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HomeMy WebLinkAbout14-2066 Supreme Court Court: of Common For Prothonotary Use Only: Civ>tl'Coveir Sheet S ,` �ti Docket No: Cum6erland` A-1 1 County 1q-jD&6 C)L /l The information collected on this form is used solely for court administration purposes. This form does not sul)plement or replace the filing and service of pleadings or other papers as required by law or rules of court. Commencement of Action: S El Complaint El Writ of Summons Petition Transfer from Another Jurisdiction Declaration of Taking E C Lead Plaintiffs Name: Lead Defendant's Name: Susquehanna Bank Chang Mun Chon and Sun Yi Chon T Dollar Amount Requested: r1within arbitration limits I Are money damages requested? El Yes El No (check one) Ex outside arbitration limits O N Is this a Class Action Suit? D Yes El No Is this an MDJAppeal? © Yes x No A Name of Plaintiff /Appellant's Attorney: Timothy J. Nieman and Holly L. Cline, Rhoads & Sinon LLP El Check here if you have no attorney (are a Self- .Represented jPro Sel Litigant) Nature of the Case Place an "X" to the left of the ONE case category that most accurately describes your PRIMARY CASE. If you are making more than one type of claim, check the one that you consider most important. TORT (do not include A4ass Tort) CONTRACT (do not include Judgments) CIVIL APPEALS 0 Intentional 0 Buyer Plaintiff Administrative Agencies Malicious Prosecution 0 Debt Collection: Credit Card ED Board of Assessment Fj Motor Vehicle E] Debt Collection: Other -1- Board of Elections F1 Nuisance Q Dept. of Transportation F] Premises Liability Q Statutory Appeal: Other S El Product Liability (does not include mass sort) ❑Employment Dispute: E Discrimination 0 Slander /Libcl/ Defamation Employment Dispute: Other ❑ Zoning Board C 0 Other: � Other: , I F[I Other: O MASS TORT Asbestos N ❑ Tobacco [�j Toxic Tort - DES F Toxic Tort - Implant REAL PROPERTY MISCELLANEOUS Toxic Waste Other: [:1 Ejectment El Common Law /Statutory Arbitration B D Eminent Domain /Condemnation] Declaratory Judgment El Ground Rent E] Mandamus Landlord/Tenant Dispute I Non - Domestic Relations Q Mortgage Foreclosure: Residential Restraining Order PROFESSIONAL LIABILITY n Mortgage Foreclosure: Commercial El Quo Warranto 0 Dental M Partition El Replevin F1 Legal 0 Quiet Title 0 Other: Fj Medical ] Other: Other Professional: Updated 1/1/2011 a .t u�► SUSQUEHANNA BANK, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff : PENNSYLVANIA CIVIL ACTION — MORTGAGE V. FORECLOSURE CHANG MUN CHON and SUN YI CHON, NO. Defendants AVISO USTED HA SIDE DEMANDADO /A EN CORTE. Si usted desea defenderse de las demandas que se presentan mas adelante en las siguientes paginas, debe tomar accion dentro de los proximos veinte (20) dias despues de la notificacion de esta Demanda y Aviso radicando personalmente o por medio de un abogado una comparecencia escrita y radicando en la Corte por escrito sus defensas de, y objecciones a, las demandas presentadas aqui en contra suya. Se le advierte de que si usted falla de tomar accion como se describe anteriormente, el caso puede proceder sin usted y un fallo por cualquier suma de dinero reclamada en la demanda o cualquier otra reclamacion o remedio solicitado por el demandante puede ser dictado en contra suya por la Corte sin mas aviso adicional. Usted puede perder dinero o propiedad u otros derechos importantes para usted. USTED DEBE LLEVAR ESTE DOCUMENTO A SU ABOGADO INMEDIATAMENTE. SI USTED NO TIENE UN ABOGADO O NO PUEDE PAGARLE A UNO, LLAME O VAYA A LA SIGUIENTE OFICINA PARA AVERIGUAR DONDE PUEDE ENCONTRAR ASISTENCIA LEGAL. CUMBERLAND COUNTY BAR ASSOCIATION 32 SOUTH BEDFORD STREET CARLISLE, PA 17013 1- 800 - 990 -9108 717 - 249 -3166 v� SUSQUEHANNA BANK, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA c " � Plaintiff r :j CIVIL ACTION — MORTGAGE v• FORECLOSURE ca° --4 CHANG MUN CHON No. / f " and SUN YI CHON, v Defendants NOTICE TO DEFEND ± YOU HAVE BEEN SUED IN COURT..I.F YOU WISH TO DEFEND AGAINST THE CLAIMS SET FORTH IN THE FOLLOWING PAGES, AND NOTI TAKE A WI , B TW (20) DAYS AFTER THIS' COMPLAIN j ENTERING A WRITTEN APPEARANCE, PERSON EFEN O •OR OBJEC TONS TO THE FILING IN WRITING WITH THE COURT YOUR D CLAIMS SET FORTH AGAINST YOU. YOU ARE WARNE YOU DGMENT MAY, E ENTERED I SO THE CASE MAY PROCEED WITHOUT Y. AN AGAINST YOU BY THE COURT WITHOUT FUR R CLAIM OTICE FOR ANY OR RELIEF REQU M CLAIMED. IN THE COMPLAINT OR FOR ANY OTHE BY THE PLAINTIFF. YOU MAY MONEY OR PROPERTY OR OTHER RIGHTS IMPORTANT TO YOU. ' DO YOU SHOULD TAKE THIS PAPER TO YOUR L AWYER OFFICE T FORTH BELOW NOT HAVE A LAWYER, GO TO OR TELEPHONE TH E THIS OFFICE CAN PROVIDE YOU WITH 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 j 32 SOUTH BEDFORD STRE CARLISLE; PA 17013 . 'f-800-990-91 08 ,! 717- 249 -3166 a{� Timothy J. Nieman, Esquire Attorney ID No. 66024 tnieman @rhoads- sinon.com Holly L. Cline, Esquire Attorney I.D. No. 208141 hcline @rhoads - sinon.com RHOADS & SINON LLP One South Market Square, 12th Floor P.O. Box 1146 Harrisburg, PA 17108 -1146 Phone: (717) 233 -5731 Fax: (717) 231 -6637 Attorneys for Plaintiff SUSQUEHANNA BANK, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff : PENNSYLVANIA CIVIL ACTION — MORTGAGE V. FORECLOSURE CHANG MUN CHON // t: itfpt and SUN YI CHON, NO. Defendants / COMPLAINT IN MORTGAGE FORECLOSURE NOW COMES Plaintiff Susquehanna Bank, by its undersigned attorneys, Rhoads & Sinon LLP, and files the within Complaint in Mortgage Foreclosure, stating as follows: 1. Plaintiff Susquehanna Bank (the `Bank" or "Plaintiff') is a Pennsylvania Banking Institution with a principal place of business located at 1826 Good Hope Road, Enola, Cumberland County, Pennsylvania 17025. 2. The Bank is the successor by merger to Graystone Bank, a Division of Graystone Tower Bank. 3. Defendant Chang Mun Chon is an adult individual with an address of 227 Ewe Road, Mechanicsburg, Cumberland County, Pennsylvania 17055. 4. Defendant Sun Yi Chon is an adult individual with an address of 227 Ewe Road, Mechanicsburg, Cumberland County, Pennsylvania 17055. c ► � COUNT MORTGAGE FORECLOSUR 5. The Bank incorporates herein by reference paragraphs 1 through 4 above. 6. The Bank brings this action to foreclose upon mortgages dated on or about September 15, 2010, between Chang Mun Chon ( "Mr. Chon ") and Sun Yi Chon ( "Mrs. Chon ") (collectively, "Defendants "), as mortgagors, and the Bank, as mortgagee. 7. On September 15, 2010, the Bank extended a term loan in the amount of $3,800,000.00 to Mr. and Mrs. Chon [Loan No. 4000009822] as evidenced by a Business Loan Agreement dated September 15, 2010 ( "Loan Agreement "). (A true and correct copy of the Loan Agreement is attached hereto as Exhibit "A" and incorporated herein by reference.) 8. For the above - referenced loan in the principal amount of $3,800,000.00, Mr. and Mrs. Chon also executed and delivered to the Bank a Promissory Note ( "Note "), dated September 15, 2010, evidencing the term loan and Mr. and Mrs. Chon's obligation to repay the principal sum of $3,800,000.00, plus interest until paid in full. (A true and correct copy of the Note is attached hereto as Exhibit "B" and incorporated herein by reference.) 9. The Loan Agreement and Note were secured by a title insured first lien open -end mortgage and security agreement, between Mr. and Mrs. Chon and the Bank, on real property located at 4943 Gettysburg Road, Mechanicsburg, Pennsylvania, entitled Open -End Mortgage and Security Agreement and dated September 15, 2010 ( "the First Mortgage "). (A true and correct copy of the First Mortgage is attached hereto as Exhibit "C" and incorporated herein by reference.) 10. The First Mortgage was recorded in the Office of the Recorder of Deeds, Cumberland County, Pennsylvania as Instrument No. 201027593 on September 30, 2010. 2 w A, 11. The Loan Agreement and Note also were secured by a second lien open -end mortgage and security agreement, between Mr. and Mrs. Chon and the Bank, on real property located at 4937 Gettysburg Road, Mechanicsburg, Pennsylvania, dated September 15, 2010 ( "the Second Mortgage "). (A true and correct copy of the Second Mortgage is attached hereto as Exhibit "D" and incorporated herein by reference.) 12. The Second Mortgage was recorded in the Office of the Recorder of Deeds, Cumberland County, Pennsylvania as Instrument No. 201026350 on September 21, 2010. 13. Specifically, the property subject to the First and Second Mortgage for which the Bank seeks foreclosure is comprised of two tracts of land located partly in Upper Allen Township, Cumberland County, and partly in Lower Allen Township, Cumberland County, with an address of 4943 Gettysburg Road, Mechanicsburg, Pennsylvania (with a real property parcel identification number of 13 -25- 0024 -013) and 4937 Gettysburg Road, Mechanicsburg, Pennsylvania (with a real property parcel identification number of 13 -25- 0024 -001), both of which are more fully described in Exhibits A to the First and Second Mortgage. (See Exhibits C and D at Exh. A.) 14. The property located at 4937 and 4943 Gettysburg Road, Mechanicsburg, Pennsylvania is not a residential property. 15. Pursuant to Pennsylvania Rule of Civil Procedure 1142, venue is proper as the mortgaged property is located entirely within Cumberland County, Pennsylvania. 16. Mr. and Mrs. Chon are the fee owners of the property subject to the First and Second Mortgage upon which foreclosure is sought. 3 17. The Loan Agreement, Note and First and Second Mortgage evidence Mr. and Mrs. Chon's obligation to repay to the Bank the principal sum of $3,800,000.00, plus interest until paid in full. (See Exhibits A -D.) 18. Pursuant to the terms of the Note, Mr. and Mrs. Chon were obligated to make 59 monthly payments of $27,303.56, beginning on October 15, 2010, with one irregular last payment estimated at $3,255,295.99 to be paid on September 15, 2015. (See Exhibit B.) 19. Mr. and Mrs. Chon failed to make the November 2013, December 2013, January 2014 and February 2014 monthly loan payment for the Note. 20. As set forth above, Mr. and Mrs. Chon defaulted under their obligations for the Note in failing to make the required monthly payments. 21. Despite repeated requests by the Bank for payment, including sending a notice of default to Mr. and Mrs. Chon on or about February 3, 2014, Defendants remain in default under the various loan documents, including the Loan Agreement, First and Second Mortgage and the Note. (A true and correct copy of the Notice of Default is attached hereto as Exhibit "E" and incorporated herein by reference.) 22. Pursuant to the terms of the Note, upon an event of default, the Bank may "declare the entire unpaid principal balance due under this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount." (See Exhibit B at 1.) 23. The Note further provides that the Bank "may hire or pay someone else to help collect this Note if Borrower does not pay. Borrower will pay [the Bank] that amount .. . [including the Bank's] reasonable attorneys' fees and [the Bank's] legal expenses, whether or not there is a lawsuit .... Borrower also will pay any court costs, in addition to all other sums provided by law." (See Exhibit B at 2.) 4 24. On March 13, 2014, the Bank confessed judgment against Mr. and Mrs. Chon, as well as against Chon Motel Enterprises, Inc. as guarantor, jointly and severally, for the amounts due and owing on the Note, docketed in this Court at Civil Action No. 14 -1487. (True and correct copies of the Complaint in Confession of Judgment (w /o exhibits), Confession of Judgment and Entry of Judgment are attached hereto as Exhibits "F", "G" and "H ", respectively, and incorporated herein by reference.) 25. As of the date of the filing of this Complaint, the amount due and owing on the Note that is secured by a pledge of the First and Second Mortgage is itemized as follows: Principal sum: $3,465,533.77 Interest: $96,847.08 Late Charges: $27,303.59 Other Charges: $69,570.67 SUB -TOTAL $3,659,255.11 *Interest accrues at per diem rate of $572.78, as indicated through April 2, 2014. ATTORNEYS' FEES $10,000.00 *This amount is an estimate only, as attorneys' fees continue to accrue. TOTAL $3,669,255.1.1 26. The Bank seeks to exercise its right to foreclose on the First and Second Mortgage pledged as collateral for the Note to satisfy the amounts due and owing to the Bank. WHEREFORE Plaintiff Susquehanna Bank respectfully requests that this Court enter judgment of mortgage foreclosure against the mortgaged property in the amount of $3,669,255.11 together with accruing interest at $572.78 per diem, costs of suit and attorneys' fees, and further order a judicial sale of the interests of Defendants Chang Mun Chon and Sun Yi Chon in the mortgaged premises. 5 iS � Respectfully submitted, RHOADS & S1NON LLP By: Timothy J. Ni m n Holly L. Cline One South Market Square, 12 Floor P.O. Box 1146 Harrisburg, PA 17108 -1146 (717) 233 -5731 Attorneys for Plaintiff Susquehanna Bank Date: April 4, 2014 6 VERIFICATION Robert Rahal, deposes and says, subject to the penalties of 18 Pa. C.S. § 4904 relating to unsworn falsification to authorities, that he is Vice President for Susquehanna Bank, that he makes this verification by its authority and that the facts 'set forth in the Complaint in Mortgage Foreclosure. are true and correct to the best of his knowledge, information and belief. Date Robert Rahal b 7 a EXHIBIT "A" BUSINESS LOAN AGREEMENT Borrower: Chang Mun Chen Lander: Graystone Bank, a Division of Graysione Tower Bank Sun Yt Chon 227 Ewe Road Capita! Region 112 Market Street Mechanicsburg, PA 17055 Harrisburg, PA 17101 THIS BUSINESS LOAN AGREEMENT dated September 15, 2010, Is made and executed between Chang Mun Chon and Sun YI Chon ('Borrower") and Graystone Bank, a Division of Graystone Tower Bank, ( "Lender") on the following terms and conditions. Borrower has received prior commercial loans from Lender or has applied to Lender for a commercial loan or loans or other financial accommodations, including Those which may be described on any exhlbil or schedule attached to this Agreement. Borrower understands and agrees that: (A) In granting, renewing, or extending any Loan, Lender Is relying upon Borrower's representations, warranties, and agreements as sot forth In this Agreement; (a) the granting, renewing, or extending of any Loan by Lender at all times shall be subject to Lender's sole Judgment and discretion; and (C) all such Loans shall be and remain subject to the terms and conditions of this Agrooment. TERM. This Agreement shall bo affective as of September 15, 2010, and shall continue In full force and effect until such time as all of Borrowers Loans in favor of Lender have been paid in full, including principal, interest, costs, expenses, attorneys' fees, and other fees and charges, or until such time as the parties may agree in writing to terminate this Agreement. CONDITIONS PRECEDENT TO EACH ADVANCE. Lanese obligation to make the initial Advance end each subsequent Advance under this Agreement shalt be subject to Ina fulfillment to Lender's satisfaction of all of the conditions set forth in this Agreement and In the Related Documents, Loan Documents, Borrower shall provide to Lender the following documents for the Loan: (1) the Nate; (2) Security Agreements granting to Lander security Interests in the Collateral; (3) financing statements and all other documents perfecting Lender's Security Interests; (4) evidence of insurance as required bolow; (6) guaranties; (6) together with all such Related Documents as lender may require for the Loan; all in form and substance satisfactory to Lender and Lender's counsel. Payment of Fees and Expenses. Borrower shell have pail to Lender all fees, charges, and other expenses which are Ilion due and payable as specified in this Agreement or any Related Document. Representations and Warranties. The representations and warranties set forth in this Agreement, In the Related Documents, and in any document or certificate delivered to Lender under thls Agreement are true and correct. No Event or Default. There shall not exist at rho time of any Advance a condition which would constitute an Event of Default under this Agreement or under any Related Document. REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as of (he date of this Agreement, as of the date of each disbursement of loon proceeds, as of the date of any renewal, extension or modification or any Loan, and at all times any Indebtedness exists: Business Activities. Chang Mun Chon maintains an office at 227 Ewe Road, Mechanicsburg, PA 17055. Unless Chang Mun Chon has designated otherwise In writing, the principal office is the office at which Chang Mun Chon keeps its books and records Including Its records concerning the Collateral. Chang Mun Chon will notity Lender prior to any change in the location of Chang Mun Chan's principal office address or any change In Chang Mun Chan's name. Chang Mun Chen shall do all things necessary to comply with all rogulations, .rules, ordinances, statutos, orders and decrees of any governmental or quasi - governmental authority or court applicable to Chang Mun Chon and Ciiang Mun Chan's business activities. Sun YI Chon maintains an office at 227 Ewe Road, hiechanlcsbuig, PA 17055, Unless Sun YI Chen has designated otherwise In writing, the principal office is the office at which Sun Yl Chon keeps its books and records including its records concerning the Collateral. Sun YI Chon will notify Lender prior to any change in the location of Sun YI Chan's principal offico address or any change in Sun Yi Chan's name. Sun YI Chon shall do all things necessary to comply with all regulations, rules, ordinances, statutos, orders and dwees of any governmental or quasi•govornmonlel authority or court applicable to Sun YI Chon and Sun YI Chan's business aclivilles. Assumed Business Names. Borrower has filed or recorded alt documents or filings required by law relating to all assumed business names used by Borrower. Excluding the name of Borrower, the following Is a complete list of all assumed business names under which Borrower does business: Nona, Authorization. Borrowers execution, delivery, and performance of this Agreement and all the Rotated Documents do not conflict with, result In a violation of, or constitute a default under (1) any provision of any agreement or other Instrument binding upon Borrower or (2) any law, governmental regulation, court decree, or order applicable to Borrower or to Borrower's properties. Financial information. Each of Borrower's financial statements suppiied to Lender truly and completely disclosed Borrowers financial condition as of the date of the statement, and there has been no material adverse change In Borrower's financial condition subsequent to the dale of the most recent financial statement supplied to Lender. Borrower has no material conlingent obligations except as disclosed in such financial statements, Legal Effect. • This Agreement constitutes, and any instrument or agreement Borrowor is required to give under this Agreement when delivered will constitute tagal, valid, and binding obligations of Borrower enforceable against Borrower in accordance with their respective terms. ' Properties, kept as contemplated by this Agreement at as previously disclosed In Borrower's financial statements or In writing to Lender and as accepted by Lender, and except for property lax Gans for taxes not presently duo and payable, Borrower owns and has good title to all of Borrower's properties free and clear of nil Security Interests, and has not executed any security documents or financing statements relating to such properties. All of Borrower's properties are titled In Borrowers legal name, and Borrower has not used or filed a financing statement under any other name (or at least the last five (5) years. Hazardous Substances. Except as disclosed to and acknowledged by Lender In writing, Borrower represents and warrants that: (1) During the period of Borrower's ownership of the Collateral, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened release of my Hazardous Substance by any person on, under, about or from any of the Collateral. (2) Borrower has no knowledge of, or reason to believe that there has been (a) arty broach or violation of any Environmental Laws; (b) any use, generation, manufacture, storage, traatmonl, disposal, release or threatened release of any Hazardous Substance on, under, about or from the Collateral by any prior owners or occupants of any of the Collateral; or (c) any actual or threatened litigation or claims of any kind by any person relating to such matters. (3) Neither Borrower nor any tenant, contractor, agent or other mdhoiized user of any of the Collateral shelf use, generate, manufacture, store, treat, drsposc of or release any Hazardous Substance on, under, about or from any of the Collateral; and any ouch activity shall be conducted In compliance with all applicable federal, stole, and local laws, regulations, and ordinances, Including without limitation all Environmental Laws. Borrower authorizes Lender and Its agents to enter upon the Collateral to make such Inspections and lasts as Lander may deort appropriate to determine compliance of the Collateral` with this suction of the r u r h BUSINESS LOAN AGREEMENT Loan No; 4000008822 (Continued) Page 2 Agreement, Any inspections or lasts made by Lender shall be at Borrowers expense and for Lender's purposes only and shelf not be construed to create any responsibility or ilabgity on the part of Lender to Borrower or to any other person. The representations and . warranties contained herein era based on Borrower's due diligence in Investigating the Collateral for hazardous waste and Hazardous Substances, Borrower hereby (1) releases and wolves any future claims against Lender for indemnity or contribution In the event Borrower becomes tieb!e for cleanup or other costs under any such laws, and (2) agrees to Indemnify, defend, and hold harmless Lender against any and oil claims, losses, liabilities damages, penalties, and expenses which Lender may dlrectiy or indirectly sustaln or suffer resulting from 'a breach Of this section of the Agreement or as a consequence of any use, generation, manufacture, storage, disposal, release or. threatened release of a hazardous waste or substance on the Collateral. Tho provisions of this section of the Agreement, Including the obtigatlon to Indemnify and defend, shall survive the payment of the indebtedness and the termination, expiration or satisfaction of this Agreement and shall not be affected by Lender's acquisition of any interest in any of the Collateral, whether by foreclosure or otherwise. Litigation and Claims. No litigation, claim, investigation, adminlslmVve proceeding or similar action (including those for unpaid taxes) against Borrower Is pending or threatened, and no other event has occurred which may materially adversely affect Borrower's financiai condition or properties, other than fitigailon, claims, or other events, if any, that have been disclosed to and acknowledged by Lender In writing. Taxes, To the best of Borrowers knowledge all of Borrowers lax returns and reports that are or were required to be filed, have been riled, and as foxes, assessments and other governmental charges have been paid in full, except those presently being or to be contested by Borrower In good falth In the ordinary course of business and for which adequate reserves have been provided. Llan Priority. Vnloss Otherwise previously disclosed to Lender In writing, Borrower has not entered into or granted any Security Agreements, or permitted (ho filing or attachment of any Security Interests on or affecting any of the Collateral directly or Indirectly securing repayment of Borrower's Loan and Note, that would be prior or that may In any way be superior to Lenders Security Interests and rights in and to such Collateral. Binding Effect. This Agreement, the Nola, all Security Agreements (If any), and all Related Documents are binding upon the signers thereof, as well as upon their successors, representatives and assigns, and are legally enforceable In accordance with their respective terms. AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, so long as this Agreement rema!ns in affect, Borrower will: Notices of Claims and Litigation. Promptly Inform Lender In wrong of (1) all material adverse changes In Borrowor's financial condition, and (2) all existing and all threatened litigation, claims, Investigations, adminlstrative proceedings or similar actions affecting Borrower or any Guarantor which could materially effect the financial condi0on of Borrower or the financial condition of any Guarantor. Financial Records. Maintain its books and records in accordance with GAAP, applied on n consistent basis, and permit Lender to examine and audit Borrowers books and records at all reasonable times. Financial Statements. Furnish Lender with the following: Additional Requirements, Borrower shall provide Lender with the following: 1) signed Personal Financial Statements, due within sixty (60) days after each calendar year end, 2) signed annual personal Federal Income Tax Returns due within sixty (60) days after the end of each applicable