendment, modification, termination, or waiver of any
provision of any Loan Document to which the Borrower is a party, nor consent to any departure by the
Borrower from any Loan Document to which it is a party, shall in any event be effective unless the same
shall be in writing and signed by the Bank, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. _
Section 13.02. Notices, Etc. All notices and other communications provided for under this
Agreement and under the other Loan Documents to which the Borrower is a a
(including telegraphic and telex transmissions and facsimile transmissions, if subje t to pre-establ shed
verification procedures) and mailed or transmitted and delivered,
if to the Borrower, at: Horsham Va-ley Airways, Inc.
450 Caredean Drive
Horsham, PA 19044
if to the Bank, at: FirstService Bank, a Division of National Penn Bank
Attention: Ronald Hartman, Senior ice President
320 West Street Road
Warminster, PA 18974
or, as to each party, at such other address as shall be designated by such party in a written notice to the
other party complying as to delivery with the terms of this Section 13.02. Except as otherwise provided in
this Agreement all such notices and communications shall, when mailed or telegraphed, be effective when
deposited in the mails or delivered to the telegraph company or sent, answerback received, respectively
addressed as aforesaid, except that notices to the Bank and Borrower pursuant to the provisions of Article
I1 shall not be effective until received by the applicable party.
Section 13.03. No Waiver; Remedies. No. failure on the part of the Bank to exercise, and no
delay in exercising, any right, power, or remedy under any Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right under any Loan Documents preclude any other
or further exercise thereof or the exercise of any other right. The remedies provided in the Loan
Documents are cumulative and not exclusive of any remedies provided bylaw.
Section 13.04. Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the Borrower and the Bank. and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights under any Loan Document to which the Borrower is a
party without the prior written consent of the Bank.
Section 13.05. Costs, Expenses, and Taxes. The Borrower agrees to pay (a} all costs and
expenses in connection wifh the preparation, execution, delivery, filing, recording and administration of
any of the Loan Documents including but not limited to the reasonable fees and out-of-pocket expenses of
counsel for the Bank, and local counsel who may be retained by said counsel, with respect thereto and
with respect to advising the Bank as to its rights and responsibilities under any of the Loan Documents; (b)
costs of inspection; and (c) ail costs and expenses, if any, in connection with the enforcement of any of the
Loan Documents including but not limited to the reasonable fees and out-of-pocket expenses of counsel
for the Bank and local counsel who may be retained by said counsel incurred by the Bank in connection
with the enforcement and collection of the Loans and the Loan Documents and with respect to advising
the Bank as to its rights and responsibilities under any of the Loan Documents. In addition, the Borrower
shall pay any and all stamp and other taxes and fees payable or determined to be payable in connection
with the execution, delivery, filing, and recording of any of the Loan Documents and the other documents
to be delivered under any such Loan Documents, and agrees to save tfie Bank harmless from and against
any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes
and fees, so long as such delay or omission is not caused by Bank.
Section 13.06. Right of Setoff. The Bank is hereby authorized at any time and from time to time,
without notice to the Borrower (any such notice being expressly waived by the Borrower), to set off and
apply any and all deposits (general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by the Bank to or for the credit or the account of the Borrower
against any and all of the obligations of the Borrower now or hereafter existing under this Agreement or .
any of the Notes or any other Loan Document, irrespective of whether or not the Bank shall have made
any demand under this Agreement or any of the Notes or such other Loan Document and although such
obligations may be unmatured. The Bank agrees promptly to notify the Borrower after any such setoff and
application, provided that the failure to give such notice shall not affect the validity of such setoff and
application. The rights of the Bank under this Section 13.06 are in addition to other rights and remedies
(including, without limitation, other rights of setoff) which the Bank may have.
Section 13.07. Governing Law. This Agreement and the Notes shall be governed by,. and
construed in accordance with, the laws of the Commonwealth of Pennsylvania.
Section 13.08. Severability of Provisions. Any provision of any Loan Document which is
prohibited or unenforceable (n any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions of such Loan Document
or affecting the validity or enforceability of such provision in any other jurisdiction.
Section 13.9. Survival of Agreement. All covenants, agreements, representations and warranties
made herein and in the certificates delivered pursuant hereto shall survive the making by the Bank of the
Loans and the execution and delivery to the Bank of the Notes and Loan Documents and shall continue in
full force and effect so long as the Notes or any amounts due hereunder are outstanding and unpaid.
Section 13.10. Headings. Article and Section headings in the Loan Documents are included in
such Loan Documents for the convenience of reference only and shall not constitute a part of the
applicable Loan Documents for any other purpose.
Section 13.11. Controlling Agreement. This Agreement shall be controlling, and take precedence
over, the Notes and Security Agreements, in the event of any inconsistency between the terms and
provisions hereof and the terms and provisions of any of the Notes or Security Agreements.
Section 13.12. JURISDICTION AND VENUE. IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER ARISING OUT OF OR RELATED TO THIS AGREEMENT
OR THE RELATIONSHIP ESTABLISHED HEREUNDER, THE BORROWER HEREBY IRREVOCABLY .
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED IN ANY COUNTY IN THE COMMONWEALTH OF PENNSYLVANIA WHERE THE BANK
MAINTAINS AN OFFICE AND AGREES NOT TO RAISE ANY OBJECTION TO SUCH JURISDICTION
OR TO THE LAYING OR MAINTAINING OF THE VENUE OF ANY SUCH PROCEEDING IN SUCH
COUNTY. THE BORROWER AGREES THAT SERVICE OF PROCESS IN ANY SUCH PROCEEDING
MAY BE DULY EFFECTED UPON IT BY MAILING A COPY THEREOF, BY REGISTERED MAIL,
POSTAGE PREPAID, TO THE BORROWER.
Section 13.13. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES TRIAL
BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF OR
RELATED TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED HEREUNDER. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE BANK TO ENTER INTO THIS AGREEMENT.
.._y :.. __ .,,,._. _.
_ ~___~__
--_.
_---.. _..--- - -- _ __.._. __._.. _.. _....:..._........: _.. _.. i
IN WITNESS WHEREOF, INTENDING TO BE LEGALLY BOUND HEREBY, the parties have
caused this Agreemen# to be executed by their respective officers thereunto duly authorized, as of the
date frst above written.
"Borrower"
HORSHAM VALLEY AIRWAYS, INC.,
a Pe vania Corp ' n
By.
Name: yt Bangs
Title: President I
"Bank"
FIRSTSERVICE BANK, A DIVISION OF
NATIONAL PENN BANK
By. ~ ,
Na e: Ronald Hartman .
' Titl Senior Vice President
J
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imaratl an tt» unpaid aNciPM DWna at vw nr and n tlr mamsr desalted e#w, urwN cent amowta ~'ra0.00_ _
owing wdar this LION a» ~ ~ Ww
recsiyed by landar sbaN a appNed lkst b aetxuad, urgli0 irlfMS#. thsn» unpaid P^~Pr. and than m Naa eh P~ N hll. JM amount
datarmirl0d by terldar. in Laridar'a aoN diadalgy as pNmiBad by law. ~ aWa a aKPamaR or in any otMt cedar as
NIITENEfT NRTE: Thin trola has a variable ir1lere# raN Nawrs. TIN irlNla;t raN on tl14 NOta may chanD 31rom ~: Nnw i1 tl» MWac Rqa idagiNad 6alow
ehvg.s. bNra# Nlell e. twrtlpu»d on tits Oaia d the. ~cLUaLn+sbez DLDOD~Yft_p]C~r
on tM NoN sIN1 bs odwleNd end p~y~py at a uuiabia raN equal m _--.-. p x Px yar. YNere#
ra» as this Nds quN be ._ _._. 5.0 DQ._% pw annum. Awtr dwpe in the Nwest wN PK tMruan t7oaz.. _8N YwNa Ra». The idNal k1Mra1
YII! 11117 OT i71~i t~il11GE IR TN1E IgLLy STRZZT D>ZIl~ ~T~ ~ a ahanpe is wa tMer FNeaw1 be Nla~ila~e on
INDEX RITE TM Mee Rata for tNe NON slttl ba:
T~ "7~ ANTE" pUBLISHIID IN THE "lfO1Rx R71TE8" SMLTIODi OT TfaE IDILy S1'Rlfi'!
rT0UR1E1L OX T3E >1PPLICABtE D11TE O>Z TEt HI~ST "pRZIQ Al-TE" I! Ip~ TEJ1A 0~ Z9
P0lLI$mfn 113 S1Jf]!Q 1D-TE 101! tSL1H1GE 7801( TIJQ ?O TIIe.
M eha Ylde: Rala is redaiiead ar tleevrnaa unavahWe, then Lalder tmy aefscl anoterr indaa whidt k subawhRy skrtaar.
RATE UMITATIONB: Subject m applieada la.., Yre minimum irtmare# raN on dlle Note MIM bs a/a 4,
rat on des NaN ahal rqt saved Pa anrwm. Tf» maailralm inNn#
Perminad to ~4< % Pw aMUm. or if len, Or N a ma,um,m QN is sot indicamad, tM rrtaKirralrrl ngsre# rats tsrKfer is
be -_ ~~ TMs meKlmum aN inersari d any ern time wet bs _ a/ a.,~ ~ madmum raN deapr at
'~ any om Nina wNl
DEFAULT RAT! B 11an N an EverN d DaYuN arldsr ttds Nds.1!» Lelwer may, in rte diaasiion, ineroasa the inlere# nts an this Nota m: THREE _ __
tERCpfT 1180'YE Y$ CORRdT IlOYE fit>-TE
P - ~~ ~~ permitNd b ehar0e by lair. srhiehewr is Ips. _.
PaY ~ Pr~wipai and irnsget aeoordirg m the IoNowinO tehaduN:
l0 payagnts Dt principal in ebe aa°unt of 567,454.55 pine acesuod istaireat begioniag AYma 15,
2008 and contirnLiap ^t asoatllly flee iattuvals tbaureaftez. >1 Baal
1?zincipal balance plus acxzuad iatarest is due aced payable on >t paYaaast °t ~° unpaid
peril 1 2009.
PfiEtAYMENT. fi# NON may bs Prepaid in pan or to tuB on or befo» Ns rrWtaNy date L_~witlt : Y. wAput penalty. N tltia Note OorrNixs rnala NNn one
Lsndir. N Hris No» is PreP+YoreM wil nd aNed Ms duce data or the anmunt d any aubeagwM NahNmeM, unleae aRraed m, h
prepaid in 1ul, Iflvn win Ds. flA miNmum Nnanw char0a of: , by flonoaa/ and
- -'----• CAPanaMYoh,
LATE (iNAROE: p a paymsm is naceiaao rttOn than 1S Cayce b», Borrower wit tta eh
unpaa lets paymsnt:i ~ • _.. _.. _. X 7.00 ar0ed a lame dwpe of: ~ - % d t11e
Y • realer - - - _. ._ % d the unpaid late payment or t 75.00
9 :~ less. as wrmiRed by Nw. . whkllnrar is
w,u~wrxi: ns11o eel siomNe - roc ~ w1uw11s l4ffpairrrwr mans
i CHECKED AS A MATERNL l4UCEaENr TO LEIVD91 TD MNIE THE LOAN EYIOENCED aw T1115
iiAfV ATTORNEY 011 TIIE f110TNONOTAIW OR CLERK ~ AYY tXNMT M TIE CONaa0t1YYFALTN ~ NEIRI~lVL KOl1 Y AUTHORIZES AND EMaOINER!
T BDIBDiaER fbR Nl S1Mm5 DlH UIIDER THiE MOTE pTNE11 LDANT DOpamHmi. AIO FDRKL A ro ~M A! ATTOIFtY i=pq
OOCt1aENi, AND TO Mlmlt!! {
AND ATTONIEv IEE3. TD0FIHER 1#TM Ir1TElE8i ON AIM dl00NIEe1i, AT THE itA}E OF WTEREa'T INTEIEii ON TgOtE AdOIR1TS COlT OF LINT.
