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HomeMy WebLinkAbout11-5833IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, Plaintiff, VS. JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. CIVIL DIVISION NO.: !1- i % (re'm CONFESSION OF JUDGMENT c 3 ern c - ? 2M r r-- -C D rev C) ?--2 --4 :X 6-n Pursuant to the authority contained in the aforesaid Note and the Guaranty, copies of which are attached to the Complaint filed in this action, I appear for the Plaintiff and confess judgment in favor of Plaintiff and against Defendants as follows: Principal $ 566,630.38 Interest through 7/8/11 $ 7,419.47 Late Charges $ 1,027.68 Other Charges/Fees $ 55.00 Attorney's Fees and Costs $ 57,404.98 (10% of Unpaid Principal & Accrued Interest) TOTAL $ 632,537.51 with interest on the principal sum of ($566,630.38) from July 8, 2011 at $66.89 per diem. BY: Scott A. IPN4c 1Qk,,Fsqui Attorneys for Defendants PRO HAC VICE PA I.D. # 55650 P.O. Box 650 Hershey, PA 17033 (717) 533-3280 CK 0 *317-50 pa Am/ C* Sot(O e,a& 2,210 ?6+? IN THE COURT OF COMMON PLEAS OF rnrn r CUMBERLAND COUNTY, PENNSYLVANIA xt?'-- r,-, ORRSTOWN BANK, Plaintiff, vs. C'nY> N ? - T1 CIVIL DIVISION ?o r- zC y ?cs NO.: 3 -{ -e JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. TYPE OF PLEADING: CIVIL ACTION - COMPLAINT IN CONFESSION OF JUDGMENT TO: DEFENDANT(S) YOU ARE HEREBY NOTIFIED TO PLEAD TO THE ENCLOSED COMPLLFR THIN TWENTY (20) DAYS FROM SERVIIHEA?FAUL T JUDGMENT MAY BE ENT ED YOU. ATTORNEY I HEREBY CERVFY THAT THE ADDRESS OF THE PLAINTIFF IS: P.O. Box 250 Shippensburg, PA 17257 AND THE DEFENDANT(S): Jack K. Hench & Lois A. Hench 5450 Westbury Drive, Enola, PA 17025 Ye Olde Ale House, Inc. 5002 Carlisle Pike, Michanicsburg, PA 17050 FILED ON BEHALF OF: Orrstown Bank, Plaintiff COUNSEL OF RECORD FOR THIS PARTY: Scott A. Dietterick, Esquire Pa. I.D. #55650 JAMES, SMITH, DIETTERICK & CONNELLY LLP P.O. BOX 650 Hershey, PA 17033 (717) 533-3280 IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, vs. Plaintiff, JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. CIVIL DIVISION NO.: '' , 6-g- S _ C,: ( .4&r;&. CIVIL ACTION - COMPLAINT IN CONFESSION OF JUDGMENT And now comes Orrstown Bank by its attorneys, James, Smith, Dietterick & Connelly, LLP, and files this Complaint in Confession of Judgment as follows: 1. Orrstown Bank ("Plaintiff') is a financial institution under the laws of the United States of America, with its principal place of business located at P.O. Box 250, Shippensburg, Pennsylvania 17257. 2. Defendants, Jack K. Hench and Lois A. Hench, are adult individuals residing at 5450 Westbury Drive, Enola, Pennsylvania 17025. 3. Defendant, Ye Olde Ale House, Inc., is a company authorized to conduct business in the Commonwealth of Pennsylvania, with an address of 5002 Carlisle Pike, Mechanicsburg, Pennsylvania 17050. 4. On or about December 20, 2002, Defendants, Jack K. Hench ("Mr. Hench") and Lois A. Hench ("Mrs. Hench"), executed and delivered a certain Promissory Note in favor of Plaintiff in the original principal amount of $780,000.00 ("Note"), which Note authorized a Confession of Judgment against Mr. Hench and Mrs. Hench. A copy of said Note is marked Exhibit "A", attached hereto and made a part hereof. 5. On or about December 20, 2002, Defendant, Ye Olde Ale House, Inc. ("Ale House"), executed and delivered to Plaintiff a Commercial Guaranty ("Guaranty") irrevocably guarantying and becoming surety for all obligations of Defendants, Mr. Hench and Mrs. Hench, to Plaintiff under the Note, which Guaranty authorized a Confession of Judgment against the Ale House. A true and correct copy of the Guaranty is marked Exhibit "B", attached hereto and made a part hereof. 6. Neither the Note nor the Guaranty, have been released, transferred or assigned. 7. Judgment has not been entered against the Defendants on the Note or the Guaranty in any jurisdiction. 8. Defendant, Mr. Hench and Mrs. Hench are in default under the aforesaid Note and Defendant, Ale House, under the Guaranty thereof, for failure to pay installments of principal and interest when due. 9. The judgment is not being entered by confession against a natural person in connection with a consumer credit transaction. 10. The itemization of the amount due, including interest and attorneys' fees as authorized by the Note and Guaranty is as follows: Principal $ 566,630.38 Interest through 7/8/11 $ 7,419.47 Late Charges $ 1,027.68 Other Charges/Fees $ 55.00 Attorney's Fees and Costs $ 57.404.98 (10% of Unpaid Principal & Accrued Interest) TOTAL $ 632,537.51 with interest on the principal sum of ($566,630.38) from July 8, 2011 at $66.89 per diem. WHEREFORE, Plaintiff as authorized by the Note and the Guaranty, demands judgment against the Defendants in the amount of $632,537.51 with interest on the principal sum ($566,630.38) from July 8, 2011 at $66.89 per diem, and brings said instrument to Court to recover the said sum. JA B'i Scl Attorneys for Plaintiff PA I.D. # 55650 P.O. Box 650 Hershey, PA 17033 (717) 533-3280 THIS IS AN ATTEMPT TO COLLECT A DEBT, AND ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE. EXHIBIT "A" PROMISSORY NOTE I tl Gtjpal Lean Cfat #; urf#?f Loran Nc? call/c. oft Account f ffl er. Iffitials $7 t? 4.QA 2 2t# MAE. References in the shaded area are for Lender's use only and do not limit the applicability of this document to any particular loan or item. Any item above containing -- has been omitted due to text length limitations. Borrower: JACK K. HENCH (SSN: 165-26-5184) LOIS A. HENCH (SSN: 204-30-5116) 5450 WESTBURY DR. ENOLA, PA 17025 Lender: ORRSTOWN BANK SILVER SPRING OFFICE 3 BADEN POWELL LANE STE. 1 MECHANICSBURG, PA 17050 Principal Amount: $780,000.00 Date of Note: December 20, 2002 Maturity Date: December 20, 2022 PROMISE TO PAY. JACK K. HENCH and LOIS A. HENCH ("Borrower") jointly and severally promise to pay to ORRSTOWN BANK ("Lender"), or order, in lawful money of the United States of America, the principal amount of Seven Hundred Eighty Thousand & 00/100 Dollars ($780,000.00), together with interest on the unpaid principal balance from December 20, 2002, until paid in full. PAYMENT. Subject to any payment changes resulting from changes in the Index, Borrower will pay this loan on demand. Payment in full is due immediately upon Lender's demand. If no demand is made, Borrower will pay this loan in accordance with the following payment schedule: 36 monthly consecutive principal and interest payments in the initial amount of $5,742.73 each, beginning January 20, 2003, with interest calculated on the unpaid principal balances at an initial interest rate of 6.250% per annum; and 204 monthly consecutive principal and interest payments in the initial amount of $5,342.13 each, beginning January 20, 2006, with interest calculated on the unpaid principal balances at an interest rate based on the Wall Street Prime (currently 4.250%), plus a margin of 1.000%, resulting in an initial interest rate of 5.250%. Borrower's final payment will be due on December 20, 2022 and will be for all principal and accrued interest not yet paid, together with any other unpaid amounts under this Note. Unless otherwise agreed or required by applicable law, payments will be applied first to accrued unpaid interest, then to principal, and any remaining amount to any unpaid collection costs and late charges. 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 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding. Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate In writing. VARIABLE INTEREST RATE. For the first 36 payments, the interest rate on this Note will be 6.250%. Thereafter, the interest rate on this Note is subject to change from time to time based on changes in an independent index which is the Wall Street Prime (the "Index"). The Index is not necessarily the lowest rate charged by Lender on its loans. If the Index becomes unavailable during the term of this loan, Lender may designate a substitute index after notice to Borrower. Lender will tell Borrower the current Index rate upon Borrower's request. The interest rate change will not occur more often than each day. Borrower understands that Lender may make loans based on other rates as well. The Index currently is 4.250% per annum. The interest rate or rates to be applied to the unpaid principal balance of this Note will be the rate or rates set forth herein in the "Payment" section. Notwithstanding any other provision of this Note, after the first payment stream, the interest rate for each subsequent payment stream will be effective as of the last payment date of the just-ending payment stream. NOTICE: Under no circumstances will the interest rate on this Note be more than the maximum rate allowed by applicable law. Whenever increases occur in the interest rate, Lender, at its option, may do one or more of the following: (A) increase Borrower's payments to ensure Borrower's loan will pay off by its original final maturity date, (B) increase Borrower's payments to cover accruing interest, (C) increase the number of Borrower's payments, and (D) continue Borrower's payments at the same amount and increase Borrower's final payment. PREPAYMENT PENALTY. Upon prepayment of this Note, Lender is entitled to the following prepayment penalty: Should Borrower prepay all or any amount of principal during the next three (3) years, the Borrower shall be assessed against the amount prepaid, a three percent (3.00%) prepayment penalty. The assessment percentage shall decrease one percent (1.00%) per annum to par. Lender acknowledges that excepted from this assessment will be principal payments that are generated as a result of operation of the business for which the loan was extended. Specifically not excepted will be any prepayments generated as a result of a refinancing at any other financial institution. Except for the foregoing, Borrower may pay all or a portion of the amount owed earlier than is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower or Borrower's obligation to continue to make payments under the payment schedule. Rather, they will reduce the principal balance due and may result in Borrower making fewer payments.. Except for the foregoing, Borrower may pay all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower's obligation to continue to make payments under the payment schedule. Rather, early payments will reduce the principal balance due and may result in Borrower's making fewer payments. Borrower agrees not to send Lender payments marked "paid in full", "without recourse", or similar language. If Borrower sends such a payment, Lender may accept it without losing any of Lender's rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender. All written communications concerning disputed amounts, including any check or other payment instrument that indicates that the payment constitutes "payment in full" of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or delivered to: ORRSTOWN BANK, P.O. BOX 250 SHIPPENSBURG, PA 17257. LATE CHARGE. If a payment is 16 days or more late, Borrower will be charged 5.000% of the regularly scheduled payment or $50.00, whichever is greater. INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the total sum due under this Note will bear interest from the date of acceleration or maturity at the variable interest rate on this Note. The interest rate will not exceed the maximum rate permitted by applicable law. DEFAULT. Each of the following shall constitute an event of default ("Event of Default") under this Note: Payment Default. Borrower fails to make any payment when due under this Note. Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower. False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower's behalf under this Note or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. Death or Insolvency. The death of Borrower or the dissolution or termination of Borrower's existence as a going business, the insolvency of Borrower, the appointment of a receiver for any part of Borrower's property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower. Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan. This PROMISSORY NOTE (Continued) Page 2 includes a garnishment of any of Borrower's accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute. Events Affecting Guarantor. Any of the preceding events occurs with respect to any Guarantor of any of the indebtedness or any Guarantor dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any guaranty of the indebtedness evidenced by this Note. In the event of a death, Lender, at its option, may, but shall not be required to, permit the Guarantor's estate to assume unconditionally the obligations arising under the guaranty in a manner satisfactory to Lender, and, in doing so, cure any Event of Default. Adverse Change. A material adverse change occurs in Borrower's financial condition, or Lender believes the prospect of payment or performance of this Note is impaired. Insecurity. Lender in good faith believes itself insecure. Cure Provisions. If any 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 default will have occurred) if Borrower, after receiving written notice from Lender demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15) days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical. LENDER'S RIGHTS. Upon default, Lender may, after giving such notices as required by applicable law, declare the entire unpaid principal balance on this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount. ATTORNEYS' FEES; EXPENSES. Lender may hire or pay someone else to help collect this Note if Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits under applicable law, Lender's attorneys' fees and Lender's legal expenses, whether or not there is a lawsuit, including attorneys' fees, expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals. If not prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums provided by law. RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower's accounts with Lender (whether checking, savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the indebtedness against any and all such accounts, and, at Lender's option, to administratively freeze all such accounts to allow Lender to protect Lender's charge and setoff rights provided in this paragraph. PROPERTY INSURANCE. Borrower understands that Borrower is required to obtain insurance for the collateral securing this Note. Further information concerning this requirement is set forth in the Mortgage and in the Agreement to Provide Insurance, all the terms and conditions of which are hereby incorporated and made a part of this Note. FINANCIAL INFORMATION. The Borrower agrees to provide the Lender with Federal Tax Returns and/or CPA prepared Financial Statements and any other financial information, required by the Lender's Original Commitment Letter to the Borrower, on an annual basis. If the Lender does not receive the required financial information within two hundred seventy (270) days of the Borrower's fiscal year end, the Lender has the right to increase the interest rate charged on this Note by 0.25%. The Borrower shall receive written notification ten (10) days prior to the Lender increasing the interest rate charged on this Note. SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower's heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender and its successors and assigns. NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES. Please notify us if we report any inaccurate information about your account(s) to a consumer reporting agency. Your written notice describing the specific inaccuracy(ies) should be sent to us at the following address: ORRSTOWN BANK P.O. BOX 250 SHIPPENSBURG, PA 17257 GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific default provisions or rights of Lender shall not preclude Lender's right to declare payment of this Note on its demand. Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them. Each Borrower understands and agrees that, with or without notice to Borrower, Lender may with respect to any other Borrower (a) make one or more additional secured or unsecured loans or otherwise extend additional credit; (b) alter, compromise, renew, extend, accelerate, or otherwise change one or more times the time for payment or other terms any indebtedness, including increases and decreases of the rate of interest on the indebtedness; (c) exchange, enforce, waive, subordinate, fail or decide not to perfect, and release any security, with or without the substitution of new collateral; (d) apply such security and direct the order or manner of sale thereof, including without limitation, any non-judicial sale permitted by the terms of the controlling security agreements, as Lender in its discretion may determine; (e) release, substitute, agree not to sue, or deal with any one or more of Borrower's sureties, endorsers, or other guarantors on any terms or in any manner Lender may choose; and (f) determine how, when and what application of payments and credits shall be made on any other indebtedness owing by such other Borrower. Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender's security interest in the collateral; and take any other action deemed necessary by Lender without the consent of or notice to anyone. All such parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the party with whom the modification is made. The obligations under this Note are joint and several. If any portion of this Note is for any reason determined to be unenforceable, it will not affect the enforceability of any other provisions of this Note. CONFESSION OF JUDGMENT. BORROWER HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR BORROWER AFTER A DEFAULT UNDER THIS NOTE AND WITH OR WITHOUT COMPLAINT FILED, CONFESS OR ENTER JUDGMENT AGAINST BORROWER FOR THE ENTIRE PRINCIPAL BALANCE OF THIS NOTE AND ALL ACCRUED INTEREST, LATE CHARGES AND ANY AND ALL AMOUNTS EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THIS NOTE, TOGETHER WITH COSTS OF SUIT, AND AN ATTORNEY'S COMMISSION OF TEN PERCENT (10%) OF THE UNPAID PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS ($500) ON WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS NOTE OR A COPY OF THIS NOTE VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY GRANTED IN THIS NOTE TO CONFESS JUDGMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS NOTE. BORROWER HEREBY WAIVES ANY RIGHT BORROWER MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT AND STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO BORROWER'S ATTENTION OR BORROWER HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL. PROMISSORY NOTE Page 3 (Continued) PROVISIONS OF THIS NOTE, THE PRIOR TO THIS NOTE, EACH VARIABLE INTEREST RATE PROVISIONS AND BORROWER THE NOTICE TO COSIGNER UNDERSTOOD SET FORTH E BELOW. E CH BORROWER AGREES INCLUDINGTO THE TERMS OF THE NOTE. BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE. THIS NOTE IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS NOTE IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. BORROWER: X (Seal) J K. HENC , I ividual y X ?. l? J o (Seal) LOM A. HENCH, individually NOTICE TO COSIGNER You are being asked to guarantee this debt. Think carefully before you do. If the borrower doesn't pay the debt, you will have to. Be sure you can afford to pay if you have to, and that you want to accept this responsibility. You may have to pay up to the full amount of the debt if the borrower does not pay. You may also have to pay late fees or collection costs, which increase this amount. The Lender can collect this debt from you without first trying to collect from the borrower. The Lender can use the same collection methods against you that can be used against the borrower, such as suing you, garnishing your wages, etc. If this debt is ever in default, that fact may become a part of YOUR credit record. This notice is not the contract that makes you liable for the debt. IASER PRO LPMitq. Ver. 5.21.00.00.9 Copr110r18ntl FinuitilM Sduums, Im. 1997, 2002. M Rghls Reed. - PA CACFIILP0020.FC TR-5M PR-1 EXHIBIT "B" OMMERCIAL GUARANTY Pf7nd! LoAli :b8te Miftirftjl Loan No Call Coll Account C,$r (33#t-Isis References in the shaded area are for Lender's use only and do not limit the applicability of this document to any particular loan or item. Any item above containing "***" has been omitted due to text length limitations. Borrower: JACK K. HENCH (SSN: 165-26-5184) Lender: ORRSTOWN BANK LOIS A. HENCH (SSN: 204-30-5116) SILVER SPRING OFFICE 5450 WESTBURY DR. 3 BADEN POWELL LANE STE. 1 ENOLA, PA 17025 MECHANICSBURG, PA 17050 Guarantor: YE OLDE ALE HOUSE, INC. (TIN: 23-1717397) 5002 CARLISLE PIKE MECHANICSBURG, PA 17050 AMOUNT OF GUARANTY. This is a guaranty of payment of the Note, including without limitation the principal Note amount of Seven Hundred Eighty Thousand & 00/100 Dollars ($780,000.00). GUARANTY. For good and valuable consideration, YE OLDE ALE HOUSE, INC. ("Guarantor") absolutely and unconditionally guarantees and promises to pay to ORRSTOWN BANK ("Lender") or its order, on demand, in legal tender of the United States of America, the Indebtedness (as that term is defined below) of JACK K. HENCH and LOIS A. HENCH ("Borrower"), or either or any of them, to Lender on the terms and conditions set forth in this Guaranty. MAXIMUM LIABILITY. The maximum liability of Guarantor under this Guaranty shall not exceed at any one time the amount of the Indebtedness described herein, plus all costs and expenses of (A) enforcement of this Guaranty and (B) collection and sale of any collateral securing this Guaranty. The above limitation on liability is not a restriction on the amount of the Indebtedness of Borrower to Lender either in the aggregate or at any one time. If Lender presently holds one or more guaranties, or hereafter receives additional guaranties from Guarantor, Lender's rights under all guaranties shall be cumulative. This Guaranty shall not (unless specifically provided below to the contrary) affect or invalidate any such other guaranties. Guarantor's liability will be Guarantor's aggregate liability under the terms of this Guaranty and any such other unterminated guaranties. INDEBTEDNESS GUARANTEED. The Indebtedness guaranteed by this Guaranty includes the Note, including (a) all principal, (b) all interest, (c) all late charges, (d) all loan fees and loan charges, and (e) all collection costs and expenses relating to the Note or to any collateral for the Note. Collection costs and expenses include without limitation all of Lender's attorneys' fees. DURATION OF GUARANTY. This Guaranty will take effect when received by Lender without the necessity of any acceptance by Lender, or any notice to Guarantor or to Borrower, and will continue in full force until all Indebtedness shall have been fully and finally paid and satisfied and all of Guarantor's other obligations under this Guaranty shall have been performed in full. Release of any other guarantor or termination of any other guaranty of the Indebtedness shall not affect the liability of Guarantor under this Guaranty. A revocation Lender receives from any one or more Guarantors shall not affect the liability of any remaining Guarantors under this Guaranty. GUARANTOR'S AUTHORIZATION TO LENDER. Guarantor authorizes Lender, without notice or demand and without lessening Guarantor's liability under this Guaranty, from time to time: (A) to make one or more additional secured or unsecured loans to Borrower, to lease equipment or other goods to Borrower, or otherwise to extend additional credit to Borrower; (B) to alter, compromise, renew, extend, accelerate, or otherwise change one or more times the time for payment or other terms of the Indebtedness or any part of the Indebtedness, including increases and decreases of the rate of interest on the Indebtedness; extensions may be repeated and may be for longer than the original loan term; (C) to take and hold security for the payment of this Guaranty or the Indebtedness, and exchange, enforce, waive, subordinate, fail or decide not to perfect, and release any such security, with or without the substitution of new collateral; (D) to release, substitute, agree not to sue, or deal with any one or more of Borrower's sureties, endorsers, or other guarantors on any terms or in any manner Lender may choose; (E) to determine how, when and what application of payments and credits shall be made on the Indebtedness (F) to apply such security and direct the order or manner of sale thereof, including without limitation, any nonjudicial sale permitted by the terms of the controlling security agreement or deed of trust, as Lender in its discretion may determine; (G) to sell, transfer, assign or grant participations in all or any part of the Indebtedness; and (H) to assign or transfer this Guaranty in whole or in part. GUARANTOR'S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Lender that (A) no representations or agreements of any kind have been made to Guarantor which would limit or qualify in any way the terms of this Guaranty; (B) this Guaranty is executed at Borrower's request and not at the request of Lender; (C) Guarantor has full power, right and authority to enter into this Guaranty; (D) the provisions of this Guaranty do not conflict with or result in a default under any agreement or other instrument binding upon Guarantor and do not result in a violation of any law, regulation, court decree or order applicable to Guarantor; (E) Guarantor has not and will not, without the prior written consent of Lender, sell, lease, assign, encumber, hypothecate, transfer, or otherwise dispose of all or substantially all of Guarantor's assets, or any interest therein; (F) upon Lender's request, Guarantor will provide to Lender financial and credit information in form acceptable to Lender, and all such financial information which currently has been, and all future financial information which will be provided to Lender is and will be true and correct in all material respects and fairly present Guarantor's financial condition as of the dates the financial information is provided; (G) no material adverse change has occurred in Guarantor's financial condition since the date of the most recent financial statements provided to Lender and no event has occurred which may materially adversely affect Guarantor's financial condition; (H) no litigation, claim, investigation, administrative proceeding or similar action (including those for unpaid taxes) against Guarantor is pending or threatened; (1) Lender has made no representation to Guarantor as to the creditworthiness of Borrower; and (J) Guarantor has established adequate means of obtaining from Borrower on a continuing basis information regarding Borrower's financial condition. Guarantor agrees to keep adequately informed from such means of any facts, events, or circumstances which might in any way affect Guarantor's risks under this Guaranty, and Guarantor further agrees that Lender shall have no obligation to disclose to Guarantor any information or documents acquired by Lender in the course of its relationship with Borrower. GUARANTOR'S WAIVERS. Except as prohibited by applicable law, Guarantor waives any right to require Lender (A) to continue lending money or to extend other credit to Borrower; (B) to make any presentment, protest, demand, or notice of any kind, including notice of any nonpayment of the Indebtedness or of any nonpayment related to any collateral, or notice of any action or nonaction on the part of Borrower, Lender, any surety, endorser, or other guarantor in connection with the Indebtedness or in connection with the creation of new or additional loans or obligations; (C) to resort for payment or to proceed directly or at once against any person, including Borrower or any other guarantor; (D) to proceed directly against or exhaust any collateral held by Lender from Borrower, any other guarantor, or any other person; (E) to give notice of the terms, time, and place of any public or private sale of personal property security held by Lender from Borrower or to comply with any other applicable provisions of the Uniform Commercial Code; (F) to pursue any other remedy within Lender's power; or (G) to commit any act or omission of any kind, or at any time, with respect to any matter whatsoever. In addition to the waivers set forth herein, if now or hereafter Borrower is or shall become insolvent and the Indebtedness shall not at all times until paid be fully secured by collateral pledged by Borrower, Guarantor hereby forever waives and gives up in favor of Lender and Borrower, and Lender's and Borrower's respective successors, any claim or right to payment Guarantor may now have or hereafter have or acquire against Borrower, by subrogation or otherwise, so that at no time shall Guarantor be or become a "creditor" of Borrower within the meaning of 11 U.S.C. section 547(b), or COMMERCIAL GUARANTY (Continued) Page 2 any successor provision of the Federal bankruptcy laws. Guarantor also waives any and all rights or defenses arising by reason of (A) any "one action" or "anti-deficiency" law or any other law which may prevent Lender from bringing any action, including a claim for deficiency, against Guarantor, before or after Lender's commencement or completion of any foreclosure action, either judicially or by exercise of a power of sale; (B) any election of remedies by Lender which destroys or otherwise adversely affects Guarantor's subrogation rights or Guarantor's rights to proceed against Borrower for reimbursement, including without limitation, any loss of rights Guarantor may suffer by reason of any law limiting, qualifying, or discharging the Indebtedness; (C) any disability or other defense of Borrower, of any other guarantor, or of any other person, or by reason of the cessation of Borrower's liability from any cause whatsoever, other than payment in full in legal tender, of the Indebtedness; (D) any right to claim discharge of the Indebtedness on the basis of unjustified impairment of any collateral for the Indebtedness; (E) any statute of limitations, if at any time any action or suit brought by Lender against Guarantor is commenced, there is outstanding Indebtedness of Borrower to Lender which is not barred by any applicable statute of limitations; or (F) any defenses given to guarantors at law or in equity other than actual payment and performance of the Indebtedness. If payment is made by Borrower, whether voluntarily or otherwise, or by any third party, on the Indebtedness and thereafter Lender is forced to remit the amount of that payment to Borrower's trustee in bankruptcy or to any similar person under any federal or state bankruptcy law or law for the relief of debtors, the Indebtedness shall be considered unpaid for the purpose of the enforcement of this Guaranty. Guarantor further waives and agrees not to assert or claim at any time any deductions to the amount guaranteed under this Guaranty for any claim of setoff, counterclaim, counter demand, recoupment or similar right, whether such claim, demand or right may be asserted by the Borrower, the Guarantor, or both. GUARANTOR'S UNDERSTANDING WITH RESPECT TO WAIVERS. Guarantor warrants and agrees that each of the waivers set forth above is made with Guarantor's full knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary to public policy or law. If any such waiver is determined to be contrary to any applicable law or public policy, such waiver shall be effective only to the extent permitted by law or public policy. SUBORDINATION OF BORROWER'S DEBTS TO GUARANTOR. Guarantor agrees that the Indebtedness of Borrower to Lender, whether now existing or hereafter created, shall be superior to any claim that Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower becomes insolvent. Guarantor hereby expressly subordinates any claim Guarantor may have against Borrower, upon any account whatsoever, to any claim that Lender may now or hereafter have against Borrower. In the event of insolvency and consequent liquidation of the assets of Borrower, through bankruptcy, by an assignment for the benefit of creditors. by voluntary liquidation, or otherwise, the assets of Borrower applicable to the payment of the claims of both Lender and Guarantor shall be paid to Lender and shall be first applied by Lender to the Indebtedness of Borrower to Lender. Guarantor does hereby assign to Lender all claims which it may have or acquire against Borrower or against any assignee or trustee in bankruptcy of Borrower; provided however, that such assignment shall be effective only for the purpose of assuring to Lender full payment in legal tender of the Indebtedness. If Lender so requests, any notes or credit agreements now or hereafter evidencing any debts or obligations of Borrower to Guarantor shall be marked with a legend that the same are subject to this Guaranty and shall be delivered to Lender. Guarantor agrees, and Lender is hereby authorized, in the name of Guarantor, from time to time to execute and file financing statements and continuation statements and to execute such other documents and to take such other actions as Lender deems necessary or appropriate to perfect, preserve and enforce its rights under this Guaranty. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Guaranty: Amendments. This Guaranty, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth in this Guaranty. No alteration of or amendment to this Guaranty shall be effective unless given in writing and signed by the party or parties sought to be charged or bound by the alteration or amendment. Attorneys' Fees; Expenses. Guarantor agrees to pay upon demand all of Lender's costs and expenses, including Lender's attorneys' fees and Lender's legal expenses, incurred in connection with the enforcement of this Guaranty. Lender may hire or pay someone else to help enforce this Guaranty, and Guarantor shall pay the costs and expenses of such enforcement. Costs and expenses include Lender's attorneys' fees and legal expenses whether or not there is a lawsuit, including attorneys' fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services. Guarantor also shall pay all court costs and such additional fees as may be directed by the court. Caption Headings. Caption headings in this Guaranty are for convenience purposes only and are not to be used to interpret or define the provisions of this Guaranty. Integration. Guarantor further agrees that Guarantor has read and fully understands the terms of this Guaranty; Guarantor has had the opportunity to be advised by Guarantor's attorney with respect to this Guaranty; the Guaranty fully reflects Guarantor's intentions and parol evidence is not required to interpret the terms of this Guaranty. Guarantor hereby indemnifies and holds Lender harmless from all losses, claims, damages, and costs (including Lender's attorneys' fees) suffered or incurred by Lender as a result of any breach by Guarantor of the warranties, representations and agreements of this paragraph. Interpretation. In all cases where there is more than one Borrower or Guarantor, then all words used in this Guaranty in the singular shall be deemed to have been used in the plural where the context and construction so require; and where there is more than one Borrower named in this Guaranty or when this Guaranty is executed by more than one Guarantor, the words "Borrower" and "Guarantor" respectively shall mean all and any one or more of them. The words "Guarantor," "Borrower," and "Lender" include the heirs, successors, assigns, and transferees of each of them. If a court finds that any provision of this Guaranty is not valid or should not be enforced, that fact by itself will not mean that the rest of this Guaranty will not be valid or enforced. Therefore, a court will enforce the rest of the provisions of this Guaranty even if a provision of this Guaranty may be found to be invalid or unenforceable. If any one or more of Borrower or Guarantor are corporations, partnerships, limited liability companies, or similar entities, it is not necessary for Lender to inquire into the powers of Borrower or Guarantor or of the officers, directors, partners, managers, or other agents acting or purporting to act on their behalf, and any Loan indebtedness made or created in reliance upon the professed exercise of such powers shall be guaranteed under this Guaranty. Notices. Unless otherwise provided by applicable law, any notice required to be given under this Guaranty shall be given in writing, and shall be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Guaranty. Any parry may change its address for notices under this Guaranty by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the parry's address. For notice purposes, Guarantor agrees to keep Lender informed at all times of Guarantor's current address. Unless otherwise provided by applicable law, if there is more than one Guarantor, any notice given by Lender to any Guarantor is deemed to be notice given to all Guarantors. No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Guaranty unless such waiver is given in writing and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right. A waiver by Lender of a provision of this Guaranty shall not prejudice or constitute a waiver of Lender's right otherwise to demand strict compliance with that provision or any other provision of this Guaranty. No prior waiver by Lender, nor any course of dealing between Lender and Guarantor, COMMERCIAL GUARANTY (Continued) Page 3 shall constitute a waiver of any of Lender's rights or of any of Guarantor's obligations as to any future transactions. Whenever the consent of Lender is required under this Guaranty, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender. Successors and Assigns. The terms of this Guaranty shall be binding upon Guarantor, and upon Guarantor's heirs, personal representatives, successors, and assigns, and shall be enforceable by Lender and its successors and assigns. DEFINITIONS. The following capitalized words and terms shall have the following meanings when used in this Guaranty. Unless specifically stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words and terms not otherwise defined in this Guaranty shall have the meanings attributed to such terms in the Uniform Commercial Code: Borrower. The word "Borrower" means JACK K. HENCH and LOIS A. HENCH, and all other persons and entities signing the Note in whatever capacity. Guarantor. The word "Guarantor" means each and every person or entity signing this Guaranty, including without limitation YE OLDE ALE HOUSE, INC.. Guaranty. The word "Guaranty" means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part of the Note. Indebtedness. The word "Indebtedness" means Borrower's indebtedness to Lender as more particularly described in this Guaranty. Lender. The word "Lender" means ORRSTOWN BANK, its successors and assigns. Note. The word "Note" means the promissory note dated December 20, 2002, in the original principal amount of $780,000.00 from Borrower to Lender, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the promissory note or agreement. Related Documents. The words "Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Indebtedness. CONFESSION OF JUDGMENT. GUARANTOR HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR GUARANTOR AFTER THE AMOUNTS HEREUNDER BECOME DUE AND WITH OR WITHOUT COMPLAINT FILED, CONFESS OR ENTER JUDGMENT AGAINST GUARANTOR FOR THE ENTIRE PRINCIPAL BALANCE OF THIS GUARANTY AND ALL ACCRUED INTEREST, LATE CHARGES AND ANY AND ALL AMOUNTS EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THE INDEBTEDNESS, TOGETHER WITH COSTS OF SUIT, AND AN ATTORNEY'S COMMISSION OF TEN PERCENT (10%) OF THE UNPAID PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS ($500) ON WHICH JUDGMENT OR JUDGMENTS. ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS GUARANTY OR A COPY OF THIS GUARANTY VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY GRANTED IN THIS GUARANTY TO CONFESS JUDGMENT AGAINST GUARANTOR SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS GUARANTY. GUARANTOR HEREBY WAIVES ANY RIGHT GUARANTOR MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT AND STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO GUARANTOR'S ATTENTION OR GUARANTOR HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL. EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT THIS GUARANTY IS EFFECTIVE UPON GUARANTOR'S EXECUTION AND DELIVERY OF THIS GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE MANNER SET FORTH IN THE SECTION TITLED "DURATION OF GUARANTY". NO FORMAL ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS GUARANTY IS DATED DECEMBER 20, 2002. THIS GUARANTY IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS GUARANTY IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. GUARANTOR: YE OLDE ALE HOUSE, INC. By: (Seal) J K H, P e ident of E OLDS ALE OUSE, INC. BY: (- a c%' (Seal) LOIS A. HENCH, Secretary of YE OLDE ALE HOUSE, INC. LASER PRO LeM ng. Ver. 5.21.00 003 UP, HaMbn Finsnclfil Sdut-S, Inc. 1997, 2002. All RIgI ll Rese- PA C:1CFI\LPL1E20.FC TR5265 PR-1 t VERIFICATION I, Linda K. Mowen, Assistant Vice President, on behalf of Orrstown Bank, depose and say subject to the penalties of 18 Pa.C.S.A., sec.4904 relating to unsworn falsification to authorities that the facts set forth in the foregoing Complaint in Confession of Judgment are true and correct to the best of my information, knowledge and belief. Linda K. Mowen, Assistant Vice President IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, VS. CIVIL DIVISION Plaintiff, NO.: n (/ -5833 Ci vi i em JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. NOTICE UNDER RULE 2958.1 OF JUDGMENT AND EXECUTION THEREON Notice of Defendant's Rights To: Jack K. Hench 5450 Westbury Drive Enola, PA 17025 l? tom.. _ax rnm xM -,C D )> C-.) DC x -t hJ r N N FY: C) C)_n C) A judgment in the amount of $632,537.51 has been entered against you and in favor of the plaintiff without any prior notice or hearing based on a confession of judgment contained in a written agreement or other paper allegedly signed by you. The sheriff may take your money or other property to pay the judgment at any time after thirty (30) days after the date on which this notice is served on you. You may have legal rights to defeat the judgment or to prevent your money or property from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR RIGHTS. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. NOTICE TO DEFEND & LAWYER REFERRAL SERVICE Cumberland County Bar Association 32 S. Bedford Street Carlisle, PA 17013 Phone (717) 249-3166 (800) 990-9108 Respectfully fibm?iJ?1?EF#eK JAMES, SM1jr , D `P?(r & CONNELLY LLP By: Scott A. Dietterick, Esquire Attorney I.D. #55650 P.O. Box 650 Hershey, PA 17033 (717) 533-3280 VIA PERSONAL SERVICE BY THE SHERIFF OF CUMBERLAND COUNTY C IN THE COURT OF COMMON PLEAS OF m CUMBERLAND COUNTY, PENNSYLVANIA x xs U) - r" ' r N ORRSTOWN BANK, CIVIL DIVISION cp y„ ?? io = c A. Plaintiff, NO.: n '" ;;, - c •• ' VS. ?(W ITr ? r -ss33 rM ? - JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. NOTICE UNDER RULE 2958.1 OF JUDGMENT AND EXECUTION THEREON Notice of Defendant's Rights To: Lois A. Hench 5450 Westbury Drive Enola, PA 17025 A judgment in the amount of $632,537.51 has been entered against you and in favor of the plaintiff without any prior notice or hearing based on a confession of judgment contained in a written agreement or other paper allegedly signed by you. The sheriff may take your money or other property to pay the judgment at any time after thirty (30) days after the date on which this notice is served on you. You may have legal rights to defeat the judgment or to prevent your money or property from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR RIGHTS. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. NOTICE TO DEFEND & LAWYER REFERRAL SERVICE Cumberland County Bar Association 32 S. Bedford Street Carlisle, PA 17013 Phone (717) 249-3166 (800) 990-9108 Respectfully Vb?m i ?rf? JAMES, SMITD & CONNELLY LLP By: ,&fdtt'A -Biditerick, Esquire Attorney I.D. #55650 P.O. BOX 650 Hershey, PA 17033 (717) 533-3280 VIA PERSONAL SERVICE BY THE SHERIFF OF CUMBERLAND COUNTY s C V IN THE COURT OF COMMON PLEAS OF C r CUMBERLAND COUNTY, PENNSYLVANIA z? - rte-- r I, ;_ CP N C ORRSTOWN BANK, CIVIL DIVISION <a G oT ? 70'0 s? ? ate, Plaintiff, NO.: 2 G -" ca m vs. n ?(- -- JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. NOTICE UNDER RULE 2958.1 OF JUDGMENT AND EXECUTION THEREON Notice of Defendant's Rights To: Ye Olde Ale House, Inc. 5002 Carlisle Pike Mechanicsburg, PA 17050 A judgment in the amount of $632,537.51 has been entered against you and in favor of the plaintiff without any prior notice or hearing based on a confession of judgment contained in a written agreement or other paper allegedly signed by you. The sheriff may take your money or other property to pay the judgment at any time after thirty (30) days after the date on which this notice is served on you. You may have legal rights to defeat the judgment or to prevent your money or property from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR RIGHTS. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. NOTICE TO DEFEND & LAWYER REFERRAL SERVICE Cumberland County Bar Association 32 S. Bedford Street Carlisle, PA 17013 Phone (717) 249-3166 (800) 990-9108 Respectfully bm?jt?fey?: JAMES, SMIT , D T RIC & CONNELLY LLP By: Scot A. Di-etterick, Esquire Attorney I.D. #55650 P.O. Box 650 Hershey, PA 17033 (717) 533-3280 VIA PERSONAL SERVICE BY THE SHERIFF OF CUMBERLAND COUNTY IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, CIVIL DIVISION Plaintiff, NO.: 1t' 5833 vs. JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. CERTIFICATION OF ADDRESS I hereby certify that the address of the parties in the above action are as follows: Address of Plaintiff- P.O. Box 250, Shippensburg, PA 17257 Address of Defendants: C i Vt., 1 1 ea'r` Jack K. Hench & Lois A. Hench 5450 Westbury Drive, Enola, PA 17025 Ye Olde Ale House, Inc. 5002 Carlisle Pike, Mechani sburg, PA 17050 JAMES, SMIT T K & CONNELLY LLP BY: i 41s tz [-/' c t A. ' erick, Esquire C-) c N ° PA I.D. # 55650 rncao ` s-? Kimberly A. Bonner, Esquire ter` PA LD #89705 -<D `N ?d Attorneys for Plaintiff r-:t --+c;, P.O. Box 650 *p 13'" a zp.Y Hershey, PA 17033 717 533 3280 za ' cs - ?' `' ( ) - --? CA CO IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, VS. CIVIL DIVISION Plaintiff, NO.: 11-5833 0- isITV60- JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. AFFIDAVIT OF NON-MILITARY SERVICE COMMONWEALTH OF PENNSYLVANIA COUNTY OF DAUPHIN SS: I, Scott A. Dietterick, Esquire and/or Kimberly A. Bonner, Esquire, attorneys for and authorized representative of Plaintiff, Orrstown Bank, hereby certify, subject to the penalties of 18 Pa.C.S.A. §4904, that the Defendants, are not in the military servicg of tlynited States of America to the best of my knowledge, information and belief. Slott ANZid1err&, Esquire Kimberly A. Bonner, Esquire SWORN TO AND SUBSCRIBED BEFORE ME THIS n c r1-3 `r~ m z 13th day of July, 2011. z? ' C -Ncz rev C:) o 'M6 n ? = C )-n Notary Public =Cs 2a I---- - _, x? c5 My Commission Expires: co NOTARIAL SEAL CHRISTINE L SPURLOCK Notary Public HUMMELSTOWN BORO, DAUPHIN COUNTY My Commission Expires Jun 23, 2012 IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, Plaintiff, VS. JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. NOTICE OF ORDER, DECREE OR JUDGMENT TO: ( ) Plaintiff (X) Defendant - JACK K. HENCH ( ) Additional Defendant(s) CIVIL DIVISION NO.. C6 vi ITiP,IrM? You are hereby notified that an Order, Decree or Judgment was entered in the above-captioned proceeding on :j ( ) A copy of the Order or Decree is as follows: or (X) The judgment is as follows: $632,537.51 plus interest on the principal sum ($566,630.38) from July 8, 2011, at the rate of $66.89 per diem, plus additional late charges and additional attorneys' fees and costs. w Prothonotary IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, Plaintiff, VS. JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants NOTICE OF ORDER, DECREE OR JUDGMENT TO: ( ) Plaintiff (X) Defendant - LOIS A. HENCH ( ) Additional Defendant(s) CIVIL DIVISION NO.. l(- 5S3 3 ei vi t (er*% You are hereby notified that an Order, Decree or Judgment was entered in the above-captioned proceeding on ( ) A copy of the Order or Decree is as follows: or (X) The judgment is as follows: $632,537.51 plus interest on the principal sum ($566,630.38) from July 8, 2011, at the rate of $66.89 per diem, plus additional late charges and additional attorneys' fees and costs. 0 Prothonotary IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, CIVIL DIVISION Plaintiff, NO.: _ vs. It - 6633 l JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. NOTICE OF ORDER, DECREE OR JUDGMENT TO: ( ) Plaintiff (X) Defendant - YE OLDE ALE HOUSE, INC. ( ) Additional Defendant(s) You are hereby notified that an Order, Decree or Judgment was entered in the above-captioned proceeding on () A copy of the Order or Decree is as follows: or (X) The judgment is as follows: $632,537.51 plus interest on the principal sum ($566,630.38) from July 8, 2011, at the rate of $66.89 per diem, plus additional late charges and additional attorneys' fees and costs. Prothonotary Ronny R Anderson Sheriff Jody S Smith Chief Deputy Richard W Stewart Solicitor OFF N1( AUG -8 PM 3. 1'-; "UMBER!_AN RENNSY!Yh,Ib?r`, Orrstown Bank vs. Case Number . Jack K. Hench (et al.) 2011-5833 SHERIFF'S RETURN OF SERVICE 07/26/2011 05:35 PM - Shawn Gutshall, Deputy Sheriff, who being duly sworn according to law, states that on July 26 2011 at 1735 hours, he served a true copy of the within Complaint in Confession of Judgment and Notice, upon the within named defendant, to wit: Jack K. Hench, by making known unto Lois A. Hench, Wife of Defendant at 5450 Westbury Drive, Enola, Cumberland County, Pennsylvania 17025 its contents and at the same time handing to her personally the said true and correct copy of a same. hv, "I HALL, 07/26/2011 05:35 PM - Shawn Gutshall, Deputy Sheriff, who being duly sworn according to law, states that on July 26 2011 at 1735 hours, he served a true copy of the within Complaint in Confession of Judgment and Notice, upon the within named defendant, to wit: Lois A. Hench, by making known unto herself personally, at 5450 Westbury Drive, Enola, Cumberland County, Pennsylvania 17025 its contents and at the same time handing to her personally the said true and correct copy of the same. HAL UTY 07/26/2011 05:35 PM - Shawn Gutshall, Deputy Sheriff, who being duly sworn according to law, states that on July 26 2011 at 1735 hours, he served a true copy of the within Complaint in Confession of Judgment and Notice, upon the within named defendant, to wit: Ye Olde Ale House, Inc., by making known unto Lois A. Hench, adult in charge at 5450 Westbury Drive, Enola, Cumberland County, Pennsylvania 17025 its contents and at the same time handing to her personally the said true and correct cop f the ame. r SHAMA ?. GUTS HALL, D SHERIFF COST: $75.00 August 02, 2011 SHERIFF'S OFFICE OF CUMBERLAND COYNTY _ _ F_E -OFFIi "r. SO ANSWERS, l? RON R ANDERSON, SHERIFF ? rour?tys,lr h.efP.i _ ;oft. b'.C. IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORRSTOWN BANK, CIVIL DIVISION Plaintiff, NO.: 11-5833 Civil Term vs. JACK K. HENCH, LOIS A. HENCH and YE OLDE ALE HOUSE, INC., Defendants. PRAECIPE TO SATISFY JUDGMENT TO THE PROTHONOTARY: rn CO M c__ =; cnr" -erg X - : I' N C7 iW r-2: - f =a Please mark the judgment filed at the above-captioned term and number satisfied. Respectfully JAMES, $,MITIJ, MMTERICK & CONNELLY LLP BY: Sco e 'ck, Esquire PA I. refor Atto Pla intiff P.O. ox 650 Hershey, PA 17033 (717) 533-3280