filing date, 3) signed company prepared Financial Statements as well as Occvpancy, ADA and RevPar reports due within thirty (30) days from the and of each quarter (March, June, September and December 31) and 4) annual STR (Smith Travel Research) Reports. All financial reports required Io be provided under this Agreement shall be prepared in accordance with GAAP, applied on a consistent basis, and certlrrod by Borrower as being true and correct. Additional Information, Furnish such additional Information and Statements, as Lender may request from time to Urns. Financial Covenants and Ratios. Comply with the following covenants and ratios: Addillonai Requirements. Throughout the term of the Loan, Borrower shall maintain a minimum Debt Coverage Ratio of 1.35x, to be reviewed December 31, 2011 And annually thereafter. Debt Coverage Ratio Is donned as: Gross Revenue less Operating Expense (excliding interest, depreciation and amortization) less 4% Replacement Reserve divided by Principal and interest paid. Except as provided above, all computations made to dolormine compliance with the requirements contained In Ihis paragraph sba!l be made In accordance with generally accepted accounting principles, applied on a consistent basis, and certified by Borrower as being true and correct. Insurance. Maintain fire and other risk Insurance, public fiabllity Insurance, and such other insurance as Lender may require with respect to Borrowors properties and operations, in form, amounts, coverages and with Insurance companies acceptable to Lender. Borrower, upon request of Lender, will deliver to Lender from time to time the policies or certificates of Insurance in form satisfactory to Lender, Including stipulations that coverages will not be cancelled or diminished without at least fifteen (15) days prior written notice to Lender. Each Insurance policy also shall fnelude an endorsement providing that coverage In favor of Lender will not be impelled in any way by any act, omission or default of Borrower or any other person. In connection with all policies covering assets In which Lender fields of Is offered a security Interest for the Loans, Borrower will provide Lender with such lenders loss payable or other endorsements as Londer may require. Insurance Reports. Furnish to Lender, upon request of Lender, reports on each existing Insurance policy showing such Information as Lender may reasonably request, including.wilhout limitation the following: (1) the name of the Insurer; (2) the risks insured; (3) the amount of the policy; (4) the properties Insured; (5) the'than current property values on the basis of which insurance has been obtained, and the manner of determin!ng those values; and (6) file expiration data of the policy. In addition, upon request of Lender (however not more often than annually), Borrower will have an Independent appraiser satisfactory to Lender determine, as applicable, the actual cash value or replacement cost of any Collateral, The cost of such appraisal shall be paid by Borrower. Guaranties. Prior to disbursement of any Loan proceeds, furnish executed guaranties of the Loans In favor of Lender, executed by the guarantor named below, on Lender's forts, and in the amount and under the conditions set forth In those guaranties. Name of Guarantor Anjo 111j Chen Motel Enlerprlses, Inc. Unlimited Other Agreements. Comply with a'd terms and conditions Of all other Agreements, whether now or hereafter existing, between Borrower 5 d � 1 BUSINESS IRAN AGREEMENT Loan No: 4000009822 (Continued) Page 3 and any other party and notify Lender Immediately In writing Of any default In connection with any other such agreements. Loan Proceeds, use ail Loan proceeds solely for the following specific purposes; refinance existing commercial mortgage, pay off existing lions, taxes due and to make improvements to the Country fen and Suites Hotel located at 4843 Gettysburg Road, Mechanicsburg PA. Taxes, Charges and Liens, Pay and discharge when due all of Its Indebtedness and oKgatlons, Including without limitation all assessments, taxes, governmental charges, levies and Ilene, of every kind end nature, imposed upon Borrower or Its properties, income or profits, prior to the dale on which penalties would attach, and all lawful claims that, If unpaid, might became a lien or charge upon any of Borrower's proporties, Income, or profits. Provided however, Borrower will not be required to pay and discharge any such assessment, tax, charge, levy, lien or claim so long as (1) the legality of the same shall be contested In good faith by appropriate proceedings, and (2) Borrower, shall have established on Borrower's books adequate reserves with respect to such contested assessment, tax, charge, levy, lien, or claim In accordance with GAAP. Performance. Perform and comply, in a timely manner, with all terms, conditions, and provisions set forth In this Agreement, In the Related Documents, and in all Other Instruments and agreements between Borrower and Lender. Borrower shall notify Lender immediately In writing of any default In connection with any agreement. Operations. Maintain executive and management personnel with substantially the same qualifications and experience as the present executive and management personnel; provide written notice to Lender of any change in executive and management personnel; conduct its business affairs In a reasonable end prudent manner. Environmental Studies. Promptly conduct and complete, at Borrower's exponso, all such Investigations, studies, samplings and leslings as may be requested by Lender or any governmental authority relative to any substance, or any waste or by- product of any substance dofined as toxic or a hazardous substance under eppfleablo federal, state, or local law, nhto, regulation, order or directive, at or affecting any property or any fatality owned, loosed or used by Borrower. Compliance with Governmental Requirements. Comply with all laws, ordinances, and regulations, now or hereafter In effect, of all governmental authorities applleab'o to the conduct of Borrower's properties, businessos and operations, and to the use or occupancy of the Collateral, including without ffrellotion the Americans With Disabilities Act, Borrower may contest In good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Borrower has notined Lender in writing prior to doing so and so long as. In Lender's sea opinion, Landor's interests In the Collateral are not Jeopardized. Lender may require Borrower to post adequate security or a surety bond, reasonably satisfactory to Lender, to protect Lender's Interest. Inspecilon. Permit employees or agents of Lender at any reasonable time to inspect any and all Collateral for the Loan or Loans end Borrower's other properties and to examine or audit Borrower's books accounts, and records and to make copies and memoranda of Borrower's books, accounts, and records. if Borrower now or at any grrio hereafter maintains any records (Including without Urnitalion compiler generated records and computer software programs for the gonaradon of such records) in the possession of a third party, 0040%Ver, upon request Of Lender, shalt notify such party to perrrmit Lender free saws to such records at of reasonable limos and to provide Lender with copies of any records It may request, all at Borrowers expanse. Environmental Compliance and Reports. Borrower shall comply in all respects with any and off Environmental Laws; not cause or permit to exist, as a result of an Intentional or unintentional action Or omission on Borrower's part or on the part of any third party, on property owned andlor occupied by Borrower, any environmental activity where damage may result to the environment, unless such environmental activity Is pursuant to and in compliance with the conditions of a permit issued by the appropriate federal, slate or local governmental authorities; shag furnish to Lender promptly and In any event within thirty (30) days after receipt thereof a copy of any notice, summons, Ilan, citation, directive, letter or other communication from any governmental agency or Instrumentality concerning any intentional or unintentional action or omission on Borrower's part in connection with any environmental ocllvity whether or not there Is damage to the environment andlor other natural resources. Additional Assurances. Make, execute and deriver to Lender such promissory notes, mortgages, deeds of trust security agreements, assignments, financing statements, Instruments, documents and other agreements as Lender or I($ attorneys may reasonably request to evidence and secure the Loans and to perfect all Security interests. RECOVERY OF ADDITIONAL COSTS. If the Imposition of or any chango kt any law, rufe, regulation or guldeffne of the Interpretation or application of any thereof by any court or administrative of governmental authority (including any request or porcy not having the force of law) shall impose, modify or make applicable any taxes (except federal, stale or local income or franchise taxes imposed on Lender), reserve requirements, capital adequacy requirements or other obligations which would (A) increase [tie cost to Lender for extending or maintaining the credit facilities to which this Agreement relates, (B) reduce the amounts payable to Lender under this Agreement Or the Rotated Documents, or (C) reduce the rate of return on Lender's capital as a consoquonce of Lendors obngallons with respect to the credit racifitles to which this Agreement relates, then Borrower agrees to pay Lender such additional amounts as will compensate Lender therefor, within nvo (5) days after Lender's %written demand for such payment, which demand sha'l be accompanied by an explanation of such Imposition or charge and a calculation In reasonable detail or the additional amounts payable by Borrower, which explanation and calcu'ations shall be conc(usivo In the absence of manifest error. LENDER'S EXPENDITURES. if any action or proceeding Is commenced that would moferially affect Lender's Interest In the Collateral or if Borrower falls to comply with any provision of this Agreement or any Related Documents, Including but not limited to Borrower's fai!ura to discharge or pay when due any amounts Borrower Is required to discharge or pay under this Agreement or any Related Documents, Lender on Borrower's behalf may (but shall not be obfrgotod to) take any action that Lender dooms appropriate, including but not limited to discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time Isvled or placed on any Collateral and paying all costs for Insuring maintaining and preserving any Collateral. All such expenditures Incurred or paid by Lender for such purposes will then bear Interest at the rate charged under the Note from the dale incurred or paid by Lender to the date of repayment by Borrower. All such expenses will become a part of The Indebtedness and, at Lender's option, will (A) be payable on demand; (B) be added to the balance of the Note and be apportioned among and be payaMo with any installment payments to become due during either (1) the term of any applicable Insurance policy; or (2) the remaining term of the Note: or (C) be treated as a balloon payment which will be due and payable at the Note's maturity. NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that tvh'le this Agreement is In effect, Borrower shall not, without the prior written consent of Leadw; Indebtedness and Lions, (1) Except for trade debt Incurred in the normal course of business and Indebtedness to Lendor contemplated by this Agreement, create, incur or assume Indebtedness for borrowed money, Including capital leases, (2) sell, transfer, mortgage, assign, pledgo, tease, grant a security Interest in, or• encumber any of Borfowees assets (except as allowed as Pormilted Lions), or (3) sell with recourse any of Borrower's accounts, except t0 Lender. Continuity of Operations. (1) Engage in any business activities substantially different than (hose In which Borrower is presently Ongoged, or (2) cease operations, liquidate, memo, transfer, ncqutre or consolidate with any other entity, change ownership, dissolve or transfer or BUSINESS LOAN AGREEMENT Loan No: 4000009622 .(Continued) Page 4 sell Collateral out of the ordinary course of business. Loans, Acquisitions and Guaranties, (1) Loan, Invest In or advance money or assets to any other person, enterprise or entity, (2) purchase, create or acquire any Interest In any other enterprise or entity, or (3) incur any obligation as surety or guarantor other than In the ordinary course of business. Agreements, Enter Into any agreement conlatning any provisions which would be violated or breached by the performance of Borrower's obligations under this Agreement or In connection herewith. CESSATION OF ADVANCES, If Lender has made any commitment to make any Loan to Borrower, whether under this Agreement or under any other agreement, Lender shall have no obligation to make Loan Advances or to disburse Loan proceeds If: (A) Borrower or any Guarantor Is In default under the terms of this Agreement or any of the Related Documents or any olhor agreement that Borrower or any Guarantor has with Lender; (B) Borrower or any Guarantor des, becomes Incompetent or becomes Insolvent, files a petition In bankruptcy or similar proceedings, or Is adjudged a bankrupt; (C) there occurs a material adverse change In Borrower's financial condition, In the financial condition of any Guarantor, or in the value of any Collateral securing any Loan; or (0) any Guarantor seeks. claims or otherwise attempts to limit, modify or ! revoke such Guarantor's guaranty of the Loan or any Other loan with Lander. RIGHT OF SETOFF, To the extent permitted by applicable law, Lender reserves a right of setoff In as Borrower's aceounls with Lender (whether checking, savings, or some other aeeounl). 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 (he extent permitted by applicable law, to charge or setoff all sums owing on the Indebtedness against any and all such accounts. DEFAULT. Each of the following shall constitute an Event of Default under (his Agreement: Paymenl Default. Borrower fells to make any payment when due under the Loan. Other Delautls. Borrower falls to comply wlth or to perform any other term, obligation, covenant or condition contained In this Agreement or In any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition contained In any other agreement between Lender and Borrower. False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower's behalf under this 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 misloodtng at any lime thereafter. Death or Insolvency. The death of Borrower or the dissolution or termination of Borrower's existence as a going business, the Insolvency of Borrower, the appointment of a receiver for any part of Borrower's property, any assignment for the benefit of creditors, any type of creditor workout, or (he commoncbmonl of any proceeding under any bankruptcy or insolvency laws by or against Borrower. Dofeetive Collateralization. This Agrearnani or any of the Related Documents ceases to be In full force and effect (including failure of any Collateral document to create a valid and porfected security Interest or lien) at any time and for any reason. Creditor or Forfeiture Proceedings, Commencomenl of foreclosure or forfeiture proceedings, whether by Judie of proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the Loan. This Includes a garnishment of any of Borrowor's accounts, including deposit accounts, with Lender. However, this Event of Default shag not apply If there Is a good faith dispute by Borrower as to the validity or reasohableness of the claim which Is the basis of the creditor or forfeiture proceeding and If Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surely bond for the creditor or forfeiture proceeding, In an amount determined by Lender, in Its sole discrollon, as being an adequate reserve or bond for the dispute. Events Affecting Guarantor. Any of the preeoding events occurs with respect to any Guarantor of any of the Indablednoss or any Guarantor dies or becomes incompetent• or revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness. Adverse Change. A material adverse change occurs In Borrower's financial condition, or Lender believes the prospect of payment or performance of the Loan Is Impalred. Rlghl to Cure. If any default, other than a default on indebtedness, Is curable and if Borrower or Grantor, as the case may be, has not been given a notice of a similar default within the preceding twelve (12) months, it may be cured if Borrower or Grantor, as Use case may be. after Lender sonds written notice to Borrower or Grantor, as the case may be, demanding cure of such default: (1) cure the default within fifteen (15) days; or (2) If the cure requires more than fifteen (15) days, Immediately Initiate steps which Lender deems In Lendor's sole dtscratlon to be sufficient to cure the default and thereafter eonUnuo and complete ON reasonable and necessary steps sufficiont to produce compliance as soon as reasonably practical. EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where otherwise provided in this Agreement or the Related Documents, all commitments and obligations of Lender under this Agreement or the Related Documents or any other agreement Immediately will terminate (including any obligation to make further Loan Advances or disbursements), and, at Lender's option, all indebtedness Immediately will become due and payable, all without notice of any kind to Borrower, except that In the case of an Event of Default of the type dosenbed In the "Insolvency' subsection above, such acceleration shall be automatic and not optional. In addition, Lender shall have all the rights and remedies provided in the Related Documents or available at law, in equity, or otherwise. Except as may be prohibited by applicable law, all of Lender's rights and remedies shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Borrower or of any Grantor shall not affect Lender's right to declare a default and to exercise its fights and remedies. RESERVE ACCOUNT. Borrower shall maintain a reserve account for FFBE equal to 3% of annual revenue. RENOVATION OISBURSEMENTS. Funding of renovation costs are subject to property inspocttons by the Lender or a satisfoolory representative approved by Lender. Disbursements for renovations will be limited to work completed and shall be made following an on -silo Inspoclion. Requests for disbursements shall be submitted with documentation of actual contractor Invoices and /or FFBE invoices. No disbursements shall be made unless all work Is completed In a workmanlike manner and FFdE materials deemed sallsfoctory to Lender. Lender alone shall make the determination as to the adequacy of work completed and disbursements of funds. All costs associated with the Inspections shall be at the cost to the Borrower. FRANCHISE AGREEMENT, Borrower shall provide to Lender an acceptable executed Assignment of Franchise Agreement between Country inns & Suites by Carlson, Inc. and Chen Alotot Enterprises, Inc. MISCELLANEOUS PROVISIONS, The following miscellaneous provisions area pad of this Agreemenl: BUSINESS LOAN AGREEMENT Loan No: 4000009822 (Continued) Page S Amendments. This Agreement, together with any Related Documents, constitutes the entire understanding and agreement of the paellas as to the matters set forth In this Agreement. No alteration of or amendebent to this Agreement shall be effectivo unless given In writing and signed by the party or pantos sought to be charged or bound by the alleration or amendment, Attorneys' Feas; Expenses. Borrower agrees to pay upon demand oil of Landoes costs and expenses, Including Londor•s reasonable attorneys' fees and Londoes legal expenses, Incurred In connection with the enforcement of this Agreement. Lander may hire or pay someone also to help enforce this Agreement, and Borrower shall pay the costs and expenses of such enforcernant. Costs and expanses Include Lender's reasonable attorneys' fees and legal expenses whether or not there Is a lawsuit, Including reasonable attorneys' fees and legal expenses for bankruptcy proceedings (Including efforts to modify or vacate any automatic slay or Injunction), appeals, and any anticipated post•judgmunl collodion services. Borrower also shah pay all court costs and such additional fees as may be directed by the court. Caption Headings. Caption headings in this Agreement are for convenience purposes only and are not to be used to Interpret or define the provisions of this Agreement, Consont to Loan Participation, Borrower agrees and consents to Lender's sale or transfer, whether now or later, of one or more participation Interests In the Loan to one or more purchasers, whether rotated or unrelated to Lander. Lender may provide, without any limitation whatsoever, to any one or more purchasers, or potential purchasers, any Information or knowledge Lender may have about Borrower or about any other matter relating to the Loan, and Borrower hereby waives any rights to privacy Borrower may have with respect to such matters. Bormwei additionally waives any and all notices of sale of participation Interests, as well as all notices of any repurchase of such participation Interests, Borrower also agrees that the purchasers of any such participation Interests will be considered as the absolute owners of such Interests In the Loan and will have all the rights granted under the participation agreement or agreements governing the sale of such participation Interests. Borrower further waives all rights of offset or counterclaim that it may have now or later against Lander or against any purchaser of such a participation Interest and unconditionally agrees that either Lender or such purchaser may enforce Borrower's obligation under the Loan irrespective of the failure or insolvency of any holder of any interest in the Loan. Borrower further ogroos that the purchaser of any such participation Interests may enforce its Interests Irrespective of any personal cielrns or defenses that Borrower may have against Lender. Governing Law. This Agreement will be govemed by federal law applicable to Lender and, to the extent not preempted by federal low, the laws of the Commonwealth of Pennsylvania without regard to Its connicis of law provisions. This Agreement has been accepted by Lender In the Commonwealth of Pennsylvania. Choice of Venue. If there Is a lawsuit, Harrower Agrees ypon Londoes (oquest to submit to the jurisdiction of the courts of Dauphin County, Commonwealth of Pennsylvania. Joint and Several Liability. All obligations of Borrower under this Agreement shall be joint and several, and all references to Borrower sholl mean each and ovary Borrower. This means that each Sonrower signing below Is responsible for all obligations In this Agreement. No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Agreement unless such waiver Is given in writing and signed by Lender. No delay or omission on the part of Lender In exercising any right shall operate as a walver of such right or any other fight. A waiver by Lender of a provision of this Agreement shag not prejudice or constitute a waiver of Lende's right otherwlso to demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course of dealing between Lender and Borrower, or between Lander and Any Grantor, shall constitute a waiver of any of Lender's rights or of any of Borrower's or any Grantor's obligations as to any future transactions. Whenever the consent of Londet is required under this Agreement, the granting of such consent by Lander In any Instance shall not constitute continuing consent to subsequent Instances where such consent is required and In all cases such consent may be granted or withheld In the sole discretion of Londer. Notices. Unless otherwise provided by appacabfe law, any notice required to be given under this Agreement shag be given In writing, and shall be effective when actually delivered, when actually received by lelefacslmlle (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or, If mailed, when deposited In the United Stales mall, as first class, eertifiod or registered mail postage prepaid, directed to the addresses shown near the beginning of this Agreement, Any party may charge Its address for notices under this Agreement by giving formal written nollce to the other partios, specifying [hot the purpose of the notice Is to change the party's address. For notice purposes, Borrower agrees to keep Lender Informed at All limes of Borrower's current address. Unless otherwise provided by applicable law, It there is more than one Borrower, any naVice given by Lender to any Borrower Is deemed to be notice given to all Borrowers. Severabillty. If a court of competent jurisdiction finds any provision of this Agreement to be illegal, Invatki, or unenfoicoabio as to any person or circumstance, that finding shall not make the offending provision Illegal, Invalid, or unenforceable as to any other person or circumstance. If feasible, the offending provision shall be considered modified so that It becomes legal, valid and enforceable. If the offending provision cannot be so modified, it shall be considered deleted from this Agreement. Unless otherwise required by low, the illegality, Invalidity, or unonforceabitity of any provision of this Agreement shall not affect the legality, validity or onforcnabilily of any other provision of this Agreement. Successors and Assigns. All covenants and agreements by or on behalf of Borrower contained in this Agreement or any Related Documents shall bind Borrower's successors end assigns and shall Inure to the benefit of Lander and its successors and Assigns. Borrower shall not, however, have the right to assign Borrowars rights under this Agwoment or any Interest therein, without the prior written consent of Lender. Survival of Ropresontatlons and Warranties. Borrower understands and agrees that in making the Loan, Lendor Is relying on all representations, warranties, and covenants mode by Borrower In this Agreement or In any certificate or other instrument delivered by Borrower to Lender under this Agreement or the Related Oocumenis, Borrower further agrees that regardless of any Investigation made by Lander, 4011 such raprosantations, warranties end covenants will survive the making of the Loan and delivery to Lender of the Related Documents, shall be continuing In nature, and shat remain In full force and effect until such time as Borrowers Indebtedness shall be paid In full, or unlit this Agreement shrO be terminated in the manner provided above, whichever Is the last to occur. Time Is of the Essence. Time Is of the essence in [he performance of this Agreement. Waive Jury. All parties to this Agreement hereby waive the right to any jury trial In any action, proceeding, or counterclaim brouglit by any party against any other party. DEFINITIONS. The following capitalized words and terms shag have the (ollowing meanings when used in lilts Agreement. Unless specifically slated to the contrary, all references to dollar amounts shell moon amounts In lawful money of the United Stales of America. Words and terms used in the singular shall Include the plural, and the plural shall Include the singular, as the context may require, Words and forms not otherwise defined In this Agroomont shell have the meanings attributed to such terms In the Uniform Commercial Code. Accounting words and terms not otherwise defined In this Agreement shall have the meanings assigned to them in accordance with generally accepted accounting principles as In BUSINESS LOAN AGREEMENT Loan No: 4000000822 (Continued) Page 6 effect on the data of this Agreement: Advance. The word ' Advnnce' means a disbursement of Loan funds made, or to be made, to Borrower or on Borrower's behalf on aline of credit or multiple advance basis under the terms and conditions of this Agreement. Agreement The word "Agreement' means this Business Loan Agreement, as this Business Loan Agreement may be amended or modified from time to time, together with all exhibits and schedules attached to this Business Loan Agreement from time to time. Borrower. The word "Borrower° moans Chang Mon Chen and Sun YI Chon and includes all co- signers and co•makors signing the Note and all their Successors and assigns. Collateral, The word ' Collatoral' means all property and assets granted as collateral security for a Loan, whether real or personal property, whether granted directly or )ndlrecty, whether granted now or In the future, and whether granted In the form of a security Interest, mortgage, collateral mortgage, deed of trust, assignment, pledge, crap pledge, chattel mortgage, collateral chattel mortgage, chattel trust, factor's lion, equipment trust, conditional sale, trust recelpl, lien, charge, lien or title retention contract, lease or consignment Intended as a security device, or any other security or (ion Interest whatsoever, whether created by law, contract, or otherwise. Environmental Laws, The words 'Environmental Laws" mean any and all stale, federal and local statutes, regulations and ordinances relating to the protection of human health or the environment, Including without limitation the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U,S.C. Section 9601, at seq. ('CERCLA'), the Superfund Amendments and Reauthorization Act of 1988, Pub, L. No. 09-499 ('SARA'), the Hazardous Materials Transportalon Act, 40 U.S.C. Section 1801, at seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, of seq., or other applicable state or fedora] laws, rules, or fegulallons adopted pursuant thereto, Event of Default The words 'Event of Oofault' mean any of the events of default sot forth in this Agreement in the default section of this Agreement. GAAP, The word 'GAAP" means generally accepted accounting pdnclples, Grantor. The word 'Grantor' moans each and all of the parsons or entities granting a Security Interest In any Collateral for file Loan, Including without limitation all Borrowers granting such a Security Interest. Guarantor, The word "Guarantor' means any guarantor, surety, or accommodation party of any or all of the Loan. Guaranty. The word 'Guaranty' means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part of the Note. Hazardous Substances. The words 'Hazardous Substances' moan materials that, because of their quonlily, concentration or physical, chemical or Infectious characteristics, may cause or pose a present or potential hazard to human health or the environment when Improperly used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled, The words "Hazardous Substances' are used in their very broadest sense and Include without limitation any and all hazardous or toxic substances, materials or waste as defined by or listed under the Environmental taws, The term 'Hazardous Substances' also includes, without limitation, petroleum and petroleum byproducts or any fraction thereof and asbestos. Indebtedness. The word "Indebtedness' moans the Indebtedness evidenced by the Note or Related Documents, Including all principal and Interest together with all other Indebtedness and costs and expenses for which Borrower Is responsible under this Agreement or under any of the Related Documents. Lender. The word 'Lender* means Grayslone Bank, a Division of Graystone Tower Bank, Its successors and assigns. Loan. The word "Loan' means any and all loans and financial accommodations from Lender to Borrower whether now or hereafter existing, and however evidenced, Including without limitation those loans and financlal accommodations described herein or described on any exhibit or schedule attached to this Agreement from time to time. Note. The word 'Note` means the Note executed by Chang Mun Chon and Sun Yi Chon In the principal amount of $3,800,000.00 dated September 15, 2010, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note or Credit agreement. Permitted Liens. The words 'Permitted Liens' mean (1) liens and security Interests securing Indebtedness owed by Borrower to Lender; (2) lions for taxes, assessmonts, or similar charges either not yet due or being contested In good follh; (3) liens of mniodalmen, mechanics, warehouseman, or carriers, or other like liens arising In the ordinary course of business and securing obligations which are not yet delinquent; (4) purchase money liens or purchase money security interests upon or In any property acquired or held by Borrower In the ordinary course of business to secure Indebtedness outstanding on the data of this Agreement or permitted to be Incurred under the paragraph of this Agreement tilled 'indebtedness and Liens'; (5) liens and security Interests which, as of the date of this Agreement, have been disclosed to and approved by the Lender In writing; and (6) those lions and security Interests which In the aggregate constitute an Immaterial end Insgnifioant monetary amount with respect to the net value of Borrowers assets. Related Documents. The words "Related Documents' mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and 0 other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Loan. Security Agreement. The words 'Security Agreement' mean and Include without limitation any agreements, promises, covenants, arrangements, understandings or other agreements, whether created by law, contract, or otherwise, evidencing, governing, representing, or creating a Security interest. S ;curity Interest, The words 'Security Interest' mean, without Ifmilotlon, any and off types of collateral security, present and future, whether In the form of a lien, charge, encumbrance, mortgage, deed of trust, security deed, assignment, p:edg% crop p:edge, chattel mortgage, collateral chattel mortgage, chattel trust, factor's lion, equipment crust, conditional sale, trust raceipl, lion or title retention contract, lease or consignment Intended as a security device, or sny other security or lien Interest whatsoever whether created by law, contract, or otherwise. BUSINESS LOAN AGREEMENT Loan N 4000009822 (Continued) Page T BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED SEPTEMBER 15, 2010. THIS AGREEMENT IS GIVEN UNDER SEAL AND IT IS INTENDEO THAT THIS AGREEMENT IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. BORROWER; r X ms } �- �r - fSeal) X (Sear Chang Nun Chen I h° LENDER: GRAYSTONE ANK, A DIVISION OF ORAYST NE TOWER BANK BY. He er ice reald t J u�nm,PSV{V�.fft0 >O:S RV. q,.m rraw `f1AYtK151 }p10. NPyv f+,nq •PA 0.'c,l.ACd RKU MI EXHIBIT " PROMISSORY NOTE Borrower; Chang Mun Chon Lender; Graystono Bank, a Division of Graystone Tower Bank Sun YI Chan Capital Region 227 Ewe Road 112 Market Street Mochanlesbuig, PA 17055 lierdsburg, PA 17104 Principal Amount: $3,600,000,00 Date of Note: September 15, 2010 PROMISE TO PAY. Chang Mun Chan and Sun Yi Chan ('Borrower") jointly and severally promise to pay to Graystone Bank, a Dlvlsion of Graystone Tower Bank ( "Lender'), or order, In lawful money of the United Stales of America, the principal amount of Three Million-Eight Hundred Thousand & 00 /100 Dollars ($3,800,000.00), together with Interest on the unpaid principal balance from September 15, 2010, calculated as described In the "INTEREST CALCULATION METHOD" paragraph using an Inlarest rate of 5.950•/ per annum based on a year of 380 days, until paid In full. The interest rate may change under the terms and conditions of the "INTEREST AFTER DEFAULT" section, PAYMENT. Borrower will pay Ibis loan, In 59 regular payments of $27,303.66 each and one Irregular last payment estimated at $3,255,295,99. Borrower's Ilrst payment Is due Octobor 15, 2010, and all subsequent payments are due on the same day of each month after that. Borrower's final payment will be duo on September 16, 2015, and will he for all principal and all accrued Interest not yet paid. Payments Include principal and Inlerosl, 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; end than to any unpaid collection costs. Borrower will pay Lander at Lenders address shown above or at such other place as Lender may designate in writing. INTEREST CALCULATION METHOD, Interest on this Note is computed on a 3651360 basis; that Is, by applying the ratio of the interest rate over a year of 350 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance Is outstanding. All Interest payable under this Note is computed using (his method. PREPAYMENT PENALTY, Borrower agrees that all loan fees and other prepaid finance charges are earned fully as of the data of the ban and will not be subject to refund upon early payment (whether voluntary or as a result of default), except as otherwise required by law. Upon prepayment of this Note, Lender Is entitled to the following prepayment penalty: A prepayment fee will be charged H the Note is prepaid, In whole or In part, during the fixed rate period. The fee will be calculated at two percent (lye) of the principal amount prepaid. A prepayment fee will not be charged on any amount (up to 10% of the current principal amount) prepaid within any loan year from Inlernally generated funds. The term "loan year" Is defined as any period of one year commencing on the closing date or any anniversary date thereafter. Except for the foregoing, Borrower may pay all or a portion of the amount owed earlier [ban it is due, Early payments w91 not, unless egreod to by Lender In writing, relieve Borrower of Borrowor's obligation to continue to make payments under the payment schedule. Rather, early payments will reduce the principal balance due and may result In Borrowers making fewer payments. Borrower agrees not to sand Lender payments marked 'paid in full ", "without recourse ", of similar language. If Borrower sends such a payment, Lender may o=pt It without losing any of Lenders rights under this Note, and Borrower will remain obligated 10 pay any further amount owed to Lender. All written communications concerning disputed amounts. Including any char -k 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 t0: GRAYST014E TOWER BANK, 1026 Good Hope Road Erholo, PA 17025. LATE CHARGE, If a payment is 15 days or more late, Borrower will be charged 10,000 %, of the regularly scheduled payment or $260,00, whichever Is greater, INTEREST AFTER DEFAULT. Upon default, Induding failure to pay upon final maturity, the Interest rate on this Note shall be Increased by 2.000 percentage points. If judgment Is entered in connection with this Note, interest will continue to accrue after the date of judgment at the rate In affect at the time judgment is entered, However, in no avant will the Interest rate exceed the maximum Interest rate limitations under applicable law. DEFAULT, Each of the following shall constitute an event or default ('Event of Default') under this Note: Payment Default. Borrower fails to make any payment when due under this Note. Other Defaults. Borrower foils to oompty with or to perform any other torm, obligation, covenant or condition contained in this Note or In any of the related documents or to comply with or to perform any term, obpgailon, covenant or condition contained in any other agreement between Lender and Borrower. False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrowers behalf under this Note or the related documents Is (also or misleading In any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. Death or Insolvency, The death of Borrower or the dissolution or termination of Borrowers existence as a going business, the Insolvency of Borrower, the appointment of a recelver for any part of Borrowers property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency taws by or 0001nsl Borrower. Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self -help, repossossion or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan. This includes a garnishment of any of Borrower's accounts, Including deposit accounts, with Lender. However, this Event of Default shall not apply If there Is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Loader monles or a surely bond for the creditor or forfeiture proceeding. In an amount determined by Lender, In Its solo 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 dles or becomes incompetent, or revokes or disputes the validity of, or liability under, any guaranty of the Indebtedness evidenced by this Note. Adverse Change. A me flat adverse change, occurs In Borrowers fmancial condition, or Lender believes the prospect of payment or performance of this Nora 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 pro'V(sion of this Note within the preceding hvelvo (12) months, It may be cured If Borrower, after Lender sends written notice to Borrower demanding cure of such default: (1) cures the default within fifteen (16) days; or (2) if the cure requires more than fifteen (15) days, immediately Initiates steps which Lender deems In Lender's so!e discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and naces3ary steps sufficient to produce compliance as soon as reasonably practical, LENDER'S RIGHTS, Upon default, Lander may, after giving such notices as required by apppeabl0 law, declare the entire unpaid principal balance under this Nate and all accrued unpaid Inlores!, ;mmedlately due, and then Borrower will pay that amount. PROMISSORY NOTE Loan No: 4000009822 (Continued) Pago x ATTORNEYS' FEES; EXPENSES, Lender may hire or pay somoone.elsa to help Collect this Note If Borrower does not pay. Borrower will pay Lender Viet amount. This indudos, subject to any limits under applicable low. Loader's reasonablo attorneys' fees and Lenders legal expenses, whether or not there is a lawsuit, Including reasonable attorneys' fees, oxpensos for tr=%ruptcy proceedings (including efforts to modify or vacate any automatic slay or Injunction), and appeals,: It not prohibited by applicable taw. Borrower also will pay any court costs, in addition to a0 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 Pennsylvania. CHOICE. OF VENUE. If there is a lawsuit, Borrower agrees upon Lenders 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 roserves a right of setoff In all Borrowers accounts with Lender (whother 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 oxtent permitted by applicable law, to charge or setoff all sums owing on the Indebtedness against any and all such accounts. 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 vndertakings (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 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 (I) described In any mortgage, pledge, assignment or other security document separately executed In favor of Lender, and (it) In which a security Interest has been granted to Lender pursuant to this Note. SUCCESSOR INTERESTS, The terms of this Note shall be binding upon Borrower, and upon Borrowers heirs, personal representatives, successors and assigns, and shall Inure to the benefit of Lender and its successors and assigns, GENERAL PROVISIONS, It any part of this Note cannol be enforced, this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any of its rights or remodfss under this Note without losing them. Each Borrower understands end agrees that, with or without notice to Borrower, Lender may with respect to any other Borrower (a) make one or more additional secured or unsecured bans or olherwiso extend additional credit; (b) alter, compromise, renew, extend, accelerolo, or otherwise change one or more limes the time for payment or other terms of any indebtedness, Including increases and decreases of the rate of Interest on the Indebtedness; (c) exchange, enforce, waive, subordinate, fail or decide not to perfect, and release any security, vAlh or without the substitution of now collateral; (d) apply such security and direct the order or rnannor of sale thereof, Including without limitation, any non - judicial sale permitted by the terms of the controlling security agreements, as Lender in its discretion may determine; (9) release, substitute, agree not to sue, of deal with any one or more of Borrowers sureties, endorsers, or other guarantors on any terns or In any manner Lender may choose; and (0 determine how, when and what application of payments and credits shall be made on any other Indebtedness owing by such other Borrower. Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change In the terms of this Note, and unless otherwise expressly slated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shat] be released from liability, All such parties agree that Lender may renew or extend (repeatedly end for any length of time) this loan or releaso any parly or guarantor or collateral; or impair, fall to realize upon or perfect Landers security Interest In the collateral; and take any other action deemed necessary by Lender without the consent of or notico to anyone. All such parties also agree that Lender may modify this loan vdthoul the consent of or notice to anyone other then the party with whom the modification is made. The obligations under this Note are joint and several. if any portion of this Note is for any reason delormiled to bo unenforceable, it will 1101 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 13Y 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 JULX MENT PROVISION TO BORROWER'S ATTENTION OR BORROWER HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL. PRIOR TO SIGNING THIS NOTE, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE. EACH 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: ' X Seal) X $sal) Chang Mum Chon Su I C on PROMISSORY NOTE Loan No: 4000009822 (Continued) Page 3 LENDER: ORAYSTON D NK, A DIVISION OF OR $TON TOWER BANK X eat R. I, We P resMnl � IAYA IpCIMpV,.,6lI.00CW Coa.Y.yJ l..�d11�+'�YC 1wl. ?]�i N(yW evM •IA I.rl,u�o»IC TMWI MI EXHIBIT " ..t .� �� b , 1111111111111111111111111111 001Y19 Parcel Identification Number: 13 -25- 0024 -013 RECORDATION REQUESTED BY: Graystone Bank, a Division of Graystone Tower Bank Capital Region 112 Market Street Harrisburg, PA 17101 WHEN RECORDED MAIL TO: GRAYSTONE TOWER BANK 112 Market Street Harrisburg, PA 17101 FOR RE CORDER'S USE ONLY OPEN - END MORTGAGE AND SECURITY AGREEMENT This instrument is an open -end mortgage and secures future advances pursuant to 42 Pa. C.S. §§ 8943 and 8144, Act No. 926 of 1990) Amount Secured Hereby: $3,800,000.00 THIS MORTGAGE dated September 15, 2010, is made and executed between Chang Mun Chon and Sun Yi Chon, whose address is 227 Ewe Road, Mechanicsburg, PA 17055 (referred to below'as "Grantor ") and Graystone Bank, a Division of Graystone Tower Bank, whose address is 112 Market Street, Harrisburg, PA 17101 (referred to below as "Lender "). GRANT OF MORTGAGE. For valuable consideration, Grantor grants, bargains, sells, conveys, assigns, transfers, releases, confirms and mortgages to Lender all of Grantor's right, title, and interest in and to the following described real property, together with all existing or subsequently erected or affixed buildings, improvements and fixtures; all streets, lanes, alleys, passages, and ways; all easements, rights of way, all liberties, privileges, tenements, hereditaments, and appurtenances thereunto belonging or anywise made appurtenant hereafter, and the reversions and remainders with respect thereto; all water, water rights, watercourses and ditch rights (Including stock in utilities with ditch or irrigation rights); and all other rights, royalties, and profits �r elating to the real property, Including without limitation all minerals, oil, g as, geothermal and similar matters, (the Real Property ") located in Cumberland County, Commonwealth of Pennsylvania: See the exhibit or other description document which is attached to this Mortgage and made a part of this Mortgage as if fully set forth herein. The Real Property or its address is commonI known as 4943 Gettysburg Road, Upper Allen Township Mechanicsburg, PA. The Real Property parcel Identification number is 13 -25 -0014 -013. Grantor presently assigns to Lender all of Grantor's right, title, and interest in and to all present and future leases of the Property and all Rents from the Property. In addition, Grantor grants to Lender a Uniform Commercial Code security Interest In the Personal Property and Rents. THIS MORTGAGE, INCLUDING THE ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN THE RENTS AND PERSONAL PROPERTY, IS GIVEN TO SECURE (A) PAYMENT OF THE INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND ALL OBLIGATIONS UNDER THE NOTE IN THE ORIGINAL PRINCIPAL AMOUNT OF $3,800,000.00, THE RELATED DOCUMENTS, AND THIS MORTGAGE. THIS MORTGAGE IS GIVEN AND ACCEPTED ON THE FOLLOWING TERMS: PAYMENT AND PERFORMANCE. Except as otherwise provided in this Mortgage, Grantor shall pay to Lender all amounts secured by this Mortgage as they become due and shall strictly perform all of Grantor's obligations under this Mortgage. R� MORTGAGE Loan No: 4000009822 (Continued) Page 2 POSSESSION AND MAINTENANCE OF THE PROPERTY, Grantor agrees that Grantor's possession and use of the Property shall be governed by the following provisions: Possession and Use. Until the occurrence of an Event of Default, Grantor may (1) remain in possession and control of the Property; (2) use, operate or manage the Property; and (3) collect the Rents from the Property. Duty to Maintain. Grantor shall maintain the Property in tenantable condition and promptly perform all repairs, replacements, and maintenance necessary to preserve its value. Compliance With Environmental Laws. Grantor represents and warrants to Lender that: (1) During the period of Grantors ownership of the Property, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance by any person on, under, about or from the Property; (2) Grantor has no knowledge of, or reason to believe that there has been, except as previously disclosed to and acknowledged by Lender in writing, (a) any breach or violation of any Environmental Laws, (b) any use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance on, under, about or from the Property - by any prior owners or occupants of the Property, or (c) any actual or threatened litigation or claims of any kind by any person relating to such matters; and (3) Except as previously disclosed to and acknowledged by Lender in writing, (a) neither Grantor nor any tenant, contractor, agent or other authorized user of the Property shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, under, about or from the Property; and (b) any such activity shall be conducted in compliance with all applicable federal, state, -and .local taws, regulations and ordinances, including without limitation all Environmental Laws. Grantor authorizes Lender and its agents to enter upon the Property to make such inspections and tests, at Grantor's expense, as Lender may deem appropriate to determine compliance of the Property with this section of the Mortgage. Any .inspections or tests .made by Lender shall be for Lender's purposes only and shall not be construed to create any responsibility or liability on the part of Lender to Grantor or j to any other person. The representations and warranties contained herein are based on Grantors due diligence in investigating the Property for Hazardous Substances. Grantor hereby '(1) releases and waives any future claims against Lender for indemnity or contribution in the event Grantor becomes liable for cleanup or other costs under any such laws; and (2) agrees to indemnify, defend, and hold harmless Lender against any and all claims, losses, i liabilities, damages, penalties, and:expenses which Lender may directly or Indirectly sustain or suffer resulting from a breach of this section of the Mortgage or as a consequence of any use, generation, manufacture, storage, disposal, release or threatened release -occurring prior to Grantor's ownership or interest in the Property, whether or not the same was or should have been known to Grantor. The provisions of this section of the. Mortgage, including the obligation to indemnify and defend, shall survive the payment of the indebtedness and the satisfaction and reconveyance of the lien of this Mortgage and shall not be affected by Lender's acquisition of any interest in the Property, whether by foreclosure or otherwise. Nuisance, Waste. . Grantor shall not cause, conduct or permit any nuisance nor commit, permit, or suffer any stripping of or waste on or to the Property or any portion of the Property. Without limiting the generality of the foregoing, Grantor will not remove, or grant to any other party the right to remove, any timber, minerals (including oil and gas), coal, clay, scoria, soli, gravel or rock products without Lender's prior written consent. Removal of Improvements. Grantor shall not demolish or remove any Improvements from the Real Property without Lender's prior written consent. As a condition to the removal of any Improvements, Lender may require Grantor to make arrangements satisfactory to Lender to replace such 'improvements with Improvements of at least equal value. Lender's Right to Enter. Lender and Lender's agents and representatives may enter upon the Real Property at all reasonable times to attend to Lender's interests and to inspect the Real Property for purposes of Grantor's compliance with the terms and conditions of this Mortgage. Compliance with Governmental Requirements. Grantor shall promptly comply with all laws, ordinances, and regulations, now or hereafter in effect; of all governmental authorities applicable to the use or occupancy of the Property, including without limitation, the Americans With Disabilities Act. Grantor may.contest in good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Grantor has notified Lender In writing prior to doing so and so long as, .in Lender's sole opinion, Lender's interests in the Property are not Jeopardized. Lender may require Grantor to post adequate security or a surety bond, reasonably satisfactory to Lender, to protect Lender's interest. Duty to Protect. Grantor agrees neither to abandon or leave unattended the Property. Grantor shall do all other acts, in addition to those acts set forth above in this section, which from the character and use of the Property are reasonably necessary to protect and preserve the Property. DUE ON SALE - CONSENT BY LENDER. Lender may, at Lender's option, declare immediately due and payable all sums secured by this Mortgage upon the sale or transfer, without Lender's prior written consent, of all or any part of the Real I Property, or any interest in the Real Property. A "sale or transfer" means the conveyance of Real Property or any right, title or interest in the Real Property; whether legal, beneficial or equitable; whether voluntary or involuntary; whether by t I I I MORTGAGE Loan No: 4000009822 (Continued) Page 3 outright sale, deed, installment sale contract, land contract, contract for deed, leasehold interest with a term greater than three (3) years, lease - option contract, or by sale, assignment, or transfer of any beneficial interest in or to any land trust holding title to the Real Property, or by any other method of conveyance of an interest in the Real Property. If any Grantor is a corporation, partnership or limited liability company, transfer also includes any change in ownership of more than twenty -five percent (25 %) of the voting stock, partnership interests or limited liability company interests, as the case may be, of such Grantor. However, this option shall not be exercised by Lender if such exercise is prohibited by federal law or by Pennsylvania law. TAXES AND LIENS. The following provisions relating to the taxes and liens on the Property are part of this Mortgage: Payment. Grantor shall pay when due (and in all events prior to delinquency) all taxes, payroll taxes, special taxes, assessments, water charges and sewer service charges levied against or on account of the Property, and shall pay when due all claims for work done on or for services rendered or material furnished to the Property. Grantor shall maintain the Property free of any liens having priority over or equal to the interest of Lender under this Mortgage, except for those liens specifically agreed to in writing by Lender, and except for the lien of taxes and assessments not due as further specified in the Right to Contest paragraph. Right to Contest. Grantor may withhold payment of any tax, assessment, or claim in connection with a good faith dispute over the obligation to pay, so long as Lender's interest in the Property is not jeopardized. If a lien arises or is filed as a result of nonpayment, Grantor shall within fifteen (15) days after the lien arises or, if a lien is filed, within fifteen (15) days after Grantor has notice of the filing, secure the discharge of the lien, or if requested by Lender, deposit with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender in an amount sufficient to discharge the lien plus any costs and reasonable attorneys' fees, or other charges that could accrue as a result of a foreclosure or sale under the lien. In any contest, Grantor shall defend itself and Lender and shall satisfy any adverse judgment before enforcement against the Property. Grantor shall name Lender as an additional obligee under any surety bond furnished in the contest proceedings. Evidence of Payment. Grantor shall upon demand furnish to Lender satisfactory evidence of payment of the taxes or assessments and shall authorize the appropriate governmental official to deliver to Lender at any time a written statement of the taxes and assessments against the Property. Notice of Construction. Grantor shall notify Lender at least fifteen (15) days before any work is commenced, any services are furnished, or any materials are supplied to the Property, if any mechanic's lien, materialmen's lien, or other lien could be asserted on account of the work, services, or materials, Grantor will upon request of Lender furnish to Lender advance assurances satisfactory to Lender that Grantor can and will pay the cost of such improvements. PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the Property are a part of this Mortgage: Maintenance of insurance. Grantor shall procure and maintain policies of fire insurance with standard extended coverage endorsements on a replacement basis for the full insurable value covering all Improvements on the Real Property in an amount sufficient to avoid application of any coinsurance clause, and with a standard mortgagee clause in favor of Lender. Grantor shall also procure and maintain comprehensive general liability insurance in such coverage amounts as Lender may request with Lender being named as additional insureds in such liability insurance policies. Additionally, Grantor shall maintain such other insurance, including but not limited to hazard, business interruption and boiler insurance as Lender may require. Policies shall be written by such insurance companies and in such form as may be reasonably acceptable to Lender. Grantor shall deliver to Lender certificates of coverage from each insurer containing a stipulation that coverage will not be cancelled or diminished without a minimum of fifteen (15) days' prior written notice to Lender and not containing any disclaimer of the insurer's liability for failure to give such notice. Each insurance policy also shall Include an endorsement providing that coverage in favor of Lender will not be impaired in any way by any act, omission or default of Grantor or any other person. Should the Real Property be located in an area designated by the Director of the Federal Emergency Management Agency as a special flood hazard area, Grantor agrees to obtain and maintain Federal Flood Insurance, if available, for the full unpaid principal balance of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the National Flood Insurance Program, or as otherwise required by Lender, and to maintain such insurance for the term of the loan. Application of Proceeds. Grantor shall promptly notify Lender of any loss or damage to the Property. Lender may make proof of loss if Grantor falls to do so within fifteen (15) days of the casualty. Whether or not Lender's security is impaired, Lender may, at Lenders election, receive and retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting the Property, or the restoration and repair of the Property. If Lender elects to apply the proceeds to restoration and repair, Grantor shall repair or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon satisfactory proof of such expenditure, pay or reimburse Grantor from the proceeds for the reasonable cost of repair or restoration if Grantor is not in default under this Mortgage. Any proceeds which have not been disbursed within 180 days after their receipt and which Lender has not committed to the repair or restoration of the Property MORTGAGE Loan No; 4000009822 (Continued) Page 4 shall be used first to pay any amount owing to Lender under this Mortgage, then to pay accrued interest, and the remainder, if any, shall be applied to the principal balance of the Indebtedness. If Lender holds any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Grantor as Grantor's interests may appear. TAX AND INSURANCE RESERVES. Upon request by Lender and subject to applicable law, Grantor shall pay to Lender each month, or at such other interval as payments under the Note may be due, on the day payments are due under the Note, a sum ( "Escrow Funds ") equal to one - twelfth, or equivalent fraction if payments are not due monthly, of (a) all annual taxes, special taxes, assessments, water charges and sewer service charges levied against or on account of the Property and (b) annual premiums for policies of fire insurance with all risks standard extended coverage required under this Mortgage ( "Escrow Items "). Lender may estimate the amount of Escrow Funds on the basis of current data and a reasonable estimate of future Escrow Items. All Escrow Funds shall be held by Lender and applied to pay the Escrow Items when due. Lender will not charge for holding and applying the Escrow Funds, analyzing the account, or verifying the Escrow Items, unless Lender pays Grantor Interest on the Escrow Funds and applicable law permits Lender to make such a charge. Grantor and Lender may agree in writing that interest shall be paid on the Escrow Funds. Unless an agreement is made or applicable law requires interest to be paid, Lender shall not be required to pay Grantor any interest or earnings on the Escrow Funds. The Escrow Funds are pledged as additional security for the amounts secured by this Mortgage. If the amount of the Escrow Funds held by Lender, together with the future monthly or other periodic payments of Escrow Funds prior to the due dates of the Escrow Items, shall exceed the amount required to pay the Escrow items when due, the excess shall be, at Grantor option, either promptly repaid to Grantor or credited to Grantor in scheduled payments of Escrow Funds. If the amount of the Escrow Funds held by Lender is not sufficient to pay the Escrow Items when due, Grantor shall pay to Lender any amount necessary to make up the deficiency in one or more payments as required by Lender. LENDER'S EXPENDITURES, If any action or proceeding is commenced that would materially affect Lender's interest in the Property or if Grantor fails to comply with any provision of this Mortgage or any Related Documents, including but not limited to Grantor's failure to discharge or pay when due any amounts Grantor Is required to discharge or pay under this Mortgage or any Related Documents, Lender on Grantor's behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed on the Property and paying all costs for insuring, maintaining and preserving the Property. All such expenditures Incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Grantor. All such expenses will become a part of the Indebtedness and, at Lender's option, will (A) be payable on demand; (B) be added to the balance of the Note and be apportioned among and be payable with any installment payments to become due during either (1) the term of any applicable Insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and payable at the Note's maturity. The Mortgage also will secure payment of these amounts. Such right shall be In addition to all other rights and remedies to which Lender may be entitled upon Default. Grantor's obligation to Lender for all such expenses shall survive the entry of any mortgage foreclosure judgment. WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are a part of this Mortgage: Title. Grantor warrants that: (a) Grantor holds good and marketable title of record to the Property in fee simple, free and clear of all liens and encumbrances other than those set forth in the Real Property description or in any title insurance policy, title report, or final title opinion issued in favor of, and accepted by, Lender in connection with this Mortgage, and (b) Grantor has the full right, power, and authority to execute and deliver this Mortgage to Lender. Defense of Title. Subject to the exception in the paragraph above, Grantor warrants and will forever defend the title to the Property against the lawful claims of all persons. In the event any action or proceeding is commenced that questions Grantor's title or the interest of Lender under this Mortgage, Grantor shall defend the action at Grantor's expense. Grantor may be the nominal party In such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding by counsel of Lender's own choice, and Grantor will deliver, or cause to be delivered, to Lender such instruments as Lender may request from time to time to permit such participation. Compliance With Laws. Grantor warrants that the Property and Grantor's use of the Property complies with all existing applicable laws, ordinances, and regulations of governmental authorities. Survival of Representations and Warranties. All representations, warranties, and agreements made by Grantor in this Mortgage shall survive the execution and delivery of this Mortgage, shall be continuing in nature, and shall remain in full force and effect until such time as Grantor's Indebtedness shall be paid in full. CONDEMNATION. The following provisions relating to condemnation proceedings are a part of this Mortgage: Proceedings. If any proceeding in condemnation is filed, Grantor shall promptly notify Lender in writing, and Grantor shall promptly take such steps as may be necessary to defend the action and obtain the award. Grantor MORTGAGE Loan No: 4000009822 (Continued) Page 5 may be the nominal party in such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding by counsel of its own choice, and Grantor will deliver or cause to be delivered to Lender such instruments and documentation as may be requested by Lender from time to time to permit such participation. Application of Net Proceeds. If all or any part of the Property is condemned by eminent domain proceedings or by any proceeding or purchase in lieu of condemnation, Lender may at its election require that all or any portion of the net proceeds of the award be applied to the Indebtedness or the repair or restoration of the Property. The net proceeds of the award shall mean the award after payment of all actual costs, expenses, and attorneys' fees incurred by Lender in connection with the condemnation. IMPOSITION OF TAXES, FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES. The following provisions relating to governmental taxes, fees and charges are a part of this Mortgage: Current Taxes, Fees and Charges. Upon request by Lender, Grantor shall execute such documents in addition to this Mortgage and take whatever other action is requested by Lender to perfect and continue Lenders lien on the Real Property. Grantor shall reimburse Lender for all taxes, as described below, together with all expenses incurred in recording, perfecting or continuing this Mortgage, including without limitation all taxes, fees, documentary stamps, and other charges for recording or registering this Mortgage. Taxes. The following shall constitute taxes to which this section applies: (1) a specific tax upon this type of Mortgage or upon all or any part of the Indebtedness secured by this Mortgage; (2) a specific tax on Grantor which Grantor is authorized or required to deduct from payments on the Indebtedness secured by this type of Mortgage; (3) a tax on this type of Mortgage chargeable against the Lender or the holder of the Note; and (4) a specific tax on all or any portion of the Indebtedness or on payments of principal and interest made by Grantor. Subsequent Taxes. If any tax to which this section applies is enacted subsequent to the date of this Mortgage, this event shall have the same effect as an Event of Default, and Lender may exercise any or all of its available remedies for an Event of Default as provided below unless Grantor either (1) pays the tax before It becomes delinquent, or (2) contests the tax as provided above in the Taxes and Liens section and deposits with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender. SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to this Mortgage as a security agreement are a part of this Mortgage: Security Agreement. This instrument shall constitute a Security Agreement to the extent any of the Property constitutes fixtures, and Lender shall have all of the rights of a secured party under the Uniform Commercial Code as amended from time to time. Security Interest. Upon request by Lender, Grantor shall take whatever action is requested by Lender to perfect and continue Lender's security interest in the Rents and Personal Property. In addition to recording this Mortgage in the real property records, Lender may, at any time and without further authorization from Grantor, file executed counterparts, copies or reproductions of this Mortgage as a financing statement. Grantor shall reimburse Lender for all expenses incurred in perfecting or continuing this security Interest. Upon default, Grantor shall not remove, sever or detach the Personal Property from the Property. Upon default, Grantor shall assemble any Personal Property not affixed to the Property In a manner and at a place reasonably convenient to Grantor and Lender and make it available to Lender within three (3) days after receipt of written demand from Lender to the extent permitted by applicable law. Addresses. The mailing addresses of Grantor (debtor) and Lender (secured party) from which information concerning the security interest granted by this Mortgage may be obtained (each as required by the Uniform Commercial Code) are as stated on the first page of this Mortgage. FURTHER ASSURANCES; ADDITIONAL AUTHORIZATIONS. The following provisions relating to further assurances and additional authorizations are a part of this Mortgage: Further Assurances. At any time, and from time to time, upon request of Lender, Grantor will make, execute and deliver, or will cause to be made, executed or delivered, to Lender or to Lender's designee, and when requested by Lender, cause to be filed, recorded, refiled, or rerecorded, as the case may be, at such times and in such offices and places as Lender may deem appropriate, any and all such mortgages, deeds of trust, security deeds, security agreements, financing statements, continuation statements, instruments of further assurance, certificates, and other documents as may, in the sole opinion of Lender, be necessary or desirable in order to effectuate, complete, perfect, continue, or preserve (1) Grantor's obligations under the Note, this Mortgage, and the Related Documents, and (2) the liens and security interests created by this Mortgage as first and prior liens on the Property, whether now owned or hereafter acquired by Grantor. Unless prohibited by law or Lender agrees to the contrary in writing, Grantor shall reimburse Lender for all costs and expenses incurred In connection with the matters referred to in this paragraph. Additional Authorizations. If Grantor fails to do any of the things referred to in the preceding paragraph, Lender MORTGAGE Loan No: 4000009822 (Continued) Page 6 may do so for and in the name of Grantor and at Grantor's expense. For such purposes, Grantor hereby irrevocably authorizes Lender to make, execute, deliver, file, record and do all other things as may be necessary or desirable, in Lender's sole opinion, to accomplish the matters referred to in the preceding paragraph. It is understood that nothing set forth herein shall require Lender to take any such actions. FULL PERFORMANCE. If Grantor pays all the Indebtedness when due, and otherwise performs all the obligations imposed upon Grantor under this Mortgage, Lender shall execute and deliver to Grantor a suitable satisfaction of this Mortgage and suitable statements of termination of any financing statement on file evidencing Lender's security Interest in the Rents and the Personal Property. Grantor will pay, if permitted by applicable law, any reasonable termination fee as determined by Lender from time to time. EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute an Event of Default under this Mortgage: /payment Default. Grantor fails to make any payment when due under the Indebtedness. / on Other Payments. Failure of Grantor within the time required by this Mortgage to make any payment for taxes or insurance, or any other payment necessary to prevent filing of or to effect discharge of any lien. /tither Defaults. Grantor falls to comply with or to perform any other term, obligation, covenant or condition contained in this Mortgage or in any of the Related Documents or to comply with or to perform any term, / obligation, covenant or condition contained In any other agreement between Lender and Grantor. False Statements. Any warranty, representation or statement made or furnished to Lender by Grantor or on Grantor's behalf under this Mortgage 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. A efective Coliateralizatlon. This Mortgage or any of the Related Documents ceases to be in full force and effect (including failure of any collateral document to create a valid and perfected security interest or lien) at any time and for any reason. A eath or Insolvency. The death of Grantor, the insolvency of Grantor, the appointment of a receiver for any part of Grantor'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 Grantor. /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 Grantor or by any governmental agency against any property securing the Indebtedness. This includes a garnishment of any of Grantor's accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Grantor as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Grantor 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. Breach of Other Agreement. Any breach by Grantor under the terms of any other agreement between Grantor and Lender that Is not remedied within any grace period provided therein, including without limitation any agreement ceming any indebtedness or other obligation of Grantor to Lender, whether existing now or later, l vents 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 uu der, any Guaranty of the Indebtedness. /Adverse Change. A material adverse change occurs In Grantor's financial condition, or Lender believes the , p ospect of payment or performance of the Indebtedness, is impaired. Right to Cure. If any default, other than a default in payment is curable and if Grantor has not been given a notice of a breach of the same provision of this Mortgage within the preceding twelve (12) months, it may be cured if Grantor, after Lender sends written notice to Grantor demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15) days, immediately Initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical. RIGHTS AND REMEDIES ON DEFAULT. Upon the occurrence of an Event of Default and at any time thereafter, Lender, at Lender's option, may exercise any one or more of the following rights and remedies, in addition to any other rights or remedies provided by law: Accelerate Indebtedness, Lender shall have the right at Its option, after giving such notices as required by applicable law, to declare the entire Indebtedness immediately due and payable. UCC Remedies. With respect to all or any part of the Personal Property, Lender shall have all the rights and remedies of a secured party under the Uniform Commercial Code. MORTGAGE Loan No: 4000009822 (Continued) Page 7 Collect Rents. Lender shall have the right, without notice to Grantor, to take possession of the Property and collect the Rents, including amounts past due and unpaid, and apply the net proceeds, over and above Lender's costs, against the Indebtedness. In furtherance of this right, Lender may require any tenant or other user of the Property to make payments of rent or use fees directly to Lender. If the Rents are collected by Lender, then Grantor irrevocably authorizes Lender to endorse Instruments received in payment thereof in the name of Grantor and to negotiate the same and collect the proceeds. Payments by tenants or other users to Lender in response to Lender's demand shall satisfy the obligations for which the payments are made, whether or not any proper grounds for the demand existed. Lender may exercise Its rights under this subparagraph either in person, by agent, or through a receiver. Appoint Receiver. Lender shall have the right to have a receiver appointed to take possession of all or any part of the Property, with the power to protect and preserve the Property, to operate the Property preceding foreclosure or sale, and to collect the Rents from the Property and apply the proceeds, over and above the cost of the receivership, against the Indebtedness. The receiver may serve without bond if permitted by law. Lender's right to the appointment of a receiver shall exist whether or not the apparent value of the Property exceeds the Indebtedness by a substantial amount. Employment by Lender shall not disqual receiver, ify a person from serving as a Judicial Foreclosure. Lender may obtain a judicial decree foreclosing Grantor's interest in all or any part of the Property, Possession of the Property, For the purpose of procuring possession of the Property, Grantor hereby authorizes and empowers any attorney of any court of record in the Commonwealth of Pennsylvania or elsewhere, as attorney for Lender and all persons claiming under or through Lender, to sign an agreement for entering in any competent court an amicable action in ejectment for possession of the Property and to appear for and confess judgment against Grantor, and against all persons claiming under or through ,Grantor, for the recovery by Lender of possession of the Property, without any stay of execution, for which this Mortgage, or a copy of this Mortgage verified by affidavit, shall be a sufficient warrant; and thereupon a writ of possession may be issued forthwith, without any prior writ or proceeding whatsoever. Nonjudicial Sale. If permitted by applicable law, Lender may foreclose Grantor's interest in all or in any part of the Personal Property or the Real Property by non - judicial sale. Deficiency Judgment. Lender may obtain a judgment for any deficiency remaining in the Indebtedness due to Lender after application of all amounts received from the exercise of the rights provided in this section. Tenancy at Sufferance. If Grantor remains In possession of the Property after the Property is sold as provided above or Lender otherwise becomes entitled to possession of the Property upon default of Grantor, Grantor shall become a tenant at sufferance of Lender or the purchaser of the Property and shall, at Lender's option, either (1) pay a reasonable rental for the use of the Property, or (2) vacate the Property immediately upon the demand of Lender. Other Remedies. Lender shall have all other rights and remedies provided in this Mortgage or the Note or available at law or in equity. Sale of the Property. To the extent permitted by applicable law, Grantor hereby waives any and all right to have the Property marshalled. In exercising its rights and remedies, Lender shall be free to sell all or any part of the Property together or separately, in . one sale or by separate sales. Lender shall be entitled to bid at any public sale on all or any portion of the Property. Notice of Sale. Lender shall give Grantor reasonable notice of the time and place of any public sale of the Personal Property or of the time after which any private sale or other intended disposition of the Personal Property is to be made. Unless otherwise required by applicable law, reasonable notice shall mean notice given at least ten (10) days before the time of the sale or disposition. Any sale of the Personal Property may be made in conjunction with any sale of the Real Property. Election of Remedies. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Mortgage, after Grantor's failure to perform, shall not affect Lender's right to declare a default and exercise its remedies. Nothing under this Mortgage or otherwise shall be construed so as to limit or restrict the rights and remedies available to Lender following an Event of Default, or in any way to limit or restrict the rights and ability of Lender to proceed directly against Grantor and /or against any other co- maker, guarantor, surety or endorser and /or to proceed against any other collateral directly or Indirectly securing the Indebtedness. Attorneys' Fees; Expenses. If Lender Institutes any suit or action to enforce any of the terms of this Mortgage, Lender shall be entitled to recover such sum as the court may adjudge reasonable as attorneys' fees at trial and Upon any appeal. Whether or not any court action is Involved, and to the extent not prohibited by law, all reasonable expenses Lender incurs that in Lender's opinion are necessary at any time for the protection of its MORTGAGE Loan No: 4000009822 (Continued) Page 8 interest or the enforcement of its rights shall become a part of the Indebtedness payable on demand and shall bear interest at the Note rate from the date of the expenditure until repaid. Expenses covered by this paragraph include, without limitation, however subject to any limits under applicable law, Lender's reasonable attorneys' fees and Lender's legal expenses, whether or not there is a lawsuit, including reasonable attorneys' fees and expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post - judgment collection services, the cost of searching records, obtaining title reports (including foreclosure reports), surveyors' reports, and appraisal fees and title insurance, to the extent permitted by applicable law. Grantor also will pay any court costs, in addition to all other sums provided by law. NOTICES. Unless otherwise provided by applicable law, any notice required to be given under this Mortgage shall be given in writing, and shall be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Mortgage. All copies of notices of foreclosure from the holder of any lien which has priority over this Mortgage and notices pursuant to 42 Pa. C.S.A. Section 8143, et. seq., shall be sent to Lender's address, as shown near the beginning of this Mortgage. Any party may change its address for notices under this Mortgage by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the party's address. For notice purposes, Grantor agrees to keep Lender informed at all times of Grantor's current address. Unless otherwise provided by applicable law, if there is more than one Grantor, any notice given by Lender to any Grantor is deemed to be notice given to all Grantors. ADVANCE MONEY MORTGAGE. (A) This Mortgage secures future advances made pursuant to the Note or Related Documents. Without limiting the foregoing, this Mortgage secures all advances made by Lender or Banks of any kind or nature described in 42 Pa. C.S.A. § 8144. (B) If Grantor sends a written notice to Lender which purports to limit the indebtedness secured by this Mortgage and to release the obligation of Lender to make any additional advances to or for the benefit of Grantor, such a notice shall be ineffective as to any future advances made: (1) to enable completion of the improvements on the Real Property for which the loan secured hereby was originally made; (2) to pay taxes, assessments, maintenance charges and insurance premiums; (3) for costs incurred for the protection of the Property or the lien of this Mortgage; (4) on account of expenses incurred by Lender by reason of a default of Grantor hereunder or under the Related Documents or under the Note; and (5) on account of any other costs incurred by Lender to protect and preserve the Property or the lien of this Mortgage. It is the intention of the parties hereto that any such advance made by Lender after any such notice by Grantor shall be secured by the_ lien of this Mortgage on the Property. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Mortgage: Amendments. This Mortgage, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth in this Mortgage. No alteration of or amendment to this Mortgage shall be effective unless given in writing and signed by the party or parties sought to be charged or bound by the alteration or amendment. Annual Reports. if the Property is used for purposes other than Grantor's residence, Grantor shall furnish to Lender, upon request, a certified statement of net operating income received from the Property during Grantor's previous fiscal year in such form and detail as Lender shall require. "Net operating income" shall mean all cash receipts from the Property less all cash expenditures made in connection with the operation of the Property. Caption Headings. Caption headings in this Mortgage are for convenience purposes only and are not to be used to interpret or define the provisions of this Mortgage. Governing Law. This Mortgage 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 Mortgage has been accepted by Lender In the Commonwealth of Pennsylvania. Choice of Venue. if there is a lawsuit, Grantor agrees upon Lender's request to submit to the jurisdiction of the courts of Dauphin County, Commonwealth of Pennsylvania. Joint and Several Liability. All obligations of Grantor under this Mortgage shall be joint and several, and all references to Grantor shall mean each and every Grantor. This means that each Grantor signing below is responsible for all obligations in this Mortgage. No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Mortgage unless such waiver is given in writing and'signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right. A waiver by Lender of a provision of this Mortgage shall not prejudice or constitute a waiver of Lender's right otherwise to demand strict compliance with that provision or any other provision of this Mortgage. No prior waiver by Lender, nor any course of dealing between Lender and Grantor, shall constitute a waiver of any of Lender's . rights or of any of Grantors obligations as to any future transactions. Whenever the consent of Lender is required under this Mortgage, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender. MORTGAGE Loan No: 4000009822 (GOntinUed) Page 9 Severability. If a court of competent Jurisdiction finds any provision of this Mortgage to be Illegal, invalid, or unenforceable as to any person or circumstance, that finding shall not the offending provision Illegal, invalid, or unenforceable as to any -other person or circumstance. If feasible, the offending provision shall be considered modified so that it becomesllegal, valid and enforceable. '.If the offending provision cannot be so modified, .it shall be. considered deleted from this Mortgage. Unless'.otherwise required :by, law, the illegality; i nvalidity, or unenforceability of any provision of this Mortgage shall not affect the legality, validity or enforceability of any other provision of this Mortgage. Merger. There shall be no merger of the interest or estate created by this, Mortgage with`any other interest or estate in the Property at any time held by of for the benefit of Lender in any capacity, without the written consent 1 of Lender. t ..•.. � . . Successor Interests. The terms of this Mortgage shall be binding upon Grantor, and upon Grantor's heirs, personal ,representatives, successors, and assigns, and shall be enforceable by Lender and its successors and assigns, Time is of the Essence. Time is of the essence In the perroriance of this Mortgage. " Waive Jury. All parties to this Mortgage hereby waive the right to any. Jury trial in any action, proceeding, or counterclaim brought by any party, against any other party.. DEFINITIONS. The following capitalized words and terms shall have the following meanings when used in this Mortgage. Unless specifically stated `to , the con "traiy, all references to dollar amounts shall mean amounts in lawful money•of the United States of America. ,Words and terms.,used in the singular shall include the plural, and the plural shall include the singular, as the context may require. "Words and terms not dtherwise' defined In this Mortgage shall have the meanings attributed to such terms in the Uniform Commercial Code: Borrower. The word "Borrower" means Chang Mun Chon and Sun Yi Chon and includes all co- signers and co makers signing the Note and all their' successors` and assigns..: "" R Default. The word "Default" means the Default set forth in this Mortgage in the section titled "Default ". Environmental Laws. - The words `' Environmental Laws" -mean any and alt state, federal' and local statutes, regulations and ordinances relating to the protection of'human health or the environment, including without limitation the Comprehensive Environmental Response,. Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq. -( "CERCLA "), the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99 -499 ( "SARA "), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, at seq., or other applicable state or federal laws, rules, or regulations adopted pursuant thereto. Event of Default. The words "Event of Default" mean any of the events of default set forth in this Mortgage in the events of default section of this Mortgage. Grantor. The word "Grantor" means Chang Mun Chon and Sun Yi Chon. Guarantor. The word "Guarantor" means any guarantor, surety, or accommodation party of any or all of the Indebtedness. Guaranty. The word "Guaranty" means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part of the Note. , Hazardous Substances. The words "Hazardous Substances" es" ( mean materials that, because of their quantity, concentration or physical, chemical or infectious characteristics, may cause or pose a present or potential hazard to human health or the environment when improperly used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words "Hazardous Substances" are used in their very broadest sense and include without limitation any and ail hazardous or toxic substances, materials or waste as defined by or listed under the Environmental Laws. The term "Hazardous Substances" also Includes, without [Imitation, petroleum and petroleum by- products or any fraction thereof and asbestos, r r 2. Improvements. The word "Improvements" means all existing and future Improvements, buildings, structures, mobile homes affixed on the Real Property, facilities, additions, replacements and other'construction on the Real Property. ' { Indebtedness. The word "Indebtedness" means all principal, interest, and other amounts, costs and expenses payable under the Note or Related Documents, together with all renewals of, extensions of, modifications of, consolidations of and substitutions for the Note or Related Documents and any amounts expended or advanced by f Lender to discharge Grantor's obligations or expenses incurred by Lender to enforce Grantor's obligations under this Mortgage, together with interest on such amounts as provided in this Mortgage. Lender. The word "Lender" means Graystone Bank, a Division of Graystone Tower Bank, its successors and assigns. MORTGAGE Loan No: 4000009822 (Continued) Page 10 Mortgage. The word "Mortgage" means this Mortgage between Grantor and Lender, Note. The word "Note" means the promissory note dated September 15, 2010, in the original principal amount of $3,800,000.00 from Grantor to Lender, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the promissory note or agreement. Personal Property. The words 'Personal Property" mean all equipment, fixtures, and other articles of personal property now or hereafter owned by Grantor, and now or hereafter attached or affixed to the Real Property; together with all accessions, parts, and additions to, all replacements of, and all substitutions for, any of such property; and together with all proceeds (including without limitation all insurance proceeds and refunds of premiums) from any sale or other disposition of the Property. Property. The word 'Property" means collectively the Real Property and the Personal Property. Real Property. The words 'Real Property" mean the real property, interests and rights, as further described in this Mortgage. Related Documents. The words 'Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Indebtedness. Rents. The word 'Rents" means all present and future rents, revenues, income, issues, royalties, profits, and other benefits derived from the Property. EACH GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS MORTGAGE, AND EACH GRANTOR AGREES TO ITS TERMS. THIS MORTGAGE IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS MORTGAGE 1S AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. GRANTOR X (Seal) Chang Mun Chon X (Seal) Su i Cho CERTIFICATE OF RESIDENCE I hereby certify, that the precise address of the mortgagee, Graystone Bank, a Division of Graystone Tower Bank herein is as follows: Capital Region, 112 Market Street, Harrisburg, PA 17101 horn r Agent foy' gee 1 MORTGAGE Loan No: 4000009822 (Continues) Page 11 INDIVIDUAL ACKNOWLEDGMENT COMMONWEALTH OF PENNSYLVANIA ) SS COUNTY OF C m 6 � ) i� On this, the day of st?:o 20 before me the undersigned Notary Public, personally appeared Chang Mun Chon and Sun Yi Chon, known to me (or satisfactorily proven) to be the person whose names are subscribed to the within instrument, and acknowledged that they executed the same for the purposes therein contained. In witness whereof, I hereunto set my hand and official seal. COMMONWE OF PENNSYLVAN Os.✓i�_ Notarial Seal n Nevin L. Beyer, Notary Public Notary Public in and for the State of Pe 0 ^ SYf UC"":Z, Lemoyne Boro, Cumberland County My Commission Expires Aug. 28, 2013 Member, Pennsylvania Association of Notaries LASER PRO Lending, Ver, 5.51.00.002 Copr. Harland Financial Solutions, Inc. 1997, 2010. All Rights Reserved. PA P:5CFI1LPL1G03.FC TR -6008 PR -6 ` EXHIBIT "A" LEGAL DESCRIPTION ALL THAT CERTAIN tract or parcel of land and premises situate, lying and being partly in Upper Allen Township and partly in Lower Allen Township, Cumberland County, Pennsylvania, more particularly described as follows: BEGINNING at a point on the center line of the legal right -of -way line of Gettysburg Road, at the northeast corner of Lands NIF Fleming Enterprises; THENCE along the center line of the legal right -of -way line of Gettysburg Road, North 40 degrees 13 minutes 14 seconds East a distance of 165.88 feet to a point being the northwest corner of Lot No. 1 of the hereinafter referenced' Preliminary/Final Subdivision Plan; THENCE along the western line of said Lot No. 1, South 49 degrees 46 minutes 46 seconds East a distance of 196.03 feet to a point; THENCE along the same, North 58 degrees 30 minutes 30 seconds East a distance of 71.06 feet to a point; THENCE along the same, South 53 degrees 49 minutes 11 seconds East a distance of 230.81 feet to a point on the northern legal right -of -way line of Route 15 (S.R. 0015); THENCE along said northern legal right - of -way line of Route 15, South 51 degrees 40 minutes 12 seconds West a distance of 636.24 feet to a point on the eastern boundary line of land N/F Smith Land & Improvement Company; THENCE along the eastern line of said Smith Land & Improvement Company lands, North 49 degrees 46 minutes 46 seconds West a .distance of 120.94 feet to an existing iron pin along the southern line of the aforementioned Fleming Enterprises land; THENCE along the southern line of said Fleming Enterprises land, North 41 degrees 33 minutes 14 seconds East a distance of 372.73 feet to a point at the southeast corner of said Fleming Enterprises land; THENCE along the eastern line of said Fleming Enterprises land, North 49 degrees 24 minutes 46 seconds West a distance of 210.00 feet to a point, the point and place of BEGINNING. THE FORGOING legal description is in conformance with the Preliminary/Final Subdivision Plan for David L. and Jamie L. Hoffman, dated June 28, 2002, last revised October 15, 2002, prepared by Hoover Engineering Services, Inc., File No. 201199, recorded in the Office of the Recorder of Deeds of Cumberland County, Pennsylvania in Plan Boole 86, Page 59. BEING Lot No. 4 of the aforementioned Preliminary/Final Subdivision Plan. UNDER AND SUBJECT to any and all conditions, restrictions, easements, rights - of -way, agreements and covenants of record and that a physical inspection of the property would disclose. PARCEL 813 -25- 0024 -013 'Y BEING THE SAME premises which David L. Hoffman and Jamie L. Hoffman, husband and wife, by deed dated September 12, 2003 and recorded September 16, 2003 in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania in Deed Book 259, Page 1490, granted and conveyed unto Chang Mun Chon and Sun Yi Chon, husband and wife. LESS AND EXCEPT, HOWEVER ALL THAT CERTAIN tract or parcel of land labeled "Proposed Lot 413" situate in Upper Allen Township, Cumberland County, Pennsylvania, more particularly described in accordance with the Minor Subdivision Plan for Chang Mun and Sun Yi Chon prepared by Alpha Consulting Engineers, Inc., dated May 3, 2004 as revised, and recorded October 5, 2004, in the Office of the Recorder of Deeds in and for Cumberland County in Plan Book 89, Page 109, as follows, to wit: BEGINNING at a point (Iron Pin to be set) on the northern right -of -way line of U.S. Route 15 (SR 0015) (120' right of way) a distance of 352.16 feet along the said line southwest from the corner of Lot 1 of other- lands of the Grantors; then beginning along said right of way line South 51 degrees 40 minutes 12 seconds West a distance of 284.08 feet to an iron pin (set) at lands now or formerly of Smith Land & Improvement Company; thence along the line of said lands North 49 degrees 46 minutes 46 seconds West a distance of 120.94 feet to an iron pin (fnd.) at lands now or formerly of Fleming Enterprises; thence along the line of said lands North 41 degrees 33 minutes 14 seconds East, a distance of 312.95 feet to the point of subdivision (cone. mon., to be set); thence along the line of Grantors' residual lot, Lot 4A, South 38 degrees 19 minutes 48 seconds East a distance of 173.50 feet to an iron pin (to be set) on the northern right -of -way line of Route 15 (S.R. 0015), the point and place of BEGINNING. CONTAINING one acre, more or less (43,563 square feet) and labeled as "Proposed Lot 411" on the said Plan. UNDER AND SUBEJCT to zoning regulations, ordinances, underground easements, building and other restrictions shown on the Plan or otherwise applicable, other easements of public utilities, privileges and rights of public service companies, rights of way, reservations, and protective covenants of record and those visible on the subject premises, and subject to all agreements or like matters of record or visible on the premises. PART OF PARCEL #13 -25 -0024 -013 BEING THE SAME premises which Chang Mun Chon and Sun Yi Chon, husband and wife, by deed dated November 2, 2004 and'recorded November 3, 2004 in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania in Deed Book 266, Page 337, granted and conveyed unto Clarence E. Asbury and Susan B. Asbury, tenants in common. ROBERT P. .EGLER RECORDER OF DEEDS CUMBERLAND COUNTY - 1 COURTHOUSE SQUARE CARLISLE, PA 17013 _ 717 -240 -6370 _- k r I Instrument Number - 201027593 Recorded On 9/30/2010 At 8:45 :59 AM * Total Pages - 14 • Instrument Type - MORTGAGE Invoice Number - 73716 User ID - KW • Mortgagor - CHON, SUN YI • Mortgagee - GRAYSTONE BANK • Customer - COMPLETE CLOSING SERVICES * FEES STATE WRIT TAX $0.50 Certification Page STATE JCS /ACCESS TO $23.50 JUSTICE DO NOT DETACH RECORDING FEES - $29.50 RECORDER OF DEEDS This a e is now art PARCEL CERTIFICATION $10.00 P g P FEES of this legal document. AFFORDABLE HOUSING $11.50 COUNTY ARCHIVES FEE $2.00 ROD ARCHIVES FEE $3.00 TOTAL PAID $80.00 I Certify this to be recorded in Cumberland County PA Of atui v o RECORDER O/ DS 1750 * - Information denoted by an asterisk may change during the verification process and may not be reflected on this page. III iilllllillll l I III EXHIBIT " `�`� F . °� f �l III Illllllllllllllllllllllll 001 YB6 Parcel Identification Number: 13 -25- 0024 -001 RECORDATION REQUESTED BY: Graystone Bank, a Division of Graystone Tower Bank Capital Region 112 Market Street Harrisburg, PA 17101 WHEN RECORDED MAIL T0: GRAYSTONE TOWER BANK 112 Market Street Harrisburg, PA 17101 FOR RECORDER'S USE ONLY OPEN - END MORTGAGE AND SECURITY AGREEMENT This instrument is an open -end mortgage and secures future advances pursuant to 42 Pa. C.S. § 8943 and 8144, Act No. 126 of 9990) Amount Secured Hereby: $3,800,000.00 THIS MORTGAGE dated September 15, 2010, is made and executed between Chang Mun Chon and Sun Yi Chon, whose address is 227 Ewe Road, Mechanicsburg, PA 17055 (referred to below as "Grantor ") and Graystone Bank, a Division of Graystone Tower Bank, whose address is 112 Market Street, Harrisburg, PA 17101 (referred to below as "Lender "). GRANT OF MORTGAGE. For valuable consideration, Grantor grants, bargains, sells, conveys, assigns, transfers, releases, confirms and mortgages to Lender all of Grantor's right, title, and interest in and to the following described real property, together with all existing or subsequently erected or affixed buildings, improvements and fixtures; all streets, lanes, alleys, passages, and ways; all easements, rights of way, all liberties, privileges, tenements, hereditaments, and appurtenances thereunto belonging or anywise made appurtenant hereafter, and the reversions and remainders with respect thereto; all water, water rights, watercourses and ditch rights (including stock In utilities with ditch or irrigation rights); and all other rights, royalties, and profits relating to the real property, including without limitation all minerals, oil, g as, geothermal and similar matters, (the "Real Property ") located in Cumberland County, Commonwealth of Pennsylvania: See the exhibit or other description document which is attached to this Mortgage and made a part of this Mortgage as if fully set forth herein. The Real Property or its address is commonly known as 4937 Gettysburg Road, Lower Allen Township, Mechanicsburg, PA. The Real Property parcel identification number is 13 -25- 0024 -001. Grantor presently assigns to Lender all of Grantor's right, title, and interest in and to all present and future leases of the Property and all Rents from the Property. In addition, Grantor grants to Lender a Uniform Commercial Code security Interest in the Personal Property and Rents. THIS MORTGAGE, INCLUDING THE ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN THE RENTS AND PERSONAL PROPERTY, IS GIVEN TO SECURE (A) PAYMENT OF THE INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND ALL OBLIGATIONS UNDER THE NOTE IN THE ORIGINAL PRINCIPAL AMOUNT OF $3,800,000.00, THE RELATED DOCUMENTS, AND THIS MORTGAGE. THIS MORTGAGE IS GIVEN AND ACCEPTED ON THE FOLLOWING TERMS: PAYMENT AND PERFORMANCE. Except as otherwise provided in this Mortgage, Grantor shall pay to Lender all amounts secured by this Mortgage as they become due and shall strictly perform all of Grantor's obligations under this Mortgage. MORTGAGE Loan No: 4000009822 (Continued) Page 2 POSSESSION AND MAINTENANCE OF THE PROPERTY. Grantor agrees that Grantor's possession and use of the Property shall be governed by the following provisions: Possession and Use. Until the occurrence of an Event of Default, Grantor may (1) remain in possession and control of the Property; (2) use, operate or manage the Property; and (3) collect the Rents from the Property. Duty to Maintain. Grantor shall maintain the Property in tenantable condition and promptly perform all repairs, replacements, and maintenance necessary to preserve its value. Compliance With Environmental Laws. Grantor represents and warrants to Lender that: (1) During the period of Grantor's ownership of the Property, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance by any person on, under, about or from the Property; (2) Grantor has no knowledge of, or reason to believe that there has been, except as previously disclosed to and acknowledged by Lender in writing, (a) any breach or violation of any Environmental Laws, (b) any use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance on, under, about or from the Property by any prior owners or occupants of the Property, or (c) any actual or threatened litigation or,ciaims of any kind by any person relating to such matters; and (3) Except as previously disclosed to and acknowledged by Lender in writing, (a) neither Grantor nor any tenant, contractor, agent or other authorized user of the Property shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, under, about or from the Property; and (b) any such activity shall be conducted in compliance with all applicable federal, state, and local laws, regulations and ordinances, including without limitation all Environmental Laws. Grantor authorizes Lender and its agents to enter upon the Property to make such inspections and tests, at Grantor's expense, as Lender may deem appropriate to determine compliance of the Property with this section of the Mortgage. Any inspections or tests made by Lender shall be for Lender's purposes only and shall not be construed to create any responsibility or liability on the part of Lender to Grantor or to any other person. The representations and warranties contained herein are based on Grantor's due diligence in investigating the Property for Hazardous Substances. Grantor hereby (1) releases and waives any future claims against Lender for indemnity or contribution in the event Grantor becomes liable for cleanup or other costs under any such laws; and (2) agrees to indemnify, defend, and hold harmless Lender against any and all claims, losses, liabilities, damages, penalties, and expenses which Lender may directly or indirectly sustain or suffer resulting from a breach of this section of the Mortgage or as a consequence of any use, generation, manufacture, storage, disposal, release or threatened release occurring prior to Grantor's ownership or interest in the Property, whether or not the same was or should have been known to Grantor. The provisions of this section of the Mortgage, including the obligation to indemnify and defend, shall survive the payment of the Indebtedness and the satisfaction and reconveyance of the lien of this Mortgage and shall not be affected by Lender's acquisition of any interest in the Property, whether by foreclosure or otherwise. Nuisance, Waste. Grantor shall not cause, conduct or permit any nuisance nor commit, permit, or suffer any stripping of or waste on or to the Property or any portion of the Property. Without limiting the generality of the foregoing, Grantor will not remove, or grant to any other party the right to remove, any timber, minerals (including oil and gas), coal, clay, scoria, soil, gravel or rock products without Lender's prior written consent. Removal of Improvements. Grantor shall not demolish or remove any Improvements from the Real Property without Lender's prior written consent. As a condition to the removal of any Improvements, Lender may require Grantor to make arrangements satisfactory to Lender to replace such Improvements with Improvements of at least equal value. Lender's Right to Enter. Lender and Lender's agents and representatives may enter upon the Real Property at all reasonable times to attend to Lender's interests and to inspect the Real Property for purposes of Grantor's compliance with the terms and conditions of this Mortgage. Compliance with Governmental Requirements. Grantor shall promptly comply with all laws, ordinances, and regulations, now or hereafter in effect, of all governmental authorities applicable to the use or occupancy of the Property, including without limitation, the Americans With Disabilities Act. Grantor may contest In good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Grantor has notified Lender in writing prior to doing so and so long as, in Lender's sole opinion, Lender's interests in the Property are not Jeopardized. Lender may require Grantor to post adequate security or a surety bond, reasonably satisfactory to Lender, to protect Lender's interest. Duty to Protect. Grantor agrees neither to abandon or leave unattended the Property. Grantor shall do all other acts, in addition to those acts set forth above in this section, which from the character and use of the Property are reasonably necessary to protect and preserve the Property. DUE ON SALE • CONSENT BY LENDER. Lender may, at Lender's option, declare immediately due and payable all sums secured by this Mortgage upon the sale or transfer, without Lender's prior written consent, of all or any part of the Real Property, or any interest in the Real Property. A "sale or transfer" means the conveyance of Real Property or any right, title or interest in the Real Property; whether legal, beneficial or equitable; whether voluntary or involuntary; whether by MORTGAGE Loan No: 4000009822 (Continued) Page 3 outright sale, deed, installment sale contract, land contract, contract for deed, leasehold interest with a term greater than three (3) years, lease- option contract, or by sale, assignment, or transfer of any beneficial interest in or to any land trust holding title to the Real Property, or by any other method of conveyance of an interest in the Real Property. if any Grantor is a corporation, partnership or limited liability company, transfer also includes any change in ownership of more than twenty -five percent (25 %) of the voting stock, partnership interests or limited liability company interests, as the case may be, of such Grantor. However, this option shall not be exercised by Lender if such exercise is prohibited by federal law or by Pennsylvania law. TAXES AND LIENS. The following provisions relating to the taxes and liens on the Property are part of this Mortgage: Payment. Grantor shall pay when due (and in all events prior to delinquency) all taxes, payroll taxes, special taxes, assessments, water charges and sewer service charges levied against or on account of the Property, and shall pay when due all claims for work done on or for services rendered or material furnished to the Property. Grantor shall maintain the Property free of any liens having priority over or equal to the interest of Lender under this Mortgage, except for the Existing Indebtedness referred to in this Mortgage or those liens specifically agreed to in writing by Lender, and except for the lien of taxes and assessments not due as further specified in the Right to Contest paragraph. Right to Contest. Grantor may withhold payment of any tax, assessment, or claim in connection with a good faith dispute over the obligation to pay, so long as Lender's interest in the Property is not jeopardized. If a lien arises or is filed as a result of nonpayment, Grantor shall within fifteen (15) days after the lien arises or, if a lien is filed, within fifteen (15) days after Grantor has notice of the filing, secure the discharge of the lien, or if requested by Lender, deposit with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender in an amount sufficient to discharge the lien plus any costs and reasonable attorneys' fees, or other charges that could accrue as a result of a foreclosure or sale under the lien. In any contest, Grantor shall defend itself and Lender and shall satisfy any adverse judgment before enforcement against the Property. Grantor shall name Lender as an additional obligee under any surety bond furnished in the contest proceedings. Evidence of Payment. Grantor shall upon demand furnish to Lender satisfactory evidence of payment of the taxes or assessments and shall authorize the appropriate govemmental official to deliver to Lender at any time a written statement of the taxes and assessments against the Property. Notice of Construction. Grantor shall notify Lender at least fifteen (15) days before any work is commenced, any services are furnished, or any materials are supplied to the Property, if any mechanic's lien, materialmen's lien, or other lien could be asserted on account of the work, services, or materials. Grantor will upon request of Lender furnish to Lender advance assurances satisfactory to Lender that Grantor can and will pay the cost of such improvements. PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the Property are a part of this Mortgage: Maintenance of Insurance. Grantor shall procure and maintain policies of fire insurance with standard extended coverage endorsements on a replacement basis for the full insurable value covering all improvements on the Real Property in an amount sufficient to avoid application of any coinsurance clause, and with a standard mortgagee clause in favor of Lender. Grantor shall also procure and maintain comprehensive general liability insurance in such coverage amounts as Lender may request with Lender being named as additional insureds in such liability insurance policies. Additionally, Grantor shall maintain such other insurance, including but not limited to hazard, business interruption and boiler insurance as Lender may require. Policies shall be written by such insurance companies and in such form as may be reasonably acceptable to Lender. Grantor shall deliver to Lender certificates of coverage from each insurer containing a stipulation that coverage will not be cancelled or diminished without a minimum of fifteen (15) days' prior written notice to Lender and not containing any disclaimer of the insurer's liability for failure to give such notice. Each insurance policy also shall include an endorsement providing that coverage in favor of Lender will not be impaired in any way by any act, omission or default of Grantor or any other person. Should the Real Property be located in an area designated by the Director of the Federal Emergency Management Agency as a special flood hazard area, Grantor agrees to obtain and maintain Federal Flood Insurance, if available, for the full unpaid principal balance of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the National Flood Insurance Program, or as otherwise required by Lender, and to maintain such Insurance for the term of the loan. Application of Proceeds. Grantor shall promptly notify Lender of any loss or damage to the Property. Lender may make proof of loss if Grantor fails to do so within fifteen (15) days of the casualty. Whether or not Lender's security is impaired, Lender may, at Lender's election, receive and retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting the Property, or the restoration and repair of the Property. If Lender elects to apply the proceeds to restoration and repair, Grantor shall repair or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon satisfactory proof of such expenditure, pay or reimburse Grantor from the proceeds for the reasonable cost of repair or restoration if Grantor is not in default under this Mortgage. Any proceeds which have not been disbursed MORTGAGE Loan No: 4000009822 (Continued) Page 4 within 180 days after their receipt and which Lender has not committed to the repair or restoration of the Property shall be used first to pay any amount owing to Lender under this Mortgage, then to pay accrued interest, and the remainder, if any, shall be applied to the principal balance of the Indebtedness. If. Lender holds any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Grantor as Grantor's interests may appear. Compliance with Existing Indebtedness. During the period in which any Existing Indebtedness described below is in effect, compliance with the insurance provisions contained in the instrument evidencing such Existing Indebtedness shall constitute compliance with the insurance provisions under this Mortgage, to the extent compliance with the terms of this Mortgage would constitute a duplication of insurance requirement. If any proceeds from the insurance become payable on loss, the provisions in this Mortgage for division of proceeds shall apply only to that portion of the proceeds not payable to the holder of the Existing Indebtedness. TAX AND INSURANCE RESERVES. Upon request by Lender and subject to applicable law, Grantor shall pay to Lender each month, or at such other interval as payments under the Note may be due, on the day payments are due under the Note, a sum ( "Escrow Funds ") equal to one - twelfth, or equivalent fraction if payments are not due monthly, of (a) all annual taxes, special taxes, assessments, water charges and sewer service charges levied against or on account of the Property and (b) annual premiums for policies of fire insurance with all risks standard extended coverage required under this Mortgage ( "Escrow Items "). Lender may estimate the amount of Escrow Funds on the basis of current data and a reasonable estimate of future Escrow Items. All Escrow Funds shall be held by Lender and applied to pay the Escrow Items when due. Lender will not charge for holding and applying the Escrow Funds, analyzing the account, or verifying the Escrow Items, unless Lender pays Grantor interest on the Escrow Funds and applicable law permits Lender to make such a charge. Grantor and Lender may agree in writing that Interest shall be paid on the Escrow Funds. Unless an agreement is made or applicable law requires Interest to be paid, Lender shall not be required to pay Grantor any interest or earnings on the Escrow Funds. The Escrow Funds are pledged as additional security for the amounts secured by this Mortgage. If the amount of the Escrow Funds held by Lender, together with the future monthly or other periodic payments of Escrow Funds prior to the due dates of the Escrow Items, shall exceed the amount required to pay the Escrow Items when due, the excess shall be, at Grantor option, either promptly repaid to Grantor or credited to Grantor in scheduled payments of Escrow Funds. If the amount of the Escrow Funds held by Lender is not sufficient to pay the Escrow Items when due, Grantor shall pay to Lender any amount necessary to make up the deficiency in one or more payments as required by Lender. LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's Interest in the Property or if Grantor fails to comply with any provision of this Mortgage or any Related Documents, including but not limited to Grantor's failure to comply with any obligation to maintain Existing Indebtedness in good standing as required below, or to discharge or pay when due any amounts Grantor is required to discharge or pay under this Mortgage or any Related Documents, Lender on Grantor's behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to discharging or paying all taxes, [tens, security interests, encumbrances and other claims, at any time levied or placed on the Property and paying all costs for insuring, maintaining and preserving the Property. All such expenditures incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Grantor. All such expenses will become a part of the Indebtedness and, at Lender's option, will (A) be payable on demand; (8) be added to the balance of the Note and be apportioned among and be payable with any installment payments to become due during either (1) the term of any applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and payable at the Note's maturity. The Mortgage also will secure payment of these amounts. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon Default. Grantor's obligation to Lender for all such expenses shall survive the entry of any mortgage foreclosure judgment. WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are a part of this Mortgage: Title. Grantor warrants that: (a) Grantor holds good and marketable title of record to the Property in fee simple, free and clear of all liens and encumbrances other than those set forth in the Real Property description or in the Existing indebtedness section below or in any title insurance policy, title report, or final title opinion issued in favor of, and accepted by, Lender in connection with this Mortgage, and (b) Grantor has the full right, power, and authority to execute and deliver this Mortgage to Lender. Defense of Title. Subject to the exception in the paragraph above, Grantor warrants and will forever defend the title to the Property against the lawful claims of all persons. In the event any action or proceeding is commenced that questions Grantor's title or the Interest of Lender under this Mortgage, Grantor shall defend the action at Grantor's expense. Grantor may be the nominal party in such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding by counsel of Lender's own choice, and Grantor will deliver, or cause to be delivered, to Lender such instruments as Lender may request from time to time to permit such participation. Compliance With Laws. Grantor warrants that the Property and Grantor's use of the Property complies with all MORTGAGE Loan No: 4000009822 (Continued) Page 5 existing applicable laws, ordinances, and regulations of governmental authorities, Survival of Representations and Warranties. All representations, warranties, and agreements made by Grantor in this Mortgage shall survive the execution and delivery of this Mortgage, shall be continuing in nature, and shall remain in full force and effect until such time as Grantor's Indebtedness shall be paid in full. EXISTING INDEBTEDNESS. The following provisions concerning Existing Indebtedness are a part of this Mortgage: Existing Lien. The lien of this Mortgage securing the Indebtedness may be secondary and inferior to an existing lien. Grantor expressly covenants and agrees to pay, or see to the payment of, the Existing Indebtedness and to prevent any default on such indebtedness, any default under the instruments evidencing such indebtedness, or any default under any security documents for such indebtedness. No Modification. Grantor shall not enter into any agreement with the holder of any mortgage or other security agreement which has priority over this Mortgage by which that agreement is modified, amended, extended, or renewed without the prior written consent of Lender. Grantor shall neither request nor accept any future advances under any such security agreement without the prior written consent of Lender. CONDEMNATION. The following provisions relating to condemnation proceedings are a part of this Mortgage: Proceedings. If any proceeding in condemnation is filed, Grantor shall promptly notify Lender in writing, and Grantor shall promptly take such steps as may be necessary to defend the action and obtain the award. Grantor may be the nominal party in such proceeding, but Lender shall be entitled to participate in the proceeding and to be represented in the proceeding by counsel of its own choice, and Grantor will deliver or cause to be delivered to Lender such instruments and documentation as may be requested by Lender from time to time to permit such participation. Application of Net Proceeds. If all or any part of the Property Is condemned by eminent domain proceedings or by any proceeding or purchase in lieu of condemnation, Lender may at its election require that all or any portion of the net proceeds of the award be applied to the Indebtedness or the repair or restoration of the Property. The net proceeds of the award shall mean the award after payment of all actual costs, expenses, and attorneys' fees incurred by Lender in connection with the condemnation. IMPOSITION OF TAXES, FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES. The following provisions relating to governmental taxes, fees and charges are a part of this Mortgage: Current Taxes, Fees and Charges. Upon request by Lender, Grantor shall execute such documents in addition to this Mortgage and take whatever other action is requested by Lender to perfect and continue Lender's lien on the Real Property. Grantor shall reimburse Lender for all taxes, as described below, together with all expenses incurred in recording, perfecting or continuing this Mortgage, including without limitation all taxes, fees, documentary stamps, and other charges for recording or registering this Mortgage. Taxes. The following shall constitute taxes to which this section applies: (1) a specific tax upon this type of Mortgage or upon all or any part of the Indebtedness secured by this Mortgage; (2) a specific tax on Grantor which Grantor is authorized or required to deduct from payments on the Indebtedness secured by this type of Mortgage; (3) a tax on this type of Mortgage chargeable against the Lender or the holder of the Note; and (4) a specific tax on all or any portion of the Indebtedness or on payments of principal and interest made by Grantor. Subsequent Taxes. if any tax to which this section applies is enacted subsequent to the date of this Mortgage, this event shall have the same effect as an Event of Default, and Lender may exercise any or all of its available remedies for an Event of Default as provided below unless Grantor either (1) pays the tax before it becomes delinquent, or (2) contests the tax as provided above in the Taxes and Liens section and deposits with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender. SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to this Mortgage as a security agreement are a part of this Mortgage: Security Agreement This instrument shall constitute a Security Agreement to the extent any of the Property constitutes fixtures, and Lender shall have all of the rights of a secured party under the Uniform Commercial Code as amended from time to time. Security Interest. Upon request by Lender, Grantor shall take whatever action is requested by Lender to perfect and continue Lender's security interest in the Rents and Personal Property. In addition to recording this Mortgage in the real property records, Lender may, at any time and without further authorization from Grantor, file executed counterparts, copies or reproductions of this Mortgage as a financing statement. Grantor shall reimburse Lender for all expenses incurred in perfecting or continuing this security interest. Upon default, Grantor shall not remove, sever or detach the Personal Property from the Property. Upon default, Grantor shall assemble any Personal Property not affixed to the Property In a manner and at a place reasonably convenient to Grantor and Lender and make it available to Lender within three (3) days after receipt of written demand from Lender to the extent permitted by applicable law. MORTGAGE Loan No; 4000009822 (Continued) Page 6 Addresses. The mailing addresses of Grantor (debtor) and Lender (secured party) from which information concerning the security interest granted by this Mortgage may be obtained (each as required by the Uniform Commercial Code) are as stated on the first page of this Mortgage. FURTHER ASSURANCES; ADDITIONAL AUTHORIZATIONS. The following provisions relating to further assurances and additional authorizations are a part of this Mortgage: Further Assurances. At any time, and from time to time, upon request of Lender, Grantor will make, execute and deliver, or will cause to be made, executed or delivered, to Lender or to Lender's designee, and when requested by Lender, cause to be filed, recorded, refiled, or rerecorded, as the case may be, at such times and in such offices and places as Lender may deem appropriate, any and all such mortgages, deeds of trust, security deeds, security agreements, financing statements, continuation statements, instruments of further assurance, certificates, and other documents as may, in the sole opinion of Lender, be necessary or desirable in order to effectuate, complete, perfect, continue, or preserve (1) Grantor's obligations under the Note, this Mortgage, and the Related Documents, and (2) the liens and security interests created by this Mortgage on the Property, whether now owned or hereafter acquired by Grantor. Unless prohibited by law or Lender agrees to the contrary in writing, Grantor shall reimburse Lender for all costs and expenses incurred in connection with the matters referred to in this paragraph. Additional Authorizations, If Grantor fails to do any of the things referred to in the preceding paragraph, Lender may do so for and in the name of Grantor and at Grantor's expense. For such purposes, Grantor hereby Irrevocably authorizes Lender to make, execute, deliver, file, record and do all other things as may be necessary or desirable, in Lender's sole opinion, to accomplish the matters referred to in the preceding paragraph. It is understood that nothing set forth herein shall require Lender to take any such actions. FULL PERFORMANCE. If Grantor pays all the Indebtedness when due, and otherwise performs all the obligations imposed upon Grantor under this Mortgage, Lender shall execute and deliver to Grantor a suitable satisfaction of this Mortgage and suitable statements of termination of any financing statement on file evidencing Lender's security interest in the Rents and the Personal Property. Grantor will pay, if permitted by applicable law, any reasonable termination fee as determined by Lender from time to time. EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute an Event of Default under this Mortgage: Payment Default. Grantor fails to make any payment when due under the Indebtedness. Default on Other Payments. Failure of Grantor within the time required by this Mortgage to make any payment for taxes or insurance, or any other payment necessary to prevent filing of or to effect discharge of any lien. Other Defaults. Grantor fails to comply with or to perform any other term, obligation, covenant or condition contained in this Mortgage or in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Grantor. False Statements. Any warranty, representation or statement made or furnished to Lender by Grantor or an Grantors behalf under this Mortgage 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. Defective Coilateralization. This Mortgage or any of the Related Documents ceases to be in full force and effect (including failure of any collateral document to create a valid and perfected security interest or lien) at any time and for any reason. Death or Insolvency. The death of Grantor, the insolvency of Grantor, the appointment of a receiver for any part of Grantor'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 Grantor. 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 Grantor or by any governmental agency against any property securing the Indebtedness. This includes a garnishment of any of Grantor's accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Grantor as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Grantor 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. Existing Indebtedness. The payment of any installment of principal or any interest on the Existing Indebtedness is not made within the time required by the promissory note evidencing such indebtedness, or a default occurs under the instrument securing such Indebtedness and is not cured during any applicable grace period In such instrument, or any suit or other action is commenced to foreclose any existing lien on the Property. Breach of Other Agreement. Any breach by Grantor under the terms of any other agreement between Grantor and MORTGAGE Loan No: 4000009822 (Continued) Page 7 Lender that is not remedied within any grace period provided therein, including without limitation any agreement concerning any indebtedness or other obligation of Grantor to Lender, whether existing now or later. 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. Adverse Change. A material adverse change occurs in Grantor's financial condition, or Lender believes the prospect of payment or performance of the Indebtedness is Impaired. Right to Cure. If any default, other than a default in payment is curable and if Grantor has not been given a notice of a breach of the same provision of this Mortgage within the preceding twelve (12) months, It may be cured if Grantor, after Lender sends written notice to Grantor demanding cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15) days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical. RIGHTS AND REMEDIES ON DEFAULT. Upon the occurrence of an Event of Default and at any time thereafter, Lender, at Lender's option, may exercise any one or more of the following rights and remedies, in addition to any other rights or remedies provided by law: Accelerate Indebtedness. Lender shall have the right at its option, after giving such notices as required by applicable law, to declare the entire Indebtedness immediately due and payable. UCC Remedies. With respect to all or any part of the Personal Property, Lender shall have all the rights and remedies of a secured party under the Uniform Commercial Code. Collect Rents. Lender shall have the right, without notice to Grantor, to take possession of the Property and collect the Rents, including amounts past due and unpaid, and apply the net proceeds, over and above Lender's costs, against the Indebtedness. In furtherance of this right, Lender may require any tenant or other user of the Property to make payments of rent or use fees directly to Lender. If the Rents are collected by Lender, then Grantor irrevocably authorizes Lender to endorse instruments received in payment thereof in the name of Grantor and to negotiate the same and collect the proceeds. Payments by tenants or other users to Lender in response to Lender's demand shall satisfy the obligations for which the payments are made, whether or not any proper grounds for the demand existed. Lender may exercise its rights under this subparagraph either in person, by agent, or through a receiver. Appoint Receiver. Lender shall have the right to have a receiver appointed to take possession of all or any part of the Property, with the power to protect and preserve the Property, to operate the Property preceding foreclosure or sale, and to collect the Rents from the Property and apply the proceeds, over and above the cost of the receivership, against the Indebtedness. The receiver may serve without bond if permitted by law, Lender's right to the appointment of a receiver shall exist whether or not the apparent value of the Property exceeds the Indebtedness by a substantial amount. Employment by Lender shall not disqualify a person from serving as a receiver. Judicial Foreclosure. Lender may obtain a judicial decree foreclosing Grantor's interest in all or any part of the Property. Possession of the Property. For the purpose of procuring possession of the Property, Grantor hereby authorizes and empowers any attorney of any court of record in the Commonwealth of Pennsylvania or elsewhere, as attorney for Lender and all persons claiming under or through Lender, to sign an agreement for entering in any competent court an amicable action in ejectment for possession of the Property and to appear for and confess judgment against Grantor, and against all persons claiming under or through Grantor, for the recovery by Lender of possession of the Property, without any stay of execution, for which this Mortgage, or a copy of this Mortgage verified by affidavit, shall be a sufficient warrant; and thereupon a writ of possession may be Issued forthwith, without any prior writ or proceeding whatsoever. Nonjudicial Sate. If permitted by applicable law, Lender may foreclose Grantor's interest in all or in any part of the Personal Property or the Real Property by non - judicial sale. Deficiency Judgment. Lender may obtain a judgment for any deficiency remaining in the Indebtedness due to Lender after application of all amounts received from the exercise of the rights provided in this section. Tenancy at Sufferance. If Grantor remains in possession of the Property after the Property is sold as provided above or Lender otherwise becomes entitled to possession of the Property upon default of Grantor, Grantor shall become a tenant at sufferance of Lender or the purchaser of the Property and shall, at Lender's option, either (1) pay a reasonable rental for the use of the Property, or (2) vacate the Property immediately upon the demand of Lender. Other Remedies. Lender shall have all other rights and remedies provided in this Mortgage or the Note or available MORTGAGE Loan No: 4000009822 (Continued) Page 8 at law or In equity. Sale of the Property. To the extent permitted by applicable law, Grantor hereby waives any and all right to have the Property marshalled. In exercising its rights and remedies, Lender shall be free to sell all or any part of the Property together or separately, in one sale or by separate sales. Lender shall be entitled to bid at any public sale on all or any portion of the Property. Notice of Sale. Lender shall give Grantor reasonable notice of the time and place of any public sale of the Personal Property or of the time after which any private sale or other Intended disposition of the Personal Property is to be made. Unless otherwise required by applicable law, reasonable notice shall mean notice given at least ten (10) days before the time of the sale or disposition. Any sale of the Personal Property may be made in conjunction with any sale of the Real Property. Election of Remedies. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Mortgage, after Grantor's failure to perform, shall not affect Lender's right to declare a default and exercise its remedies. Nothing under this Mortgage or otherwise shall be construed so as to limit or restrict the rights and remedies available to Lender following an Event of Default, or in any way to limit or restrict the rights and ability of Lender to proceed directly against Grantor and /or against any other co- maker, guarantor, surety or endorser and /or to proceed against any other collateral directly or indirectly securing the Indebtedness. Attorneys' Fees; Expenses. If Lender institutes any suit or action to enforce any of the terms of this Mortgage, Lender shall be entitled to recover such sum as the court may adjudge reasonable as attorneys' fees at trial and upon any appeal. Whether or not any court action is involved, and to the extent not prohibited by law, all reasonable expenses Lender incurs that in Lender's opinion are necessary at any time for the protection of its interest or the enforcement of its rights shall become a part of the Indebtedness payable on demand and shall bear Interest at the Note rate from the date of the expenditure until repaid. Expenses covered by this paragraph include, without limitation, however subject to any limits under applicable law, Lenders reasonable attorneys' fees and Lender's legal expenses, whether or not there is a lawsuit, including reasonable attorneys' fees and expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post judgment collection services, the cost of searching records, obtaining title .reports (including foreclosure reports), surveyors' reports, and appraisal fees and title insurance, to the extent permitted by applicable law. Grantor also will pay any court costs, in addition to all other sums provided by law. NOTICES. Unless otherwise provided by applicable law, any notice required to be given under this Mortgage shall be given in writing, and shall be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Mortgage. All copies of notices of foreclosure from the holder of any lien which has priority over this Mortgage and notices pursuant to 42 Pa. C.S.A. Section 8143, et. seq., shall be sent to Lender's address, as shown near the beginning of this Mortgage. Any party may change its address for notices under this Mortgage by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the parry's address. For notice purposes, Grantor agrees to keep Lender informed at all times of Grantors current address. Unless otherwise provided by applicable law, if there is more than one Grantor, any notice given by Lender to any Grantor is deemed to be notice given to all Grantors. ADVANCE MONEY MORTGAGE. (A) This Mortgage secures future advances made pursuant to the Note or Related Documents. Without limiting the foregoing, this Mortgage secures all advances made by Lender or Banks of any kind or nature described in 42 Pa. C.S.A. § 8144. (B) If Grantor sends a written notice to Lender which purports to limit the indebtedness secured by this Mortgage and to release the obligation of Lender to make any additional advances to or for the benefit of Grantor, such a notice shall be ineffective as to any future advances made: (1) to enable completion of the Improvements on the Real Property for which the loan secured hereby was originally made; (2) to pay taxes, assessments, maintenance charges and Insurance premiums; (3) for costs incurred for the protection of the Property or the lien of this Mortgage; (4) on account of expenses incurred by Lender by reason of a default of Grantor hereunder or under the Related Documents or under the Note; and (5) on account of any other costs incurred by Lender to protect and preserve the Property or the lien of this Mortgage. It is the intention of the parties hereto that any such advance made by Lender after any such notice by Grantor shall be secured by the lien of this Mortgage on the Property. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Mortgage: Amendments. This Mortgage, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth in this Mortgage. No alteration of or amendment to this Mortgage shall be effective unless given in writing and signed by the party or parties sought to be charged or bound by the alteration or amendment. Annual Reports. If the Property is used for purposes other than Grantor's residence, Grantor shall furnish to Lender, upon request, a certified statement of net operating income received from the Property during Grantor's MORTGAGE Loan No; 4000009822 (Continued) Page 9 previous fiscal year in such form and detail as Lender shall require. "Net operating income" shall mean all cash receipts from the Property less all cash expenditures made in connection with the operation of the Property. Caption Headings. Caption headings in this Mortgage are for convenience purposes only and are not to be used to interpret or define the provisions of this Mortgage. Governing Law, This Mortgage 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 Mortgage has been accepted by Lender In the Commonwealth of Pennsylvania. Choice of Venue. If there is a lawsuit, Grantor agrees upon Lender's request to submit to the jurisdiction of the courts of Dauphin County, Commonwealth of Pennsylvania. Joint and Several Liability. All obligations of Grantor under this Mortgage shall be joint and several, and all references to Grantor shall mean each and every Grantor. This means that each Grantor signing below is responsible for all obligations in this Mortgage. No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Mortgage unless such waiver is given in writing and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right. A waiver by Lender of a provision of this Mortgage shall not prejudice or constitute a waiver of Lender's right otherwise to demand strict compliance with that provision or any other provision of this Mortgage. No prior waiver by Lender, nor any course of dealing between Lender and Grantor, shall constitute a waiver of any of Lenders rights or of any of Grantor's obligations as to any future transactions. Whenever the consent of Lender is required under this Mortgage, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender. Severability. If a court of competent jurisdiction finds any provision of this Mortgage to be illegal, invalid, or unenforceable as to any person or circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other person or circumstance. If feasible, the offending provision shall be considered modified so that it becomes legal, valid and enforceable. If the offending provision cannot be so modified, it shall be considered deleted from this Mortgage. Unless otherwise required by law, the illegality, invalidity, or unenforceabiI4 of any provision of this Mortgage shall not affect the legality, validity or enforceability of any other provision of this Mortgage. Merger. There shall be no merger of the interest or estate created by this Mortgage with any other interest or estate in the Property at any time held by or for the benefit of Lender in any capacity, without the written consent of Lender. Successor Interests. The terms of this Mortgage shall be binding upon Grantor, and upon Grantor's heirs, personal representatives, successors, and assigns, and shall be enforceable by Lender and its successors and assigns. Time is of the Essence. Time is of the essence in the performance of this Mortgage. Waive Jury. All parties to this Mortgage hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by any party against any other party. DEFINITIONS. The following capitalized words and terms shall have the following meanings when used in this Mortgage. Unless specifically stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the singular shall include the plural, and the plural shall Include the singular, as the context may require. Words and terns not otherwise defined in this Mortgage shall have the meanings attributed to such terms In the Uniform Commercial Code: Borrower. The word "Borrower" means Chang Mun Chon and Sun YI Chon and includes all co- signers and co- makers signing the Note and all their successors and assigns. Default. The word "Default" means the Default set forth in this Mortgage in the section titled "Default ". Environmental Laws. The words "Environmental Laws" mean any and all state, federal and local statutes, regulations and ordinances relating to the protection of human health or the environment, including without limitation the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq. ( "CERCLA "), the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99 -499 ( "SARA "), the Hazardous Materials Transportation Act, 49 U.S.C, Section 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, at seq., or other applicable state or federal laws, rules, or regulations adopted pursuant thereto. Event of Default. The words "Event of Default" mean any of the events of default set forth in this Mortgage in the events of default section of this Mortgage. Existing Indebtedness, The words "Existing Indebtedness" mean the indebtedness described in the Existing Liens provision of this Mortgage. MORTGAGE Loan No: 4000009822 (Continued) Page 10 Grantor. The word "Grantor" means Chang Mun Chon and Sun Yi Chon. Guarantor. The word "Guarantor" means any guarantor, surety, or accommodation party of any or all of the Indebtedness. Guaranty. The word "Guaranty" means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part of the Note. Hazardous Substances. The words "Hazardous Substances" mean materials that, because of their quantity, concentration or physical, chemical or infectious characteristics, may cause or pose a present or potential hazard to human health or the environment when improperly used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words "Hazardous Substances" are used in their very broadest sense and include without limitation any and all hazardous or toxic substances, materials or waste as defined by or listed under the Environmental Laws. The term "Hazardous Substances" also includes, without limitation, petroleum and petroleum by- products or any fraction thereof and asbestos. Improvements. The word "Improvements" means all existing and future Improvements, buildings, structures, mobile homes affixed on the Real Property, facilities, additions, replacements and other construction on the Real Property. Indebtedness. The word "Indebtedness" means all principal, interest, and other amounts, costs and expenses payable under the Note or Related Documents, together with all renewals of, extensions of, modifications of, consolidations of and substitutions for the Note or Related Documents and any amounts expended or advanced by Lender to discharge Grantor's obligations or expenses incurred by Lender to enforce Grantor's obligations under this Mortgage, together with interest on such amounts as provided in this Mortgage. Lender. The word "Lender" means Graystone Bank, a Division of Graystone Tower Bank, Its successors and assigns. Mortgage. The word "Mortgage" means this Mortgage between Grantor and Lender. Note. The word "Note" means the promissory note dated September 15, 2010, in the original principal amount of $3,800,000.00 from Grantor to Lender, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the promissory note or agreement. Personal Property. The words "Personal Property" mean all equipment, fixtures, and other articles of personal property now or hereafter owned by Grantor, and now or hereafter attached or affixed to the Real Property; together with all accessions, parts, and additions to, all replacements of, and all substitutions for, any of such property; and together with all proceeds (Including without limitation all insurance proceeds and refunds of premiums) from any sale or other disposition of the Property. Property. The word "Property" means collectively the Real Property and the Personal Property. Real Property. The words "Real Property" mean the real property, Interests and rights, as further described in this Mortgage. Related Documents. The words "Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Indebtedness. Rents. The word "Rents" means all present and future rents, revenues, income, issues, royalties, profits, and other benefits derived from the Property. i y MORTGAGE Loan No: 4000009822 (Continued) Page 19 EACH GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS MORTGAGE, AND EACH GRANTOR AGREES TO ITS TERMS. THIS MORTGAGE IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS MORTGAGE IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. GRANTOR: X (Seal) Chan h n X Seal) Su i Chon CERTIFICATE OF RESIDENCE I hereby certify, that the precise address of the mortgagee, Graystone Bank, a Division of Graystone Tower Bank, h rein is as follows: Capital Region, 112 Market Street, Harrisburg, PA 17101 At ey ent or Yo ge INDIVIDUAL ACKNOWLEDGMENT COMMONWEALTH OF PENNSYLVANIA ) ) SS COUNTY OF 'th On this, the S day of _ . 20 /0 before me the undersigned Notary Public, personally appeared Chang Mun Chon and Sun Yi Chon, known to me (or satisfactorily proven) to be the person whose names are subscribed to the within instrument, and acknowledged that they executed the same for the purposes therein contained. In witness whereof, I hereunto set my hand and official seal. COMMONWEALTH OF PENNSYLVANIA Notarial Seal Notary Public In and for the State of F v1 /L Sy /Va "r iZj Nevin L. Beyer, Notary PuE2013 Lemoyne Boro, Cumberland C My Commission Expires Aug. 2 Mcm PEnnsvlvania Asso datlon of Notaries LASER PRO Lending, Ver, 5.51.00.002 Copr. Harland Financial Solutions, Inc. 1997, 2010. All Rights Reserved. PA P:\CFI\LPL \GO3.FC TR -6008 PR -6 ' EXHIBIT "A" LEGAL DESCRIPTION ALL THAT CERTAIN tract or parcel of land and premises situate, lying and being in Lower Allen Township, Cumberland County, Pennsylvania, more particularly described as follows: BEGINNING at a point on the southern legal right -of -way line of Gettysburg Road, at the northwest corner of Lot No. 3 of the hereinafter referenced Preliminary/Final Subdivision Plan; THENCE along the southwestern line of said Lot No. 3, South 48 degrees 50 minutes 19 seconds East a distance of 308.69 feet to a point; THENCE along the same, North 73 degrees 01 minute 31 seconds East a distance of 169.79 feet to a point; THENCE along the same, South 42 degrees 54 minutes 34 seconds East a distance of 119.04 feet to a point on the northern legal right -of -way line of Route 15 (S.R. 0015), at the southernly most corner of said Lot No. 3; THENCE along the northern legal right -of -way line of Route 15 (S.R. 0015), South 47 degrees 05 minutes 26 seconds West a distance of 144.77 feet to a point; THENCE along the same, South 51 degrees 05 minutes 50 seconds West a distance of 99.49 feet to a point; THENCE along the same, South 51 degrees 40 minutes 12 seconds West a distance of 323.30 feet to a point at the southeast corner of Lot No. 4 of the hereinafter referenced Preliminary/Final Subdivision Plan; THENCE along the eastern boundary line of said Lot No. 4, North 53 degrees 49 minutes 11 seconds West a distance of 230.81 feet to a point; THENCE along the same, South 58 degrees 30 minutes 30 seconds West a distance of 71.06 feet to a point; THENCE along the same, North 49 degrees 46 minutes 46 seconds West a distance of 166.03 feet to a point on the southern legal right -of -way line of Gettysburg Road, at the northern most corner of said Lot No. 4; THENCE along the southern legal right -of -way line of Gettysburg Road, North 40 degrees 13 minutes 14 seconds East a distance of 518.62 feet to a point at the northwest corner of the aforementioned Lot No. 3, the point and place of BEGINNING. THE FORGOING legal description is in conformance with the Preliminary/Final Subdivision Plan for David L. and Jamie L. Hoffman, dated June 28, 2002, last revised October 15, 2002, prepared by Hoover Engineering Services, Inc., File No. 201199, recorded in the Office of the Recorder of Deeds of Cumberland County, Pennsylvania in Plan Book 86, Page 59. BEING Lot No. 1 of the aforementioned Preliminary/Final Subdivision Plan. PARCEL #13 -25 -0024 -001 BEING THE SAME premises which David L. Hoffman, a married man, by deed dated September 15, 2003 and recorded September 16, 2003 in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania in Deed Book 259, Page 1494, granted and conveyed unto Chang Mun Chon and Sun Yi Chon, husband and wife. ROBERT P. LIEGLER t RECORDER OF DEEDS fir;: Ri CUMBERLAND COUNTY„. 1 COURTHOUSE SQUARE CARLISLE, PA 17013 = 717- 240 -6370 am- Instrument Number - 201026350 Recorded On 9/21/2010 At 11:47:07 AM *Total Pages - 13 • Instrument Type - MORTGAGE Invoice Number - 73070 User ID - ES • Mortgagor - CHON, SUN YI • Mortgagee - GRAYSTONE BANK • Customer - COMPLETE CLOSING SERVICES * FEES STATE WRIT TAX $0.50 Certification Page STATE JCS /ACCESS TO $23.50 JUSTICE DO NOT DETACH RECORDING FEES - $27.50 RECORDER OF DEEDS PARCEL CERTIFICATION $10.00 This page is now part FEES of this legal document. AFFORDABLE HOUSING $11.50 COUNTY ARCHIVES FEE $2.00 ROD ARCHIVES FEE $3.00 TOTAL PAID $78.00 I Certify this to be recorded in Cumberland County PA �y of cu�re� ,p o $ z RECORDER O D EDS 1750 * - Information denoted by an asterisk may change during the verification process and may not be reflected on this page. 111 00 EXHIBIT "E" n c Kate Deringer Sallie ph (717) 237 -6792 RHOADS � SINON fx (717) 238 -8623 ksallie@rhoads-sinon.com Reply to Harrisburg Office FILE NO:,.1 2409126 February 3, 2014 Re: Susquehanna Bank/Chang Mun & Sun Yi Chon — NOTICE OF DEFAULT VIA FEDEX Sun Yi Chon Chang Mun Chan Chon Motel Enterprises 227 Ewe Road Mechanicsburg, PA 17055 Mr, and Mrs. Chon: We represent Susquehanna Bank, successor by merger to Graystone Bank (the "Bank ") in connection with that certain $3,800,000 loan made by the Bank to Sun Yi and Chang Mun Chon (collectively, the "Borrowers ") and guaranteed by Chon Motel Enterprises (together with the Borrowers, the "Obligors "), such loan being more specifically identified as Loan No. 4000009822 (the "Loan "). You are hereby notified that the Loan is currently more than 90 days past due and is in default for non - payment of the monthly payments for November 2013, December 2013, and January 2014, Accordingly, the Bank hereby declares an Event of Default under the various loan documents related to the Loan (the "Loan Documents ") for failure to make payment when due (the "Event of Default "). This notification represents the Obligors' final opportunity to satisfy the current outstanding indebtedness due and. owing under the Loan Documents. A failure to pay the amounts due and owing to the Bank within ten (10) days from the date of this letter may result in the Bank exercising its remedies as provided in the Loan Documents, Specifically, if a payment of $81,910.68 (covering the November, December and January monthly payments due and owing under the Loan) is not made within 10 days from the date of this letter, we have been authorized to institute appropriate legal action against the Obligors of the Loan, including, but not limited to, confession of judgment against the Obligors, and the foreclosure, liquidation, collection or other enforcement of the Bank's security interests and liens in any or all of the collateral ( "Collateral ") securing the indebtedness and obligations under the Loan Documents, in order to recover all amounts owed to the Bank under the Loan. Documents, including legal fees, costs of collection and interest. One South Market Square, 12th Floor • P.O. Box 1146 Harrisburg, PA 17108 -1146 • ph: 717.233.5731 29 Dowlin Forge Road • Exton, PA 19341 • ph: 610.423.4200 • fax: 610.423.4201 935765.1 ��` www.rhoads- sinon.coin February 3, 2014 Page 2 The Bank's election not to exercise any of its other rights and remedies at the present time, and any financial accommodations the Bank may have made to date, shall not be construed as a waiver of any rights or remedies of the Bank. Nothing contained herein or in any other conununieation or in any ongoing discussions or negotiations which have or may take place between the Obligors and the Bank shall directly or indirectly: (i) create any obligation upon the Bank to defer any enforcement action or make any further financial accommodations; (ii) constitute a consent or waiver of any past, present or future Event of Default or other violation of any provisions of any Loan Document; (iii) amend, modify or operate as a waiver of any provision of any Loan Document or any right, power, privilege or remedy of the Bank thereunder; or (iv) constitute a course of dealing or other basis for altering any duty or obligation owed by the Obligors to the Bank. Nothing contained in this letter shall confer on any Obligor or any other person or entity any right to other or further notice or cure periods with respect to any Event of Default. The Bank expressly reserves all of its rights, powers, privileges and remedies under the Loan Documents and /or applicable laws, including, without limitation, the Bank's right at any time, as applicable: (i) to apply the Default Rate to the obligations under the Loan Documents since the date of inception of the Events of Default; (ii) to commence any legal or other action to collect any or all of the indebtedness and obligations under the Loan Documents and /or any Collateral or any property pledged by any other person or entity as security for any or all of the indebtedness and obligations under the Loan Documents; (iii) to foreclose or otherwise realize on any or all of the Collateral and /or set -off or apply to the payment of any or all of the indebtedness or obligations under the Loan Documents any or all of the Collateral; and (iv) to take any other enforcement action or otherwise exercise any or all rights and remedies provided by any Loan Document or by applicable laws. Very truly yours, RHOADS & SiNON LLP J � t By' i l� to Deringer Sall' cc: Robert Rahal, Senior Vice President a Page 1 of 1 Fed i' , ,�x— Shipment Receipt Address Information Ship to: I Ship from: Sun Yi Chon and Chang Mun Kate Deringer Sallie, Esquire Chon Chon Motel Enterprises Rhoads & Sinon LLP 227 Ewe Road One S. Market Square 12th Floor Mechanicsburg, PA Harrisburg, PA 17055 17108 US US 717 -231 -6692 7172335731 Shipment Information: Tracking no,: 797794833866 Ship date: 02/03/20I4 Estimated shipping charges: 20.30 Package Information Pricing option: FedEx Standard Rate Service type: Priority Overnight Package type: FedEx Envelope Number of packages: 1 Total weight: I LBS Declared Value: 0,00 USD Special Services: Pickup /Drop -off: Use an already scheduled pickup at my location Billing Information: Bill transportation to: rhoads & sinon LLP -796 Your reference: 12409/26 P.O. no.. Invoice no,: Department no,: Thank you for shipping ciAne with FedEx ShipManager at fadex.com, Please Note FadEx will net be responsible far any claim In exeesa of $100 per package, whether the result of loss, damage, delay, ran- delivery, misdelivery. or misinformation, unless you enter a higher value, pay an additional charge, document your actual lots and file a tlmtly ctalm Limilallons found in the current FedEx $a holes Guide apply. Your right to recover Imm FedEx far any be,, includino Intrinsic value of the package, loss or sales. income interest profit, attamey�s to as, costs, and other forms of damage whethat direct, Inoldaatal, comequenllal, or special Is limited to the Via ate r off 5100 or lho ouMorttod declared You*. Recovery cannot exceed actual doeumented loss. Maalmum lot Items of extreordinbly Yalu' Is Sf.00, e.g., jewelry, preclmta metals, negotiable Instruments and other item! listed In our Service Guide. Wfiden claims must be filed within outlet time limlts; Consult the applicable FedEc Service Guide for details. The estimated shipping afte ge may be different then the actual charges far your shipment, Differences may oxur baaed on actual weight dimensions, and other factors. Cenaul; the applicable FodFj;3 Iervka Guid of the FedEx Rote Sheets for detaits on bout shipping chs fees are calculated. htips:Hw ww,fedex. corn / shipping /html /en/PrintIFrame,html 2/3/2014 EXHIBIT " Kathryn U. Sallie, Esquire Attorney I.D. No. 208116 p , i 2 ksallie@rlioads-siiiozi.com Holly L. Cline, Esquire Attomey T.D. No. 208141 )iclitieCa-rhoids-si.tioti.cotii RHOADS & SINON LLP One South Market Square, 12th Floor P.O, Box 114& Harrisburg, PA 17108-1146 Phone: (717 233-5731 Fax: (7'17)231 -6637 Attorneys :for Plaintiff SUSQUEHANNA BANK, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW CHANG MUINT CHON, SUN YI CHON, NO. and CHON MOTE], ENTERPRISES, INC., Defendants COMPLAINT EN CONFESSION OF JUDGMENT NOW COMES Plaintiff Susquehanna Bank, by its undersigned attorneys, Rlioads & Sinon LLP, and files the within Complaint in Confession of Judgment, stating as follows: 1. Susquehanna Bank (the "Bank") is a Pemisylvartia Banking Institution with a principal place of business located at 1826 Good Hope Road, Enola, Cumberland County, Pennsylvania 17025, 2. The Bank is the successor by merger to Graystone Bank, a Division of Graystone Tower Bank, 3. Defendant Chang Mun Chon ("Mr, Chon") is an adult individual with an address o£227 Ewe Road, Mechanicsburg, Cumberland County, Pennsylvania 17055. 4. Defendant Sun Yi Chon ("Mrs. Chon") is in adult individual with all address of 227 Ewe Road, Mechanicsburg, Cumberland County, Pennsylvania 17055. 5. Defendant Chou Motel Enterprises, Inc. ("Chon Motel") is a Peilnsylvani,-a business corporation with a registered office address and place of business at 227 Ewe Road, Mechanicsburg, Cumberland County, Pennsylvania 17055. 6. Upon information and belief, Mr. and Mrs. Chon are owners and/or officers of Chon Motel. 7. On September 15, 201 in consideration of" a commercial mortgage loan from the Bank to Mr. and Mrs. Chon in the original, principal amount of S3,800,000.00 ("Loan"), Mr. and Mrs. Chon executed and delivered to the Bank a Promissory Note ("Note") evidencing Mr. and Mrs. Chon's obligation to repay the principal sum of $3,800,000,00, plus interest until paid in full. (A true and correct copy of the Note is attached hereto as Exhibit "A" and incorporated herein by reference). 8. For the above referenced Loan, Mrs. Chon, acting in her capacity as President and Treasurer of Chon Motel, executed and delivered to the Bank a Commercial Guaranty ("Guaranty") evidencing, inter alia, the corporate guaranty of Chon Motel to the Bank for Mr. and Mrs. Chon's commercial indebtedness to the Bank in connection with the Loan. (A true and correct copy of the Guaranty is attached hereto as Exhibit "B" and incorporated herein by reference). 9. Pursuant to the terms of the Note, Mr. and Mrs. Choti were obligated to make 59 monthly payments of 527,303.56, beginning oil October 15 2010, with one irregular last Z:� $ payment estimated at $3,255.295.99 to be paid on September 15, 2015. (See Exhibit A). F 1 10.. Mr. and Mrs. Chon failed to make the November 2013, December 2013, January 2014 a nd February 2014 monthly loan payment for the Note. 11. As set forth above, Mr. and Mrs. Chon defaulted under their obligations for the Note in failing to rmakc the required monthly payments. 12. On February 3, 2014, the Bank sent notice of default to Mr. and Mrs. Chon and Guarantor Defendant Chon Motel, declaring an event ol`default for failure to pay under the Note and notifying Mr. and Mrs. Chon and Chon Motel of such event of default and, although not necessary under the relevant documents, provided Mr. and Mrs, Chon with an opportunity to cure such default by payment on or before February 13, 2014. (A true and correct copy of the Notice of Default is attached hereto as Exhibit "C" and incorporated herein by reference). 13. Following receipt of the Notice of Default, Defendants failed and refused to pay the obligations under the Note which constitutes a default under the Note, as well as the Guaranty. 14. The Note contains the follo\ving confession of judgruent provision which empowers any attorney of any court of record to appear for and enter judgment against Mr. and Mrs. Chon and in favor of the Bank.: CONFESSION OF JUDGMENT, BORROWER HEREBY IRREVOCABIAr AUTHORIZES AND EMPOWERS ANY ATTORNEY OR. TILE, 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 13Y .LENDER REI A'I'ING 1'O AN1' COLLA:` °ERAL SECURING 'PHIS NOTE TOGETHER WITH COSTS OF SUIT, AND AN ATTORNFY'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 ($500.00) ON WHICH JUDGMENT OR. JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS NOTE OR A COPY OF T141S 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 tJNDER THIS NOTE. BORROWER HEREBY WAIVES ANY R.IGH'r 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. (See Exhibit A.) 15. The Guaranty for the Note contains a nearly identical confession of judgment provision which also empowers any attorney of any court of record to appear for and enter judgment ag ainst Guarantor Defendant. Chon Motel and in favor of the Bank. (See Exhibit B.) 16, Further, Mr. Chop and Mrs. Chon, in both their personal and corporate capacity, each executed a Disclosure fbi Confession of Judgment ( "Disclosures ") expressly acknowl&lging, inter alia, that the Note and/or Guaranty contains a confession of judgment provision that would pennit the lender to enter jud,(anent in court without advance notice or without offering an opportunity to defend. (True and correct copies of the three (3) separate Disclosures are attached hereto as Exhibit "D" and incorporated herein by reference). 17. Judgment is not being entered by confession against a natural person in connection with a consumer credit transaction. 18. The above referenced Note has not been assigned. 19. The Guaranty referenced herein has not been assigned, 1 1 20. Judgment, has not been entered on the Nate or Guaranty in any jurisdiction. 21. Jud in favor of the Bank and against Defendants is demanded as authorized by the warrants of attorney contained in the Note and Guaranty. 22. The actual amounts presently due and payable to the Bank under the Loan and/or Note is itemized as follows: Principal sum: $3,465,533.77 Interest: S8 1,954.50 Late Charges: $27,303.59 Other Charges: $69,570.67 SUB -TOTAL $3,644,362.83 ' .Interest accrues at per diem rate of $572.78, as indicated through March 7, 2014. AT'T`ORNEYS' FEES $10,000.00 TOTAL 53,654.362.83 WHEREFORE Plaintiff Susquehanna Bank demands judgment in its favor and against Defendants Chon Motel Enterprises, Inc, and Chang Mun Chon and Sun Yi Chon, jointly and severally, in the amount of $3,654,362.83 together with accruing interest at S572.78 per diem, costs of suit, attorneys' frees, and such other charges as authorized by the warrants contained in the Note and Guaranty referenced herein. ^ I I Respectfully submitted, RITOADS & SCNION UT By: Kat �ryii D. Sal ie Holly 1„ Ol i��i. One South Market Square, 12' Floor P.O. Box 1 146 Flarrisburg, PA 17108-1146 (717)2;3 -5731 I1l ioi }rs Chon kfolel Fnierprises, Inc., Chop t lum Chon Lind Sun } i C Con, for purposes of c:onfissiorr of judgment,- A1lorateys for 1'Iaintiff'ISusrlr.0 hai ma Bank f�rr crll other px�r poses Dote: March ��. 2014 VEJUMCA"HON Robert Rabat, deposes and says, subject to the penalties of IS Pa. C.S. § 4904 relating to C, unswom falsification to authorities, that- Vice President fbT Susquehanna Bank, that-slTe makes this verification by its authority and that the facts set forth in the Complaint irt Confession of Judgment are true and correct to the best of her knowledge, information and belief. Date Robert Ralial EXHIBIT " Kaih.ryn D. Sallie, .Esquire Attorney I.D. No. 204116 ksallic a;rlYOac3s- suion.cona > �; _ y Holly L Cline, Esquire ' i.l rt �ti_J � Attorney I.D. No. 204141 =;', 1.j lie] inegrhoad.s- sinon.com RHOADS & S1NON LLP One South M irket Square, 12th Floor P.O. Box 1146 ITarrisburg, PA 17108 -1146 Phone: (717) 233 -5731 Fax (7I7) 231 -6637 Attorneys for Plaintiff SUSQUEHANNA BAND, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW CHANG MIJN CHON, SUN YI CI-ION, and CHON MOTEL ENTERPRISES, INC., : Defendants CONFESSION OF ,IUDGNIENT Pursuant to the authority contained in the warrants of attorney, the originals or true and correct copies of which are attached to the Complaint filed in this action, I appear for the Defendants and confess judgment in favor of the Plaintiff and against the Defendants, including per diem interest and costs from the date of judgment and costs of collection, as follows: Principal sum: $3,465,533.77 Interest: $81,954.80 Late Charges: 527,303.59 Other Charges: S69,570.67 SUB -TOTAL 53,644,362.83 *Interest accrues at per dieni rate of $.572.78, as indicated through March 7, 2014. A f7ORNEYS' FEES S10.000-00 TOTAL S3,654 f t t t Respectfully submitted, RHOADS & SINON LLP ✓ -�� �_, lat 11'yr] D. S I1 Holly L. Cllr One South Market Square, 1.2`" }door P,O. Boa I t46 1 .Pn 17108 - 1146 (717) 2.3a - 5731 tlllorrre} for Defr?rrclonts Chon Hutel Enteiprises, b7C., Chang AIwi Chon and Sun Yi Chore forhurpvses ofc�oq ession of judgment, Attorneys far• Plaintiff Susyueharvw Bank /or all other purposes Date: March 2014 . i I EXHIBIT "H" SUSQUEHANNA BANK, IN THE COLJRT OF COMMON PLEAS OF CUIMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW CIIANG MUN CHON, SUN Yl CHON, NO. and CHON' MOTEL ENTERPRISES, INC., Defendants ENTRY OF JUDGMENT AND NOW, this 1 3714 day of , A " —, 2014, Judgment is hereby entered in favor of the Plaintiff Susquehanna Bank and against the Defendants Chang Mun Chon, Sun Yi Chon and Chon Motel Enterprises, Inc., and damages are assessed in the amount of $3,654,362.83 together with interest from the date Of judgment accruing at the rate of $572J8 per day PILIS Costs of Collection. Prothonotary Ronny R Anderson Sheriff Jody S Smith Chief Depu Richard W Stewart Solicitor SHERIFF'S OFFICE OF CUMBERLAND COUNTY T/FPRO�A�',.: ''' 7814 APR 14 At1 10: °n CUMBERLAND PENNSYLVANIA E'`LA Ty Susquehanna Bank vs. Chang Mun Chon (et al.) Case Number 2014-2066 SHERIFF'S RETURN OF SERVICE -'-'' - ��� - �� 0407C2014 05:46 PM - Deputy Noah Cline, being duly sworn accordin to l served the requested Notice of Residential Mortgage Foreclosure Diversion Program and Complaint in Mortgage Foreclosure by "personally" handing a true copy to a person representing themselves to be the Defendant, to wit: Sun Yi Chon at 227 Ewe Rd., Lower Allen Twp., Mechanicsburg, PA 17055. NOAH CLINE, DEPUTY 04X07/2014 05:46 PM - Deputy Noah Cline, being duly sworn accordin to l served the requested Notice of Residential Mortgage Foreclosure Diversion Program and Complaint in Mortgage Foreclosure by handing a true copy to a person representing themselves to be Sun Yi Chon wife, who accepted as "Adult Person in Charge" for Chang [NunChonat227 Ewe Rd.. Lower Allen, Mechanicsburg, PA17055. NOAH CLINE, DEPUTY SHERIFF COST: $55. 3O SO ANSWERS, April 08, 2014 RON R ANDERSON, SHERIFF Timothy J. Nieman, Esquire Attorney ID No. 66024 tnieman@rhoads-sinon.com Holly L. Cline, Esquire Attorney I.D. No. 208141 hcline@rhoads-sinon.com RHOADS & SINON LLP One South Market Square, 12th Floor P.O. Box 1146 Harrisburg, PA 17108-1146 Phone: (717) 233-5731 Fax: (717) 231-6637 Attorneys for Plaintiff SUSQUEHANNA BANK, Plaintiff V. CHANG MUN CHON and SUN YI CHON, Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION — MORTGAGE FORECLOSURE NO. 2014-CV-2066 PROOF OF SERVICE Attached hereto as Exhibit "A" is a true and correct copy of the Sheriffs Return of Service of the Complaint in Mortgage Foreclosure, which was served upon the above-referenced Defendants on April 7, 2014. By: Date: April 15, 2014 Respectfully submitted, RHOADS & SINON LLP Timothy J. Nie Holly L. Cline One South Market Square, 12th Floor P.O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Plaintiff Susquehanna Bank EXHIBIT "A" 690169.1 Ronny R Anderson Sheriff Jody S Smith Chief Deputy Richard W Stewart Solicitor SHERIFF'S OFFICE OF CUMBERLAND COUNTY FficEOFrvE,V-c RIFF Susquehanna Bank vs. Chang Mun Chon (et al.) Case Number 2014 -2066 SHERIFF'S RETURN OF SERVICE 04/07/2014 05:46 PM - Deputy Noah Cline, being duly sworn according to law, served the requested Notice of Residential Mortgage Foreclosure Diversion Program and Complaint in Mortgage Foreclosure by "personally" handing a true copy to a person representing themselves to be the Defendant, to wit: Sun Yi Chon at 227 Ewe Rd., Lower Allen Twp., Mechanicsburg, PA 17055. NOAH CLINE, DEPUTY 04/07/2014 05:46 PM - Deputy Noah Cline, being duly sworn according to law, served the requested Notice of Residential Mortgage Foreclosure Diversion Program and Complaint in Mortgage Foreclosure by handing a true copy to a person representing themselves to be Sun Yi Chon, wife, who accepted as "Adult Person in Charge" for Chang Mun Chon at 227 Ewe Rd., Lower Allen, Mechanicsburg, PA 17055. NOAH CLINE, DEPUTY SHERIFF COST: $55.30 SO ANSWERS, April 08, 2014 tc) CountySuite Shoot), Teleosoft, lee. RONNY R ANDERSON, SHERIFF CERTIFICATE OF SERVICE I hereby certify that on this 15th day of April, 2014, a true and correct copy of the foregoing document was served by means of United States mail, first class, postage prepaid, upon the following: Bruce D. Foreman, Esquire Foreman & Caraciolo, P.C. 112 Market Street, 6th Floor Harrisburg, PA 17101 Timothy J. Nieman, Esquire Attorney ID No. 66024 tnieman@rhoads-sinon.com Holly L. Cline, Esquire Attorney I.D. No. 208141 hcline@rhoads-sinon.com RHOADS & SINON LLP One South Market Square, 12th Floor P.O. Box 1146 Harrisburg, PA 17108-1146 Phone: (717) 233-5731 Fax: (717) 231-6637 Attorneys for Plaintiff SUSQUEHANNA BANK, Plaintiff v. CHANG MUN CHON and SUN YI CHON, Defendants 2E14 i4; E 7 4:-; IC: cl,11413ERIJAND CO 111',:7-'," PENNS YL VA NIA IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION — MORTGAGE FORECLOSURE NO. 2014 -CV -2066 PRAECIPE TO DISCONTINUE TO THE PROTHONOTARY: Kindly mark the above -captioned matter discontinued, without prejudice, pursuant to Pa. R.C.P. 229. By: Date: May 6, 2014 Respectfully submitted, RHOADS & SINON LLP 0,2 TFmothy J. Ni :j an Holly L. Cline One South Market Square, 12th Floor P.O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Plaintiff Susquehanna Bank CERTIFICATE OF SERVICE I hereby certify that on this 6th day of May, 2014, a true and correct copy of the foregoing document was served by means of United States mail, first class, postage prepaid, upon the following: Bruce D. Foreman, Esquire Foreman & Caraciolo, P.C. 112 Market Street, 6th Floor Harrisburg, PA 17101 .ereek„