Ct1Cli JUpGAIENT 1aaTa. THE FUII AM0IAIT ODE IFNDER a At:TUN.LY RECENED. lint NOTE. OR A COPY YBRIilEO IrrNOTE AFTER OEFAtILT. FROa1 TIE U71TRY OF
Dla: LENDER OIMNTED HERF.M AMY aE EXERCISED AS NEEDED FNDat TWE TD TaYE, AS OFTEN AS NEL` .s rrrr AFFa1AV1T..~ ~ A 9lIfT/1aENT tatwptlT.
D7LNi
PRESIDEMT
8<)RR07RER
T/ III~f1L7S. IAC.
TH6 WpTE.
Ltfay day. 1D08 .
tIORROMVER
aDRNOWEN
BORROWER
eORRDWER:
t10WtOWER'
Isonzsz t. Irrr+aF...rwa"AA",.,AC. nr:doll aoacrane
sECURm: To eacun ~.
dgb, tNe, Mrd Weprast ie a1 moni.~, qr ~ ~O~ntM ind+rnd urdar Ihis NoM, Bonorwr _
b to psealbet< N m aesigrpol ttrM an rww or~tly 1ut~un ~lar~~ s p ~ a fRA. ~ . outs aaremurrt and otlnrs
imtnanenl(e1 aer:arirg Kris (Vote b~ ra ~~ ^tK) ~ncutsd in oonnlc~on wipe firs Nob. arW any eoybry d! m yry otMr slgrRy ~ ....
CHECK PROCESg~p FEE. N a etycir to poceairtp ~ a~. ~.nnd.r for any~~ ~ ~. bus. tnrrr! an nsulticient twws in Borrower
oh~ng +a~1. lender wrN assess a tltack a
added b the priroipal baanw.
~~~ ;__. k durdred, this Note is a ronerrel bus not a aysreayon, d lean Number
i. EYENTS OF DEFAttLT'. M Ewm of T>`.~ AMD ODNWTION4 -- -
b actse hh Nob: L)ohah wNl occur under dos Noce M dte ewxn llret Brwroeyr. an
W t~ b maNe wr1' PaYrnme on yds Note a V guaramor or any drtyr tNrd pert' gedging coNataral
(b1 tttik b ptrrbwn any obNgayar a Lh' etlrar irreieWedrtese b Lender when dw:
K1 ProMdee aasuaan r~r~"9 ~r °~'~abt~a sarow~m leMir, '" t~s t'1o1s• a~ ~'Nf' ~strumanl, w wt' other Present tx
(dl>ww. eO^wY+ti a y ~M9 mOntlme a ropre»rtaion to be provided to Linda;
N) I~w i pvnipgrrl ~ O0~ m writwut~aP~el of Lender: dsaYOya. loa.e or darnape: wcb eogateru in
aeauro due Note a any of yreir pro ~ tdterJenenr or lien enhretl a served egatear Bartara, arty gwranbr, or any crud party pMdgrng rxnaeael b
m din, beoorrrn UpeliY inodrepeteeL y dresWwd a w^unate4
~1 fads b n ~ ~~evlderKe a sege4egpry tYtrroNt w'~ °t a°F b>'. uaoMm,Y a debtoro~r rshebigfafon~npromw~idthp; th. binNil
(h) has •
Pl r Lsrba~ ~~ of ~ No1d a ~ b anY Pasat a ently other then .nY Peron or emiry Ihat has the
in wafn Neell Myaarre due b a efgeNiCartt daarme ~~~ us W any real a propery seeurvlg peymem d pus Note. a Lender
good faits. bsyeese Ny proePeti of payrrynt a ~r/amattcs h i psrsonel
t RIGNTS OF LEIrDER ON EVENT OF DEFAL!<T. q tteae b an Event of Deleult urwar thta Noes. Lsntls win be emayd b aaercise one or more of tM
toMreirrg rerrredka wYhor aebes a demand (aroept b nyutrad by ye,1-
W to assess the Pfypptt ttmwnt plus aosruee! itderoq under yria Nob and aq oywr Priam and futon sore W Borrower imrnediattfy tlue and
Iol m osaa a h,N. swyr axweration ~rMi b. aubmatie and i N 1M Evan of Oehult k a dlinp undo pthr Code:
]b) m oaNsct the outtnergirrp obigefiale d Barower wdh a
makig advanea under yiy Noes a 'aO~'tg to ~~ prdcesa;
(d1 b glee posasesien W any mNereral in any mw~ier ~1N1een Baroawr and !..ender;
~) m mM• Nreae oMrenHa dhlpose d ~ a~~y m Larder any colfaf~i a a p~ ~~ m Borrowr and l,ender.
(g) m Belot! Bartnwr's obtgasons egeainet~y ~ t,~u y~ belrfn wqh err wYhord reaortin0 to b0a1 Prooas:
maiehbed wth lender; and etdwsirtg, but nq Horned b, ntonys, rnshumenp. and Oeposie erxourets
~~ `axMtdse d outer dgMa aveilebh m Crider untls any otMr wrMan agreamsM a aPPtkebla Itw,
rights are prmuWbe end may be saspsed bgetfrer, aaputdy, srd in my order. Lender s remedies ruder this paragraph are in addi4on b those
awilabte M aarrrrhdrt hw: htaludirrp, but not gmtes0 m, Mrs right of sepotf.
3 DEMAND FFJITURE. _ .. q etrscked, this Note oatpins a demand teab+re. Lender's rigtrt m demand paywrenL et art' time. and hom limo b time. shat he
in landef: sole end absoaae diaaeaort, eHlegter a not any dafsrdt has occrared.
s. FNLANOIAL ItIFOtIMATION. Borrower wN at eq bores lee
atxadMpe with gwlasyy aotwpted ~001^ting P'reciPUy err o w~71deMve~toL~ wttirn w w~h tuq. trw an0 cvnecl anYiq ahaq be made m
mpy of the annual tkrenolei setasntems of Borrower r ^s~Y WO) wya ethr Bts sod of each ysal err o}
b t4r~t ~ yser such aanenynla b irtdude (i) ens Da1Mwe sheet d Borrower as at tBO"OM e d of
aueh Nan! year and gifts nlgetl Ylmme stssarupen, swarryrtt of rsssireed larntnps aM tdemarwnt oT caNl lbw d Borower br oval Kcal yar, prapasd
amar~ie, a ooPY ~B orra'rrteenre ~~w rom ~ tbne. ~ rri ~D so-ees b waver m tender wghin tikeen (t~ days aha hfm~p
4 MQDINCATION AND ytMlBl. TM modirgden a finenoid inbrm~on wqh roapeat m Borrorrar as Lertwr may reptresL
wn~' a ~~~~ ~ Paforrn art' o/ Borrowry ~o61~a~~~,~ eox~a's riplKS unwr this Mots mop lx comrned in a
Nmlender arryeMS, ~ ~ e~~+,te a waMr an any ~ e~a~- ~~Q~d~u~ tlrs No~laessgh~ rw~ aftsc~led
ineu ~ 'PaNI in FiA' a~wMhro a sirrW~4lsrrd a any~ahM raeNesserys tsetp rp p w b ~ co'~ro~ a 9u+rrantor or any of
~ rid by tttal langeags end without waiving any ~ p p deeGgrirtg • PaY^'ynt ai foil ~eueadlon~ obggadona k~iewr~idunwr Nx~N wrthmrt being
PeMMrd of aq amouate owrny
in any N ~ P~^eion of tlris Able a iMaGd. r~epet or uMnlorwable. Me v
b+pMred ehenby. ~Y• bgafity, end aMoroaebiHy or Ms remauwrg prov~s~or~t shad not
7. ASSIONMENI'. Borrower agrwa not m aeapn any of earbwery riptas, romsdies a o
Larder. wNth by Lends in ip sole btu^s detoabed in this NWe r.ipwut dw prior wriNen oonant of
dsauibed to this'd~iout nova b ato a th- pda raorwm of ~n~ BO~O`~r agrees that UM.r a amitled m assign Borne w all of its righh and natsdes
a NOTICE.~ Myy noyce a otMr trontmuniceyon m be provided m eonortw a Lenwr under !hie Nob shaq 6e b writing and amt b the pertip at the
addresses dac-bed in ark Noes a arolr oyrM address as try pryer may In wrNiryl froro yntr b tkne.
aern~psyeta landeruu man~~ i~~ ~' ~ ~ use whidl opmPywMe Leedsr for the gnsrnien of usdd m Borrows undo Nris Nob. a which
of Pena>•yltrwaia V dstarat a breach ~atarrrrsyand~ end eondiyons d ems Nob. ahaq bs governed by ny laws of Ny sttrp
M paaasyllaslaia Urrlaes appgospb taw oondogorrs W leers 410b aAMI be gowrhetl by yra lawc of the state
loaned err F'wnttsYltraaia t>wewda otttenriae, Borravrer oarreertp b me lurisdicyoe end wow of any coon
to COLLECTIOft ~, To tlw aapm s~°O~ br L°n~• in its Oitreretinn, h tM swot of a pOd Proceetling odds ink Not..
panndted by taw. Boaesyr Area b pay Cantle's rrraonebp has and coop, irtdtrtling, but not ymiled b. has and
Lender, tMtsese maared by Luba M erd~• t PaeMgeb, derb end om>,Ahelsi. whether a nW such agornsy a e9en1 R an amp
bra not limited m, M tea and costs i ~ ~ amount dues a mbraeg any right a reeredy under eery pats, wheerer or not Writ K brought indu~ing
naered on apWM, et banlcpKy. and /or post-lud9mem collection action:.
t t. MISCELLANEOU6. ors pmts is P nN rbmr+arciar,
Borrower sprees b males aq psyrtrme b Leader M r• a businsab
~persan who endorsee flue Wola being tereanetl rind gamy addrats purposes Borrower and ladder agna that trine is of
wstwa preantrryM, demand for mated by Lando and in laertw United 9ws currency Borrower and
grossed agrnst Nov bdoro prowedveg apeimt Borrows ~ . notice of dfehtms Mid propel srq IuAyr warws any rats b rcgwro Len Ito
this Nop, and NuesAay be Mdirp uPar yy tyro. auooesebre sad won' ~ rdararoes b Bonoawr m This Nola atrall induw at of the parties
tarwr this NoM duy !w jeim antl erred!. bMomrayon of Borrower and Lander. q levers is moro than one s'9^wg
rotttreshd by Proper Alps! praaa. Thk Nog conesrrurtg this Nob rway qe itrperbd m r+edk reporeing egeneles and wN bpi maw M.agebN when
tyreot. repreaanta the aanpab and Nnephtpd uhdtrstart4ihp between Btxrmaer and Lender
rogadilg yra terms
12 JIIgY TRIAL MAly9i. ~~ A~ HERLS3Y 1MAIYE /INY RKiMT TO A TRIAL by JtAIY IN Airy CIU1L ~~ ARISINQ OUT OF, OR
BASED UPON. TNQ NOTE OR Tt1E COLLATERAL SECUIpNB THIS NOTE.
11 AGOITI~W. TERMS:
~P~ r rr.d.rc.wRWtrardrana.tic. p:aroq Welroe-erns
mi
s
~~
~o
o g
~ g
~ m
m
FIRSTSERVICE BANK
A pN151ON OF NATIt3PIAL PENN BANK
TERM NOTE
October 23, 2008
INTENDING TO BE LEGALLY BOUND, and for value received, the undersigned, whether one or
mare persons, partnerships, corporations or other entities (jointly and severally "Borrower") agree as
follows:
~ . OWiaation.
Borrower promises to pay to the order of FIRSTSERVICE BANK, a Division of
NATIONAL PENN BANK (S ~ 000 a00 ~~f ~tLoan )1 togeihe~r wth pntere tl in acco dance w~i1h the
FOUR MILLION DOLLAR
Payment schedule set~fonrte t')edated even tdate herewit~h.~'tAny cap taezed terms which re I not defined
Agreement ("Loan Agr
herein shall have the meaning ascribed thereto in the Loan Agreement.
2, Payment Schedule.
(a) Beginning one (1) month from the date of this Note, and thereafter on tt~e same
day of each succeeding month, Borrower shall reps nt t~hePramrncountsof Thirty FiveotThousandn~ Ddla9s
successive monthly installments of principal each
($35,000.00), pluual t the remaining bt ancetof he ununpaid rSmc palpSum together with allacc~ ued tunpaid
Maturity Date eq
interest and all obaelance tog her w~~ith alaaccrued but unpaid nle eostuand all othe~charges due~hereunder
unpaid prinapa
shall be due and payable without further notice on the fifth (5th} anniversary of this Note ("Maturity Date .
{b) The annual interest rate for this Note is computed on 3306 aati0 bmuslltipliedtbytha
applying the ratio of the annual interest rate over a year of three hundred sixty ( ) Ys.
outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.
(c) All payments will be applied first on account of interest, thereafter on account of any
other unpaid charges due Lender and thereafter on account of prinapal.
(d) Borrower acknowledges and agrees that the entire rem~rring unpaid principal
balance toget he ~ aTHIS A BALLOON OBLIGATIONU THE REGULARLY SCHEDULED PAYMENTS
from the date
OF PRINCIPANCEI OF PRINCIPAL ANDOALL ACCRUED BUN UNPAID NTEREST BECOMES DUEINAND
UNPA1O GALA
PAYABLE IN FULL.
3_ Preaavrn~t.
In the event Borrower in any one year (year defined by anniversary date of this Note),
prepays an aggregate amount which exceeds a sum equal to two Percent (2%) of the original principal
amount of this Note, exclud'ng the total amount of all scheduled payments, ~e Lender maY deliver to
Borrower a written notice of the amount (the "Prepayment Premium") determined by the Lender to be the
difference between: (a) the present value of the interest payment that would have been paid in the future
to the Lender by the Borrower on such prepaid portion of praicipal; this present value calculation being
computed on a monthly basis, applying the interest rate in effect under the Note on the date of
Prepayment for a period equal to the remaining Note term on the total amount of principal prepaid; and (b)
the present value of the interest payments that would be paid in the future to the Lender, if the Lender
were to reirnest the prepaid principal at the U.S. Treasury Rate plus one and one-half percent (1.50%) for
a period equal to the remaining Note term.
The U.S. Treasury Rate shall be the interest rate payable on U.S. Treasury issues with a
maturity date in the same month and year as the maturity date of this Note. The above notwithstanding,
the prepayment premium shall not be less than one percent (14'0) of the original loan amount.
assessed if this Note is~refinanced n anly manner by another financialr nsf t tion oPother enfity.dl only be
4. Late Charge.
If any payment which is to be made hereunder is not paid within fifteen (15) days after the
date when due, the Borrower shall pay to the Lender a late charge of seven cents ($0.07} for each ddlar
which is so overdue, but not less than S75.D0, for the purpose of defraying the expense incident to
handling such delinquency. This provision shall not be deemed to affect or lengthen the time to cure any
default hereunder.
$• Collateral.
As additional security for all indebtedness to Bank now or hereafter incurred by Borrower,
under this Note, Borrower grants Bank a lien upon and security interest in any securities, instruments or
other personal property of Borrower now or hereafter in Bank's possession and in any deposit balances
now or hereafter held by Bank for Borrower's account and in all proceeds of any such personal property or
deposit balances. Such liens and security interests shall be independent of Banks right of setoff. This
Note and the indebtedness evidenced hereby shall be additionally secured by any hen or security interest
evidenced by a writing (whether now existing or hereafter executed) which contains a provision to the
effect that such lien or security interest is intended to secure (a) this Note or indebtedness evidenced
hereby or (b) any category of liabilities, obligations or the indebtedness of Borrower to Bank wh~h
includes thLs Note or the indebtedness evidenced hereby, and all property subject to any such lien or
security interest shalt be collateral for this Note.
6• Set-Off.
As additional security for the aayment of this Note and any renewal, extension or
modification of this Note and for the due payment of any and all other obligations, direct or indirect, due or
to become due, now existing or hereafter contracted, of Borrower. Bon'ower agrees that Lender shah have
a lien upon and a security interest in and a right of set-off against any and all present. future and after-
acquired funds, monies, balances, stocks, bonds, notes and other property at any time in the hands of
Lender in which Borrower has an interest. except that Lender shall have no right of set-off agarctst, no lien
upon or security interest in any IRA or any other retirement account which is deemed distributed if pledged
as collateral under applicable law.
T• Default.
Upon the happening of any of the fdlowing events, each of which shall constitute an
Event of Default hereunder, ell liabilities of Borrower to Lender, at the option of Lender, shall become
immediately due and payable:
4
{a) Failure of Borrower to pay the principal or Merest on this Note when due or on
arty renewal, extension or other modifigtion of this Note or failure to pay when due any interest or
installment on any other obligation of any nature whatsoever owing to Lender;
(b} Failure of Borrower or any Guarantor (as defined in the Loen A~eement
accompanying this Nofe) to perform arty obligation owing to Lender under this Note or any agreement with
Lender or breach of any representation, warranty, covenant or agreement herein contained or contained in
any other agreement now or hereafter entered into between Borrower or any Guarantor and Lender;
(c} FaJure of any business orgar~zation in which Borrower or any Guarantor has an
ownership interest, to perform any obligation owing to Lender under any note, mortgage, loan agreement or
any other agreement with Lender or breach of any representation, warranty or covenant therein contained or
hereafter entered into between such business organaation and Lender;
{d) The filing of bankruptcy, receivership or insolvency proceedings of any kind by or
against Borrower or any Guarantor, the making by Borrower or any Guarantor of art assignment for the
benefit of creditors, the suspension of business by Borrower or any Guarantor or the death of any
principal, shareholder, officer or member of Borrower;
(e} The institution of any legal or equitable proceedings against Borrower or arty
Guarantor;
(f) The entry of a judgment against Borrower or any Guarantor,
{g) The issuance of any writs of attachment or execution against Borrower or any
Guarantor;
(h) The furnishing of materially false inforrrtafion heretofore or hereafter by Borrower
or any Guarantor to Lender or the refusal by Borrower or any Guarantor to provide material information
hereafer;
(i) Any change in the financial condition of Borrower or any Guarantor which causes
Lender in good faith to believe that Performance of the obligations herein is impaired or doubtful;
{l) The occurrence of any event of default as defined in the Loan Agreement or in
any other Loan Document.
{k) The guaranty of any Guarantor ceases to be effective for any reason or the death
of any Guarantor.
{I) The dissolution, merger, consolidation, or the sale or change in control (as control
is defined in Rule 12b-2 under the Securities Exchange Act of 1934) of Borrower, or transfer of any
substantial portion of any of Borrower's assets, or if any agreement for such dissolution, merger,
consolidation, change in control, sale or transfer is entered into by Borrower, without the written consent of
Lender.
Notwithstanding the foregoing, if any Event of Default, other than a default in payment, is
curable andrf Borrower has not been given a notice of a breach of the same provision of this Note within
the preceding twelve (12) months, ii may be cured (and no Event of Default will have occurred} if
Borrower, after receiving written notice from Lender demanding cure of such Default: (a} cures the default
within thirty {30} days; or (b) if the cure wires more than thirt 30 da
which Lender deems in Lenders soled cretion to be sufficient to cure the defaultyand t ereaReS
continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical.
3
8• Remedies Uoon Default.
Should any event of default occur and not He cured in accordance with Paragraph 7,
(a} the entire unpaid balance of the principal sum with interest accrued thereon at the
rates hereinbefore specified to the date of said default, and thereafter at the rate of 396 above the rate
extant on the date of default (the "DefauR Rate`) and alt other sums due by Borrower hereunder or under
the Loan Agreement, shaft, at the option of Lender, and without notice to Borrower, become due and
payable immediately.
(b) Lender may forthwith appropriate and apply on account of the amount payable
hereunder, any and all funds, monies, or sums deposited with lender to the credit of Borrower, or liquidate
and set any collateral in the hands of lender in which Borrower has an interest, except that Lender shall
have na power to appropriate or liquidate any IRA or any other retirement account which is deemed
distributed if pledged as collateral under applicable law.
(c) In addition, Lender may attach, levy or execute upon and sett any other assets of
Borrower and exercise any other rights or remedies available to Lender under the Uniform Commercial
Code, any other applicable law, or under the Loan Agreement or any cdtateral or security documents
executed by Borrower or Guarantor in accordance with the Loan Agreement
(d) Following the date of any default, interest at the Default Rate shall accrue and
compound on the principal balance due and on all interest, charges, assessments, costs and fees then or
thereafter due hereunder. In such pse, Lender may also recover all costs of suit and other expenses in
connection therewith (including, but not limited to, costs and attorney fees incurred in any insolvency or
bankruptcy proceeding, or any negotiations related thereto, involving Borrower or any other person or
entity if such proceedings shah in any way jeopardize Lender's security or collateral or in any way limit or
impair Lender's ability to enforce a claim against any security or collateral provided for this Note}, and also
an attorney's commission for collection of 59'0 of the full amount due hereon but not less than FIVE
THOUSAND DOLLARS (55,000.00).
9. Remedies Cumulative.
The rights and remedies of Lender as provided in this Note shall be cumulative and
concurrent and may be pursued separately, successively or together against Borrower at the sole
discretion of Lender and may be exercised as often as occasion therefor shall arise. Borrower hereby
waives presentment far payment, demand, protest, notice of protest and dishonor and all other notices or
demands in connection with the delivery, acceptance, performance, default or enforcement of this Note.
The liability of Borrower hereunder shalt be unconditional without regard to the liability of any other party
and shall not be in any manner affected by any indulgence. extension of time, renewal. waiver or
modification granted or consented to by Lender. Lender shall not by any ad or omission or under any
circumstances be deemed to have waived any of its rights other than any rights waived by Lender in
writing. Any reference herein to Borrower shall be deemed to refer to and be applicable to each signer
separately as well as all of them jointly. If this Note shall be paid by any Borrower, Lender may srxrender
this Note and alt security pledged with it to the one so paying, Lender is hereby authorized. without furfher
notice, to obtain the signature of additional co-makers and to date this Note as of the date on which the
loan is made.
10. Confession of Judgment.
80RROWER HEREt3Y AUTHORIZES AND EN-POWERS T E PROTHONOTARY OR CLERK UNDER.
ATTORNEY OF ANY COURT OF RECORD TO APPEAR FOR AND CONFESS JUDGMENT THEREIN
4
AGAINST BORROWER, WITH OR WITHOUT DECLARATION FILED OR ANY OF Typyl FOR THE
AMOUNT WHICH FROM THE FACE HEREOF MAy gppEAR TO BE DUE HEREIN, PLUS THE
GREATER OF 5°r6 OF THE PRINCIPAL AMOUNT OF SUCH JUDGMENT OR FNE THOUSAND
DOLLARS ($5,000.00) ADDED FOR COLLECTION FEES. BY SIGNING THIS NOTE, BORROWER
ACCEPTS THE COLLECTION FEE AS BEING REASONABLE AND APPROVES SAID FEE. THE
AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT AGAINST BORROWER
SHALL NOT BE EXHAUSTED 8Y THE INITIAL EXERCISE THEREOF, AND THE SAME MAY BE
EXERCISED FROM TIME TO TIME, AS OFTEN AS LENDER SHALL DEEM NECESSARY qNp
DESIRABLE, AND THIS NOTE SHALL BE SUFFICIENT WARRANT.
(b} BORROWER ACKNOWLEDGES THAT THE FULL LEGAL SIGNIFICANCE OF
THE CONFESSION OF JUDGMENT CLAUSE SET FORTH ABOVE HAS BEEN CAREFULLY
EXAMINED BY BORROWER AND BORROWER DOES HEREBY ACKNOWLEDGE THAT BORROWER
HAS SIGNED THIS NOTE KNOWINGLY, VOLUNTARILY AND UNDERSTANDINGLY, AND WITH
KNOWLEDGE THAT, LENDER MAY CAUSE JUDGMENT TO BE CONFESSED AGAINST BORROWER
WITH OR WITHOUT DEFAULT, AND UPON ANY DEFAULT IN THE OBLIGATIONS OF BORROWER,
MAY CAUSE EXECUTION TO ISSUE AND AS THE RESULT, THERE MAY BE A JUDICIAL SALE OF
REAL, PERSONAL OR MIXED PROPERTY BELONGING TO BORROWER. BORROWER yAS
ACCESS TO LEGAL COUNSEL AND WANES ANY RIGHTS TO HAVE A MORE DETAILED
EXPLANATION OF BORROWER'S LEGAL RIGHTS UNDER THIS NOTE AND OF THE EFFECT OF
THE CONFESSKN OF JUDGMENT CLAUSE.
'- ~ ~ Consent to Jurisdiction and Venue.
IN ANY LEGAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY. ANY
MATTER ARISING OUT OF OR RELATED TO THIS NOTE OR THE RELATIONSHIP EVIDENCED
HEREBY, EACH UNDERSIGNED PARTY HEREBY IRREVOCABLY SUBMITS TO 7HE
NONEXCLUSIVE JUR[SDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN ANY CO(1NTY
IN THE COMMONWEALTH OF PENNSYLVANIA INHERE LENDER MAINTAINS AN OFFICE, AND TO
THE JURISDICTION OF ALL APPELLATE COURTS TO WHICH AN APPEAL MAY BE TAKEN
THEREFROM, AND AGREES NOT TO RAISE ANY OBJECTION TO SUCH JURISDICTION OR TO
THE LAYING OR MAINTAINING OF THE VENUE OF ANY SUCH PROCEEDING IN SUCH COURT.
EACH UNDERSIGNED PARTY AGREES THAT SERVICE OF PROCESS IN ANY SUCH PROCEEDING
MAY BE DULY EFFECTED UPON IT BY MAILING A COPY THEREOF, BY REGISTERED MAIL,
POSTAGE PREPAID, TO EACH UNDERSIGNED PARTY.
1z• Waiver of Jurv Trial.
EACH UNDERSIGNED PARTY HEREBY WAIVES, AND LENDER BY ITS
ACCEPTANCE HEREOF THEREBY WAIVES, TRUIL BY JURY IN
INVOLVING DIRECTLY OR ~VDIRECTLY, ANY MATTER ANY LEGAL PROCEEDING
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF OR RELATED TO T-~ SI NOTE OR THEE
RELATIONSHIP EVIDENCED HEREBY. THIS PROVISION iS A MATERIAL INDUCEMENT FOR
LENDER TO ENTER INTO, ACCEPT OR RELY UPON THIS NOTE.
"Bon'ower~
HORSHAM VALLEY AIRWAYS, INC.,
a Pennsytv nia Corp ration
By:
Nam }~yt 13a (SEAL}
Title: President
5
* 4
VERIFICATION
Bryan S. Lebo hereby states that he is a Senior Vice President of National Penn Bank,
f/t/a FirstService Bank, and as such, he is authorized to make this Verification on its behalf, that
he has read the statements contained in the foregoing Complaint in Confession of Judgment, and
that the statements contained therein are true and correct to the best of his knowledge,
information and belief. The undersigned also understands that these statements are made subject
to the penalties of 18 Pa.C.S.A. § 4904 relating to unsworn falsification to authorities.
Dated: ~ ' ~ ' ~00~
PHII.1 836324-1
FlLED-0~ SCE
OF ?Hc ~1~~4TAPY
1QQg APR - 8 AM 10~ 5 ~
$ 7 , SO ~. ~ 1 l~ ~ c ~i ~ ~Hr~ pan ~ P4-rvc~ ~ .~k~ .
~-
ck ~ ~5' ~
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512, .
Plaintiff,
v.
HOYT BANGS and ALICE P. BANGS :
1054 Derwydd Lane
Berwyn, PA 19312, :
Defendants. .
Civil Action
No. 0 9 - ~ .~ b ~ C , ~; l
AFFIDAVIT
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF BERKS
SS.
Bryan S. Lebo, being first duly sworn upon his oath according to law, deposes and says:
1. I am a Senior Vice President of National Penn Bank, f/t/a FirstService Bank, the
plaintiff herein, and I am authorized to make this affidavit on its behalf.
2. The instruments attached as exhibits (the "Instruments") to the Complaint in
Confession of Judgment filed in this matter are true and correct copies of the original
Instruments.
3. The defendants are in default of their respective obligations under the
Instruments, as more fully set forth in the Complaint in Confession of Judgment.
PHILI 836324-1
4. By reason of the defendants' defaults under the aforementioned Instruments, as of
March 31, 2009, there is due and owing to the Bank the aggregate amount of $17,048,274.49, as
follows (all terms shall have the meanings ascribed to them in the Complaint in Confession of
Judgment):
AUGUST 2003 LOAN:
Principal: $ 2,491,914.84
Interest
(as of 3/31/2009): $ 6,741.88
SUBTOTAL: $ 2,498,656.72
MARCH 2004 LOAN:
Principal: $ 906,859.17
Interest
(as of 3/31/2009): $ 13,807.27
Late Chazges: $ 63,480.14
SUBTOTAL: $ 984,146.58
NOVEMBER 2005 LOAN:
Principal: $ 770,195.82
Interest
(as of 3/31/2009): $ 21,673.82
Late Charges: $ 5,451.52
SUBTOTAL:
2
$ 797,320.62
PHILI 836324-1
r
APRIL 2006 LOAN:
Principal: $ 1,470,355.78
Interest
(as of 3/31/2009): $ 40,501.77
Late Charges: $ 6,827.78
SUBTOTAL: $ 1,517,685.33
JANUARY 2007 LOAN:
Principal: $ 2,046,538.40
Interest
(as of 3/31/2009): $ 68,348.67
Late Charges: $ 8,810.16
SUBTOTAL: $ 2,123,967.23
MAY 2007 LOAN:
Principal: $ 2,436,752.06
Interest
(as of 3/31/2009): $ 77,625.96
Late Charges: $ 23,767.20
SUBTOTAL: $ 2,538,145.22
MAY 2008 LOAN:
Principal: $ 337,591.24
Interest
(as of 3/31/2009): $ 4,910.46
Late Charges: $ 4,033.66
SUBTOTAL: $ 346,535.36
3
PHILI 836324-1
J
OCTOBER 2008 LOAN:
Principal: $ 3,909,150.00
Interest
(as of 3/31/2009): $ 96,767.93
Late Charges: $ 12,211.52
SUBTOTAL:
TOTAL FOR ALL LOANS:
ATTORNEY'S FEES
(15% per Guaranty):
$ 4,018,129.45
$14,824,586.51
$ 2,223,687.98
GRAND TOTAL: $17,048,274.49
Interest continues to accrue on the Loans from and after March 31, 2009 at the aggregate daily
rate of $3,014.06901, which aggregate daily rate is subject to fluctuation as the interest rates in
the applicable Loan Documents fluctuate.
5. The allegations contained in the Complaint in Confession of Judgment are true
and correct to the best of my knowledge, information and belief.
Bryan S.
SWORN TO and SUBSCRIBED
before me this 1' day
of Apri12009.
TAR P IC
COMMONWEALTH OF PENNSYLVANIA
Nobriad seat
Kimberly M. Anthony, Notary PubNc
BoysrlOwn BOrO, Barka County
My Commleelan May 27, 2012
Member, PennsyNa~e Aesodetlon of Notarba
4
PHII.1 836324-1
~~{~'~~
of ;~ ~;~;~~,,.,~,03-
2Q09~PR -8 ~~} I!: ~p
Ct,~~~J
Y" 1
l~ ~ti~Y~ ~~;~~il=~
w
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues Civil Action
Boyertown, PA 19512,
Plaintiff, No. GtC~ - 01 ~ ~ ~ c : v ~ I
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312,
Defendants.
AFFIDAVIT OF ADDRESSES, NON-MILITARY SERVICE AND
CONJUGAL INCOME
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF BERKS
SS.
Bryan S. Lebo, being first duly sworn upon his oath according to law, deposes and says:
1. I am a Senior Vice President of National Penn Bank, f/t/a FirstService Bank, the
plaintiff herein, and I am authorized to make this affidavit on its behalf.
2. The plaintiffs address is Philadelphia and Reading Avenues, Boyertown,
Pennsylvania 19512.
3. The last-known address of each defendant is 1054 Derwydd Lane, Berwyn,
Pennsylvania 19312.
PHIL1 836324-1
r ~
4. Neither defendant is in the armed forces of the United States of America or its
allies or otherwise subject to the provisions of the Soldiers' And Sailors' Civil Relief Act of
1940, as amended, or the Servicemens' Civil Relief Act.
5. Upon information and belief, at all relevant times, the annual household income
of each of the defendants exceeded $10,000.00.
SWORN TO and SUBSCRIBED
before me this-day
of Apri12009.
TAR PU C
COMMONtfiIEALTH OF PENNSYLVANIA
Notarial Seal
Kimberly M. Anthony, Notary PubNc
Boyertanm Born, Becks County
My Commission Expires 27, 2012
AAemher PennsyNanfa Aasodadon Of Notaries
2
PHILI 836324-I
..
t)f~}'
2Qdg,~P~ _8 ~~,. • a
-o
CU~~~ s~':~. w
R~~~~•5~~~ ~~ ~
1 ~t
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512,
Plaintiff,
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312,
Defendants.
Civil Action
No. 6,c~ - ~.2d ~ c;v~~
AFFIDAVIT OF LENDER
COMMONWEALTH OF PENNSYLVANIA
SS.
COUNTY OF BERKS
Bryan S. Lebo, being first duly sworn upon his oath according to law, deposes and says:
1. I am a Senior Vice President of National Penn Bank, f/t/a FirstService Bank, the
plaintiff herein, and I am authorized to make this affidavit on its behalf.
2. This is not an action by a seller, holder or assignee arising out of a retail
installment sale, contract or account.
3. The underlying transaction was not a consumer credit transaction, as defined by
Pa.R.Civ.P. 2950.
PHILI 836324-1
1 ..,~
SWORN TO and SUBSCRIBED
before me this ~~Gday
of Apri12009. _
Notarfel Seal
Kimberly M. nrrtnony, Notary Public
Boyertown eoro, Barks County
My Comnrbeion ExpNas May 27.2012
PHIL,1 836324-1
~,»~ +~
~r-
2139 aPR -8 Aft II= 00
~ ~a
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
NATIONAL PENN BANK, f/t/a
FIRSTSERVICE BANK
Philadelphia and Reading Avenues
Boyertown, PA 19512,
Plaintiff,
v.
HOYT BANGS and ALICE P. BANGS
1054 Derwydd Lane
Berwyn, PA 19312,
Defendants.
Civil Action
No. `
D~~~ ~-2D ~ cr~~
AFFIDAVIT OF BUSINESS TRANSACTION
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF BERKS
SS.
Bryan S. Lebo, being first duly sworn upon his oath according to law, deposes and says:
1. I am a Senior Vice President of National Penn Bank, f/t/a, FirstService Bank, the
plaintiff herein, and I am authorized to make this affidavit on its behalf.
2. The transaction represented by the instruments attached to the Complaint in
Confession of Judgment filed in this matter was a business transaction and was not entered into
for personal, family or household purposes.
PHILl 836324-1
~ , •~
SWORN TO SUBSCRIBED
before me this day
of Apri12009.
ARY IC
ca~MONw~n~! of PErp~s~.v
ivoar»+ s.~
aim eoro, ea*sCour~ty
My Commissla- ExpMa May n~ Z012
Member, Pennsyprania Aasodation of NOb~tNs
PAIL,1 836324-1
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