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HomeMy WebLinkAbout12-1829U. r iii • t? T, ,ra? ?COUNTY e?++ry E i?1 FI S Y"L VANIA METRO BANK Fk/a COMMERCE BANK/ HARRISBURG, N.A. Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA DGA, INC. d/b/a INFINITY PRINT GRAPHICS et al. ; NO 20 Defendant : Civil Term NOTICE TO DEFEND YOU HAVE BEEN SUED IN COURT. IF YOU WISH TO DEFEND AGAINST THE CLAIMS SET FORTH IN THE FOLLOWING PAGES, YOU MUST TAKE ACTION WITHIN TWENTY (20) DAYS AFTER THIS COMPLAINT AND NOTICE ARE SERVED, BY ENTERING A WRITTEN APPEARANCE PERSONALLY OR BY AN ATTORNEY AND FILLING IN WRITING WITH THE COURT YOUR DEFENSES OR OBJECTIONS TO THE CLAIMS SET FORTH AGAINST YOU. YOU ARE WARNED THAT IF YOU FAIL TO DO SO THE CASE MAY PROCEED WITHOUT YOU AND A JUDGEMENT MAY BE ENTERED AGAINST YOU BY THE COURT WITHOUT FURTHER NOTICE FOR ANY MONEY CLAIMED IN THE COMPLAINT OR FOR ANY OTHER CLAIM OR RELIEF REQUESTED BY THE PLAINTIFF. YOU MAY LOSE MONEY OR PEOPERTY OR OTHER RIGHTS IMPORTANT TO YOU. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO THE TELEPHONE OR THE OFFICE SET FORTH BELOW TO FIND WHERE YOU CAN GET LEGAL HELP. CUMBERLAND COUNTY BAR ASSOCIATION 32 SOUTH BEDFORD STREET CARLISLE, PA 17013 1-800-990-9108 717-249-3166 QI? 11 1o37S(xd e?-? Issas 2 9- a7 9 -7so WEBER GALLAGHER SIMPSON STAPLETON FIRES & NEWBY, LLP By: Peter E. Meltzer Identification No.: 39828 By: Sarah A. Elia Identification No.: 306954 Fulton Bank Building 200 North Third Street, Suite 9A Harrisburg, PA 17101 (717) 237-6940 Attorneys for Plaintiff METRO BANK f/k/a COMMERCE BANK/ COURT OF COMMON PLEAS HARRISBURG, N.A. CUMBERLAND COUNTY 3801 Paxton Street Harrisburg, PA 17111 NO. V. DGA, INC. d/b/a INFINITY PRINT GRAPHICS 121 North Pitt Street Carlisle, PA 17013 MICHAEL R. GUION 117 Sholly Drive Mechanicsburg, PA 17055 VICKIE B. GUION 117 Sholly Drive Mechanicsburg, PA 17055 COMPLAINT AND NOW, comes the plaintiff, Metro Bank f/k/a Commerce Bank/Harrisburg, N.A., by and through its attorneys, Weber Gallagher Simpson Stapleton Fires & Newby, LLP, and files this Complaint in Mortgage Foreclosure pursuant to the Pennsylvania Rules of Civil Procedure and avers the following: PARTIES 1. Plaintiff is a banking institution with an address as listed above. Plaintiff was formerly operating as Commerce Bank/Harrisburg, N.A. and is currently known as Metro Bank. 2. Defendant, DGA, Inc. d/b/a Infinity Print Graphics ("DGA") is a corporation with a place of business as listed above. 3. Defendant, Michael R. Guion ("M. Guion") is an adult individual with an address as listed above. 4. Defendant, Vicki B. Guion ("V. Guion") is an adult individual with an address as listed above. VENUE 5. Venue is proper in Cumberland County in that said County is the county where the Defendants reside or have a place of business. FACTS 6. On or about February 8, 2002, Plaintiff loaned DGA the principal sum of $92,500.00 with interest in accordance with the terms and conditions of a certain Promissory Note of even date executed by DGA in favor of Plaintiff (the "Note"). A true and correct copy of the Note is attached hereto as Exhibit 1. 7. On or about February 8, 2002, M. Guion and V. Guion ("Guarantors") entered into a guarantee wherein they unconditionally and irrevocably assured and guaranteed DGA's obligations under the Note (the "Guarantee"). A true and correct copy of the Guarantee is attached as Exhibit 2. 8. On or about February 8, 2002, DGA executed a Loan Agreement which incorporates by reference an SBA Authorization. A true and correct copy of the Loan and SBA Authorization is attached as Exhibit 3. 9. The Guarantee requires the Guarantors to provide such financial statements as Plaintiff may require. The SBA Authorization requires DGA to provide such financial statement and reports as Plaintiff may require. Plaintiff has made repeated requests for financial statements including without limitation the 2010 tax return for DGA and Guarantors but said 2010 tax returns have not been delivered to Plaintiff. A default under the SBA Authorization and the Guarantee is a default under the Note. As a result of the default, the entire unpaid balance of principal indebtedness, together with all accrued and unpaid interest, and all of Plaintiffs costs as authorized in the Note are immediately due and payable, comprised as follows: Principal Balance Due: $ 61,953.47 Interest Due through March 15, 2012: $ 100.72 Late Charges: $ 38.77 Attorney's Fees: $ 3,102.67 Costs of Suit and Title Search: $ 500.00 Total Sum Due $ 65,695.63 Interest accrues on the Note from and after March 16, 2012, at the per diem rate of $7.19. WHEREFORE, Plaintiff demands judgment against Defendants in the amounts set forth in paragraph 9 above and for such other relief as the court may deem just and appropriate. Respectfully submitted, Weber Gallagher Simpson Stapleton Fires Newby, LLP Dated: 3 d 1 L By: P TER . ELTZER, ESQUO(E VERIFICATION I, ?• UP?t°j3D/? , an authorized representative of Metro Bank am duly authorized to make this Verification on behalf of Metro Bank, and do hereby verify that the statements made in the foregoing Complaint are true and correct to the best of my knowledge, information and belief. I further understand that the statements therein made are subject to the penalties of 18 Pa. C.S. Section 4904, relating to unsworn falsification to authorities. Exhibit 1 0S Small Fusinew, Administration . U.S. Small Business Administration NOTE SBA Loan # PLP 516-974-4003 SBA Loan Name DGA Inc. d/b/a Infinity Print Graphics Date February 8, 2002 Loan Amount 92,500.00 Interest Rate New York Prime + 1.00%, floating - Initial rate of 5 75% Borrower DGA Inc. d/b/a Infinity Print Graphics Operating Company N/A Lender Commerce Bank/Harrisburg, N.A. 1. PROMISE TO P.AY In return for the Loan. Bornmer pronlises to pal to the order nl LiI1dCl. the amount of Ninetv-two thousand five hundred and 00/100------------------------------------------------------------- I )oI lar? interest on the unpaid principal balance. and all other ainoUllts required b\ this Note. 2. DEFINITIONS: "Collateral" means any property taken as security f'or payment of this Note or any guarantee of this Notc. "Guarantor" means each person or entity that signs a guarantee of payment of this Note. "I.oan" means the loan evidenced by this Note. i.oan Documents" means the documents related to this loan sieved by Borrower. any Guarantor. or anyone 1? ho pledges collateral. "SBi1" means the Small Business Administration, an Agency of the United States of America. SBA Form 147 (10122/98) Previous' editions obsolete Page 116 3. PAYMENT TERMS: Borrower must make all payments at the place Lender designates. The payment terms for this Note are: The interest rate on this Note will not fluctuate. The initial interest rate is 5.75% per year. This initial rate is the prime rate on the date SBA received the loan application, plus 1.00%. Borrower must pay one payment of interest only on the disbursed principal balance one month from the month this Note is dated; payment must be made on the first calendar day in the month it is due. Borrower must pay principal and interest payments of $582.00 every month, beginning one month from the month this Note is dated; payments must be made on the first calendar day in the months they are due. Lender will apply each installment payment first to pay interest accrued to the day Lender receives the payment, then to bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal. Lender may adjust the interest rate for the first time no earlier than the first calendar day of the first month after initial disbursement. The interest rate will then be adjusted quarterly (the "change period:). The "Prime Rate" is the prime rate in effect on the first business day of the month in which a change occurs, as published in the Wall Street Journal on the next business day. The adjusted interest rate will be 1.00% above the Prime Rate. Lender will adjust the interest rate on the first calendar day of each change period. The change in interest rate is effective on that day whether or not Lender gives Borrower notice of the change. The initial interest rate must remain in effect until the first change period begins. Lender must adjust the payment amount at least annually as needed to amortize principle over the remaining term of the note. If SBA purchases the guaranteed portion of the unpaid principal balance, the interest rate becomes fixed at the rate in effect at the time of the earliest uncured payment default. If there is no uncured payment default, the rate becomes fixed at the rate in effect at the time of purchase. All remaining principal and accrued interest is due and payable 25 years from date of Note. Late Charge: If a payment on the Note is more than 10 days late, Lender may charge Borrower a late fee of up to 5% of the unpaid portion of the regularly scheduled payment. PREPAYMENT CHARGE: In addition to any other fees referenced in this note, when, in any one year, a Borrower voluntarily prepays more than 25 percent of the outstanding principal balance of the loan, the Borrower must pay to SBA a prepayment fee as follows: a) During the first year after the date on which the loan is first disbursed, 5 percent of the prepayment amount, b) During the second year after the date on which the loan is first disbursed, 3 percent of the prepayment amount; and, c) During the third year after the date on which the loan is first disbursed, 1 percent of the prepayment amount. SBA Form 147 (10/22/98) Previous editions obsolete Page 2/6 4. RIGHT TO PREPAY: Borrower may prepay this Note. Borrower may prepay 20 percent or less of the unpaid principal balance at any time without notice. If Borrower prepays more than 20 percent and the Loan has been sold on the secondary ntarket. Borrower must. A Give Lender written notice. 13 Psv all accrued interest: and C. If the prepayment is received less than 21 days from the date Lender receives the notice, pay an amount equal to 21 days' interest from the date lender receives the notice. less any interest accrued during.the 21 clays ano paid under subparagraph B. If Borrower does not prepay within 60 days from the date Lender receives the notice, Borrower must give Lender a new nonce. 5. DE-FA1,11': Borro?\er is in default under this Note if Borrower does not make a payment when due under this Note, or it' Burrower or Operating Company: A. Fails to do anything required by this Note and other Loan Documents; 13. Defaults on any other loan with Lcnder; C. Does not preserve, or account to Lender's satisfaction for, any of the Collateral or its proceeds; D. Does not disclose, or 2nyone acting on their behalf does not disclose, any material fact to Lender or SBA, L. Makes, or anyone acting on their behalf makes, a materially false or misleading representation to Lender or SBA: F. Defaults on any loan or agreement with another creditor. if Lender believes the default may niateriall affect Borrower's ability to pay this Note: (; Fails to pay and taxes when due, I I Becomes the sub.jcct of a proceeding under am bankruptc.\ or insolvency late. I Has a receiver or liquidator appointed for any part of their business or property. .I. Makes an assignment for the benefit of creditors: K Ha: any adverse change in financial condition or business operation that Lender believes nrt% nrucriall% affect Borrower's ability to pad this Note: L. Reorganizes, merges, consolidates. or otherwise changes ownership or business structure xithout Lcnd,c) 's prior written consent: or M. Becomes the subject of a civil or criminal action that Lcnder believes may materially affect 13orruwcr'> ibilit\ to pay this Note. 6 LENDER'S RIGHTS IF THERE IS A DEFAULT Without notice or demand and without giving up any of its rights. Lender may: A. Require immediate payment of all amounts owing under this Note; B. Collect all amounts owing from any Borrower or Guarantor, C. File suit and obtain judgment: D Take possession of any Collateral. or E. Sell, lease, or otherwise dispose of, any Collateral at public or private sale, with or without advertisement. SBA Form 147 (10/22/98) Previous editions obsolete Page 316 7 LF:N[VR'S GENERAL. PO%\,LRS. Without notice and without Rorrowei 's consent, Lender ma`. A. Bid on or buy the Collateral at its sale or the sale of another lienholder. at any price it chousc? B. Incur expenses to collect amounts due under this Note, enforce the terms of this Note or an.\ other Lean Document, and preserve or dispose of the Collateral. Among other things, the expenses may include payments for property taxes, prior liens, insurance, appraisals. environmental remediation costs, and reasonable attorney's fees and costs. If Lender incurs such expenses, it may demand immediate repayment from Borrower or add the expenses to the principal balance: C. Release anyone obligated to pay this Note; D. Compromise, release, renew, extend or substitute any of the Collateral: and E. 'rake any action necessary to protect the Collateral or collect amounts owing on this Note. S WFIFN FEDERAL LAW APPLIES: When SBA is the holder, this Note will be interpreted and enforced under federal law. inCluding SBA regulations. Lender or SBA may use state or local procedures for filing papers. recording documents, giving notice. foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax, or liability. As to this Note, Borrower mad not claim or assert against SBA any local or state la\v to deny any obligation: defeat any claim of SBA, or preempt lecral law. 9 St CCI:SSORS AND ASS]( iNS: Linder this Note. Borrower and OperminL, Compam O1Clude the successors of each, and Lender include it, successors ind as?)Lnl 10. GENERAL PROVISIONS A All individuals and entities signing this Note are jointly and severally liable. il. Borrower waives all suretyship defenses C Borrower must sign all documents necessary at any time to Comply with the Loan Document, and to enahlc Lender to acquire, perfect, or maintain Lender's liens on Collate ai D Lender may exercise.anY of its rights separately or together. as many times and in any Order it chooses. Lender may delay or forgo enforcing any of its rights without giving up any of them. E Borrower may not use an Aral statement of Lender or SBA to contradict or alter the written terms oi'this Note. F If any part of this Note is unenforceable, all other parts remain in effect. G, To the extent allowed by law, Borrower waives all demands and notices in connection with this Note. including presentment. demand, protest, and notice of dishonor. Borrower also waives any defenses haled upon any claim that Lender did not obtain any guarantee: did not obtain, perfect, or maintain a lien upon Collateral impair. d Collateral: or did not ohmin the fair market value of Collateral at a sale. SBA Form 147 (10122/98) Previous editions obsolete Page 4/6 1 1. STATE-SPECIFIC PROVISIONS: Borrower hereby irrevocably authorizes and empowers any attorney or the attorney or the prothonotary or clerk of any court in the Commonwealth of Pennsylvania, or elsewhere, to appear at any time for Borrower after a default under this Note, and with or without complaint filed, as of any term, confess or enter judgment against borrower for the entire principal balance of this Note, all accrued interest, late charges, and any and all amounts expended or advanced by Lender relating to any collateral securing this Note together with interest on such amounts, together with costs of suit, and an attorney's commission of ten percent (10%) of the unpaid principal balance and accrued interest for collection, but in any event not less than five hundred dollars ($500) on which judgement or judgements 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 judgement against Borrower shall not be exhausted by any exercise of that authority, but shall continue from time to time and at all times until payment in full of all amounts due under this Note. Borrower hereby waives any right Borrower may have to notice or to a hearing in connection with any such confession of judgment, except any notice andior hearing required under applicable law with respect to execution of the judgment, and states that either a representative of Lender specifically called this confession of judgment provision to Borrower's attention or Borrower has been represented by independent legal counsel The lien arising from any judgment confessed or entered pursuant to the foregoing authority shall not extend to any of Borrower's residential real property as that term is defined in the Pennsylvania Act of January 30, 1974 (PA Laws 13, No. 6), referred to as the loan interest and protection law as amended. and the holder of any judgment confessed or entered pursuant to the foregoing authority shall not, in enforcement of any such judgment execute, levy or otherwise proceed against any such residential real property, provided, however, that the lien of such judgment shall extend to such residential real property and that the holder thereof shall be permitted to execute, levy, or proceed against such residential real property from and after the entry of a judgment as contemplated by Section 407 of such loan interest and protection law and Rules 2981 to 2986 of the Pennsylvania Rules of Civil Procedure, or successor or similar statutes and rules. No limitation of lien or any execution, levy or other enforcement contained in the immediately preceding sentence shall apply with respect to any judgment obtained other than by the foregoing authority to confess or enter judgment. SBA Form 147 (10122198) Previous editions obsolete Page 516 12. BORROWER'S NAME(S) AND SIGNATURE(S): Bysigning below, each indn idual or entity becomes obligatCd under this Note as Borro\wr. nrA Inn doh/a Infinity Prini Graphics Michael R. Guion, President February 8, 2002 SBA Form 147 (10122/98) Previou5editions obsolete Page 616 Exhibit 2 US. Small tlusine a Adminiatratton . U.S. Small Business Administration UNCONDITIONAL GUARANTEE SBA Loan # PLP 516-974-4003 SBA Loan Name DGA Inc. d/b/a Infinity Print Graphics Guarantor Michael R..Guion Vickie B. Guion Borrower DGA Inc. d/b/a Infinity Print Graphics Lender Commerce Bank/Harrisburg, N.A. Date February 8, 2002 Note Amount 92,500.00 L GUARANTEE: Guarantor unconditionally guarantees payment to Lender of all amounts owing under the Note. "Ibis GWIraI I tee remains in effect until the Note is paid in full. Guarantor must pay all amounts due under the Note when Lender makes written demand upon Guarantor. Lender. is not required to seek payment from any other source before demanding payment from Guarantor. 2. NOTE: The "Note" is the promissory note dated February 8, 2002 Ninety-two thousand five hundred and 00/1 in the principal amount of Doilars. from Borrower to Lender. It includes any assumption, renewal, substitution, or replacement of the Note, and multiple notes under a line of credit. 3. DEFINITIONS: "Collateral" means any property taken as security for payment of the Note or any guarantee of the Note. "Loan" means the loan evidenced by the Note. "Loan Documents" means the documents related to the Loan signed by Borrower, Guarantor or any other guarantor, or anyone who pledges Collateral. "SBA" means the Small Business Administration, an Agency of the United States of America. SBA Form 148 (10/98) Previous editions obsolete. Page 1/5 4. LENDER'S GENERAL POWERS: Lender may take any of the following actions at any time, without notice, without Guarantor's consent, and without making demand upon Guarantor: A. Modify the terms of the Note or any other Loan Document except to increase the amounts due under the Note; B. Refrain from taking any action on the Note, the Collateral, or any guarantee; C. Release any Borrower or any.guarantor of the Note; D. Compromise or settle with the Borrower or any guarantor of the Note; E. Substitute or release any of the Collateral, whether or not Lender receives anything in return; F. Foreclose upon or otherwise obtain, and dispose of, any Collateral at public or private sale, with or without advertisement; G. Bid or buy at any sale of Collateral by Lender or any other penholder, at any price Lender chooses; and H. Exercise any rights it has, including those in the Note and other Loan Documents. These actions will not release or.reduce the obligations of Guarantor or create any rights or claims against lender. 5. FEDERAL LAW: When SBA is the holder, the Note and this Guarantee will be construed and enforced under federal law, including SBA regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax; or liability. As to this Guarantee, Guarantor may not claim or assert any local or state law against SBA to deny any obligation, defeat any claim ol'SIIA, or preempt federal law. 6. RIGHTS, NOTICES, AND DEFENSES THAT GUARANTOR WAIVES: To the extent permitted by law, A. Guarantor waives all rights to: I) Require presentment, protest, or demand upon Borrower; 2) Redeem any CoIlateral'before or after Lender disposes of it; 3) Have any disposition of Collateral advertised; and 4) Require a valuation of Collateral before or after Lender disposes of it. B. Guarantor waives any notice of: 1) Any default under the Note; 2) Presentment, dishonor, protest, or demand; 3) Execution of the Note; 4) Any action or inaction on the Note or Collateral, such as disbursements, payment, nonpayment, acceleration, intent to accelerate. assignment, collection activity, and incurring enforcement expenses; >) Any change in the lmancial condition or business operations of Borrower or any guarantor. 6) Any changes in the terms of the Note or other loan Documents, except increases in the amounts due under the Note; and 7) The time or place of any sale or other disposition of Collateral. C. Guarantor waives defenses based upon any claim that: 1) Lender failed to bbtain any guarantee; 2) Lender failed to obtain, perfect, or maintain a security interest in any property offered or taken as Collateral; 3) Lender or others improperly valued or inspected the Collateral; 4) The Collateral changed in value, or was neglected, lost, destroyed, or underinsured: SBA Form 148 (10198) Previous editions obsolete. Page 2/5 5) Lender impaired the Collateral; 6) Lender did not dispose of any of the Collateral; 7) Lender did not conduct a commercially reasonable sale; 8) Lender did not obtain the fair market value of the Collateral; 9) Lender did not make or perfect a claim upon the death or disability of Borrower or any guarantor of the Note; 10) The financial condition of Borrower or any guarantor was overstated or has adversely changed: 11) Lender made errors or omissions in Loan Documents or administration of the Loan. 12) Lender did not seek payment from the Borrower, any other guarantors, or any Collateral hcfore demanding payment from Guarantor: 13) Lender impaired Guarantor's suretyship rights; 14) Lender modified the Note terms, other than to increase amounts due under the Note. If Lender modifies the Note to increase.the amounts due under the Note without Guarantor's consent, Guarantor will not be liable for the increased amounts and related interest and expenses, but remains liable for all other amounts; 15) Borrower has avoided liability on the Note; or 16) Lender has taken an action allowed under the Note, this Guarantee, or other Loan Documents. 7. DUTIES AS TO COLLATERAL: Guarantor will preserve the Collateral pledged by Guarantor to secure this Guarantee. Lender has no duty to preserve or dispose of any Collateral. 8. SUCCESSORS AND ASSIGNS: Under this Guarantee, Guarantor includes heirs and successors, and Lender includes its successors and assigns. 9. GENERAL PROVISIONS. A. ENFORCEMENT EXPENSES. Guarantor promises to pay all expenses Lender incurs to enforce this Guarantee, including, but not limited to, attorney's fees and costs. B. SBA NOT A CO-GUARANTOR. Guarantor's liability will continue even if SBA pays Lender. S13A is not a co-guarantor with Guarantor. Guarantor has no right of contribution from SBA. C. SUBROGATION RIGHTS. Guarantor has no subrogation rights as to the Note or the Collateral until the Note is paid in full. D. JOINT AND SEVERAL LIABILITY. All individuals and entities signing as Guarantor are jointly and severally liable. E. DOCUMENT SIGNING. Guarantor must sign all documents necessary at any time to comply with the Loan Documents and to enable bender to acquire, perfect, or maintain Lender's liens on Collateral. F. I INANCIAL STATI;MI.:NTS. Guarantor must give Lender financial statements as Lender requires. a G I,FNDER'S RIGHTS CUMLJL.ATIVI':- NOT WAIVED Lender may exercise any of its rights scparaicly or together, as many times as it chooses. Lender may delay or forgo enforcing any of its rights without !o."ing or impairing any of them. H. ORAL. STATEMENTS NOT BINDING. Guarantor may 1101 use an oral statement to contradict or alicr the written terms of the Note or this Guarantee, or to raise a defense to this Guarantee. 1. SEVERABILITY. If any part of this Guarantee is found to be unenforceable, all other parts will remain in effect. J. CONSIDERATION. The consideration for this Guarantee is the Loan or any accommodation by Lender as to the Loan. SBA Form 148 (10/98) Previous editions obsolete. Page 3/5 10. STATE-SPECIFIC PROVISIONS: Guarantor hereby irrevocably authorizes and empowers any attorney or the attorney or the prothonotary or clerk of any court in the Commonwealth of Pennsylvania, or elsewhere, to appear at any time for Guarantor after a default under this Note, and with or without complaint filed, as of any term, confess or enter judgment against borrower for the entire principal balance of this Note, all accrued interest, late charges, and any and all amounts expended or advanced by Lender relating to any collateral securing this Note together with interest on such amounts, together with costs of suit, and an attorney's commission of ten percent (10%) of the unpaid principal balance and accrued interest for collection, but in any event not less than five hundred dollars ($500) on which judgement or judgements 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 judgement 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 Note. Guarantor hereby waives any right Guarantor may have to notice or to a hearing in connection with any such confession of judgment, except any notice and/or hearing required under applicable law with respect to execution of the judgment, and states that either a representative of Lender specifically called this confession of judgment provision to Guarantor's attention or Guarantor has been represented by independent legal counsel. The lien arising from any judgment confessed or entered pursuant to the foregoing authority shall not extend to any of Guarantor's residential real property as that term is defined in the Pennsylvania Act of January 30, 1974 (PA Laws 13, No. 6), referred to as the loan interest and protection law, as amended, and the holder of any judgment confessed or entered pursuant to the foregoing authority shall not, in enforcement of any such judgment execute, levy or otherwise proceed against any such residential real property; provided, however, that the lien of such judgment shall extend to such residential real property and that the holder thereof shall be permitted to execute, levy, or proceed against such residential real property from and after the entry of a judgment as contemplated by Section 407 of such loan interest and protection law and Rules 2981 to 2986 of the Pennsylvania Rules of Civil Procedure, or successor or similar statutes and rules. No limitation of lien or any execution, levy or other enforcement contained in the immediately preceding sentence shall apply with respect to any judgment obtained other than by the foregoing authority to confess or enter judgment. SBA Form 148 (10/98) Previous editions obsolete. Page 4/5 1 1. GUARANTOR ACKNOWLEDGMENT OF TERMS. Guarantor acknowledges that Guarantor has read and understands the significance of all terms of the Note and this Guarantee, including all waivers. 12. GUARANTOR NAME(S) AND SIGNATURE(S): By signing below, each individual or entity becomes obligated as Guarantor under this Guarantee. Michael R. Guion and Vickie B. Guion Michael R. Guion Vickie B. Guion February 8, 2002 February 8, 2002 SBA Form 148 (10/98) Previous editions obsolete. Page 5/5 Exhibit 3 LOAN AGREEMENT THIS LOAN AGREEMENT ("Agreement") is made February 8, 2002 between the Borrower and Lender identified in the attached Authorization issued by the U.S. Small Business Administration ("SBA") to Lender, dated January 23, 2002 SBA Loan Number PLP 516-974-4003 ("Authuriratiun"). SBA has authorized a guaranty of a loan from Lender to Borrower for the amount and undcr the tcmi? stated in the attached Authorization (the "Loan") In consideration of the promises in this Agreement and Im other good and valuable consideration, Borrower and Lender agree as follows: 1. Subject to the terms and conditions of the Authorization and SBA's Participating Lender Rules as defined in the Guarantee Agreement between Lender and SBA, Lender agrees to make the Loan if' Borrower complies with the following "Borrower Requirements". Borrower must: a. Provide Lender with all certifications, documents or other information Lender is required by the Authorization to obtain from Borrower or any third party; b. Execute a note and any other documents required by Lender; and c. Do everything necessary for Lender to comply with the terms and conditions of the Authorization. 2. The terms and conditions of this Agreement: a. Are binding on Borrower and Lender and their successors and assigns, and b. Will remain in effect allcr the closing of the Lonn. 3. Failure to abide, by any of the Burrower Rcquircmcnt? will constitute an event Of del"ItUll under the note and other loan documents Borrower: DGA Inc. d/b/a Infinity Print Graphics By Date February 8, 2002 Michael R. Guion, President Lender: Commerce Bank/Harrisburq, N.A. B Dale: February 8. 2002 U.S. Small Business Administration EEC AUTHORIZATION (SBA GUARANTEED LOAN) SBA Loan # PLP 516-974-4003 SBA Loan Name Infnit Print Graphics Approval Date January 23, 2002 Lender: U. S. Small Business Administration (SBA): Commerce Bank/Harrisuburg, N.A. Harrisburg Branch Office 100 Senate Avenue 100 Chestnut Street - Room 307 Camp Hill, PA 17011 Harrisburg, PA 17101- SBA approves, under Section 7(a) of the Small Business Act as amended, Lender's application. received January 23, 2002, for SBA to guarantee 85'% of a loan ("Loan") in the amount of $92,500.00 to assist: Borrower: DGA, Inc. dba Infinity Print Graphics 121 North Pitt Street Carlisle, PA 17013 All requirements in the Authorization which refer to Borrower also apply to any Co-Borrower, A. THE GUARANTEE FEE IS $1_,572.50. Lender must pay-the guarantee fee within 90 days of the date of this Authorization. Failure to timely pay the guarantee fee will result in cancellation of the SBA guarantee.' The 90-day deadline may not be extended. Lender must send the guarantee fee to the Small Business Administration, Denver, CO 80259-0001. The remittance check should show the Loan number. No part of the guarantee fee is refundable if Lender has made any disbursement. Lender may collect this fee from Borrower after initial disbursement of Loan, BOrroWC]' May use Loan proceeds to reimburse Lender for the guarantee fee. B. ONGOING SERVICING FEE -Lender agrees to pay an ongoing fee equal to one-half ol'one percent per year of the guaranteed portion of the outstanding balance. Lender may not charge this fee to Borrower. C. IT IS LENDER'S SOLE RESPONSIBILITY TO : Close the Loan in accordance with the terms and conditions of this Authorization. 2. Obtain valid and enforceable Loan documents, including obtaining the signature or written consent of any obligor's spouse if such consent or signature is necessary to bind the marital community or create a valid lien on marital property. SBA Loan Number: -PLP 516-974-4003 Page 1 SBA Loan Name: Inf nity_Print_Graphics (Word 2000 Courtesy Release 9/00 -- 7a Wizard 3.0) 3. Retain all Loan closing documents. Lender must submit these documents, along with other required documents, to SBA for review if Lender requests SBA to honor its guarantee on the Loan, or at any time SBA requests the documents for review. D. REQUIRED FORMS Lender may use its own forms except as otherwise instructed in this Authorization. Lender must use the following SBA forms for the Loan: SBA Form 147, Note SBA Form 1050, Settlement Sheet, for each disbursement SBA Form 159, Compensation Agreement, for each representative SBA Form 2004, Lender's Certification SBA Form 722, Equal Opportunity Poster SBA Form 793, Notice to New Borrowers SBA Form 148, Guarantee 2. Lender may use computer-generated versions of mandatory SBA Forms, as long as these versions are exact reproductions. Lenders must submit completed SBA Forms 159 and 2004 for non-PLP loans to the SBA immediately after final disbursement. E. CONTINGENCIES - SBA issues this Authorization in reliance on representations in the Loan application, including supporting documents. The guarantee is contingent upon lender : Having and complying with a valid SBA Loan Guarantee Agreement (SBA Form 750 or SBA Form 750B, for short-term loans) and any required supplemental guarantee agreements, between Lender and SBA; 2. Complying with the current SBA Standard Operating Procedures (SOP); Making initial disbursement of the Loan no later than 3 months, and completing disbursement no later than 6 months, from the date of this Authorization, unless SBA extends the time in writing; 4. Having no evidence since the date of the Loan application, or any preceding disbursement, of any unremedied adverse change in the financial condition, organization, operations, or fixed assets of Borrower which would warrant withholding or not making any further disbursement, and; 5. Satisfying all of the conditions in this Authorization. SBA Loan Number: PLP 516-974-4003 page 2 SBA Loan Name: Infinity.Print_Graphics (Word 2000 Counesy Rclcasc 9mo - 7a Wizard 3.0) F. NOTE TERMS : Maturity: This Note will mature in 25 years from date of Note. Repayment Terms: Lender must insert onto SBA Note, Form 147, to be executed by Borrower, the following repayment terms, without modification. Lender must complete all blank terms on the Note at time of closing: The interest rate on this Note will fluctuate. The initial interest rate is 5.75°4b per year. This initial rate is the prime rate on the date SBA received the loan application, plus 1.00%. Borrower must pay principal and interest payments of $801.00 ever?__mont.li, beginning one month from the month his Note dated; _payments must be made on the first calendar day in the months they are due. Lender will apply each installment payment first to pay interest accrued to the day Lender receives the payment, then to bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal. The interest rate will be adjusted every calendar quarter (the "change period"). The "Prime Rate" is the prime rate in effect on the first business day ol'the month in which an interest rate change occurs, as published in the Wall Street Journal on the next business day. The adjusted interest rate will be 1.00% above the Prime Rate. Lender will adjust the interest rate on the first calendar day of each change period. The change in interest rate is effective on that day whether or not Lender gives Borrower notice of the change. The initial interest rate must remain in effect until the first change period begins. Lender must adjust the payment amount at least annually as needed to amortize principal over the remaining term of the note. If SBA purchases the guaranteed portion of the unpaid principal balance, the interest rate becomes fixed at the rate in effect at the time of the earliest uncured payment default. If there is no uncured payment default, the rate becomes fixed at the rate in effect at the time of purchase. All remaining principal and accrued interest is due and payable 25 years from date of Note. Late Charge : If a payment on this Note is more than 10 days late, Lender may charge Borrower a late fee of up to 5% of the unpaid portion of the regularly scheduled payment. 3. Lender, at its option, may include confession of judgment clauses in the Note for borrower(s) resident in Pennsylvania. G. USE OF PROCEEDS $92,500.00 to purchase land located at 121 North Pitt Street, Carlisle, PA 17013. All amounts listed above are approximate. Lender must document that Borrower used the loan proceeds for the.purposes stated in this Authorization. SBA Loan Number: PLP 516-974-4003 Page 3 SBA Loan Name: Infinity Print_Graphics (Word 2000 Courtesy Release 9/00 --- 7a Wizard 3.0) Lender may not disburse Loan proceeds solely to pay the guarantee fee. Lender may disburse to Borrower, as working capital only, funds not spent for the listed purposes as long as these funds do not exceed 10% of the specific purpose authorized or $10,000.00, whichever is less. An Eligible Passive Company may not receive working capital funds. Lender must complete SBA Form 1050, Settlement Sheet, for each disbursement and retain these forms in its Loan file. H. COLLATERAL CONDITIONS Lender must obtain a lien on 100% of the interests in the following collateral and properly perfect all lien positions: First Mortgage (including due on sale clause and assignment of rents) on land and improvements located at 121 North Pitt Street, Carlisle, PA 17013. This property is commercial. a. Subject to no other liens. b. Evidence of title and priority of lien must be based upon (1) Title insurance customarily obtained for similar transactions in this jurisdiction. Guarantee on SBA Form 148, by Michael R. Guion, resident in Pennsylvania. Guarantee on SBA Form 148, by Vickie B. Guion, resident in Pennsylvania. The following language must appear in all lien instruments including Mortgages, Decd., of'frust, and Security Agreements: "The Loan secured by this lien wa.s made under a United States Small L3u.ciue.`s .4rlmi,ristration (SBA) nationwide program which uses tax dollars to assist small business 014:rlers. If the United States is seeking to enforce this document, then under SBA regulations a) When SBA is the holder of the Note, this document and all documents evidencing or securing this Loan will be construed in accordance with federal lativ, b) Lender or SBA may use local or state procedures for purposes such us filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using these procedures, SBA does not waive any.federal immunity from local or state control, penalty, tax or liability. No Borrower or Guarantor may claim or assert against .SBA any local or state law to deny any obligation of Borrower, or defeat any claim of SBA ivith respect to this Loan. Any clause'in this document requiring arbitration is not enforceable when SBA is the holder of the Note secured by this instrument. " SBA Loan Number: PLP 516-974-4003 Page 4 SBA Loan Name: In.finity PTint_Graphics (Word 2000 Courtesy Release 9/00 - 7a Wizard 3.0) I. ADDITIONAL CONDITIONS Insurance Requirements Prior to disbursement, Lender must require Borrower to obtain the following insurance coverage and maintain this coverage for the life of Loan: a. Flood Insurance. If FEMA Form 81-93 reveals that any portion of the collateral is located in a special flood hazard zone, Lender must require Borrower to obtain Federal flood insurance, or other appropriate special hazard insurance, in amounts equal to the lesserof the insurable value of the property or the maximum limit of coverage available. (Borrower will be ineligible for any future SBA disaster assistance or business loan assistance if Borrower does not maintain any required flood insurance for the entire term of the Loan.) b. Real Estate Hazard Insurance coverage on all real estate that is collateral for the Loan in the amount of the full replacement cost. If full replacement cost insurance is not available, coverage should be for maximum insurable value. Insurance coverage must contain a MORTGAGEE CLAUSE (or substantial equivalent) in favor of Lender. This clause must provide that any act or neglect of the mortgagor or owner of the insured property will not invalidate the interest of Lender. The policy or endorsements must provide for at least 10 days prior written notice to Lender of policy cancellation. Environmental Requirements a. Lender may not disburse the Loan until it has: (1) completed the review for potential environmental contamination required in SOP 50 10(4) ("Environmental Investigation") on each business real property site that is: (a) acquired or improved with proceeds from Loan, or (b) taken as collateral if the site represents over 50% of the value of all collateral securing the Loan; and (2) sufficiently minimized the risk from any adverse environmental findings discovered in the Environmental Investigation, or otherwise, as required by SOP 50 10(4), Subpart A, Chapter 5, Paragraph 7 (Environmental Conditions). b, Lender should consult with the local SBA office where the real property collateral is located to ascertain any state or local environmental requirements. Borrower, Guarantor and Operating Company Documents Prior to closing, Lender must obtain from Borrower, Guarantor and Operating Company a current copy of each of the following as appropriate: (1) Corporate Documents - Articles or Certificate of Incorporation (with amendments), any By-laws, Certificate of Good Standing (or equivalent), Corporate Borrowing Resolution, and, if a foreign corporation, current authority to do business within this state. (2) Limited Liability Company (LLC) Documents - Articles of Organization (with amendments), Fact Statement or Certificate of Existence, Operating Agreement, Borrowing Resolution, and evidence of registration with the appropriate authority. (3) General Partnership Documents - Partnership Agreement, Certificate as to Partners, and Certificate of Partnership or Good Standing (or equivalent), as applicable. SBA Loan Number: PLP 516-974-4003 Page 5 SBA Loan Name: Infinity Print. Graphics (Word 2000 Courtesy Release 9/00 - 7a Wizard 3.0) (4) Limited Partnership Documents - Partnership Agreement, Certificate as to Partners, and Certificate of Partnership or Good Standing (or equivalent), as applicable, Certificate of Limited Partnership, and evidence of registration with the appropriate authority. (5) Limited Liability Partnership (LLP) Documents - Partnership Agreement, Certificate as to Partners, Certificate of Partnership or Good Standing (or equivalent) as applicable, and evidence of registration with the appropriate authority. (6) Trustee Certification - A Certificate from the trustee warranting that: (a) The trust will not be revoked or substantially amended for the term of the Loan without the consent of SBA; (b) The trustee has authority to act; (c) 'rbe trust has the authority to borrow funds, guarantee loans, and pledge trust . assets; (d) If the trust is an Eligible Passive Company, the trustee has authority to lease the property to the Operating Company; (e) There is nothing in the trust agreement that would prevent Lender from realizing on any security interest in trust assets; (f) The trust agreement has specific language confirming the above; and (g) The trustee has provided and will continue to provide SBA with a true and complete list of all trustors and donors. (7) Trade Name - Documentation that Borrower has complied with state requirements for registration of Borrower's trade name (or fictitious name), if one is used. Prior to closing, Lender must obtain from Borrower and Operating Company: (1) Purchase-Sale Agreement - Executed Purchase-Sale Agreement. (2) Ownership: Evidence that Borrower's ownership and managers are as stated in the application, and have not changed since the application was submitted. 4. Operating.Information Prior to any disbursement of Loan proceeds, Lender must obtain: Verification of Financial Information - Lender must submit IRS Form 4506 to the Internal Revenue Service to obtain federal income tax information on Borrower or, if the Borrower is an EPC, then the Operating Company for the last 3 years (unless Borrower or Operating Company is a start-up business). If the business has been operating for less than 3 years, lender must obtain the information for all years in operation. This requirement does not include tax information for the most recent fiscal year if the fiscal year-end is within 6 months of the application date. Lender must compare the tax data received fi-om the IRS with the financial data or tax returns submitted with the Loan application, and relied upon in approving the Loan. Borrower must resolve any significant differences to the satisfaction of Lender and SBA. Failure to resolve differences may result in cancellation of the Loan. b. If Lender does not receive a response from the IRS within 10 business days of submitting the SBA version of IRS Form 4506, then Lender may disburse prior to completing this verification provided that Lender has submitted IRS Form 4506 to the IRS no later than 10 business days from the date of this Authorization. Lender must still perform the verification and resolve any significant differences discovered. SBA Loan Number: PLP 516-974-4003 Page 6 SBA Loan Name: Infnity_Print_Graphics (Word 2000 Courtesy Release 9/00 - 7a Wizard 3.0) C. Authority to Conduct Business - Evidence that the Borrower has an Employer Identification Number and all insurance, licenses, permits and other approvals necessary to lawfully operate the business. d. Flood Hazard Determination - A completed Standard Flood Hazard Determination (FEMA Form 81-93). 5. Certifications and Agreements Lender must require Borrower to certify that: (1) Receipt of Authorization - Borrower has received a copy of this Authorization and SBA Form 793, Notice to New SBA Borrower, from Lender; and acknowledges that: (a) The Authorization is not a commitment by Lender to make a loan to Borrower; (b) The Authorization is between Lender and SBA and creates no third party rights or benefits to Borrower; (c) The Note will require Borrower to give Lender prior notice of intent to prepay. (d) If Borrowet defaults on Loan, SBA may be required to pay Lender under the SBA guarantee. SBA may then seek recovery of these funds from Borrower. Under SBA regulations, 13 CFR Part 101, Borrower may not claim or assert against SBA any immunities or defenses available under local law to defeat, modify or otherwise limit Borrower's obligation to repay to SBA any funds advanced by Lender to Borrower. (e) Payments by SBA to Lender under SBA's guarantee will not apply to the Loan account of Borrower, or diminish the indebtedness of Borrower under the Note or the obligations of any personal guarantor of the Note. (2) Child Support - No principal who owns at least 50% of the ownership or voting interest of the company is delinquent more than 60 days under the terms of any (a) administrative order, (b) court order, or (c) repayment agreement requiring payment of child support. (3) Current Taxes - Borrower is current on all federal, state, and local taxes, including but not limited to income taxes, payroll taxes, real estate taxes, and sales taxes. (4) Environmental - For real estate located at 121 North Pitt Street, Carlisle, PA 17013: (a) At the time Borrower submitted the Loan application, Borrower was in compliance with all local, state, and federal environmental laws and regulations pertaining to environmental contamination; (b) Borrower has and will continue to comply with these laws and regulations; (c) Borrower has no knowledge of any environmental contamination of any real or personal property pledged as collateral for the Ldan which violates any such laws and regulations, (other than what was disclosed in connection with the Environmental Investigation of the property); (d) Borrower assumes full responsibility for all costs incurred in any clean-up of environmental contamination and agrees to indemnify Lender and SBA against payment of any such costs (Lender or SBA may require Borrower to execute a separate indemnification agreement); (e) Until full repayment of Loan, Borrower will promptly notify Lender and SBA if itknows, suspects or believes there may be any environmental contamination in or around the real property securing the Loan, or if Borrower or such property are subject to any investigation or enforcement action by any Governmental agency pertaining to any environmental contamination of the property. SBA Loan Number: PLP 516-974-4003 Page 7 SBA Loan Name: Infinity,. Print. Graphics (Word 2000 Courtesy Release 9/00 - 7a Wizard 3.0) b. Lender must require Borrower to certify that it will: (1) Reimbursable Expenses- Reimburse Lender for expenses incurred in the making and administration of the Loan. (2) Books, Records, and Reports- (a) Keep proper books of account in a manner satisfactory to Lender; (b) Furnish year-end statements to Lender within 120 days of fiscal year end; (c) Furnish additional financial statements or reports whenever Lender requests them; (d) Allow Lender or SBA, at Borrower's expense, to: [1] Inspect and audit books, records and papers relating to Borrower's financial or business condition; and [2] Inspect and appraise any of Borrower's assets; and [3] Allow all government authorities to furnish reports of examinations, or any records pertaining to Borrower, upon request by Lender or SBA. (3) Equal Opportunity - Post SBA Form 722, Equal Opportunity Poster, where it is clearly visible to employees, applicants for employment and the general public, and comply with the requirements of SBA Form 793, Notice to New SBA Borrowers. (4) American-made Products - To the extent practicable, purchase only American-made equipment and products with the proceeds of the Loan. (5) Taxes - Pay all federal, state, and local taxes, including income, payroll, real estate and sales taxes of the business when they come due. Lender must require Borrower to certify that it will not, without Lender's prior written consent: (1) Distributions- Make any distribution of company assets that will adversely affect the financial condition of Borrower. (2) Ownership Changes - Change the ownership structure or interests in the business during the term of the Loan. (3) Transfer of Assets - Sell, lease, pledge, encumber (except by purchase money liens on property acquired after the date of the Note), or otherwise dispose of any of Borrower's property or assets, except in the ordinary course of business. ADMINISTRATOR SMALL BUSINESS ADMINISTRATION January 23, 2002 By: Kristin L. Lombardi, SBA Commercial Loan Officer, Date a Preferred Lender, as Lender and as an agent of and on behalf of the SBA for the purpose of executing this Authorization. SBA Loan Number: PLP 516-974-4003 Page 8 SBA Loan Name: Infinity Print. Graphics (Word 2000 Courtesy Release 9100 - 7a Wizard 3.0) SHERIFF'S OFFICE OF CUMBERLAND COUNTY Ronny R Anderson Sheriff Jody S Smith Chief Deputy ?0'0 t1 r?7,xr/4 i Richard W Stewart Solicitor Metro Bank Case Number vs. DGA, Inc. (et al.) 2012-1829 SHERIFF'S RETURN OF SERVICE 03/24/2012 08:30 AM - Mark Conklin, Deputy Sheriff, who being duly sworn according to law, states that on March 24, 2012 at 0830 hours, he served a true copy of the within Complaint and Notice, upon the within named defendant, to wit: Michael Guion, by making known unto Vickie Guion, Wife of Defendant at 117 Sholly Drive, Mechanicsburg, Cumberland County, Pennsylvania 17055 its contents a at a me time handing to her personally the said true and correct copy of the same. ARK ONKLIN, DEPUTY 03/24/2012 08:30 AM - Mark Conklin, Deputy Sheriff, who being duly sworn according to law, states that on March 24, 2012 at 0830 hours, he served a true copy of the within Complaint and Notice, upon the within named defendant, to wit: Vickie B. Guion, by making known unto herself personally, at 117 Sholly Drive, Mechanicsburg, Cumberland County, Pennsylvania 17055 its contents and at the sne tyre handing to her personally the said true and correct copy of the same. A / / fMAR(< j5 KL# DEPUTY 03/28/2012 12:22 PM - William Cline, Corporal, who being duly sworn according to law, states that on March 28, 2012 at 1222 hours, he served a true copy of the within Complaint and Notice, upon the within named defendant, to wit: DGA, Inc., by making known unto Vickie Clouse, Account Manager for DGA, Inc. at 121 N. Pitt Street, Carlisle, Cumberland County, Pennsylvania 17013 its contents an at the same time handing to her personally the said true and correct copy of the /,,;,/ LLIAM CLINE, DEPUTY SHERIFF COST: $76.00 March 30, 2012 SO ANSWERS, RON R ANDERSON, SHERIFF WEBER GALLAGHER SIMPSON STAPLETON FIRES & NEWBY, LLP By: Peter E. Meltzer Identification No.: 39828 By: Sarah A. Elia Identification No.: 206946 2000 Market Street, 13th Floor Philadelphia, PA 19103 (267) 295-3364 METRO BANK f/k/a COMMERCE BANK/ HARRISBURG, N.A. V. 'J J1 1 8 ". 11, 4 1 'L itj PEN Attorneys for Plaintiff COURT OF COMMON PLEAS CUMBERLAND COUNTY NO. 2012-1829 DGA, INC. d/b/a INFINITY PRINT GRAPHICS et al. PRAECIPE TO DISCONTINUE COMPLAINT To the Clerk: Kindly discontinue the above-captioned Complaint without prejudice. No Answer has been filed in this matter. Respectfully submitted, WEBER GALLAGHER SIMPSON STAPLETON FIRES & NE BY, LLP ' P Dated: June 4, 2012 By: PETER E. E TZER, ESOU-