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HomeMy WebLinkAbout14-5007 MAGNOLIA PORTFOLIO, LLC, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW CARILLO, LLC and NO. 'S0CS� -O� JEFFREY A. GOSS, z m ti r= Defendants .1 co 3�_ 2 CONFESSION OF JUDGMENT , CD�5, Pursuant to the authority contained in the warrant of attorney, the original or<a copy off: which is 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, plus interest at a per diem rate of $9.25 and costs from the date of judgment and costs of collection, as follows: (a) Unpaid Principal $45,947.50 (b) Unpaid Interest $ 4,649.34 (c) Late Charges $ 1,000.00 (d) Attorneys' Fees $ 625.00 TOTAL $ 52.221 .84 RHOADS & SINON LLP By: C�� "_447E7 — Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Defendants Carillo, LLC and Jeffrey A. Goss for purposes of confession of judgment; Attorneys for Plaintiff Magnolia Portfolio, LLC for all other purposes 960143.2 ��G W " " r - r ;L F tC;i ' r t_ Stephanie E. DiVittore,Esquire Attorney I.D.No. 85906 Kathryn D. Sallie,Esquire '^r t. Al r:1� ^1• ^1 Attorney I.D.No. 108116 �t'�'�� `� ` RHOADS& SINON LLP C U M BE R L N D COUN T Y One South Market Square P L NN S Y LVA N i to P.O. Box 1146 Harrisburg,PA 17108-1146 (717)233-5731 Attorneys for Plaintiff MAGNOLIA PORTFOLIO, LLC, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW CARILLO, LLC and NO. L1,• Spy 7 JEFFREY A. GOSS, Defendants COMPLAINT IN CONFESSION OF JUDGMENT NOW COMES Plaintiff Magnolia Portfolio, LLC, by and through its attorneys, Rhoads & Sinon LLP, and files the within Complaint in Confession of Judgment, stating as follows: 1. Plaintiff Magnolia Portfolio, LLC ("the Lender"), is a Delaware limited liability company with its principal place of business at 4675 Macarthur Court, Suite 1550, Newport Beach, California 92660. 2. Defendant Carillo, LLC ("Borrower") is a Pennsylvania limited liability company with its principal place of business at 60 Pine Street, Carlisle, Cumberland County, Pennsylvania 17013. 3. Defendant Jeffrey A. Goss is an adult, married individual with an address of 10 Derbyshire Drive, Carlisle, Cumberland County, Pennsylvania 17013. 960143.2 4. On or about September 5, 2007, Orrstown Bank extended a loan in the original principal amount of $50,000 to the Borrower [Orrstown Loan No. 26474100101] (the "Loan") secured by that certain Mortgage dated September 5, 2007 in favor of Orrstown Bank (the "Mortgage"). (A copy of the Mortgage is attached hereto as Exhibit "A" and incorporated herein by reference). 5. The Borrower also executed and delivered a Promissory Note dated September 5, 2007 to Orrstown Bank evidencing its obligation to repay the Loan (the "Note"). (A copy of the Note is attached hereto as Exhibit"B" and incorporated herein by reference). 6. Defendants Jeffrey A. Goss (the "Guarantor") guaranteed the Loan, evidenced by the Guaranty agreement executed September 5, 2007. (A copy of the Guaranty is attached hereto as Exhibit"C" and incorporated herein by reference). Michael Cassidy also executed a guaranty. Michael Cassidy is now deceased. 7. The Lender is successor by assignment to Orrstown Bank, as on or about February 5, 2013, Orrstown Bank assigned all of its right, title and interest in the Note, Mortgage and Guaranties to Magnolia Portfolio, LLC, now referenced as Loan No. 104183-001. (Copies of the Assignments are attached hereto as Exhibit "D" and incorporated herein by reference). 8. Pursuant to the terms of the Note, Borrower was obligated to make repayment as follows: Borrower will pay this loan in full immediately upon Lender's demand. Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning October 5, 2007, with all subsequent interest payments to be due on the same day of each month after that. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then to principal; then to any late charges; and then to any unpaid collection costs. The annual interest rate for this Note is imputed on a 365/360 basis; that is, by applying the ratio of the annual interest rate over a year of 360 960]43.2 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding. Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate in writing. (Exhibit B —Note, p. 1). 9. An Event of Default has occurred under the terms of the Note, as the Borrower has failed to make a payment when due. (Exhibit B—Note). 10. Pursuant to the terms of the Note, "the Borrower will pay this loan ill {'ull immediately upon Lender's demand." (Exhibit B —Note). 11. On March 30, 2012, Orrstown Bank notified the Borrower and the Guarantors (collectively, the "Obligors") of their default and demanded payment in full. (A copy of the Demand Notice is attached hereto as Exhibit "E" and incorporated herein by reference). 12. The Note also grants the Lender the right to its attorneys' fees, costs and expenses incurred in collecting such amounts due and owing. (Exhibit C -Note). 13. The Note and Commercial Guaranty contain confession of judgment provisions which empower any attorney of any court of record to appear for and enter judgment against the Obligors and in favor of the Lender, upon default by the Borrowers. (Exhibit B — Note; Exhibit C—Guaranties). 14. Judgment is not being entered by confession against a natural person in connection with a consumer credit transaction. 15. Except as set forth above, the Mortgage, Note and Guaranties have not been assigned by the Lender. 960143.2 16. The Obligors continue to be in default under the terms of the written agreements set forth herein. 17. Judgment has not been entered previously on the warrants of attorney contained in the Note or Guaranty in any jurisdiction. 18. The actual amounts due and payable to the Lender under the Note as of July 29, 2014 are itemized as follows: (a) Unpaid Principal $45,947.50 (b) Unpaid Interest $ 4,649.34 (c) Late Charges $ 1,000.00 (d) Attorneys' Fees $ 625.00 TOTAL $ 52,221.84 960143.2 WHEREFORE Plaintiff Magnolia Portfolio, LLC demands judgment in its favor and against Defendants Carillo, LLC and Jeffrey A. Goss in the amount of$52.221.84 together with accruing interest at a per diem rate of$9.25, costs of suit, attorneys' fees, and such other charges as authorized by the warrants contained in the Note. Respectfully submitted, RHOADS & SINON LLP By: ` � , Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Magnolia Portfolio, LLC 960143.2 VERIFICATION Ann Hempfling hereby deposes and says, subject to the penalties of 18 Pa. C.S. § 4904 relating to unsworn falsification to authorities, that she is the Asset Manager for Sabal Financial Group, L.P., servicing agent for Magnolia Portfolio, LLC, that she snakes this verification as such officer by its authority, and that the facts set forth in the foregoing Complaint in Confession of Judgment are true and correct to the best of her knowledge, information and belief. Date Awi4empbin Manager Sabal Financial a L.P. EXHIBIT A Parcel Identification (✓ 7 Number: I)c RECORDATION REQUESTED BY: ORRSTOWN BANK STONEHEDGE OFFICE i t 77 EAST KING STREET f r P 0BOX 250 SHIPPENSBURG,PA 17257 WHEN RECORDED MAIL TO: ORRSTOWN BANK 77 EAST KING STREET P.O.Box 250 SHIPPENSBURG,PA 17257 FOR RECORDER'S USE ONLY OPEN - END MORTGAGE THIS MORTGAGE SECURES FUTURE ADVANCES Amount Secured Hereby: $50,000.00 THIS MORTGAGE dated September 5, 2007, is made and executed between Lakeside Holding Company, Inc., whose address is 105 West King Street, Shippensburg, PA 17257 (referred to below--as--Grantor") and ORRSTOWN BANK, whose address is 77 EAST KING STREET, P O BOX 250,SHIPPENSBURG,PA 17257(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,gas,geothermal and similar matters, (the "Real Property") located in Cumberland County,Commonwealth of Pennsylvania: See attached The Real Property or its address is commonly known as 105 West King Street, Shippensburg, PA 17257. CROSS-COLLATERALIZATION. In addition to the Note,this Mortgage secures all obligations,debts and liabilities,plus interest thereon,of either Grantor or Borrower to Lender,or any one or more of them,as well as all claims by Lender against Borrower and Grantor or any one or more of them,whether now existing or hereafter arising,whether related or unrelated to the purpose of the Note, whether voluntary or otherwise, whether due or not due, direct or indirect, determined or undetermined, absolute or contingent, liquidated or unliquidated, whether Borrower or Grantor may be liable individually or jointly with others,whether obligated as guarantor,surety,accommodation party or otherwise,and whether recovery upon such amounts may be or hereafter may become barred by any statute of limitations, and whether the obligation to repay such amounts may be or hereafter may become otherwise unenforceable. REVOLVING LINE OF CREDIT. This Mortgage secures the Indebtedness including,without limitation,a revolving line of credit,which obligates Lender to make advances to Borrower unless Borrower fails to comply with all the terms of the Note. 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 THIS MORTGAGE. THIS MORTGAGE IS GIVEN AND ACCEPTED ON THE FOLLOWING TERMS: GRANTOR'S WAIVERS. Grantor waives all rights or defenses arising by reason of any"one action"or"anti-deficiency" law, or any other law which may prevent Lender from bringing any action against Grantor, including a claim for deficiency to the extent Lender is otherwise entitled to a claim for deficiency,before or after Lender's commencement or completion of any foreclosure action,either judicially or by exercise of a power of sale. GRANTOR'S REPRESENTATIONS AND WARRANTIES. Grantor warrants that: (a) this Mortgage is executed at Borrower's request and not at the request of Lender; (b)Grantor has the full power, right, and authority to enter into this Mortgage and to hypothecate the Property; (c)the provisions of this Mortgage do not conflict with,or result in a default under any agreement or other instrument binding upor.Grantor and do not result in a violation of any law, regulation,court decree or order applicable to Grantor; (di Grantor has established adequate means of obtaining from Borrower on a continuing basis information about Borrower's financial condition; and (e) Lender has made no representation to Grantor about Borrower(including without limitation the creditworthiness of Borrower). PAYMENT AND PERFORMANCE. Except as otherwise provided in this Mortgage, Borrower and Grantor shall pay to Lender all Indebtedness secured by this Mortgage as it becomes due,and Borrower and Grantor shall strictly perform all Borrower's and Grantor's obligations under this Mortgage. POSSESSION AND MAINTENANCE OF THE PROPERTY. Borrower and Grantor agree that Borrower's and Grantor's possession and use of the Property shall be governed by the following provisions: Possession and Use. Until Default. Grantor may (1) remain in possession and control of the Property; (2) use, ........... MORTGAGE (Continued) Page 2 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 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 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 wn e n,o a or any part or the Real Property,or any interest in the RealProperty. A"sale or raps er 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 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: Paymerm 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 governmental official to deliver to Lender at any time a written MORTGAGE (Continued) Page 3 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 ten 00)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. The Real Property is or will 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 tens 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 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. Grantor's Report on Insurance. Upon request of Lender,however not more than once a year,Grantor shall furnish to Lender a report on each existing policy of insurance showing: (i) the name of the insurer; (2) the risks Insured; (3) the amount of the policy; (4) the property insured, the then current replacement value of such property,and the manner of determining that value;and (5) the expiration date of the policy. Grantor shall,upon request of Lender,have an independent appraiser satisfactory to Lender determine the cash value replacement cost of the Property. 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, 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 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 Tide. 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. MORTGAGE (Continued) Page 4 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 Borrower'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 Borrower which Borrower 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 Borrower. 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 Default, and Lender may exercise any or all of its available remedies for 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 (11 Borrower's and 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 Borrower and Grantor pay all the Indebtedness when due,.and Grantor otherwise performs all 'the obligations imposed upon Grantor under this Mortgage, Lender shall execute and deliver to Grantor a suitable MORTGAGE (Continued) Page 5 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. DEFAULT. Default will occur if payment in full is not made immediately when due. RIGHTS AND REMEDIES ON DEFAULT. Upon 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 Borrower or 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 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 Borrower or 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,Borrower and Grantor hereby waive 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 Default, or in any way to limit or restrict the rights and ability of Lender to proceed directly against Grantor and/or Borrower 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, 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 postjudgment 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 MORTGAGE (Continued) Page 6 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 chance its address for notices under this Mortoace 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. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a par 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. Joint and Several Liability. All obligations of Borrower and Grantor under this Mortgage shall be joint and several, and all references to Grantor shall mean each and every Grantor,and all references to Borrower shall mean each and every Borrower. This means that each Grantor signing below is responsible for all obligations in this Mortgage. Where any one or more of the parties is a corporation,partnership,limited liability company or similar entity,it is not necessary for Lender to inquire into the powers of any of the officers,directors,partners,members,or other agents acting or purporting to act on the entity's behalf,and any obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed under 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 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 circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other 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 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 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. 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 shell mean amounts in lawful money of the United States of America. Words and terms used in the singular shall include the plural, and the plural shall include the singular,as the context may require. Words and terms not otherwise defined in this Mortgage shall have the meanings attributed to such terms in the Uniform Commercial Code: Borrower. The word 'Borrower'means Carillo, LLC and includes all co-signers and oo-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,at 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,at 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. Existing indebtedness. The words"Existing Indebtedness'mean the indebtedness described in the Existing Liens provision of this Mortgage. Grantor. The word"Grantor"means Lakeside Holding Company,Inc.. 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. MORTGAGE (Continued) Page 7 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. The liens and security interests created pursuant to this Mortgage covering the Indebtedness which may be created in the future shall relate back to the date of this Mortgage. Specifically,without limitation,Indebtedness includes all amounts that may be indirectly secured by the Cross-Collateralization provision of this Mortgage. Lender. The word"Lender"means ORRSTOWN 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 5, 2007, in the original principal amount of$50,000.00 from Borrower to Lender,together with all renewals of,extensions of,modifications of,refinancings of,consolidations of,and substitutions for the promissory note or agreement. The maturity date of the Note is NOTICE TO GRANTOR: THE NOTE CONTAINS A VARIABLE INTEREST RATE. 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. GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS MORTGAGE, AND 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: LAKESIDE H�DING COMPANY,INC. By; JL ,. ✓� - -(Seat) Je s,President of Lakeside Holding Company,Inc. ATT T: f Corporate Seal lI/Ierk6ry or Assistant Secretary CERTIFICATE OF RESIDENCE 1 hereby certify,that the precise address of the mortgagee,ORRSTOWN BANK,herein is as follows: STONEHEDGE OFFICE,77 EAST KING STREET,P 0 BOX 250,SHIPPENS RG,PA 17257 y Attorney or Agent for Mortgagee MORTGAGE (Continued) Page 8 CORPORATE ACKNOWLEDGMENT COMMONWEALTH OF PENNSYLVANIA ) !I i )SS COUNTY OF J) On this,the h day of ,before me the undersigned No "ry'Public, personally appeared JefiTey A.Goss, President of lakeside Holding Company, Inc., who acknowledged himself or herself to be the President of Lakeside Holding Company, Inc_, of a corporation, and that he or she as such President of Lakeside Holding Company, Inc.. being authorized to do so,executed the foregoing instrument for the purposes therein contained by signing the name of the corporation by himself or herself as President of Lakeside Holding Company.Inc.. In witness whereof,I hereunto set my hand and official seal. Notarial Seal � �s•'� Kathy L.Mummers Notary Public Carlislel3otougb CSrmberl Notary Pu iib in and for the State of My Commission Expires AuRusf i tItY.F :asea ra: a �.E.3�.W.�34>.tW!na�:vewSv,we,re.,?3>.2�.R:M4M1¢Fe:med. M�y_ruxe¢.re rwinn rF� ROBERT P. ZIEGLER RECORDER OF DEEDS CUMBERLAND COUNTY 1 COURTHOUSE SQUARE CARLISLE, PA 17013 717-240-6370 - =� Instrument Number-200734709 Recorded On 9/5/2007 At 4:09:23 PM *Total Pages-9 *Instrument Type-MORTGAGE Invoice Number-3885 User ID-RAK *Mortgagor-LAKESIDE HOLDING CO INC "'Mortgagee-ORRSTOWN BANK *Customer-DUNCAN FEES STATE WRIT TAX $0.50 Certification Page STATE JCS/ACCESS TO $10.00 JUSTICE DO NOT DETACH RECORDING FEES - $19.50 RECORDER OF DEEDS AFFORDABLE HOUSING $11.50 This page is now part COUNTY ARCHIVES FEE $2.00 of this legal document. ROD ARCHIVES FEE $3.00 TOTAL PAID $46.50 I Certify this to be recorded in Cumberland County PA ,Of CUA@� ,4 RECORDER O D EDS \ J 1TSQ *-Information denoted by an asterisk may change during the verification process and may not be reflected on this page. 00030! 11111 ii 1011111111111 EXHIBIT B PROMISSORY (VOTE Principal tan €]ateiatu.ry Loan?4o Gat=!Cotl Account C €icer Initials 50,DE3{#.Qt3 f9-05-Zt30767t3E4t ? j 1�13o CA087 JSGA1' i References in the boxes above are for Lender's use only and do not limit the appiicability of this document to any particular loan or item. Any itern above containing "`"'" has been omitted due to text length limitations. Borrower: Carillo,LLC(TIN: 26-0302846) Lender: ORRSTOWN BANK 60 Pine Street STONEHEDGE OFFICE Carlisle, PA 17013 77 EAST KING STREET P 0 BOX 250 SHiPPENSBURG, PA 17257 Principal Amount: $50,000.00 Initial Rate: 9.250% Date of Note: September 5, 2007 PROMISE TO PAY. Carillo, LLC ("Borrower") promises to pay to ORRSTOWN BANK ("Lender"), or order, in lawful money of the United States of America, on demand, the principal amount of Fifty Thousand & 001100 Dollars ($50,000.00) or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until repayment of each advance. PAYMENT. Borrower will pay this loan in full immediately upon Lender's demand. Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning October 5, 2007, with all subsequent interest payments to be due on the same day of each month after that. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then to principal; then to any late charges; and then to any unpaid collection costs. The annual interest rate for this Note is computed on a 3651360 basis;that is, by applying the ratio of the annual interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding. Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate in writing. VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based on changes in an independent index which is the Wall Street Prime (the "index"). The Index is not necessarily the lowest rate charged by Lender on its loans. It the Index becomes unavailable during the term of this loan, Lender may designate a substitute index after notifying Borrower. Lender wilt tell Borrower the current Index rate upon Borrower's request. The interest rate change will not occur more often than each day. Borrower understands that Lender may make loans based on other rates as well. The Index currently is 8.250% per annum. The interest rate to be applied to the unpaid principal balance during this Note will be at a rate of 1.000 percentage point over the Index, resulting in an initial rate of 9.250% per annum. NOTICE: Under no circumstances will the interest rate on this Note be more than the maximum rate allowed by applicable law. PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges are earned fully as of the date of the loan and will not be subject to refund upon early payment (whether voluntary or as a result of default), except as otherwise required by law. Except for the foregoing, Borrower may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower's obligation to continue to make payments of accrued unpaid interest. Rather, early payments will reduce the principal balance due. Borrower agrees not to send Lender payments marked "paid in full", "without recourse", or similar language. If Borrower sends such a payment, Lender may accept it without losing any of Lender's rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender. All written communications concerning disputed amounts, including any check or other payment instrument that indicates that the payment constitutes "payment in full" of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or delivered to: ORRSTOWN BANK, 77 EAST KING STREET, P.O. BOX 250 SHIPPENSBURG, PA 17257. LATE CHARGE. If a regularly scheduled interest payment is 16 days or more late, Borrower will be charged 5.000% of the regularly scheduled payment or $50.00, whichever is greater. If Lender demands payment of this loan, and Borrower does not pay the loan in full within 16 days after lender's demand, Borrower also will be charged either 5.000% of the sum of the unpaid principal plus accrued unpaid interest or$50.00, whichever is greater. INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest rate on this Note shall be increased by adding a 3.000 percentage point margin ('Default Rate Margin"). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had there been no default. If judgment is entered in connection with.this Note, interest will continue to accrue after the date of judgment at the rate in effect at the time judgment is entered. However, in no event will the interest rate exceed the maximum interest rate limitations.under applicable law. DEFAULT. Each of the following shall constitute an event of default("Event of Default") under this Note: Payment Default. Borrower fails to make any payment when due under this Note. Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower. False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower's behalf under this Note or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. Death or Insolvency. The dissolution of Borrower (regardless of whether election to continue is made), any member withdraws from Borrower, or any other termination of Borrower's existence as a going business or the death of any member, the insolvency of Borrower, the appointment of a receiver.for any part of Borrower's property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower. Creditor or Forfeiture Proceedings.. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan. This includes a garnishment of.any of Borrower's accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute. j Events Affecting Guarantor. Any of the preceding events occurs with respect to any Guarantor of any of the indebtedness or any Guarantor dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any guaranty of the indebtedness ' evidenced by this Note. in the event of a death, Lender, at its option, may, but shall not be required to,permit the Guarantor's estate to s r PROMISSORY (VOTE Loan No: 26474100101 (Continued) Page 2 assume unconditionally the ob6gatio.n.s arising under the ouaranTY In a m.,nnei satisfac-tory to Lender, and, .n d0:1^ 50, Cure any E:Veni of Default. Adverse Change. A material adverse change occurs in Borrower's `inancial condition, or Lender believes the prospect of pavment or performance of;his Note is impaired. Insecurity. Lender in good faith believes itself insecure. Cure Provisions. if any default, other than a default in payment is curable and if Borrower has not been given a notice of a breach of the same provision of this Note v✓ithir, the preceding twelve (12) months, it may be cured if Borrower, a ter receiving written notice from Lender demanding cure of such default: (1) cures the default within fifteen (15) deys; or .+,21 if the cure requires more than fifteen (15) days, immediately initiates steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical. LENDER`S RIGHTS. Upon default, Lender may, after giving such notices as required by applicable law, declare the entire unpaid principal balance under this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount. ATTORNEYS' FEES; EXPENSES. Lender may hire or pay someone else to help collect this Note if Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any iimits under applicable law, Lender's reasonable attorneys' fees and Lender's legal expenses, whether or not there is a lawsuit, including reasonable attorneys' fees, expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals. If not prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums provided by law. JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Borrower against the other. DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $20.00 if Borrower makes a payment on Borrower's loan and the check or preauthorized charge with which Borrower pays is later dishonored. RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower's accounts with Lender{whether checking, savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the indebtedness against any and all such accounts,and, at Lender's option,to administratively freeze all such accounts to allow Lender to protect Lender's charge and setoff rights provided in this paragraph. COLLATERAL. Borrower acknowledges this Note is secured by the following collateral described in the security instruments listed herein: (A) a Mortgage dated September 5, 2007,to Lender on real property located in Cumberland County, Commonwealth of Pennsylvania. (B) an Assignment of All Rents to Lender on real property located in Cumberland County,Commonwealth of Pennsylvania. (C) collateral described in a Commercial Security Agreement dated September 5, 2007. PROPERTY INSURANCE. Borrower understands that Borrower is required to obtain insurance for the collateral securing this Note. Further information concerning this requirement is set forth in the Security Agreement and Mortgage and in the Agreement to Provide Insurance, all the terms and conditions of which are hereby incorporated and made a part of this Note. LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this Note, as well as directions for payment from Borrower's accounts, may be requested orally or in writing by Borrower or by an authorized person. Lender may, but need not,require that all oral requests be confirmed in writing. Borrower agrees to be liable for all sums either: (A) advanced in accordance with the instructions of an authorized person or (B) credited to any of Borrower's accounts with Lender. The unpaid principal balance owing on this Note at any time may be evidenced by endorsements on this Note or by Lender's internal records, including daily computer print-outs. FINANCIAL INFORMATION.The Borrower agrees to provide the Lender with Federal Tax Returns and/or CPA prepared Financial Statements and any other financial information, required.by the Lender's Original Commitment Letter to the Borrower, on an annual basis. If the Lender does not receive the required financial information within two hundred seventy (270) days of the Borrower's fiscal year end, the Lender has the right to increase the interest rate charged on this Note by 0.25%. The Borrower shall receive written notification ten (10) days prior to the Lender increasing the interest rate charged on this Note. OVERDRAFT PROTECTION.You may obtain credit advances under your Credit Line by writing a check on your checking account(s) with us in excess of the available collected balance in the account(s). . SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower's heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender and its successors and assigns. NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES. Please notify us if we report any Inaccurate information about your account(s)to a consumer reporting agency. Your written notice describing the specific inaccuracy(ies) should be sent to us at the following address: ORRSTOWN BANK 77 EAST KING STREET P.O. BOX 250 SHIPPENSBURG, PA 17257. GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific default provisions or rights of Lender shall not.preclude Lender's right to declare payment of this Note on its demand. If any part of this Note cannot be enforced,this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them. Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may renew or extend (repeatedly and for any length of time)this loan or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender's security interest in the collateral; and take any other action deemed necessary by Lender without the consent of or notice to anyone. All such parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the party with whom the modification is made. The obligations under this Note are joint and several. If any portion of this Note is for any reason determined to be unenforceable, it will not affect the enforceability of any other provisions of this Note. f 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 PROMISSORY DOTE Loan No: 26474100101 tContinued) Page 3 COLLECTION, BUT N ANY EVENT NOT _ESS THAN FIVE HUNDRED DOLLARS ($500) ON 1%'diICH JUDGMENT OR ,:UDG(J;ENTS ONE OR MORE EXECUTIONS MAY ISSUE iIt';IJ;EDIATELY;_ND FOR SO DOING, THIS NOTE OR A COPY 0=THIS NOTE VERIFIED EY AFFIDAVIT SHALL BE SUFFICIENT WAP,RANI . THE AUTHORITY GRANTED IN THIS NOTE TO CONFESS JUDGMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT T A•UTHORITY, BUT SHALL CONTINi}E FROM TIIfE TO T IIJE AND AT ALL T JOES UNTIL PAY PIEN T IN FULL OF ALL AMOUNTS DUE UNDER THIS NOTE. BORROWER HERESY WAWES ANY RIGHT BOR-FROWER MIAY HAVE TO NOTICE 03 TD A HEARING IN CONNECTION i 'ITH ANY SUCH CONFESSION OF JUDGMENT AND STATES THAT EITHER A REPRESENTATIVE OF ' EN ER S?ECIFiCALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO BORROVJEFI-S ATTENTION OR BORROVvER HAS SEEN RE?RESENTED BY INDEPENDENT LEGAL COUNSEL. The Een arising from any judgment confessed or entered pursuant to the foregoing authority shall not extend to any of BorroIver's residential real property as that ter: is defined in the Pennsylvania Act of January 30, 11974 (Pa. Lavas 13, No. 6), refer ed to as the Loan Interest and Protection Law, as amended, and the holder of any judgment confessed or entered pursuant to the forgoing authority shall not, in enforcement of any such iudgment, execute, levy or otherwise proceed against any such residential real property; provided, hoxvever, that the lien of such judgment shall extend to such residential real property and that the holder thereof shail be permitted to execute, levy or proceed against such residential reai propery from and after the entry of a judgment as contemplated by Section 407 of such Loan Interest and Protection La;v and Rules 2981 to 2356 of the Pennsylvania Rules of Civil Procedure, or successor or similar statutes and rules. No limitation of lien or any execution, levy or other enforcement contained in the immediately preceding sentence shall apply with respect to any judgment obtained other than by the foregoing authority to confess or enter judgment. PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE. BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE. THIS NOTE IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS NOTE IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. BORROWER: CARILLO, LLC By: �-- (Seal) By: A� : t ' �sY (Seal) Jeffr . Goss,Member of Carilio, LLC roi hael J. C y, a of Cariflo, LLC LASER PRC L--Q.Ver•5.37.00.009 C­.H.Ii FMe Rd SIWt10m Me.1997.7071. Ali Rphu Rra d .FA e-ICF11LFILID20.FC 71R.17M9 FRI E DISCO URE FOR CONFESSION OF , ,DGM ENT Principal Loan Data E►laturity t Loan leo Call.,cots eco l{t Officer Initials $50,000.00 109-05-2007 � 2:64' tr?30- 1 CRAGS67 .ISGAY References in the boxes above are for Lender's use only and do riot limit the applicability of this document to any particular loan or item. Any item above containing has been omitted due to text length limitations. Declarant: Cari€lo, LLC (TIN: 26-0302S46) Lender: ORRSTOWN BANK 50 Pine Street STONEHEDGE OFFICE Carlisle,PA 17013 77 EAST KING STREET P 0 BOX 250 SHIPPENSBURG, PA 17257 DISCLOSURE FOR CONFESSION OF JUDGMENT THE UNDERSIGNED IS EXECUTING ON BEHALF OF DECLARANT, THIS 5th DAY OF September 20 07 A PROMISSORY NOTE FOR$50,000.00 OBLIGATING DECLARANT TO REPAY THAT AMOUNT. A. THE UNDERSIGNED UNDERSTANDS THAT THE NOTE CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO ENTER JUDGMENT AGAINST DECLARANT IN COURT, AFTER A DEFAULT ON THE NOTE, WITHOUT ADVANCE NOTICE TO DECLARANT AND WITHOUT OFFERING DECLARANT AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY OF JUDGMENT. IN EXECUTING THE NOTE, BEING FULLY AWARE OF DECLARANT'S RIGHTS TO ADVANCE NOTICE AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS THAT LENDER MAY ASSERT AGAINST DECLARANT UNDER THE NOTE, THE UNDERSIGNED, ON BEHALF OF THE DECLARANT, IS KNOWINGLY, INTELLIGENTLY, AND VOLUNTARILY WAIVING THESE RIGHTS, INCLUDING ANY RIGHT TO ADVANCE NOTICE OF THE ENTRY OF JUDGMENT,AND THE UNDERSIGNED EXPRESSLY AGREES AND CONSENTS TO LENDER'S ENTERING JUDGMENT#GAINST#DrANT BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT PROVISION. INITIALS: B. THE ZNDERSIGNED FURTHER UNDERSTANDS THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST DECLARANT WITHOUT ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE NOTE ALSO CONTAINS LANGUAGE THAT WOULD PERMIT LENDER,AFTER ENTRY OF JUDGMENT,AGAIN WITHOUT EITHER ADVANCE NOTICE OR A HEARING,TO EXECUTE ON THE JUDGMENT BY FORECLOSING UPON, ATTACHING, LEVYING ON, TAKING POSSESSION OF OR OTHERWISE SEIZING DECLARANT'S PROPERTY, IN FULL OR PARTIAL PAYMENT OF THE JUDGMENT. IN EXECUTING THE NOTE, BEING FULLY AWARE OF DECLARANT'S RIGHTS TO ADVANCE NOTICE AND A HEARING AFTER JUDGMENT IS ENTERED AND BEFORE EXECUTION ON THE JUDGMENT,THE UNDERSIGNED, ON BEHALF OF THE DECLARANT, IS KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE RIGHTS, AND THE UNDERSIGNED EXPRESSLY AGREES AND CONSENTS TO LENDER'S IMMEDIATELY EXECUTING ON THE JUDGMENT IN ANY MANNER PE MI APPLICABLE STATE AND FEDERAL LAW,WITHOUT GIVING DECLARANT ANY ADVANCE NOTICE. INITIALS C. AFTER HAVING READ AND DETERMINED WHICH OF THE FOLLOWING STATEMENTS ARE APPLICABLE, BY INITIALING EACH STATEMENT THAT APPLIES,THE UNDERSIGNED REPRESENTS THAT: I .P LS eNOTE. LARANT WAS REPRESENTED BY DECLARANT'S OWN INDEPENDENT LEGAL COUNSEL IN CONNECTION WITH THE 2. AREPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE NOTE TO DECLARANT'S ATTENTION. THIS DISCLOSURE IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS DISCLOSURE IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. DECLARANT: CARILLO, By: (Seal) ffr oss,Member o illo,LLC [Seal) el J.Cas ' ,Me of Carillo,LLC LASER PRO L-9.Yu,5.37 00.003 Cop..AeWd FinsiRrl Scinio"o,Im.t997,Z=. Al RipU R—tt. -PA—CFRLPLi030.FC rn-17789 PR.i - EXHIBIT C { s GUARANTY THIS AGREEMENT dated the day of_ S-W�U-Y\h eA 2007,entered into by the undersigned(the"Guarantor")in favor of Orrstown Bank,a'Pennsyivania banking institution,with a principal mailing address of P.O. Box 250, 77 East King Street, Shippensburg, Cumberland County,Pennsylvania 17257(the"Bank")relating to the liabilities of Carillo,LLC,a Pennsylvania Limited Liability Company, doing business at 60 Pine Street, Carlisle, Cumberland County, Pennsylvania 17013 (the "Borrower") In consideration of credit accommodations heretofore,now or hereafter granted to Borrower by Bank, the Guarantor hereby unconditionally and irrevocably guarantees and becomes surety to Bank and its successors, endorsees and assigns for the payment when due (whether at stated maturity,by acceleration or otherwise)by Borrower of all indebtedness,obligations,and liabilities of every kind and nature(whether primary or secondary,direct or indirect,absolute or contingent,sole, joint, or several, secured or unsecured, similar or dissimilar, or related or unrelated), heretofore, now, or hereafter contracted or acquired, of Borrower to Bank, including but not limited to indebtedness, obligations and liabilities under and on account of a $150,000.00 commercial term loan and a $50,000.00 commercial line of credit, together with all amendments, modifications, renewals and refinancing thereof or thereto and all substitutions therefor (jointly the "Liabilities"). Such liability shall not be affected by nor shall anything herein contained be deemed to be a limitation on the amount of credit which may be extended to Borrower,orthe number of transactions with Borrower or the nature or amount of the obligations which may be incurred by Borrower. The Guarantor further agrees as follows. 1. Guarantor assents to all agreements made or to be made with Bank by Borrower, including any amendments or modifications of any instruments or agreements evidencing or creating any of the Liabilities. 2. Bank may,without affecting the obligation of the Guarantor hereunder,exchange or surrender any property pledged by Borrower without notice to or the consent of the Guarantor,and Bank need not proceed against or exhaust any remedies against Borrower, any other surety or guarantor, any security, or any other party before proceeding against the Guarantor. 3. Bank may renew or extend the term of any of the Liabilities or otherwise amend the terms thereof without notice to orthe consent of the Guarantor. 4. Bank may waive any of its rights or remedies against Borrower or any other surety or guarantor with respect to the Liabilities without notice to or the consent of the Guarantor. 5. Bank need not notify the Guarantor of its acceptance of this agreement or of its intention to act in reliance thereon, or of any loan to or any other transaction between Bank and Borrower, or, except as expressly required herein, of any default by Borrower. 6. As security for all obligations hereunder Bank shall have,and the Guarantor hereby assigns and grants to Bank, a right of set-off against and a lien upon and security interest in (a)all property of the Guarantor now or at any time hereafter in Bank's possession in any capacity whatsoever,including but not limited to any balance or share of any deposit,trust or agency account and any policy of life or other insurance, (b) any claim of the Guarantor against Bank, and the proceeds thereof, and (c)any present orfuture claim or demand of the Guarantor against Borrower and any collateral therefor. The Guarantor hereby irrevocably appoints Bank (with full power of substitution)as the Guarantor's attomey-in-fact to enforce such claims or demands by legal action, voting or proof of debt in any collection, bankruptcy or other proceeding for liquidation, reorganization or arrangement of Borrower or its debts and to endorse on behalf of the Guarantor any instrument for the payment of money concerning same, such recovery to be held by Bank as additional collateral security.The Guarantor shall receive as trustee for,and shall upon receipt and in the form received forthwith pay to Bank, any recovery made on account of such claims or demands against Borrower. No such claim or demand shall ever be represented by any promissory note or other written evidence of debt,except such as are forthwith endorsed and delivered to Bank. 7. If any of the Liabilities shall not be paid when due(whether at stated maturity or upon demand, acceleration of maturity or otherwise) or if Borrower shall otherwise default (after the expiration of any applicable grace periods)with respect to any of the Liabilities, Bank,subject to the aforementioned limitations, (a) may forthwith recover from the Guarantor the full amount of the Liabilities;(b)may sell all or any part of any property held as security hereunder on any exchange or at public or private sale at the option of Bank,at any time ortimes without advertisement or demand upon or notice to the Guarantor(all of which are hereby waived,except such notice as is required by applicable statute and cannot be waived), with the right on the part of Bank or its nominee to become the purchaser thereof at such sale (unless prohibited by statute)free from any equity of redemption and from all other claims; (c) may exercise any rights it may have under any document executed by the Guarantor securing its liabilities hereunder or otherwise executed in connection herewith;(d)shall have the right,immediately and withoutfurther action,to set off against the liability of the Guarantor hereunder all money owed by Bank in any capacity to the Guarantor,whether due or not; and (e) may exercise any other remedy available at law or in equity. 8. The obligations of the Guarantor hereunder shall be in addition to that stated in any other suretyship agreement or guarantee, and shall be binding on the heirs, personal and legal representatives, successors and assigns of the Guarantor. 9. No failure by Bank to exercise any right hereunder shall be construed as a waiver of the right to exercise the same or any other right at any other time and from time to time thereafter. 10. This Agreement and the Guarantor's payment obligations hereunder shall continue to be effective or be reinstated,as the case may be, if at any time payment of any of the Liabilities is rescinded or must otherwise be restored or returned by Bank,all as though such payments had not been made. Bank's good faith determination as to whether a payment must be restored or returned shall be binding on Guarantor. 11. The Guarantor waives: a. all presentments, demands for performance, notices of nonperformance, protests,notices of protest,and notices of dishonor,except such as is required by applicable statute and cannot be waived; b. the defense of any statute of limitation affecting the obligation of the Guarantor hereunder or the enforcement thereof, to the extent permitted by law; C. any defense arising by reason of any invalidity or unenforceability of any of the Liabilities or any instrument evidencing or securing the Liabilities or any disability of Borrower,or by any cessation from any cause whatsoever of the liability of Borrower for the Liabilities or any of -2 - them,or by reason of any event or circumstance that under any rule of law would otherwise operate to discharge the liability of a surety or guarantor; d. any right to require Bank to advise the Guarantorof any information known to Bank regarding the financial condition of Borrower(it being agreed that the Guarantor assumes the responsibility for being and keeping informed regarding such condition); e. any right of subrogation or reimbursement and any right to enforce any remedy which Bank now has or may hereafter have against Borrower and any benefit of, and any right to participate in, any security now or hereafter held by Bank; and f. any defense arising by reason of any election by Bank pursuant to Section 1111(b)(2)of the United States Bankruptcy Code or any similar or successor section or based upon any borrowing or grant of a security interest under Section 364 of such Code or any similar or successor section. 12. The Guarantor hereby authorizes and empowers Bank, its successors, endorsees and assignees,to exercise in its or their sole discretion,any rights and remedies,or any combination thereof, which may then be available, it being the purpose and intent of the Guarantor that its obligations hereunder shall be absolute, independent and unconditional under any and all circumstances. The Guarantor therefore waives any defense based upon an election of remedies by Bank including,without limitation,any election to'proceed byjudicial or nonjudicial foreclosure or by deed in lieu thereof. 13. The Guarantor hereby authorizes and empowers any attorney of any court of record to appear for and confess judgment against any or all of the undersigned for such sums as shall have or may become due hereunder,with or without declaration,with costs of suit,release of error, without stay of execution and with $1,500 or fifteen percent of the Liabilities then outstanding, whichever is greater,added for attorney's collection fees;and also waives the right of inquisition on any real estate levied on, voluntarily condemns the same, authorizes the Prothonotary or Clerk to enter upon the Writ of Execution said voluntary condemnation,agrees that said real estate may be sold on a writ of execution;and also waives any relief from any appraisement,stay or exemption law of any state now in force or hereafter enacted. If a copy of this Agreement, verified by affidavit of any Bank officer shall have been filed in such action, it shall not be necessary to file the original Agreement as a warrant of attorney, any practice or usage to the contrary notwithstanding. 14. The Guarantor shall pay Bank on demand all reasonable costs and expenses (including reasonable counsel fees) incurred by Bank in the' preparation, administration, amendment, enforcement or collection of any of the. Liabilities or of this agreement, including reasonable costs, expenses and fees incurred after as well as before the entry of any judgment. 15. The provisions of this agreement, and the obligations of the Guarantor hereunder, are independent of and separable from each other, and no such provision or obligation shall be affected or rendered invalid or unenforceable by virtue of the-fact that for any reason any other such provision or obligation may be invalid or unenforceable in whole or in part. 16. This agreement shall be governed by the laws of the Commonwealth of Pennsylvania. The Guarantor waives any objection based on venue or inconvenient forum. THE GUARANTOR WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION INVOLVING THIS AGREEMENT. This agreement may be signed in any number of counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument. - 3 - 17. Bank may wholly or partially transfer the benefit of this Guaranty to any subsequent transferee or holder of any of the Liabilities. Subject to the preceding sentence, this Guaranty is made exclusively for the benefit of Bank and the undersigned, and no other person or entity (including, without limitation, the Borrower) is authorized or intended to rely hereon. IN WITNESS WHEREOF,the undersigned, intending to be legally bound,has executed this agreement, under seal, as of the date first written above. Witness: Mic 'e. . assidy I hereby certify that the precise mailing address of Michael J. Cassidy is: r� By: liliam A. Duncan, Esquire Orrstown Bank Guaranty Cassidy Liq/PLCB settle scn 1260-002 -4 - DISCLI ,URE FOR CONFESSION OF ,DGMENT Principal Loan Date Maturity Loan l�0 Call I Gat1 � :AccountInitials $E,0£}00-0€3 09-€5-2007 26474�D010.1 �1300 � 867 JSG_AY References in the boxes above are for Lender's use Only and do not limit the applicability of;his document to any Particular loan or item. Any i-em above containing "*"" has been omitted due to text lengv'-1 iimitetions. Borrower: Ca;illo, LLC [TIN: 26-03028461 Lender: ORRSTOWN BANK 60 Pine Street STONEHEDGE OFFICE Carlisle, PA 17013 77 EAST KING STREET P 0 BOX 250 SHIPPENSBURG, PA 17257 Declarant: Michael J. Cassidy tSSN: 176-46-61571 3 Rockwell Court Carlisle, PA 17013 DISCLOSURE FOR CONFESSION OF .JUDGMENT I AM EXECUTING, THIS 5th DAY OF _ September , 20 07 , A GUARANTY OF A PROMISSORY NOTE FOR $50,000.00 OBLIGATING ME TO REPAY THAT AMOUNT. A. I UNDERSTAND THAT THE GUARANTY CONTAINS A CONFESSION OF JUDGMENT PROVISION THAT WOULD PERMIT LENDER TO ENTER JUDGMENT AGAINST ME IN COURT, AFTER A DEFAULT ON THE GUARANTY, WITHOUT ADVANCE NOTICE TO ME AND WITHOUT OFFERING ME AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY OF JUDGMENT. IN EXECUTING THE GUARANTY, BEING FULLY AWARE OF MY RIGHTS TO ADVANCE NOTICE AND TO A HEARING TO CONTEST THE VALIDITY OF ANY JUDGMENT OR OTHER CLAIMS THAT LENDER MAY ASSERT AGAINST ME UNDER THE GUARANTY, I AM KNOWINGLY, INTELLIGENTLY, AND VOLUNTARILY WAIVING THESE RIGHTS, INCLUDING ANY RIGHT TO ADVANCE NOTICE OF THE ENTRY OF JUDGMENT, AND I EXPRESSLY AGREE AND CONSENT TO LENDER'S ENTER DGM ENT AGAINST ME BY CONFESSION AS PROVIDED FOR IN THE CONFESSION OF JUDGMENT PROVISION. [INITIALS: . B. I FURTHER UNDERSTAND THAT IN ADDITION TO GIVING LENDER THE RIGHT TO ENTER JUDGMENT AGAINST ME WITHOUT ADVANCE NOTICE OR A HEARING, THE CONFESSION OF JUDGMENT PROVISION IN THE GUARANTY ALSO CONTAINS LANGUAGE THAT WOULD PERMIT LENDER, AFTER ENTRY OF JUDGMENT, AGAIN WITHOUT EITHER ADVANCE NOTICE OR A HEARING, TO EXECUTE ON THE JUDGMENT BY FORECLOSING UPON,ATTACHING,LEVYING ON,TAKING POSSESSION OF OR OTHERWISE SEIZING MY PROPERTY, IN FULL OR PARTIAL PAYMENT OF THE JUDGMENT, IN EXECUTING THE GUARANTY, BEING FULLY AWARE OF MY RIGHTS TO ADVANCE NOTICE AND A HEARING AFTER JUDGMENT IS ENTERED AND BEFORE EXECUTION ON THE JUDGMENT, I AM KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVING THESE RIGHTS, AND I EXPRESSLY AGREE AND CONSENT TO LENDER'S IMMEDIATELY EXECUTING ON THE JUDGMENT INA NNER PERMITTED BY APPLICABLE STATE AND FEDERAL LAW,WITHOUT GIVING ME ANY ADVANCE NOTICE. INITIALS: _. C. AFTER HAVING READ AND DETERMINED WHICH OF THE FOLLOWING STATEMENTS ARE APPLICABLE, BY INITIALING EACH STATEMENT TbIAT APPLIES, I REPRESENT THAT: INITIAL 1. 1 WAS REPRESENTED BY MY OWN INDEPENDENT LEGAL COUNSEL IN CONNECTION WITH THE GUARANTY. 2. A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THE CONFESSION OF JUDGMENT PROVISION IN THE GUARANTY TO MY ATTENTION. D. I CERTIFY THAT MY ANNUAL INCOME EXCEEDS $10,000;THAT THE BLANKS IN THIS DISCLOSURE WERE FILLED IN WHEN 1 INITIALED AND SIGNED IT:AND THAT I RECEIVED A COPY AT THE TIME OF SIGNING. THIS DISCLOSURE IS GIVEN UNDER SEAL AND IT IS INTENDED THAT THIS DISCLOSURE IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO LAW. DECLARANT- X, ANT:X [Seal} NIi a x LASER PRO Lmomp.Vv.5.374D.=COR.Hl .d F —W 9oartcnF Inc.1997,2027. Ag Righ¢R-4. -PA s 1CFRLPL%D30-SC 78-17289 PR'-1 1 i GUARANTY THIS AGREEMENT dated the j day of Sef) NNI 2007,entered into by tie undersigned(the"Guarantor")in favor of Orrstown Bank, Pennsylvania banking institution,with a principal mailing address of P.O. Box 250, 77 East King Street, Shippensburg, Cumberland County,Pennsylvania 17257(the"Bank")relating to the liabilities of Carillo,LLC,a Pennsylvania Limited Liability Company, doing business at 60 Pine Street, Carlisle, Cumberland County' Pennsylvania 17013 (the "Borrower") In consideration of credit accommodations heretofore,now or hereafter granted to Borrower by Bank, the Guarantor hereby unconditionally and irrevocably guarantees and becomes surety to Bank and its successors, endorsees and assigns for the payment when due (whether at stated maturity,by acceleration or otherwise)by Borrower of all indebtedness,obligations,and liabilities of every kind and nature(whether primary or secondary,direct or indirect,absolute or contingent,sole, joint, or several, secured or unsecured, similar or dissimilar, or related or unrelated), heretofore, now, or hereafter contracted or acquired, of Borrower to Bank, including but not limited to indebtedness, obligations and liabilities underand on account of a $150,000.00 commercial term loan and a $50,000.00 commercial line of credit, together with all amendments, modifications, renewals and refinancing thereof or thereto and all substitutions therefor (jointly the "Liabilities"). Such liability shall not be affected by nor shall anything herein contained be deemed to be a limitation on the amount of credit which maybe extended to Borrower,or the number of transactions with Borrower or the nature or amount of the obligations which may be incurred by Borrower. The Guarantor further agrees as follows. 1. Guarantor assents to all agreements made or to be made with Bank by Borrower, including any amendments or modifications of any instruments or agreements evidencing or creating any of the Liabilities. 2. Bank may,without affecting the obligation of the Guarantor hereunder,exchange or surrender any property pledged by Borrower without notice to or the consent of the Guarantor,and Bank need not proceed against or exhaust any remedies against Borrower, any other surety or guarantor, any security, or any other party before proceeding against the Guarantor. 3. Bank may renew or extend the term of any of the Liabilities or otherwise amend the terms thereof without notice to or the consent of the Guarantor. 4. Bank maywaive any of its rights or remedies against Borrower or any other surety or guarantor with respect to the Liabilities without notice to or the consent of the Guarantor. 5. Bank need not notify the Guarantor of its acceptance of this agreement or of its intention to act in reliance thereon, or of any loan to or any other transaction between Bank and Borrower, or, except as expressly required herein, of any default by Borrower. 6. As securityfor all obligations hereunder Bank shall have,and the Guarantor hereby assigns and grants to Bank, a right of set-off against and a lien upon and security interest in (a)all property of the Guarantor now or at any time hereafter in Bank's possession in any capacity whatsoever,including but not limited to any balance or share of any deposit,trust or agency account and any policy of life or other insurance, (b) any claim of the Guarantor against Bank, and the proceeds thereof, and (c)any present orfuture claim or demand of the Guarantor against Borrower and any collateral therefor. The Guarantor hereby irrevocably appoints Bank (with full power of substitution)as the Guarantor's attorney-in-fact to enforce such claims or demands by legal action, voting or proof of debt in any collection, bankruptcy or other proceeding for liquidation, reorganization or arrangement of Borrower or its debts and to endorse on behalf of the Guarantor any instrument for the payment of money concerning same, such recovery to be held by Bank as additional collateral security. The Guarantor shall receive as trustee for,and shall upon receipt and in the form received forthwith pay to Bank, any recovery made on account of such claims or demands against Borrower. No such claim or demand shall ever be represented by any promissory note or otherwritten evidence of debt,except such as are forthwith endorsed and delivered to Bank. 7. If any of the Liabilities shall not be paid when due(whether at stated maturity or upon demand, acceleration of maturity or otherwise) or if Borrower shall otherwise default (after the expiration of any applicable grace periods)with respect to any of the Liabilities,Bank,subject to the aforementioned limitations, (a) may forthwith recover from the Guarantor the full amount of the Liabilities; (b)may sell all or any part of any property held as security hereunder on any exchange or at public or private sale at the option of Bank,at any time or times without advertisement or demand upon or notice to the Guarantor(all of which are hereby waived,except such notice as is required by applicable statute and cannot be waived), with the right on the part of Bank or its nominee to become the purchaser thereof at such sale (unless prohibited by statute)free from any equity of redemption and from all other claims; (c) may exercise any rights it may have under any document executed by the Guarantor securing its liabilities hereunder or otherwise executed in connection herewith;(d)shall have the right,immediately and withoutfurther action,to set off against the liability of the Guarantor hereunder all money owed by Bank in any capacity to the Guarantor,whether due or not; and (e) may exercise any other remedy available at law or in equity. 8. The obligations of the Guarantor hereunder shall be in addition to that stated in any other suretyship agreement or guarantee, and shall be binding on,the heirs, personal and legal representatives, successors and assigns of the Guarantor. 9. No failure by Bank to exercise any right hereunder shall be construed as a waiver of the right to exercise the same or any other right at any other time and from time to time thereafter. 10. This Agreement and the Guarantor's payment obligations hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment of any of the Liabilities is rescinded or must otherwise be restored or returned by Bank,all as though such payments had not been made. Bank's good faith determination as to whether a payment must be restored or returned shall be binding on Guarantor. 11. The Guarantor waives: a. all presentments, demands for performance, notices of nonperformance, protests,notices of protest,and notices of dishonor,except such as is required by applicable statute and cannot be waived; b. the defense of any statute of limitation affecting the obligation of the Guarantor hereunder or the enforcement thereof, to the extent permitted by law; C. any defense arising by reason of any invalidity or unenforceability of any of the Liabilities or any instrument evidencing or securing the Liabilities or any disability of Borrower,or by any cessation from any cause whatsoever of the liability of Borrower for the Liabilities or any of -2 - them,or by reason of any event or circumstance that under any rule of law would otherwise operate to discharge the liability of a surety or guarantor, d. any right to require Bank to advise the Guarantor of any information known to Bank regarding the financial condition of Borrower(it being agreed that the Guarantor assumes the responsibility for being and keeping informed regarding such condition); e. any right of subrogation or reimbursement and any right to enforce any remedy which Bank now has or may hereafter have against Borrower and any benefit of, and any right to participate in, any security now or hereafter held by Bank; and f. any defense arising by reason of any election by Bank pursuant to Section 1111(b)(2)of the United States Bankruptcy Code or any similar or successor section or based upon any borrowing or grant of a security interest under Section 364 of such Code or any similar or successor section. 12. The Guarantor hereby authorizes and empowers Bank, its successors, endorsees and assignees,to exercise in its or their sole discretion,any rights and remedies,or any combination thereof, which may then be available, it being the purpose and intent of the Guarantor that its obligations hereunder shall be absolute, independent and unconditional under any and all circumstances. The Guarantor therefore waives any defense based upon an election of remedies by Bank including,without limitation,any election to proceed byjudiciai or nonjudicial foreclosure or by deed in lieu thereof. 13. The Guarantor hereby authorizes and empowers anyattomey of any court of record to appear for and confess judgment against any or all of the undersigned for such sums as shall have or may become due hereunder,with or without declaration,with costs of suit,release of error, without stay of execution and with $1,500 or fifteen percent of the Liabilities then outstanding, whichever is greater,added for attorney's collection fees;and also waives the right of inquisition on any real estate levied on, voluntarily condemns the same, authorizes the Prothonotary or Cleric to enter upon the Writ of Execution said voluntary condemnation,agrees that said real estate may be sold on a writ of execution;and also waives any relief from any appraisement,stay or exemption law of any state now in force or hereafter enacted. If a copy of this Agreement, verified by affidavit of any Bank officer shall have been filed in such action, it shall not be necessary to file the original Agreement as a warrant of attorney,any practice or usage to the contrary notwithstanding. 14. The Guarantor shall pay Bank on demand all reasonable costs and expenses (including reasonable counsel fees) incurred by Bank in the preparation, administration, amendment, enforcement or collection of any of the Liabilities or of this agreement, including reasonable costs, expenses and fees incurred after as well as before the entry of any judgment. 15. The provisions of this agreement, and the obligations of the Guarantor hereunder, are independent of and separable from each other, and no such provision or obligation shall be affected or rendered invalid or unenforceable by virtue of the fact that for any reason any other such provision or obligation may be invalid or unenforceable in whole or in part. 16. This agreement shall be governed by the laws of the Commonwealth of Pennsylvania. The Guarantor waives any objection based on venue or inconvenient forum. THE GUARANTOR WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION INVOLVING THIS AGREEMENT. This agreement may be signed in any number of counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument. - 3 - 17. Bank may wholly or partially transfer the benefit of this Guaranty to any subsequent transferee or holder of any of the Liabilities. Subject to the preceding sentence, this Guaranty is made exclusively for the benefit of Bank and the undersigned, and no other person or entity (including, without limitation, the Borrower) is authorized or intended to rely hereon. IN WITNESS WHEREOF,the undersigned,intending to be legally bound,has executed this agreement, under seal, as of the date first written above. Witness: Al / ffrey A. Goss I hereby certify that the precise mailing address of Jeffrey A. Goss is: C) I U C" '�/ "w V�i Pais'_ By: . Mt liam A. Duncan, quire . Orrstown Bank Guaranty Cassidy Lig(PLCB settle sen 1260-002 -4 - EXHIBIT D - :axraraau r,wrs,cra 1UiKC lril:A'�'ava hu,lobte 34-34-2417-103 - SHIPP-WEST HMO OWIS REGISTRY 42/19/2013 BY Ta THIS DOCUMENT PREPARED BY AND UPON RECORDATION,RETURN TO: ANDERSON,MCCOY&ORTA,P.C. 100 North Broadway,Suite 2600 Oklahoma City,OK 73102 Telephone: (888)236-0007 Cumberland County,State ofPenusgtvania Tax Map Na or Tai Parcel Matifimeon No.:34-34-2417.103 I certify that the precisa address of the Assignee is clo Sabal Financial Group,L.P.,4675 MacArthur Court,Suite 1550 Newport Beach,CA 92660 N' llone ASSIGNMENT OF MORTGAGE KNOW ALL AU N BY TI4ESE PRESENTS: THAT, Orratown Hank, it Pennsylvania banking corporation, having an address of 77 East King Street, Shippensburg,PA 17257(hereinafter refereed to as"Assignor'),for value received, does by these pests, lit, sell,transfer, assign, convey and set over to Magnolia Portfolio,LLC,a Delaware limited liability company, its succemrs and assigns(hereiruda referred to as "Asst ee" having an address of c/o Saba] Financial Group, L.P., 4675 MacArthur Court, Suite 1550, Newport Beach, CA 92660, all of Assignor's right, title and interest in and to that ce7taiu: AMO Rd.:2510.127 Lam Name:CARMLO LLC Loan Ret:26474100101 THIS DOCUMENT PREPARED BY AND UPON RECORDATION, RETURN TO: ANDERSON,MCCOY&ORTA,P.C. 100 North Broadway,Suite 2600 Oklahoma City,OK 73102 Telephone: (888)236-0007 Cumberland County,State of Pennsylvania Tax Map No.or Tax Parcel Identification No.:3434-2417-103 [certify that the precise address of the Assignee is c/o Sabal Financial Group,L.P.,4675 MacArthur Court,Suite 15�Newport Beach,CA 92660 Nick,VC7ellone ASSIGNMENT OF MORTGAGE KNOW ALL MEN BY THESE PRESENTS: THAT, Orrstown Bank, a Pennsylvania banking corporation, having an address of 77 East King Street, Shippensburg, PA 17257 (hereinafter referred to as "Assignor'), for value received, does by these presents, grant, sell, transfer, assign, convey and set over to Magnolia Portfolio,LLC, a Delaware limited liability company, its successors and assigns (hereinafter referred to as "Assigyee" having an address of c/o, Sabal Financial Group, L.P., 4675 MacArthur Court, Suite 1550, Newport Beach, CA 92660, all of Assignor's right, title and interest in and to that certain: AMO Ref.:2510.127 Loan Name:CARILLO LLC Loan Ref.:26474 100 101 Open-End Mortgage dated September 5, 2047, executed by Lakeside Holding Company, Inc., the grantor, to Onstown Bank, the Lender, recorded on September 5,2047,as IftSIrUment Number 200734749 in the Official Records of Cumberland County, State of Pennsylvania ("Recorder's Office"), as the same may have been assigned, amended, supplemented, restated or modified (the "Mortgage"). The Mortgage covers the property described therein,less and except any portion of the property previously released and/or reconveyed. TO HAVE AND TO HOLD the same unto said MAGNOLIA PORTFOLIO, LLC,ITS SUCCESSORS AND ASSIGNS. THIS ASSIGNMENT IS MADE WITHOUT RECOURSE, REPRESENTATION OR WARRANTY,EXPRESS OR WLIED,WRITTEN OR ORAL,BY ASSIGNOR. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] AMO Ref.:2310.127 Loan Nwme:'CARIILo L.LC Low Rd:26474100101 IN WITNESS WHEREOF, Assignor has caused this instrument to be executed this j1 — day of February,2013. ASSIGNOR: ORRSTOWN BANK,a Pennsylvania banking corporation By: Magnolia Portfqgp, LLC,a Delaware limited liability company, ' s eY5 Fact By: Name: R. Patterson Jackson Title: Authorized Signatory xurvt �o �" f�wper af A ACKNOWLEDGME &evr&od cn: 01 13014013 STATE OF CALIFORNIA SS: COUNTY OF ORANGE ) On this day of February, 2013, before me personally appeared R. Patterson Jackson, as Authorized Signatory fior Magnolia Portfolio, L , a Delaware limited liability company, Attorney-in- Fact for Orrstown Bank,a Pennsylvania Ing corporation,known to me or proved to me on the basis of satisfactory evidence to be the ns who executed the foregoing instrument, and they thereupon duty acknowledged to me that executed the same to be their free act and deed. WITNESS my hand and Icial seal. My commiss' expires: Name of Notary: P 0 11 AMO Ref.;2510.127 Loan Name:CARILLO LLC Loan Rd.:26474100101 State of California ) County of Orange On February ; 2013,before me, Lynn Mattson, Notary.Public, personally appeared R. Patterson Jac son, who proved to me on the basis df satisfactoty evidence tw be.the person whose name is subscribed to the within instrument and.acknowledged.to."me that he executed the same in his authorized capacity, and that .by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. 1 certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS.my hand and official seal. LYNN MASON Commlaaion•1930475 z a ,Notary Public•Caltimnit Oran9a County .mo� (SEAL) M Comm.Ex lies Nu 27.2015 No blic Signature .��. • LVi�Vr...V I►yY ' ML v ROBERT P. ZEEGLER RECORDER OF DEEDS CUMBERLAND COUNTY 1 COURTHOUSE SQUARE CARLISLE, PA 17013 717-240-6370 r , Instrument Number-201305530 Recorded On 2/19/2013 At 2:57:29 PM "Total Pages-5 •Instrument Type-ASSIGNMENT Invoice.Number- 129699 User ID-KW •Grantor-LAKESIDE HOLDING CO INC •Grantee-MAGNOLIA PORTFOLIO LLC •Customer- SIMPLIFILE LC E-RECORDING FEES STATS WRIT TAX $0.50 Certification Page RECORDIMO FEES — $11.50 RECORDER OF DEEDS DO NOT DETACH PARCEL CERTIFICATION $10.00 FEES COUNTY ARCHIVES FEE $2.00 This page is now part ROD ARCHIVES FEE $3.00 of this legal document TOTAL PAID $27.00 I Certify this to be recorded in Cumberland County PA RECORDER OF DEEDS •.InformaMm denoted by an utedsk emq change dmtaa the Verimcadon proms and mar not be rttkeoed ou this page. CBRTIF2Zn P7t PPM IDRNTIFIWZON HtJNF3 M 34-34-2417-103 - SaIPP-WEST WARD CCOIS WaGISTRY 02/14/2013 BY 76 TlflS DOCUMENT PREPARED BY AND UPON RECORDATION,RETURN TO: ANDERSON,MCCOY&ORTA,P.C. 100 Nasth Broadway,Suite 2600 Oklahoma City,OK 73102 Telephone: (888)236-000? Cumberland Co",State of Pennsyhran a Tax Map No.or Tax Pwwl Identiiieation No.:3434-2417.103 1 certify that the precise address of the Assignee is do Sabal Financial Group,L.P.,4675 MacArthur Court, t 558,Newport Beach,CA 42660 Nick !lone ASSIGNMENT OF ASSIGNMENT OF RENTS KNOW ALL MEN BY THESE PRESENTS: THAT, Orrstown Bank, a Pennsylvania banking Corporation, having an address of 77 East King Street, Shippensburg,PA 17257 referred to as"AssAssimor"),for value received, does by these presents,grant, sell, transfer, assign, convey and set over to Magnolia Portfolio,LLC,a Delaware limited liability company, its successors and assigns(hereinafter referred to as "AidWIf having an address of c/o Sabal Financial, Group, L.F., 4675 MacArthur Court, Suite 1550, Newport Beach, CA 92660, all of Assignor's right, title and interest in and to that cetain: AMO Rci:2510.t27 Loss Name:CARDID LLC Loan Rd:26474100101 THIS DOCUMENT PREPARED BY AND UPON RECORDATION,RETURN TO: ANDERSON,MCCOY&ORTA,P.C. 100 North Broadway,Suite 2600 Oklahoma City,OK 73102 Telephone: (888)236-0007 Cumberland County,State of Pennsylvania Tax Map No.or Tax Parcel Identification No.:34-34-2417-103 1 certify that the precise address of the Assignee is c/o Sabal Financial Group,L.P.,4675 MacArthur Court,S 'te 1550,Newport Beach,CA 92660. Nick hone ASSIGNMENT OF ASSIGNMENT OF RENTS KNOW ALL MEN BY THESE PRESENTS: THAT, Orrstown Bank, a Pennsylvania banking corporation, having an address of 77 East King Street, Shippensburg, PA 17257 (hereinafter referred to as"Assignor'), for value received, does by these presents,grant, sell, transfer, assign, convey and set over to Magnolia Portfolio,LLC,a Delaware limited liability company, its successors and assigns(hereinafter referred to as "Assi ng_ee" having an address of c/o Sabal Financial Group, L.P., 4675 MacArthur Court, Suite 1550, Newport Beach, CA 92660, all of Assignor's right, title and interest in and to that certain: AMU Rd.:2510.127 Loan Name:CARILLO LLC Loan Ref.:26474100101 Assignment of Rents dated September 5, 2007 (the "Assignment of Rents"), made by Lakeside Holding Company,Inc.,in favor of Orrstown Bank,recorded September 5, 2007, as Instrument Number 200734711 in the Real Estate Records of Oberland County, State of Pennsylvania("Real Estate Records"); Any notes and or other agreements evidencing the indebtedness and/or the obligations secured by the recorded loan documents indentified above;and Any and all other documents and instruments evidencing, securing and/or relating to the indebtedness and/or obligations secured by the recorded loan documents identified above. Ile Assignment of Retn covers the property described therein, less and except any portion of the property previously released and/or rcconveyed. TO HAVE AND TO HOLD the same unto said MAGNOLIA PORTFOLIO, LLC, ITS SUCCESSORS AND ASSIGNS. THIS ASSIGNMENT IS MADE WITHOUT RECOURSE, REPRESENTATION OR WARRANTY,EXPRESS OR IMPLIED,WRTITEN OR ORAL,BY ASSIGNOR. [REMAINDER OF PAGE UMNI70NALLY LEFT BLANK] AMO Ref.:1510.07 Loan Kum:CARLU-0 LLC Loan Rd,26474100101 IN WITNESS WHEREOF, Assignor has caused this instrument to be executed this day of February, 2013, ASSIGNOR: ORRSTOWN BANK,a Pennsylvania banking corporation By: Magnolia Pa olio, LLC,a Delaware limited liability compan , A me -Fact By: Name: R. Patterson ackson Title: Authorized Signatory :4rsL . *o 44,.• ' t,�c.� Adtrn.cc� Uc4rcl-fi� Cj-� : 01136/,;tOr 3 ACKNOWLEDGMENTS{� . STATE OF CALIFORNIA 363a 4,3 SS: COUNTY OF ORANGE ) On this day of February, 2013, before m personally appeared R. Patterson Jackson, as Authorized Signatory far Magnolia Portfolio, , a Delaware limited liability company, Attorney-in- Fact for Qrrstown Bank,a Pennsylvania mg corporation,known to me or proved to me on the basis of satisfactory evidence to be the ons who executed the foregoing instrument, and they thereupon duly acknowledged to me tha y executed the same to be.their free act and deed. WITNESS my hand and ficial seal. My commiss' expires: Name of Notary: p�), C�U� AMO Ref.:2510.127 . Loan Name:CARILLO LLC Loan Ref.:264 74 100 101 State of California ) County of Orange ) On February I(_,2013,before me, Lynn Mattson, Notary Public, personally appeared R. Patterson Jackson, who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted,executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. LYNN NATr80N Commie:ioa 11830475 Notary Public•Cslitornis Oran&County (SEAL) MY Comm.Expires Ma 27.2015 No u lic Signa re ROBERT P. ZIEGLER RECORDER OF DEEDS CUMBERLAND COUNTY 1 COURTHOUSE SQUARE CARLISLE, PA 17013 717-240-5370 Instrument Number-201305530 Recorded On V19/2013 At 2:57:29 PM •Total Pages-S •Instrument Type-ASSIGNMENT Invoice Number- 129699 User ID-KW Grantor-LAKESIDE HOLDING CO INC "Grantee-MAGNOLIA PORTFOLIO LLC •Customer-SIMPLIFILE LC E-RECORDING "FEES STATR WRIT TAX $0.50 Certification Page RECORDING FEES — $11.50 RECORDER OF DEEDS DO NOT DETACH PARCEL CERTIFICATION $10.00 FESS COUNTY ARCHIVES "A $2.00 This page is now part ROD ARCHr aS FSE $3.00 of this legal document. TOTAL PAID $27.00 I Certify this to be recorded in Cumberland County PA )A70-- RECORDER OF DEEDS •.Iaformatloa dew*rd M an satnrtstt nw c mgr during the verftadon proms and mar not be reflected on this page- ASSIGNMENT OF SECURITY DOCUMENTS ORRSTOWN BANK, A PENNSYLVANIA BANKING CORPORATION, ("Assignor"), for good and valuable consideration, the receipt and sufficiency of which are acknowledged, hereby sells, transfers, assigns, delivers, sets-over and conveys to MAGNOLIA PORTFOLIO, LLC, A DELAWARE LIMITED LIABILITY COMPANY, its successors and assigns ("Assignee"), without recourse to the Assignor, and without representations, warranties or covenants, express or implied, written or oral, by the Assignor, all right, title and interest of the Assignor in and to the loan identified on Exhibit A attached hereto (the "Loan"), including without limitation all of Assignor 's right, title and interest in any guaranties, loan participation interests, indemnities, claims, collateral, insurance policies, certificates of deposit, letters of credit, escrow accounts, performance bonds, demands, causes of action and any other collateral arising out of and/or executed and/or delivered in or to or with respect to the Loan, together with any other documents or instruments executed and/or delivered in connection with or otherwise related to the Loan. Dated this of February,2013 ASSIGNOR: ORRSTOWN BANK, a Pennsylvania banking carpnration By: MAGNOLIA PORTFOLIO, LLC, a Delaware limited liabili com y, its Attorney-in-Fact By: Name: R. Patterson kson Title: Authorized Signatory AMO Ref.: 2510.127 Loan Namc: CARILLO LLC Loan Rd;26474100101 EXHIBIT"A" TO ASSIGNMENT OF SECURITY DOCUMENTS That certain loan dated September 5,2007, in the stated original principal amount of$50,000.00, executed by Carillo, LLC to ORRSTOWN BANK, which is secured by property located in Cumberland County,State of Pennsylvania. AMO Ref.: 2310.127 Loan Name CARILLO LLC Loan Ref:26474100101 EXHIBIT E Kate Durfil-ger satlic 1,11(717)237-0792 fi; x7171 331-0676 A.111 III elj�Yhoads-.Yilloa com RHnADS & SI GN LLP i fuNo 12652101 June 19. 2014 Re: DEMAND NOTICE VIA FEDERAL EXPRESS Mark D. Hipp, Esquire iMette Evans & Wbodside PC 3401 North Front Street 11.0. Box 5950 Harrisburg, PA 17110-0950 Dcar '-,Mr. Hipp: We represent Saba] Financial Group, LT., as servicing agent for Magnolia Portfolio, LLC (the "Lender") who purchased those certain loans made to Carillo, LLC, being 11-101-c specifically identified as Loan 'Nos. 104183-001 and 1,04189-001, which such loans are guaranteed by Tefftey Goss and Michael Cassidy. It Is our understanding that you represent Carillo, LLC* Michael Cassidy and Jeffrey Goss (collectively, the "Obligors"), and that you will share this Notice with your clients. If that is not the u.1se, please advise Lis within the next three (3) days so that we can re-deliver this notice accordingly. -rhe foregoing, oing loans may be referred to herein as each a "Loan", and. collective]y, the "Loans". Capitalized terns used herein sliall have the meanings attributed thereto by the various loan documents associated with the Loans (the "Loan Documents") unless otherwise defined herein. As You may know, the Loans were in default at the time Lender purchased them and since that time, the Obligors have made efforts to make payments and rehabilitate the Loans. Unfortunately, the Obligors have not made consistent or timely payments as required under the Loan Documunts, and thercibrc., the Loans continue to be in default. The Failure to make timely payments on the Loans constitutes an event of default under the LOarl Documents (the. "Events of Default"). As a result of the Events of Delault. the Lender Nvas and continues to be entitled to pursue various rights and remedies under the Loan Documents, including,.. without limitation. the acceleration of all of tile indebtedness that is owed by the Obligors to the Lender under the Loan Documents relating to the Defaulting Loans, the imposition of the default rate of interest ("Default Rate") authorized by the Loan Documents. concession of' Judgment, and tile One South Market Square, 121.h Floor * P.O. Box 1146 o Harrisburg, PA 17108-1146 a ph: 717.233.5731 vsaoarc 29 Dowlin Forge Road a Exton, PA 19341 ph, 610.423.4200 - fax: 610,423.4201 U.111FIV,T'hoettis-sition.Cott] foreclosure. liquidation, collection or other enforcement of the Lenders security interests and liens in any or all of the collateral securing the indebtedness and obligations under the Loar, Documents. Accordingly, you and the Obligors are hereby notified that: a Interest shall continue to accrue on the unpaid principal balance at the default interest rate of three percent(3)%) over the CUI'I,-CDt applicable rate of each Loan. 0 The Lender is hereby declaring the Loans immediately due and payable. The outstanding principal and accrued interest under the Loans as of May 30, 2014 is as follows: ............. Principal UnpaidDefault Total i Loan 4 Balance Interest Late fees Other Fees Interest Due 104183-0 01 545947.50 $236718 S 90().WS62500 ................­_ , , _ , '726.86t 551J66.64 164189 003 $90,290.58 $6,733.47 52,1;3.58 S__ $4,836.19 j 5104,013.82 ....................... . . Total Amount Due $1.55,580.46 Notwithstanding the fact that the Lender may ininiediately exercise its rights and remedies tin-der the Loan Documents, the Lendcr will allow the Obligors until July 15, 2014 to satisfy the outstanding indebtedness as set forth above, if the Obligors do not satis.f�, the outstanding indebtedness on or before July 15,2014, the Lender may choose to exercise its rights and remedies under the Loan Documents without any finther notice to the Obligors. Additionally, if payment is not made on or before July 15, 2014 as set forth above, we have been authorized to institute appropriate legal action against the Obligors, including. I)LII.110t limited to, confession of judgment against the Obligors, and the fOrCCIOSLire, liquidation, collection or other enforcement of the Lender'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 Lender under the I.,oan Documents, Including legal fees, costs of collection and interest, ,rhe Lender's election not to exercise any of its other rights and remedies at the present time, and any Financial accommodations the Lender may have made to date, shall not be construed as a waiver of any rights or remedies of the Lender. Nothing contained herein or in any other corm-nunication or in any ongoing discussions or negotiations which have or may take place, between the Obligors and the Lender shall directly or indirectly: (i) create any obligation LIP011,the Lender to defer any enforcement action or make any fiii-ther 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 Lender thereunder; or (iv) constitute a course of dealing or other basis for altering any duty or obligation owed by the Obligors to the Lender. Nothing contained in,this letter shall confer on.any Obligor or any other person or entity any right to other or fiji-ther notice Or cure periods with respect to any Event of Default. The Lender expressly reserves all of its i1ghts, powers, privileges and remedies under the I-oati Documents and/or applicable laws, Including, without limitation, the T,ender .s., right at any time, as applicable: (1) 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 1.)Icdgcd 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 I-,oan Documents any or all of the Collateral; and (iv) to tape any other ejifbrcement action or otherwise exercise any or all rights and remedies provided by any Loan Document or by applicable laws, The Lender appreciates the efforts made to date with respect to the Loans and feels that a call to discuss these Loans would be beneficial. Please advise of your availability 'for a conference call within the next ten days. In the meantime, , please do not hesitate to contact the undersigned with any questions or concerns. Very truly yours, RHOADS& SI 'ON LIT By: Ka Deringer Sallie cc: Ann I-lempfling, Saba] Financial CTroup, .L.P. (via electronic mail) Ralph Fetrow (via electronic mail) MAGNOLIA PORTFOLIO, LLC, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION- LAW CARILLO, LLC and NO. lq JEFFREY A. GOSS, : Defendants ENTRY OF JUDGMENT AND NOW, this Z4 day of August, 2014, Judgment is hereby entered in favor of the Plaintiff Magnolia Portfolio, LLC, and against Defendants Carillo, LLC and Jeffrey A. Goss and damages are assessed in the amount of$52,221.84 together with accruing interest at a per diem rate of$9.25 from the date of judgment. Prot onotary c rn Cis r -r C} L�� C71 960143.2 MAGNOLIA PORTFOLIO, LLC, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA C-: V. CIVIL ACTION - LAW C-) CARILLO, LLC and NO. i =.;Q — s_ JEFFREY A. GOSS, Cn Defendants t..J PRAECIPE FOR ENTRY OF JUDGMENT ' To: The Prothonotary Pursuant to the attached Entry of Judgment, please enter judgment in favor of the Plaintiff Magnolia Portfolio, LLC and against Defendants Carillo, LLC and Jeffrey A. Goss and damages are assessed in the amount of $52,221.84 together with interest from the date of judgment accruing at the rate of$9.25 per day plus costs of collection. RHOADS & SINON LLP By: G%�/ ` y1` Stephanie DiVittore Kathryn D. Sallie One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Defendants Carillo, LLC and Jeffrey A. Goss for purposes of confession of judgment; Attorneys for Plaintiff Magnolia Portfolio, LLC, for all other purposes 960143.2 MAGNOLIA PORTFOLIO, LLC, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION- LAW CARILLO, LLC and ; NO. JEFFREY A. GOSS, Defendants NOTICE OF ENTRY OF CONFESSED JUDGMENT To: Carillo, LLC 60 Pine Street Carlisle, PA 17013 Jeffrey A. Goss 10 Derbyshire Drive Carlisle, PA 17013 You are hereby notified that on August, �, 2014,judgment by confession was entered against you in the amount of$52,221.84 together with accruing interest at a per diem rate of $9.25 from the date of judgment. Attached hereto are copies of all documents filed with the Prothonotary in support of the confession of judgment. Date: Prothonotary YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. Court Administrator 4th Floor, Cumberland County Courthouse Carlisle, PA 17013 (717) 240-6200 960143.2 Lawyer Referral Service 4th Floor, Cumberland County Courthouse Carlisle, PA 17013 (717) 240-6200 Lawyer Referral Service: Pennsylvania lawyer Referral Service (800) 692-7375 960143.2 :u rillt Stephanie E.DiVittore,Esquire Attorney I.D.No. 85906 201 AUG 26 AM 10: 36 Kathryn D. Sallie,Esquire Attorney I.D.No. 108116 CUMBERLAND COUNTY RHOADS& SINON LLP PENNSYLVANIA One South Market Square P.O. Box 1146 Harrisburg,PA 17108-1146 (717)233-5731 Attorneys for Plaintiff i P MAGNOLIA PORTFOLIO, LLC, : IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. CIVIL ACTION - LAW CARILLO, LLC and NO. 500- JEFFREY A. GOSS, Defendants NOTICE UNDER RULE 2958.1 OF JUDGMENT AND EXECUTION THERETO Notice of Defendant's Rights To: Carillo, LLC 60 Pine Street Carlisle, PA 17013 Jeffrey A. Goss 10 Derbyshire Drive Carlisle, PA 17013 A judgment in the amount of Fifty Two Thousand Two Hundred Twenty One Dollars and Eighty Four Cents ($52,221.84)plus interest from the date of judgment accruing at the rate of Nine Dollars and Twenty-Five Cents ($9.25)per day and costs of collection, has been entered against you and in favor of the Plaintiff without any prior notice or hearing based on a Confession of Judgment contained in a written agreement or other paper allegedly signed by you. The Sheriff may take your money or other property to pay the judgment at any time after thirty (3 0) days after the date on which this notice is served on you. You may have legal rights to defeat the judgment or to prevent your money or property from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR RIGHTS. 960143.2 YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE. Court Administrator 4th Floor, Cumberland County Courthouse Carlisle, PA 17013 (717) 240-6200 Lawyer Referral Service 4th Floor, Cumberland County Courthouse Carlisle, PA 17013 (717) 240-6200 Lawyer Referral Service: Pennsylvania lawyer Referral. Service (800) 692-7375 960143.2 Ronny R Anderson Sheriff Jody S Smith Chief Depu Richard W Stewart Solicitor SHERIFF'S OFFICE OF CUMBERLAND COUNTY p�'�� ;(et � %4'� OFFICE QF THE ViERIFF ;'' .//Yc `��� PRO°' /Mcole?��(`� 20/4 SEP 23 0: 00 CUMBERLAND NNS _v YL VA NIA Magnolia Portfolio, LLC vs. Carillo, LLC (et al.) Case Number 2014-5007 SHERIFF'S RETURN OF SERVICE 09/18/2014 08:49 PM - Deputy Jason Kinsler, being duly sworn according to law, served the requested Complaint in Confession of Judgment, Confession of Judgment, Entry of Judgment, Notice of Entry of Confessed Judgment, Notice Under Rule 2958.1 of Judgment and Execution Thereto and Parecipe of Entry of we - Judgment by handing a true copy to a person representing themselves to be Jeffrey A Goss, Co -Owner, who accepted as "Adult Person in Charge" for Carillo, LLC at 10 Derbyshire Rd, South Middleton, Carlisle, PA 17013. 09M8C2014 08:49 PM - Deputy Jason Kinslerbeing duly sworn according to law, served the requested Complaint in Confession of Judgment, Confession of Judgment, Entry of Judgment, Notice of Entry of Confessed Judgmen1, Notice Under Rule 2958.1 of Judgment and Execution Thereto and Parecipe of Entry of Judgment by "personally" handing a true copy to a person representing themselves to be the Defendant, to wit: Jeffrey A Goss at 10 Derbyshire Drive, South Middleton, Carlisle, PA 17013. SHERIFF COST: $51.27 SO ANSWERS, September 19, 2014 RONNYRANDERSON, SHERIFF Heather Z. Kelly, Esquire Sup. Ct. I.D. No. 86291 METTE, EVANS & WOODSIDE 3401 North Front Street P.O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 — Phone (717) 236-1816 — Fax hzkelly@mette.com Attorney for Defendants MAGNOLIA PORTFOLIO, LLC, Plaintiff VS. CARILLO, LLC, and JEFFREY A. GOSS, Defendant m INA NO COUN( : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, : PENNSYLVANIA : NO. 14-5007 Civil Action : CONFESSION OF JUDGMENT PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND STAY EXECUTION NOW COME Defendants, Carillo, LLC ("Carillo") and Jeffrey A. Goss ("Goss," and, collectively with Carillo, "Defendants"), by and through their attorneys, Mette, Evans & Woodside, and file the within Petition to Open or Strike Confessed Judgment and Stay Execution ("Petition") filed by Magnolia Portfolio, LLC ("Plaintiff"), and in support whereof aver as follows: Background 1. On August 26, 2014, Plaintiff filed a Complaint in Confession of Judgment (the "Complaint") against Defendants and entered judgment pursuant thereto (the "Judgment"). 2. The Judgment was entered pursuant to warrants of attorney contained in a September 5, 2007 Promissory Note executed by Defendant Carillo in favor of Orrstown Bank (the "Note") and a Guaranty executed by Goss guarantying the indebtedness evidenced by the Note (the "Guaranty"). The Note and Guaranty are attached to the Complaint as Exhibits "B" and "C", respectively. 3. Plaintiff avers in the Complaint that it is the successor by assignment to the Note and Guaranty based on "Assignments" that are attached to the Complaint as Exhibit "D." 4. The Assignments attached to the Complaint consist of (1) an "Assignment of Mortgage" referencing a mortgage recorded with the Cumberland County Recorder of Deeds at Instrument No. 200734709; (2) an "Assignment of Assignment of Rents" referencing an Assignment of Rents recorded with the Cumberland County Recorder of Deeds at Instrument No. 200734711; and (3) an "Assignment of Security Documents" for certain specified documents executed in connection with a September 5, 2007 "Loan" (as defined in the Assignment of Security Documents). 5. All of the Assignments attached to the Complaint are executed by Plaintiff, the purported Assignee of the documents. 2 6. The Assignment of Mortgage and Assignment of Assignment of Rents (neither of which specifically assigns the Note or Guaranty to Plaintiffs) indicate that they are executed by Plaintiffs "Authorized Signatory", "Pursuant to the Limited Power of Attorney Recorded January 30, 2013 as Instrument 201303263" (the "Limited POA"). 7. The Limited POA is not attached to the Complaint. 8. Notwithstanding, the Limited POA is a public record recorded with the Cumberland County Recorder of Deeds and is attached hereto as "Exhibit A." 9. The Limited POA references a "Loan Sale Agreement" between Orrstown Bank and Plaintiff. (Limited POA, Ex. A). 10. Pursuant to the Limited POA, Orrstown Bank provided Plaintiff with the limited power to indorse documents "necessary to assign, transfer, extend, release or otherwise carry out the intent of the Loan Sale Agreement..." (Limited POA, Ex. A). 11. The Limited POA does not include a copy of the Loan Sale Agreement and does not specifically reference any loans that were sold or transferred by Orrstown Bank to Plaintiff pursuant to the Loan Sale Agreement. 12. The Loan Sale Agreement is not attached to the Complaint. 13. Notably, at the same time that Plaintiff confessed judgment in this action against Defendants, it also confessed judgment in seven (7) other actions against Defendants and/or related individuals and entities, under different instruments, but pursuant to assignments related 3 to the Loan Sale Agreement. See Cumberland County Docket Nos. 14-5003; 14-5007; 14-5010; 14-5014; 14-5016; 14-5017; 14-5018. 14. Because the Loan Sale Agreement was not attached to the pleadings in this action or any of the other actions referenced above, and because neither Plaintiff nor Orrstown Bank has ever made it available to Defendants, Defendants have never seen the Loan Sale Agreement and have never received confirmation that the Note, Guaranty and other loan documents were properly assigned by Orrstown Bank to Plaintiff. 15. Neither Defendants nor the Court, based on the face of the pleadings, can determine the "intent of the Loan Sale Agreement" (as set forth in the Limited Power of Attorney), because it is not attached to the pleadings and has never been made available to Defendants. 16. Plaintiff confessed judgment in the amount of $52,221.84, together with accruing interest at a per diem rate of $9.25. (Pl. Compl. at ¶18). Petition to Open or Strike Confessed Judgment For Failure to Establish Proper Assignment of the Note and Guaranty 17. The above Paragraphs are incorporated by reference. 18. The face of the Complaint, even coupled with the Limited POA of public record, fails to establish Plaintiff's right to confess judgment against Defendants. 4 19. Plaintiff signed the Assignments pursuant to the Limited POA, which gave Plaintiff only the power to execute documents to "carry out the intent of the Loan Sale Agreement..." (Limited POA, Ex. A). 20. The Loan Sale Agreement is not a matter of public record, nor is it attached to the Complaint. 21. Accordingly, there is no proof that Plaintiffs signature on the Assignments was authorized by Orrstown Bank. 22. A judgment entered by confession must be self-sustaining and may not be entered when the court must consider matters outside the instrument in order to support the judgment. Manor Bldg. Corp. v. Manor Complex Assoc. Ltd., 645 A.2d 843, 846 (Pa. Super. 1994). 23. If the Plaintiff did not have the right to confess judgment against Defendants, which is not established by the face of the Complaint, the Judgment must be stricken. 24. No judge has ruled on any other petition in this or any related matter. 25. WHEREFORE, the Defendants, Carillo, LLC and Jeffrey A. Goss, respectfully request that the Judgment dated August 26, 2014 in the above -referenced matter be stricken. In the alternative, the Defendants respectfully request that the judgment dated August 26, 2014 in the above referenced matter be opened and the Defendants be permitted to file an answer to the Complaint. Defendants further request such other relief as the Court deems just and appropriate under the circumstances. 5 Motion to Stay Execution 26. The above Paragraphs are incorporated herein by reference. 27. Defendants accepted service of the Complaint on September 18, 2014. 28. The Complaint was served together with a Notice Under Rule 2958.1 of Judgment and Execution Thereto, indicating that Defendant may execute on the Judgment on or after 30 days from the date of service, or October 18, 2014. 29. If the Court grants Defendants' Petition to Open or Strike, set forth above, the amount of the Judgment may be reduced or stricken completely. 30. Rule 3121(b) provides that "[e]xecution may be stayed by the court as to all or any part of the property of the defendant upon its own motion or application of any party interest showing...(2) any other legal or equitable ground therefore." 31. Here, Defendants have raised a meritorious defense to the Judgment, including the very ability of Plaintiff to confess judgment against Defendants. 32. Under the circumstances, it would be inequitable to permit Plaintiff to proceed with permitting Plaintiff to execute upon the Judgment. 6 WHEREFORE, Defendants respectfully request that the Court stay execution upon the Judgment entered in this case pending disposition of this Petition to Open or Strike. Respectfully submitted, METTE, EVANS & WOODSIDE By: Date: October 9, 2014 Heather Z. Ke y, Esquire Sup. Ct. I.D. No. 86291 METTE, EVANS & WOODSIDE 3401 North Front Street P. 0. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 (717) 236-1816 — Fax hzkelly@mette.com Attorney for Defendants 7 VERIFICATION I, Jeffrey A. Goss, have read the foregoing document and verify that the facts set forth therein are true and correct to the best. of my knowledge, information and belief. To the extent that the foregoing document and/or its language are that of counsel, I have relied upon counsel in making this Verification. I understand that any false statements made herein are subject to the penalties of 18 Pa. C.S. §4904 relating to unsworn falsification to authorities. Dated: q p i 7l , CERTIFICATE OF SERVICE I certify that I am this day serving a copy of the foregoing document upon the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of same in the United States Mail at Harrisburg, Pennsylvania, with first-class postage, prepaid, as follows: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire Rhoads & Sinon LLP One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 By: Date: October 9, 2014 Respectfully submitted, METTE, EVANS & WOODSIDE 4ed- Heather Z. K y, Esq re Sup. Ct. I.D. No. 86291 METTE, EVANS & WOODSIDE 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 (717) 236-1816 — Fax hzkelly@mette.com Attorney for Defendants ) ti Inst. # 201303263 - Page 1 of 3 NOT APPLICABLE FOR PIN NUMBER CCGIS REGISTRY 01/30/2013 BY DC LIMITED POWER OF ATTORNEY Reference is made to that certain Loan Sale Agreement for Portfolio Offering #121210, dated as of December 20, 2012 (the "Loan Sale Agreement") by and between ORRSTOWN BANK having a notice address of 77 East King Street, Shippensburg, PA 17257, Attn: Jeffrey M. .Seibert, EVP/Chief Operating Officer ("Seller") and MAGNOLIA J?ORTFOLTO, LLC having a notice address of c/a Sabal Financial Group, L.P,, 4675 MacArthur Court, Suite 1550, Newport Beach, California 92660; Attn: R. Patterson Jackson ("Buyer"). Each capitalized term used herein but not defined herein shall have the meaning assigned thereto in the Loan Sale Agreement. In accordance with the Loan Sale Agreement, Seller hereby makes, constitutes, appoints and confers upon Buyer, its successors and assigns, Seller's irrevocable, limited power of attorney to indorse Seller's name and collect any checks or other forms of payment received from Obligors, under the related Evidence of Indebtedness sold by Seller to Buyer under the Loan Sale Agreement and to endorse and sign any documents necessary to assign, transfer, extend, release or otherwise carry out the intent of the Loan Sale Agreement with respect to Loan Notes, mortgages, deeds of trust, security instruments, judgments, assignments of insurance policies or other instruments related to an Evidence. of Indebtedness; provided, however, any such endorsement (i) shall be permitted only to the extent necessary to carry out the intent of the Loan Sale Agreement and (ii) shall state clearly that such endorsement is "WHERE IS", "WITH ALL FAULTS" AND WITHOUT RECOURSE AND WITHOUT ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN. This Limited Power of Attorney shall expire one (1) year from the date of execution hereof. Page 1 of 2 Inst. # 201303263 - Page 2 of '3 IN WITNESS WHEREOF, Seller has caused its name to be subscribed hereto by its duly. authorized officer this 19th day of December, 2012. Signed, sealed and delivered in the fresekcf By: Name: UM CIA NW t,O v, X10( By: ORRSTOWN BANK, a Pennsylvania banking corporation By: Name: Zachary Lynn Title: SVP, SAG rector Special Assets Group Name: • Sit -.4 ccr... ACKNOWLEDGEMENT STATE OF YNY\S(J4)N((%y\1 Ck § i COUNTY OF Cy-ok l +1r § I CERTIFY that on the 19th day of December 2012, Zachary M. Flynn personally came before me and acknowledged under oath, to my satisfaction, that: (a) he signed the attached document as Senior Vice President of Orrstown Bank and (b) this document was signed and made by Orrstown Bank as its voluntary act and deed, COMMONWEAt7H OF PENNSYLVANIA Notarial Seal Ashley R. Nell, Notary.Bubllc Greene Twp., Franklin County My Commission Wines May 29, 2016 MEMBER PENN5YLVANFAASSOCIA7t0N OF NOTARIES NOTARY . . LIC My Commi. ,on Expires: ( &cjtdj up Page 2 of 2 Inst. # 201303263 - Page 3 of 3 ROBERT P. ZIEGLER RECORDER OF DEEDS CUMBERLAND COUNTY 1 COURTHOUSE SQUARE CARLISLE, PA 17013 717-240-6370 Instrument Number - 201303263 Recorded On 1/30/2013 At 2:14:56 PM *Instrument Type - POWER OF ATTORNEY Invoice Number - 128113 User ID - MSW * Grantor - ORRSTOWN BANK *Grantee - MAGNOLIA PORTFOLIO LLC *Customer - SIMPLIFILE LC E -RECORDING *FEES STATE WRIT TAX RECORDING FEES — RECORDER OF DEEDS COUNTY ARCHIVES FEE ROD ARCHIVES FEE TOTAL PAID $0.50 $11.50 $2.00 $3.00 $17.00 *Total Pages -3 Certification Page DO NOT DETACH This page is now part of this legal document. I Certify this to be recorded in Cumberland County PA 76 RECORDER OF DEEDS - Information denoted by an asterisk may change during the verification process and may not be reflected on this page. MAGNOLIA PORTFOLIO. INC. Plaintiff v. CARILLO, LLC, and JEFFREY A GOSS Defendants Count) of euntberfanb IN THE COURT OF COMMON PLEAS OF THE NINTH JUDICIAL DISTRICT 14-5007 CIVIL ACTION IN RE: PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND STAY EXECUTION ORDER OF COURT AND NOW, this 21st day of October 2014, upon consideration of Defendants' Petition to Open or Strike Confessed Judgment and Stay Execution, a RULE is issued upon Plaintiff to show cause the requested relief should not be granted. DEFENDANTS shall effectuate service of this Order of Court upon Plaintiff and shall file proof of service. Response by Plaintiff shall contain a proposed order. RULE RETURNABLE twenty (20) days from the date of service. Thomas A. Placey Dis�tribution List: ,/St phanie E. DiVittore, Esq. ryn D. Sallie, Esq. eather Z. Kelly, Esq. 1;Szapy C.P.J. t Ll 20 14 OCT 24 AM 11: 4 6 CUMBERLAND COUNTY PENNSYLVANIA METTE, EVANS & WOODSIDE Heather Z. Kelly, Esquire Sup. Ct. I.D. No. 86291 3401 North Front Street P.O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 (717) 236-1816 (fax) Attorneys for Plaintiff MAGNOLIA PORTFOLIO, LLC, IN THE COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA V. NO. 14-5007 CARILLO, LLC and JEFFREY A. GOSS, Defendants PROOF OF SERVICE I, Heather Z. Kelly, Esquire, counsel for the Defendants, certify that on October 23, 2014, 1 served an Order granting Rule to Show Cause dated October 21, 2014 on the Plaintiff, via United States mail, first-class postage prepaid, as follows: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire RHOADS & SINON, LLP RHOADS & SINON, LLP One South Market Square, 12th Floor One South Market Square, 12th Floor P.O. Box 1146 P.O. Box 1146 Harrisburg, PA 17108-1146 Harrisburg, PA 17108-1146 Respectfully submitted, METTE, EVANS & WOODSIDE By: LAI— Heather Z. Kelly, Wuire IJ Sup. Ct. ID No. 86291 3401 North Front Street P.O. Box 5950 Harrisburg, PA 17110-0950 (717)232-5000 Attorneys for Defendants Date: October 24, 2014 748276v1 CERTIFICATE OF SERVICE I certify that I am this day serving a copy of the foregoing document upon the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of same in the United States Mail at Harrisburg, Pennsylvania, with first-class postage,prepaid, as follows: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire RHOADS & S1NON, LLP RHOADS & SINON, LLP One South Market Square, 12th Floor One South Market Square, 12th Floor P.O. Box 1146 P.O. Box 1146 Harrisburg, PA 17108-1146 Harrisburg, PA 17108-1146 METTE, EVANS & WOODSIDE By: L�� H ATHER Z. KPLLY, ESQUIRE Sup. Ct. I.D.No. 86291 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 - Phone (717) 236-1816 - Fax Attorneys for Defendants Date: October 24, 2014 Stephanie E. DiVittore, Esquire Attorney I.D. No. 85906 Kate Deringer Sallie, Esquire Attorney I.D. No. 208116 RHOADS & SINON LLP One South Market Square, 12th Floor P.O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Plaintiff MAGNOLIA PORTFOLIO, LLC, Plaintiff v. G & C ASSOCIATES and JULIE A. CASSIDY, Defendants And MAGNOLIA PORTFOLIO, LLC, Plaintiff v. CARILLO, LLC and JEFFREY A. GOSS, Defendants And MAGNOLIA PORTFOLIO, LLC, Plaintiff v. MT. HOLLY BEVERAGE, L.L.C. and JULIE A. CASSIDY, Defendants And 971013.1 1:11 ED -OFFICE (Ji: TPROltIONOTARY HE 2011a NOV 1 9 PM 3: 0 1 CUMBERLAND COUNTY PENNS Y LVA NI A COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION — LAW CASE NO. 14-5003 COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION — LAW CASE NO. 14-5007 COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION — LAW CASE NO. 14-5010 [Caption Continues Onto Next Page] MAGNOLIA PORTFOLIO, LLC, COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION — LAW PINEXPRESS, LLC and JEFFREY A. GOSS, Defendants And CASE NO. 14-5014 MAGNOLIA PORTFOLIO, LLC, COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION — LAW G&C ASSOCIATES and JULIE A. CASSIDY, Defendants And CASE NO. 14-5016 MAGNOLIA PORTFOLIO, LLC, COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION — LAW G&C ASSOCIATES and JULIE A. CASSIDY, Defendants And CASE NO. 14-5017 MAGNOLIA PORTFOLIO, LLC, COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION — LAW G&C ASSOCIATES and JULIE A. CASSIDY, Defendants And CASE NO. 14-5018 [Caption Continues Onto Next Page] MAGNOLIA PORTFOLIO, LLC, COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION — LAW CARILLO, LLC and JEFFREY A. GOSS, Defendants CASE NO. 14-5019 UNCONTESTED MOTION TO CONSOLIDATE, ISSUE ' DISCOVERY SCHEDULE & SCHEDULE A HEARING NOW COMES, Plaintiff Magnolia Portfolio, LLC, by and through its counsel, Rhoads & Sinon LLP, and files the within Uncontested Motion to Consolidate, Issue Discovery Schedule & Schedule a Hearing pursuant to Rule 213 of the Pennsylvania Rules of Civil Procedure, and in support thereof, avers the following: Motion to Consolidate 1 The instant motion seeks to have the above -captioned eight actions consolidated pursuant to Rule 213 of the Pennsylvania Rules of Civil Procedure. Pa. R. Civ. P. 213. 2. Each of these actions was initiated by filing a Complaint in Confession of Judgment relating to underlying loan transactions between the parties. 3 Specifically, Complaints in Confession of Judgment were filed on behalf of Magnolia Portfolio with respect to eight loan transactions on August 26, 2014. 4. On October 8, 2014, Petitions to Open or Strike Confessed Judgments and Motions to Stay Execution were filed on behalf of the Defendants in Docket Nos. 14-5003, 14-5010, 14- 5016, 14-5017 and 14-5018. 5. These actions were assigned to The Honorable Albert H. Masland, and in each of these actions, Judge Masland issued an Order issuing a Rule to Show Cause. Those Orders specified respondent had 20 days to answer the Petitions, directed discovery to be completed within 60 days and scheduled argument for December 22, 2014 at 11:00 a.m. in Courtroom 1. (Copies of Judge Masland's Orders are attached hereto as Exhibit "A" and incorporated herein by reference). 6. On October 9, 2014, Petitions to Open or Strike Confessed Judgments and Motions to Stay Execution were filed on behalf of the Defendants in Docket Nos. 14-5007, 14-5014, and 14- 5019. 7. These actions were assigned to The Honorable Thomas A. Placey, and in each of these actions Judge Placey issued an Order dated October 21, 2014 issuing a Rule to Show Cause. These Orders specified that the Rule was returnable within twenty (20) days from the date of service. (Copies of Judge Placey's Orders are attached hereto as Exhibit "B" and incorporated herein by reference). 8. Plaintiff filed Answers to the Rules to Show Cause in each of the eight proceedings. 9. Plaintiff submits that each of the above -captioned cases arise from related transactions or occurrences and involve common questions of law and fact and, as a result, the Parties agree that they should be consolidated for discovery, pretrial proceedings and, if necessary, trial. 10. Specifically, these actions each involve commercial loan transactions originally entered into between Orrstown Bank .and the Defendants. The loans were purchased from Orrstown Bank by Plaintiff Magnolia Portfolio, LLC. In the Petitions to Open or Strike Confessed Judgments filed on behalf of Defendants, Defendants raise a defense challenging the validity of the assignments, an identical defense which Plaintiff submits will involve the same necessary resolution of facts and law. 11. Rule 213 of the Pennsylvania Rules of Civil Procedure permits a court to consolidate actions pending in the same county that involve common questions of law or fact or which arise from the same transactions or occurrence. Rule 213 states: In actions pending in a county which involve a common question of law or fact or which arise from the same transaction or occurrence, the court on its own motion or on the motion of any party may order a joint hearing or trial of any matter in issue in the actions, may order the actions consolidated, and may make orders to avoid unnecessary cost and delay. Pa. R. Civ. P. 213(a). 12. Consolidation is a procedural device used in order "to avoid multiplicity of hearings, the loss of time of participants and the possibility of unjust differences in results . . . . Consolidation fosters the orderly and speedy disposition of disputes . . . ." Children's Hosp. of Phila. v. Am. Arbitration Ass'n, 331 A.2d 848, 850 (Pa. Super. Ct. 1974) (citing Van Campen Corp. v. Bldg. & Constr. Trades, 195 A.2d 134 (Pa. Super. Ct. 1963)). 13. Pennsylvania case law interpreting Rule 213(a) has established three elements that are required in order to consolidate multiple suits: (1) the presence of the same transaction or occurrence, (2) the presence of the same issues, and (3) one party is not at an advantage or disadvantage to another due to the consolidation. Azinger v. Pa. R.R. Co., 105 A. 87, 88 (Pa. 1918) (citations omitted); cited in Hill v. Hill, 619 A.2d 1086, 1087 (Pa. Super. Ct. 1993). 14. Here, on the face of the Complaints, as well as the Petitions to Open or Strike filed on behalf of the Defendants, it is obvious that the actions arise from the same transactions or occurrences, that is the commercial loan obligations between Orrstown Bank and the Defendants, and that the defenses raised by Defendants in the Petitions to Open or Strike involve similar questions of law and fact. 15. As the actions arise from the same transaction or occurrence, the Parties anticipate conducting discovery that would jointly cover both the actions. Consolidating the cases would streamline the discovery process. 16. No party will be advantaged or disadvantaged as compared to one another as a result of consolidation. To the contrary, consolidation is in every party's, and the Court's, best interest. 17. Having a single hearing on the Petitions to Open or Strike moreover, will save the time and money incurred from litigating multiple cases, not only for all relevant parties, but also for the Court. Motion to Issue Discovery Schedule & Schedule Hearing 18. In the Orders in Docket Nos. 14-5003, 14-5010, 14-5016, 14-5017 and 14-5018, Judge Masland directed the parties to conduct discovery within 60 days and scheduled oral argument for December 22, 2014. 19. Judge Placey did not, in the Orders issued in Docket Nos. 14-5007, 14-5014, and 14- 5019, issue a discovery schedule or schedule hearing or argth-nent. 20. The parties agree that discovery will be necessary in order to resolve the Petitions to Open or Strike. 21. The parties further agree that, instead of oral argument, a hearing enabling the parties to present evidence, as well as legal argument, will be necessary to resolve the Petitions to Open or Strike. 22. As a result, the parties also respectfully request that this Court issue an Order cancelling the December 22, 2014 oral argument, granting the parties 90 days to conduct discovery and schedule a hearing before the Court. 23. Counsel for the Defendants, Heather Kelly, Esquire, has reviewed this Motion and consents to the relief requested. WHEREFORE Plaintiff respectfully requests that this Honorable Court grant the within Motion and consolidate the above -captioned actions, cancel the oral argument scheduled for December 22, 2014, grant the parties 90 days in which to conduct discovery and schedule a hearing as soon thereafter as available with the Court. Respectfully submitted, RHOADS & SINON LLP By: v lac` Stephanie E. DiVittore, Esquire Attorney I.D. No. 85906 sdivittore@,rhoads-sinon.com Kate Deringer Sallie, Esquire Attorney I.D. No. 208116 ksallie@rhoads-sinon.com P. O. Box 1146 Harrisburg, PA 17108-1146 (717) 233-5731 Attorneys for Magnolia Portfolio, LLC EXHIBIT A MAGNOLIA PORTFOLIO, LLC, Plaintiff VS. G & C ASSOCIATES and JULIE A. CASSIDY Defendant : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, : PENNSYLVANIA : NO. 14-5003 Civil Action : CONFESSION OF JUDGMENT ORDER GRANTING RULE TO SHOW CAUSE AND STAY OF EXECUTION AND NOW, this 15 day of bhqr foreaoing. petition, it is hereby ordered that r") -7 . upon consideration of the (1) a rule is issued upon the respondent to show cause why the petitioner is not entitled to the relief requested; (2) the respondent shall file an answer to the petition within 0 days of this date; (3) the petition shall be decided under Pa.R.C.P. No. 206.7; (4) depositions and other discovery shall be completed within 621) days of this date; (5) argument hall be held on 1*.e.,a,:2e2(9014 , am in Courtroom j of the Cumberland County Courthouse; (6) execution on the judgment entered in the action is STAYED pending disposition of the Petition to Open or Strike; and (7) notice of the entry of this order shall be provided to all parties by the petitioner; BY THE COURT: Is! Albert I4 iviaalanci J. Notice of the entry of order to be sent to: Stephanie E. DiVirtore, Esquire Kathryn D. Sallie, Esquire Rhoads & Sinon LLP One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 Heather Z. Kelly, Esquire METTE, EVANS & WOODSIDE 3401 North Front Street P.Q. Box 5950 Harrisburg., PA 171.10-0950 745162v1 MAGNOLIA PORTFOLIO, LLC. Plaintiff VS. MT. HOLLY BEVERAGE, L.L.C. and JULIE A. CASSIDY Defendant : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, : PENNSYLVANIA : NO. 14-5010 Civil Action : CONFESSION OF JUDGMENT ORDER GRANTING RULE TO SHOW CAUSE AND STAY OF EXECUTION AND NOW, this 15' day of )01-aiDer • doi4 , upon consideration of the foregoing petition, it is hereby ordered that (1) a rule is issued upon the respondent to show cause why the petitioner is not entitled to the relief requested; (2) the respondent shall file an answer to the petition within days of this date; () the petition shall be decided under Pa.R.C.P. No. 206.7; (4) depositions and other discovery shall be completed within days of this date; (5) argument shall be held on be; la cQ014 ,ilmam in Courtroom 1 of the Cumberland County Courthouse; (6) execution on the judgment entered in the action is STAYED pending disposition of the Petition to Open or Strike; and (7) notice of the entry of this order shall be provided to all parties by the petitioner; BY THE COURT: 1 ) Albert N. Mand J. Notice of the entry of orcier to be sent to: Stephanie E. DiVirtore, Esquire Kathryn D. Sallie, Esquire Rhoads & Sinon LLP One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 Heather Z. Kelly. Esquire METTE, EVANS & WOODSIDE 3401 North Front Street P.O. Box 5950 Harrisburg., PA 17110-0950 745177v1 MAGNOLLA PORTFOLIO, LLC, Plaintiff S. G & C ASSOCIATES and JULIE A. CASSIDY Defendant : IN TELL COURT OF COMMON PLEAS OF :. CUMBERLAND COUNTY, : PENNSYLVANIA : NO. 14-5016 Civil Action : CONFESSION OF JUDGMENT ORDER GRANTING RULE TO SHOW CAUSE AND STAY OF EXECUTION AND NOW, this 151L day of bojthe,r cloc4 rr-1 , upon consideration of the CD foregoing petition, it is hereby ordered that (1) a rule is issued upon the respondent to show cause yhy the petitioner is not entitled to the relief requested; (2) the respondent shall file an answer to the petition within (9,1) days of this date; (3) the petition shall be decided under Pa.R.C.P. No. 206.7; (4) depositions and other discovery shall be completed within fDb days of this date; (5) argument shall be held on -)62,g,a <4014 .13:OD am in Courtoom 1 of the Cumberland County Courthouse; (6) execution on the judgment entered in the action is STAYED pending disposition of the Petition to Open or Strike; and (7) notice of the entry of this order shall be provided to all parties by the petitioner; BY THE COURT: Is/ Aiber+ i4. klaBlanci Notice of the entry of order to be sent to: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire Rhoads & Sinon LLP One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 Heather Z. Kelly, Esquire IvIETTE. EVANS & 'WOODSIDE 3401 North - Front Street P.O. Box 5950 Harrisburg, PA 17110-0950 745185v1 h4 GNOL.LA PORTFOLIO, L.L.C. Plaintiff VS. G & C ASSOCIATES and JULIE A. CASSIDY Defendant : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA : NO. 14-5017 Civil Action : CONFESSION OF JUDGMENT 1 - ' ORDER GRANTING RULE TO SHOW CAUSE AND STAY OF EXECUTION AND NOW, this /day of 0,,r-tber c O4 ; upon consideration of the foregoing petition, it is hereby ordered that (1) a rule is issued upon the respondent to show cause why the petitioner is not entitled to the relief requested; (2) the respondent shall file an answer to the petition within alb days of this date; (3) the petition shall be decided under Pa.R.C.P. No. 206.7; (4) depositions and other discovery shall be completed within (00 days of this date; (5) argument shall be held on be.. awl/ , jl'D0 a in Courtroom „j. of the Cumberland County Courthouse; (6) execution on the judgment entered in the action is STAYED pending disposition of the Petition to Open or Strike; and (7) notice of the entry of this order shall be provided to all parties by the petitioner; BY THE COURT: /g/ Aim+ M&and Notice of the entry of order to be sent to: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire Rhoads & Sinon LLP One South Market Square P.O. Box 1146 Harrisburg, PA 17108-1146 Heather Z. Kelly. Esquire METTE, EVANS- & WOODSIDE 3401 North Front Street P.O. Box 5950 Harrisburg, PA 17110-0950 745145v1 MAGNOLIA PORTFOLIO, LLC, Plaintiff VS. G & C ASSOCIATES and JULIE A. CASSIDY Defendant IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY. : PENNSYLVANIA : NO. 14-5018 Civil Action : CONFESSION OF JUDGMENT ORDER GRANTING RULE TO SHOW CAUSE AND STAY OF EXECUTION AND NOW, this 154day of blit P, r , (-3614 ; upon consideration of the foregoing petition, it is hereby ordered that (1) a rule is issued upon the respondent to show cause why the petitioner is not entitled to the relief requested; (2) the respondent shall file an answer to the petition within 4D days of this date; (3) the petition shall be decided under Pa.R.C.P. No. 206.7; (4) depositions and other discovery shall be completed within /p© days of this date; (5) argument shall be held on Thee, ego 14 , j1:0(?ati► in Courtroom 1 of the Cumberland County Courthouse; (6) execution on the judgment entered in the action is STAYED pending disposition of the Petition to Open or Strike; and (7) notice of the entry of this order shall be provided to all parties by the petitioner; BY THE COURT: 1s1 Alber+ N. Marland J. Notice of the entry of order to be sent to: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire Rhoads, & Sinon LLP One South Market Square. P.O. Box 1146 Harrisburg.; PA 17108-1146 Heather Z. Kelly, Esquire METTE, EVANS & WOODSIDE 3401 North Front Street P.O. Box 5950 Harrisburg, PA 17110-0950 745204v1 EXHIBIT B MAGNOLIA PORTFOLIO INC. Plaintiff v. CARILLO, LLC, and JEFFREY A GOSS Defendants ilia Cotintp of CumberIuib IN THE COURT OF COMMON PLEAS OF THE NINTH JUDICIAL DISTRICT 14-5007 CIVIL ACTION IN RE: PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND STAY EXECUTION ORDER OF COURT AND NOW, this 21st day of October 2014, upon consideration of Defendants' Petition to Open or Strike Confessed Judgment and Stay Execution, a RULE is issued upon Plaintiff to show cause the requested relief should not be granted. DEFENDANTS shall effectuate service of this Order of Court upon Plaintiff and shall file proof of service. Response by Plaintiff shall contain a proposed order. RULE RETURNABLE twenty (20) days from the date of service. Distribution List: Stephanie E. DiVittore, Esq. Kathryn D. Sallie, Esq. Heather Z. Kelly, Esq. Thomas A. Placey 0 c-4 N N a MAGNOLIA PORTFOLIO INC. Plaintiff v. PINEXPRESS, LLC, and JEFFREY A GOSS Defendants County of tunrber[anb IN THE COURT OF COMMON PLEAS OF THE NINTH JUDICIAL DISTRICT 14-5014 CIVIL ACTION IN RE: PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND STAY EXECUTION ORDER OF COURT AND NOW, this 21st day of October 2014, upon consideration of Defendants' Petition to Open or Strike Confessed Judgment and Stay Execution, a RULE is issued upon Plaintiff to show cause the requested relief should not be granted. DEFENDANTS shall effectuate service of this Order of Court upon Plaintiff and shall file proof of service. Response by Plaintiff shall contain a proposed order. RULE RETURNABLE twenty (20) days from the date of service. BY THE COURT, Distribution List: Stephanie E. DiVittore, Esq. Kathryn D. Sallie, Esq. Heather Z. Kelly, Esq. Thomas A. Placey C.P.J. MAGNOLIA PORTFOLIO INC. Plaintiff v. CARILLO, LLC, and JEFFREY A GOSS Defendants Count? of Cumbertana IN THE COURT OF COMMON PLEAS OF THE NINTH JUDICIAL DISTRICT 14-5019 CIVIL ACTION IN RE: PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND STAY EXECUTION ORDER OF COURT AND NOW, this 21st day of October 2014, upon consideration of Defendants' Petition to Open or Strike Confessed Judgment and Stay Execution, a RULE is issued upon Plaintiff to show cause the requested relief should not be granted. DEFENDANTS shall effectuate service of this Order of Court upon Plaintiff and shall file proof of service. Response by Plaintiff shall contain a proposed order. RULE RETURNABLE twenty (20) days from the date of service. Distribution List: Stephanie E. DiVittore, Esq. Kathryn D. Sallie, Esq. BY THE COURT, Thomas A'Placey C.P.J. 3 .r- -I xgrr� O- r n:rn.co —f L;=,r ND oc r—= N <p s=, >p = �^'' Dc r. ✓ / r:I- Mr CERTIFICATE OF SERVICE 1 hereby certify that on this day of November, 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: Heather Z. Kelly, Esquire Mette, Evans & Woodside 3401 North Front Street P.O. Box 5950 Harrisburg, PA 17110-5950 Heather Z. Kelly, Esquire Sup. Ct. I.D. No. 86291 METTE, EVANS & WOODSIDE 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 — Telephone (717) 236-1816 — Facsimile % hzkelly@mette.com Attorneys for Defendants MAGNOLIA PORTFOLIO, LLC, Plaintiff v. : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA : NO. 14-5007 CARILLO, LLC and JEFFREY A. GOSS, : Defendants CERTIFICATE PREREQUISITE TO SERVICE OF SUBPOENA PURSUANT TO PA.R.C.P. 4009.2 As a prerequisite to service of a subpoena for documents and things pursuant to Rule 4009.22, Defendants, certify that: (1) a Notice of Intent to serve a subpoena with a copy of the subpoena attached thereto was mailed to each party; (2) a copy of the Notice of Intent, including the proposed subpoena, is attached to this Certificate; (3) no objection has been filed and the twenty day requisite period has expired; and (4) the subpoena which will be served is identical to the subpoena which is attached to the Notice of Intent to serve subpoena directed to Records Custodian, Orrstown Bank. By: Date: November 19, 2014 Respectfully submitted, METTE, EVANS & WOODSIDE Heather Z. Kelly, E ' uire Sup. Ct. I.D. No. 86291 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Attorneys for Defendants Heather Z. Kelly, Esquire Sup. Ct. I.D. No. 86291 METTE, EVANS & WOODSIDE 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 — Telephone (717) 236-1816 — Facsimile hzkelly@mette.com Attorneys for Defendants MAGNOLIA PORTFOLIO, LLC, Plaintiff V. : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA : NO. 14-5007 CARILLO, LLC and JEFFREY A. GOSS, : Defendants NOTICE OF INTENT TO SERVE SUBPOENA TO PRODUCE DOCUMENTS AND THINGS FOR DISCOVERY PURSUANT TO PA. R.C.P. 4009.22 Defendants, Carillo, LLC and Jeffrey A. Goss, intend to serve a subpoena upon Orrstown Bank for the purpose of obtaining loan documentation. The subpoena is identical to the one that is attached to this notice. You have twenty (20) days from the date listed below in which to file of record and serve upon the undersigned objections to the subpoena. If no objection is made, the subpoena may be served. Date: October 23, 2014 Respectfully submitted, METTE, EVANS & WOODSIDE By: edAA /` ei9 eather Z. