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HomeMy WebLinkAbout12-3068BARLEY SNYDER LLP William C. Colby, Jr., Esquire Court I.D. No. 46880 50 North Fifth Street, P.O. Box 942 Reading, PA 19603-0942 (610) 376-6651 c: cy) ur) Attorney for Plaintiff SUSQUEHANNA BANK, Successor by Merger to GRAYSTONE BANK Plaintiff V. WESTHAFER CONSTRUCTION, INC. COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL, ACTION - LAW Defendant I No. IA-,30(o ? CONFESSION OF JUDGMENT Nil Pursuant to the authority contained in the Warrant of Attorney, a true and correct copy of which is attached to the Complaint filed in this action, I appear for the Defendant and confess judgment in favor of the Plaintiff and against the Defendant, as follows: Principal Balance $ 107,183.64 Interest to and including 4/18/12 4,557.03 Late Fees 8,276.89 Other Charges 44.00 Attorneys' Fees 11,174.07 Total $ 131,235.63 Interest continues to accrue at the per diem rate of $20.09 from .April 18, 2012, continuing late fees, and costs of collection. BARLEY SNYDER LLP By: -Iwwze?' CA A - - William F. Col y, Jr. E quir S Attorney for Plaintiff 4to 00 Pd g7Tq a-mufpo ?d e# x750-q4 3548292 NACQ BARLEY SNYDER LLP William C. Colby, Jr., Esquire Court I.D. No. 46880 50 North Fifth Street, P.O. Box 942 Reading, PA 19603-0942 (610) 376-6651 Attorney for Plaintiff SUSQUEHANNA BANK, Successor by COURT OF COMMON PLEAS OF Merger to GRAYSTONE BANK CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW WESTHAFER CONSTRUCTION, INC. 1 Defendant No. /- ' 3 6 6 COMPLAINT CONFESSION OF JUDGMENT The Plaintiff, Susquehanna Bank, Successor by Merger to Graystone Bank is a banking corporation maintaining an address of 1828 Good Hope Drive, Enola, PA 17025. 2. Westhafer Construction, Inc. (the "Defendant") is a Pennsylvania corporation with a registered address of 71 Silver Crown Drive, Mechanicsburg, PA 17055. 3. On May 16, 2006, for value received, in connection with a commercial, and not a consumer, transaction, Defendant executed to the order of, and delivered to Plaintiff a certain Promissory Note ("Note") pursuant to which the Defendant promised to pay to Plaintiff the principal amount of One Hundred Twenty-five Thousand Dollars ($125,000.00), plus interest and late fees thereon as therein provided (the "Note"). A true and correct copy of the Note is attached hereto, made a part hereof, and marked as Exhibit "A." A true and correct copy of the 3550821-1 Disclosure for Confession of Judgment is attached hereto, made a part hereof, and marked as Exhibit "B". 4. The Note was modified by a Change in Terms Agreement dated May 29, 2008 (the "Agreement"), modifying various terms and condition of the Note as described in the Agreement. A true and correct copy of the Agreement is attached hereto, made a part hereof, and marked as Exhibit "C". The Note and Agreement are hereinafter collectively referred to as the "Note". The Note has not been assigned and the Plaintiff is the owner of the Note. 6. This Court has subject matter jurisdiction over all causes of action under the Note. 7. The Defendant is in default because the Defendant has failed, refused, and continues to fail and refuse to pay the monthly payments from October S, 2011, and monthly thereafter, due Plaintiff under and pursuant to the Note. 8. The Plaintiff has made a demand upon Defendant for payment under and pursuant to the terms and conditions of the Note, which the Defendant has failed and refused to pay. A true and correct copy of the demand is attached hereto, made a part hereof, and marked as Exhibit "D'". 9. After a default under the terms and conditions of the Note, the Plaintiff may accelerate the full balance due under the Note and declare the entire indebtedness immediately due and payable to Plaintiff without further notice to the Defendant. Plaintiff exercises this option. 10. Judgment is not being entered by confession against a natural person in connection with a consumer credit transaction. 3550821-1 11. Judgment has not been entered on the warrant of attorney contained in the Note in any jurisdiction. 12. An itemization of the amount due and owing to the Plaintiff by the Defendant under the Note and Mortgage, as of April 18, 2012, is as follows: Principal Balance $ 107,183.64 Interest to and including 4/18/12 4,557.03 Late Fees 8,276.89 Other Charges 44.00 Attorneys' Fees 11,174.07 Total $ 131,235.63 Interest continues to accrue at the per diem rate of $20.09 from April 18, 2012, plus late fees, and costs of collection. 13. The warrant of attorney contained in the Note provides for the confession of judgment against the Defendant for the entire principal balance owed under the Note, all accrued interest, late charges, together with costs of suit and an attorney's commission of ten percent (10%) of the unpaid principal balance and accrued interest. WHEREFORE, Plaintiff, prays your Honorable Court to grant judgment in favor of the Plaintiff and against the Defendant in the sum of One Hundred Thirty-one Thousand Two Hundred Thirty-five Dollars and Sixty-three Cents ($131,235.63), plus interest at the per diem rate of $20.09, from April 18, 2012, late fees, and costs of collection. BARLEY SNYDER LLP By: (?. William F. Colb , Jr., Esq re Attorneys for Plaintiff 3550821-1 PROMISSORY NOTE Borrower; Westhafer Construction, Inc. 71 Silver Crown Drive Mechanicsburg, PA 17055 Lender: GRAYSTONE BANK Capital Commercial Banking Region 112 Market Street Harrisburg, PA 17101 Principal Amount: $125,000.00 Date of Note: May 16, 2006 PROMISE TO PAY. Westhafer Construction, Inc. I"Borrower") promises to pay to GRAYSTONE BANK ("Lender"), or order, in lawful money of the United States of America, on demand, the principal amount of One Hundred Twenty-five Thousand & 001100 Dollars ($125,000.00) of so much as may be outstanding, together with Interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until repayment of each advance. PAYMENT. Borrower will pay this loan in full immediately upon Lender's demand. Borrower will pay regular monthly payments of all accrued unpaid Interest due as of each payment date, beginning July 1, 2006, with all subsequent interest payments to be due on the same day of each month after that. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then .to principal; then to any late charges; and then to any unpaid collection costs. 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. The interest rate on this Note is subject to change from time to time based on changes in' an index which is Lender's Prime Rate (the "Index"). This is tiie rate Lender oharges, or would charge, on 90-day unsecured loans to the most creditworthy corporate customers. This rate may or may not be the lowest rate available from Lender at any given time. Lender will tell Borrower the current Index rate upon 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 Interest rate to be applied to the unpaid principal balance during this Note will be at a rate' of 1.000 percentage point over the Index. NOTICE: Under no circumstances will the interest rate on this Note be more than the maximum rate allowed by applicable law. PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges are carried fully as of the date of the loan and will not be subject to refund upon early payment (whether voluntary or as a result of defaultl, except as otherwise required by law. Except for the foregoing, Borrower may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower's obligation to continue to make payments of accrued unpaid interest. Rather, early payments will reduce the principal balance due. Borrower agrees not to sand Lender payments marked "paid in full", "without recourse", or similar language. If Borrower sends such a payment, Lender may accept it without lasing 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: GRAYSTONE BANK, 112 Market Street Harrisburg, PA 17101. LATE CHARGE. If a regularly scheduled interest payment is 20 days or more late, Borrower will be charged 10.000% of the regularly scheduled payment or $250.00, whichever is greater. It tender demands payment of this loan, and Borrower does not pay the loan in full within 20 days after Lender's demand, Borrower also will be charged either 10.000`Ye of the sum of the unpaid principal plus accrued unpaid interest or $250.00, whichever Is greater. INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest rate on this Note shall be increased by adding a 2.000 percentage point margin ("Default Rate Margin"). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had there been no default. If judgment is entered in connection with this Note, interest will continue to accrue after the date of judgment at the rate in effect at the timejudgment is entered. However, in no event will the interest rate exceed the maximum interest rate (imitations under applicable law. LENDER'S RIGHTS, Upon Lender's dernand, Lender may, after giving such notices as required by applicabib law, declare the entire unpaid principal balance under 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 It Borrower does not pay. Borrower will pay i.ender that amount. This includes, subject to any limits tinder applicable law, Lender's attorneys' fees and Lender's legal expenses, whether or riot 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 ail other sums provided by law. JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Borrower against the other. GOVERNING LAW. This Note will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the Commonwealth of Pennsylvania without regard to its conflicts of law provisions. This Note has been accepted by Lender in the Commonwealth of Pennsytvania. CHOICE OF VENUE. If there is a lawsuit, Borrower agrees upon Lender's request to submit to the jurisdiction of the courts of Dauphin County, Commonwealth of Pennsylvania. 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 Ertl such accounts. LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this Note may be requested either orally or in writing by Borrower or by an authorized person. All oral requests shall be confirmed in writing on the day of the request, on forms acceptable to Lender. Ali communications, instructions, or directions by telephone or otherwise to Lender are to be directed to Lender's office shown above. Borrower agrees to be liable for all sums efther: (A) advanced in accordance with the instructions of an authorized person or tBi credited to any of Borrower's accounts with Lender. The unpaid principal balance owing on this Note at any time may be evidenced by endorsements on this Note or by Lender's internal records, including daily computer print-outs. SECURITY. All collateral (as herein defined) is security for this Note and any renewals, extensions and modifications thereof, and the payment, performance and discharge of all other present or future indebtedness, obligations and undertakings (whether individual, joint, several, direct, contingent or otherwise) of the Borrower to or for the benefit of Lender, whether arising directly to Lender under this Note or under any other PROMISSORY NOTE Loan No: 4000001221 (Continued) Page 2 agreement, promissory note or undertakings now existing or hereinafter entered Into by the Borrower to the Lender. The term "Collateral" includes all tangible and intangible property (1) described In any mortgage, pledge, assignment or other security document separately executed in favor of Lender, and (ii) in which a security interest has been granted to Lender pursuant-to this Note. ANNUAL REVIEW. The Lender will review the Note annually for renewals and extensions; such renewals and extensions to be granted predicated on the performance of the company and/or individuals and adherence to the Loan Agreement and/or loan policy. CROSS COLLATERALIZE/CROSS DEFAULT. This loan will be cross-collateralized/cross-defaulted with all other loans from Borrower, or any of Borrower's related entities, to Lender. If at any time there is a default under this loan, all loans will be considered in default and all outstanding amounts under the loans will be immediately due and payable in full. A default in one loan shall constitute a default in all others. 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. GENERAL PROVISIONS. If any part of this Note cannot be enforced, this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them. Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, 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. It 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 ($600) 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. PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE. 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: WE FER CONSTRUCTION, INC+ofWestha_fer t3y. (Seal) Steven E. Westhafer, PresiConstruction, Inc. LENDER: GRAYSTONE ANK X Het. Ha I, sst. Vice Pr rden 45fR."O [u.Eq, V... 6.i,.00.0w cap."Wee inw.eN ioNfbu, YC IYS]. 20 . MI Ry?Y MNmd. .M ]:W¢"inWMIn nSC TR?5 M,I DISCLOSURE FOR CONFESSION OF JUDGMENT Declarant: Westhafer Construction, Inc. Lender: GRAYSTONE BANK 126 to. AlL,!?A Capital Commercial Ranking Region Mechanicsburg, PA 17055 112 Market Street :5 C-0 Harrisburg, PA 17101 DISCLOSURE FOR CONFESSION OF JUDGMENT THE UNDERSIGNED IS EXECUTING ON BEHALF OF DECLARANT. THIS DAY OF _ 20( JGJ? , A PROMISSORY NOTE FOR $125,000.00 OBLIGATING DECLARANT TO REPAY THAT AMOUNT. A. THE UNDERSIGNED UNDERSTANDS THAT THE NOTE CONTAINS A CONFESSION OF JUDGMENT P ISION THAT WOULD PERMIT LENDER TO ENTER JUDGMENT AGAINST DECLARANT IN COURT, AFTER A DEFAULT ON THE NOTE, WITHOUT ADVANCE NOTICE TO DECLARANT AND WITHOUT OFFERING DECLARANT AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY OF JUDGMENT'. IN EXECUTING THE NOTE, BEING FULLY AWARE OF DECLARANT'S RIGHTS TO ADVANCE NOTICE AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS THAT LENDER MAY ASSERT AGAINST DECLARANT UNDER THE NOTE, THE UNDERSIGNED, ON BEHALF OF THE DECLARANT, IS KNOWINGLY, INTELLIGENTLY, AND VOLUNTARILY WAIVING THESE RIGHTS, INCLUDING ANY RIGHT TO ADVANCE NOTICE OF THE ENTRY OF JUDGMENT, AND THE UNDERSIGNED EXPRESSLY AGREES AND CONSENTS TO LENDER'S ENTERING JUDGMENT AGAINST DECLARANT BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT PROVISION. B. THE UNDERSIGNED FURTHER UNDERSTANDS THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST DECLARANT WITHOUT ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE NOTE ALSO CONTAINS LANGUAGE THAT WOULD PERMIT LENDER, AFTER ENTRY OF JUDGMENT, AGAIN WITHOUT EITHER ADVANCE NOTICE OR A HEARING, TO EXECUTE ON THE JUDGMENT BY FORECLOSING UPON, ATTACHING, LEVYING ON, TAKING POSSESSION OF OR OTHERWISE SEIZING DECLARANT'S PROPERTY, IN FULL OR OARTIAL PAYMENT OF THE JUDGMENT. IN EXECUTING THE NOTE, BEING FULLY AWARE: OF DECLARANT'S RIGHTS TO ADVANCE NOTICE AND A HEARING AFTER JUDGMENT 1S ENTERED AND BEFORE EXECUTION ON THE JUDGMENT, THE UNDERSIGNED, ON BEHALF OF THE DECLARANT, IS KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE RIGHTS, AND THE UNDERSIGNED EXPRESSLY AGREES AND CONSENTS TO LENDER'S IMMEDIATELY EXECUTING ON THE JUDGMENT IN ANY MANNER PERMITTED BY APPLICABLE STATE AND FEDERAL LAW, WITHOUT GIVING DECLARANT ANY ADVANCE NOTICE. C. AFTER HAVING READ AND DETERMINED WHICH OF THE FOLLOWING STATEMENTS ARE APPLICABLE, BY INITIALING EACH STATEMENT THAT APPLIES, THE UNDERSIGNED REPRESENTS THAT; INITIALS 1. DECLARANT WAS REPRESENTED BY DECLARANT'S OWN INDEPENDENT LEGAL COUNSEL IN CONNECTION WITH THE NOTE. S4.1? 2- A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE NOTE TO DECLARANT'S ATTENTION. THIS DISCLOSURE 15 GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS DISCLOSURE IS AND SHALt CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT' ACCORDING TO LAW. DECLARANT; W AFER CONSTRUCTION, I NC. g (Seal) Steven E_ Westhaf r, President of Westhafer Construction, Inc. Ltsel 1.0-. '. V,,. 9.71.00.OW Goy?.,lullml Nnwct4]ulu0unl. 4-199]. loos. At rJq- O....J. -Ih ]:W elw,.\GFlUlilO]O.fC 111-,Ba M11 FYF'1T B CHANGE IN TERMS AGREEMENT Borrower; Westhafer Construction, Inc. 71 Silver Crown Drive Mechanicsburg, PA 17055 Lender: GRAYSTONE BANK Capital Region 112 Market Street Harrisburg, PA 17101 Principal Amount: $124,935.77 Date of Agreement: May 29, 2008 DESCRIPTION OF EXISTING INDEBTEDNESS. On May 16, 2006, Borrower executed and delivered to Lender s Promissory Note in the original Principal Amount of One Hundred Twenty Five Thousand and 00/100 Dollars ($125,000.00) ("Note") with interest accruing at Lender's Prime Rate plus 1.00% and principal due'and payable on demand. As of the date of this Agreement, the principal balance of this Note is Ono Hundred Twenty Four Thousand Nine Hundred Thirty Five and 77/100 Dollars ($124,935.77). DESCRIPTION OF CHANGE IN TERMS. Effective the date of this Agreement, Lender and Borrower have agreed to terming out the outstanding principal balance over ten years with a five-year initial fixed rate of 6.76%, all the terms of which are defined below under PAYMENT. PROMISE TO PAY. Westhafer Construction, Inc, ("Borrower") promises to pay to GRAYSTONE BANK ("Lender"), or order, in lawful money of the United States of America, the principal amount of One Hundred Twenty-four Thousand Nine Hundred Thirty-five & 77/100 Dollars ($124,935.77), together with interest on the unpaid principal balance from May 29, 2008, until paid in full. PAYMENT. Subject. to any payment changes resulting from changes in the Index, Borrower will pay this loan in accordance with the following payment schedule; Principal and interest are due and payable in 60 equal consecutive monthly installments of $1,112.09 each, commencing on June 5, 2008 and ending May 5, 2013 (payment based on a 180-month amortization). From the date hereof until May 5, 2013 ("Initial Fixed Rate Period"i interest will be fixed at 6.75%- Thereafter, the Interest rate shall be re-negotiated to a new fixed rate offered by Lender in its soli discretion {and agreed to by Borrowed, or the rate will revert to Graystone Bank's Prime Rate (as defined in Variable Interest Rate below) plus 1.00%. After the Initial Fixed Rate Period and based on the subsequent change in interest rate, the monthly payment shall be changed to an amount sufficient to amortize the unpaid principal balance over the remaining amortization period of 120 months. Such payments shall commence June 6, 2013 and shall continue until Maturity. All unpaid principal together with any unpaid interest and late charges will be due and payable at maturity, May 5, 2018. Unless otherwise agreed or required by applicable law, payments.will be applied first to any accrued unpaid interest; then to principal; then to any late charges; and then to any unpaid collection costs. Interest on this loan is computed on a 365/360 simple interest 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.wrlting. VARIABLE INTEREST RATE. The interest rate on this loan is subject to change from time to time based on changes in an index which is Lender's Prime Rate (the "Index"). This is the rata Lender charges, or would charge, on 90-day unsecurdd loans to the most creditworthy corporate customers. This rate may of may not be the lowest rate available from Lender at any given time. 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 snake loans based on other rates as well. The interest rate to be applied to the unpaid principal balance during this loan will be at a rate of 1.000 percentage point over the Index. NOTICE: Under no circumstances will the interest rate on this loan be less than 5.000% per annum or more than the maximum rate allowed by applicable law. Whenever increases occur in the interest rate, Lender, at its option, may do bne 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. Borrower may pay without penalty sit 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 snake 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 Agreement, 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: GRAYSTONE BANK, 112 Market Street Harrisburg, PA 17101. LATE CHARGE. If a payment is 15 days or more late, Borrower will be charged 10-000% of the regularly scheduled payment or $250.00, whichever is greater- INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest rate on this loan shall be increased by adding is 2.000 percentage point margin ("Default Rate Margin"). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had there been no default. If judgment is entered in connection with this Agreement, interest will continue to accfue after the date of judgment at the rate in effect at the time judgment is entered. However, in no event will the interest rate exceed the maximum interest rate limitations under applicable law. DEFAULT. Each of the following shall constitute an Event of Default under this Agreement: Payment Default. Borrower fails to make any payment when due under the Indebtedness. Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Adreement or in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in afly 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 Agreement 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. Insolvency. 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 Indebtedness. This includes a garnishment of any of Borrower's accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply it there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of E Y]WT C CHANGE IN TERMS AGREEMENT Loan No: 4000001221 (Continued) Page 2 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. Change In Ownership. Any change in ownership of twenty-five percent (25%) or more of the common stock of Borrower Adverse Change. A material adverse change occurs in Borrower's financial condition, or Lender believes the prospect of payment or performance of the Indebtedness is impaired. 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 Agreement within the preceding twelve (12) months, it may be cured if Borrower, after receiving written notice from lender demanding cure of such default: 0) 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 under this Agreement 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 Agreement if Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits under applicable law, Lender's reasonable attorneys' fees and Lender's legal expenses, whether or riot there is a lawsuit, including reasonable 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. JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either lender or Borrower against the other. GOVERNING LAW. This Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the Commonwealth of Pennsylvania without regard to its confricts of law provisions. This Agreement has been accepted by Lender in the Commonwealth of Pennsylvania. CHOICE OF VENUE. If there is a lawsuit, Borrower agrees upon Lender's request to submit to the jurisdiction of the courts of Dauphin County, Commonwealth of Pennsylvania. 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, CONTINUING VALIDITY. Except as expressly changed by this Agreement, the torms of the original obligation or obligations, including all agreements evidenced or securing the obligationls), remain unchanged and in full force and effect. Consent by Lender to this Agreement does not waive Lender's right to strict performance of the obligation(s) as changed, nor obligate Lender to make any future change In terms. Nothing in this Agreement will constitute a satisfaction of the obligationis). It is the intention of Lender to retain as liable parties all makers and endorsers of the original obligation(s), including accommodation parties, unless a party is expressly released by Lender in writing. Any maker or endorser, including accommodation makers, will not be released by virtue of this Agreement. If any person who signed the original obligation does not sign this Agreement below, then all persons signing below acknowledge that this Agreement Is given conditionally, based on the representation to Lender that the non-signing party consents to the changes and provisions of this Agreement or otherwise will not be released by it. This waiver applies not only to any initial extension, modification or release, but also to all such subsequent actions. SUCCESSOR INTERESTS. The terms of this Agreement shall be binding upon Borrower, and upon Borrower's heirs, personal representatives, successors, and assigns, and shall be enforceable by Lender and its successors and assigns. MISCELLANEOUS PROVISIONS. If any part of this Agreement cannot be enforced, this fact will not affect the rest of the Agreement. Lender may delay or forgo enforcing any of Its rights or remedies under this Agreement without losing them. Burrower and any other person who signs, guarantees or endorses this Agreement, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change in the terms of this Agreement, and unless otherwise expressly stated in writing, no party who signs this Agreement, 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 Agreement are joint and several. CHANGE IN TERMS AGREEMENT Loan No: 4000001221 tContinued) Paige 3 PRIOR TO SIGNING THIS AGREEMENT, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS AGREEMENT, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORMWER AGREES TO THE TERMS OF THE AGREEMENT. THIS AGREEMENT IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS AGREEMENT IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. BORROWER: WE ?FER? CT10N, NC. By• (Seat) Steven E. Westha er, Preat ent Westha er Construction, inc. LENDER: i- GRAYS`IPNE BAN ft"rLsitient LA9EP Pfl9 L,i,JhO. V,i. b-. -1-1h-.O 1"llt- Inc. 100. 2009. M AtOll. fl,ana0. P? 990m.dbWPOR W2X- TA 116 PA 1 I 1 91 7199 9991 7030 3418 2437 March 21, 2012 wsquehann4a i a VIA 1 s' CLASS MAIL AND CERTIFIED MAIL RETURN RECEIPT REQt JESTED Westhafer Construction, Inc. Steven E. Westhafer Cumberland Valley Development, Inc. 71 Silver Crown: Drive Mechanicsburg, PA 17055 Re: Loans In Original Principal Amounts of $125,000.00, $970,000.00 and $60,000.00 By Susquehanna Bank, successors by merger to Oraystone Bank, To Westhafer Construction, Inc., Steven E. Westhafer and Cumberland Valley Development, Inc. Dear Mr. Westhafer: Susquehanna Bank, successor by merger to Graystone Bank (the "Lender") made a loan to Westhafer Construction Inc. (the "Borrower") in the original principal amount of One Hundred Twenty-Five Thousand Doliars ($125:000.00); a loan to Cumberland Valley Development: Inc., (the "`Borrower") in the original principal amount of Nine Hundred Seventy Thousand Dollars ($970,000.00) and a loan to Westhafer Construction: Inc. and Steven E. Westhafer; (the "Borrower") in the original principal amount of Sixty Thousand Dollars ($60,000.00) respectively, he loan in the original principal amount of One Hundred Twenty-Five Thousand Dollars ($125,000.00) is evidenced by a Promissory Note dated May 16, 2006, a Change in Terms Agreement dated May 29, 2008, an Open-End Mortgage dated May 16, 2006, a Business Loan Agreement dated May 16; 2006 and various documents relating to the loan (collectively, the "Loan 1 Documents°). The loan in the original principal amount Thousand Dollars ($970,000.00) is evidenced by a 31, 2006, Change in Terms Agreements dated M October 27, 2008, October 28; 2009, March 10, 2C 25, 2011, two Open-End Mortgages dated May Mortgage dated January 15; 2009; a Construction of Nine Hundred Seventy Promissory Note dated May y 29, 2008, July 17, 2008; 10; June 25, 2010 and May 31, 2006; a Modification of Loan Agreement dated May EXHOT 0 Westhafer Construction, Inc. Steven Westhafer March 21, 2012 Page 2 31, 2006 and various documents relating to the loan (collectively, the "Loan 2 Documents"). The loan in the original principal amount of Sixty Thousand Dollars ($60,000.00) is evidenced by a Promissory Note dated January 15, 2009, Change in Terms dated September 18, 2009, December 15, 2009, March 16, 2010, June 25, 2010, an Open-End Mortgage dated January 15, 2009, a Business Loan Agreement dated January 15, 2009, and various documents relating to the loan (collectively, the "Loan 3 Documents"), The Loan 1 Documents, Loan 2 Documents, and Loan 3 Documents shall be referred to collectively as the ("Loan Documents"). Pursuant to a Commercial Guaranty dated May 16, 2006 and May 31, 2006, Steven E. Westhafer, (the "Guarantor") unconditionally guaranteed the payment and performance of the Borrower's obligations to the Lender under the Loan 1 and 2 Documents. A Commercial Guaranty dated January 15, 2009, by Cumberland Valley Development, inc. (the "Guarantor") unconditionally guaranteed the payment and performance of the of the Borrower's obligations to the Lender under the Loan 3 Documents. The Borrower's obligations to the Lender under the Loan Documents are due and payable upon demand by the Lender whether or not the Borrower is in default. Moreover, the Borrower is in default under the Loan Documents due to its failure to make payments when and as due under the Loan Documents. Accordingly, the Lender demands that the Borrower pay its obligations under the Loan Documents immediately. As of March 21, 2012, the balance outstanding under the Loan 1 Documents is $119,501.81. Interest accrues on the unpaid principal balance at the rate of $19.77 per day after March 21, 2012. In addition to the above amounts, the Borrower is obligated to pay all reasonable attorneys' fees and expenses incurred by the Lender in enforcing the Loan 1 Documents. As of March 21, 2012, the balance outstanding under the Loan 2 Documents is $507,487.46. Interest accrues on the unpaid principal balance at the rate of $75.63 per day after March 21, 2012. In addition to the above amounts, the Borrower is obligated to pay all reasonable attorneys' fees and expenses incurred by the Lender in enforcing the Loan 2 Documents. As of March 21, 2012, the balance outstanding under the Loan 3 Documents is $63,484.05, Interest accrues on the unpaid principal balance at the rate of $8.73 per day after March 21, 2012. In addition to the above amounts, Westhafer Construction, Inc. Steven Westhafer March 21, 2012 Page 3 the Borrower is obligated to pay all reasonable attorneys' fees and expenses incurred by the Lender in enforcing the Loan 3 Documents. The Lender hereby demands that the Borrower pay the amounts set forth by certified check, cashier's check or wire transfer by March 31, 2012. Nothing in this letter should be deemed an agreement by the Lender to forbear from enforcing any rights or remedies available to it under the Loan Documents or applicable law. The Lender reserves all of its available rights and remedies. Moreover, acceptance by the Lender of payment of less than the full amount due under the Loan Documents shall not constitute.' a waiver of the demand for payment of all amounts due, or any of the rights available to the Lender under the Loan Documents or applicable law, Susquehanna Bank By Lisa Painter VP, Loan Workout Officer OREO/Workout Dept Phone: 717-724-4605 VERIFICATION Lisa Painter verifies that she is the Loan Workout Officer of Susquehanna Bank, Plaintiff in the within matter, that she is authorized to execute this Verification on its behalf, and that the facts set forth in the within Complaint are true and correct to the best of her knowledge, information and belief. She understands that false statements herein are made subject to the penalties of 18 Pa.C.S. Section 4904 relating to unsworn falsification to authorities. Date: 1(2-, _ Lisa Painter 3550821-1 BARLEY SNYDER LLP William C. Colby, Jr., Esquire Court I.D. No. 46880 50 North Fifth Street, P.O. Box 942 Reading, PA 19603-0942 (610) 376-6651 Attorney for Plaintiff SUSQUEHANNA BANK, Successor by Merger to GRAYSTONE BANK Plaintiff V. WESTHAFER CONSTRUCTION, INC. COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW No. /02 -r30(ob aivi l Term CERTIFICATE OF RESIDENCE PA. R.C.P. 236 I, William F. Colby, Jr., Esquire, Attorney for the Plaintiff, hereby certify to the best of my knowledge, information and belief that the name and current address of each party is as follows: The address of the Plaintiff, Susquehanna Bank, is 1828 Good Hope Drive, Enola, PA 17025. The registered address for the Defendant, Westhafer Construction, Inc. is 71 Silver Crown Drive. Mechanicsburg, PA 17055. Respectfully submitted, BARLEY SNYDER LLP By: -..' kwe?'? William F. Colby, r. Esquire Attorney for Plaintiff 3550821-1 or w w BARLEY SNYDER LLP William C. Colby, Jr., Esquire Court I.D. No. 46880 50 North Fifth Street, P.O. Box 942 Reading, PA 19603-0942 (610) 376-6651 --, :Z: r Attorney for Plaintiff SUSQUEHANNA BANK, Successor by Merger to GRAYSTONE BANK Plaintiff V. WESTHAFER CONSTRUCTION, INC. COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA No. 1,2 - 30b 8 CIVIL ACTION - LAW NOTICE UNDER RULE 2958.1 OF JUDGMENT AND EXECUTION THEREON NOTICE OF DEFENDANTS' RIGHTS TO: WESTHAFER CONSTRUCTION, INC. DATE: May , 201.2 A judgment in the amount of $131,235.63, plus interest at the rate per day rate of $20.09 from April 18, 2012, continuing late fees, and costs of collection has been entered against you and in favor of the Plaintiff, Susquehanna Bank, 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 3550821-1 or 1 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, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE. Cumberland County Bar Association 34 S. Bedford Street Carlisle, Pennsylvania 717-249-3166 Respectfully submitted, BARLEY SNYDER LLP By W?illiam J ., squire Attorney for Plainti f 3550821-I SUSQUEHANNA BANK, Successor by Merger to GRAYSTONE BANK Plaintiff V. WESTHAFER CONSTRUCTION, INC. COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW No. dot - 30fo8 L i vi l Fey (X ) Notice is hereby given that a judgment in the above-captioned matter has been entered against you in the amount of $131,235.63, on May 2012. (X) A copy of all documents filed with the Prothonotary in support of the within judgment are enclosed. PrE - T r notary Civil Division By: If you have any questions regarding this Notice, please contact the filing party: NAME: William F. Colby, Jr. Barley Snyder LLP ADDRESS: 50 North Fifth Street P.O. Box 942 Reading, PA 19603 TELEPHONE:(610) 376-6651 (This Notice is given in accordance with Pa.R.C.P.236.) NOTICE SENT TO: NAME: Westhafer Construction, Inc. ADDRESS: 71 Silver Crown Drive, Mechanicsburg, PA 17055 Esquire 3550821-1 SHERIFF'S OFFICE OF CUMBERLAND COUNTY Ronny R Anderson Sheriff ,???trtc#, of ?sc+nt?rr?;??0 rr ? _a Jody S Smith Chief Deputy Richard W Stewart Solicitor w r, Susquehanna Bank vs. Westhafer Construction, Inc. Case Number 2012-3068 SHERIFF'S RETURN OF SERVICE 06/13/2012 01:35 PM - Jason Vioral, Sergeant, Deputy Sheriff, who being duly sworn according to law, states that on June 13, 2012 at 1335 hours, he served a true copy of the within Complaint in Confession of Judgment and Notice 2958.1, upon the within named defendant, to wit: Westhafer Construction, Inc., by making known unto Steve Westhafer, Owner of Westhafer Construction, Inc. at The Cumberland County Courthouse, 1 Courthouse Square, Carlisle, Cumberland County, Pennsylvania 17013 its contents and at the same time handing to him personally the said true and correct copy of the same. SHERIFF COST: $88.00 June 14, 2012 JASO 10, AL, DEPUTY SWERS, RON R ANDERSON, SHERIFF I- CeunlyStmC Sh'E ^ - ..'r p,r,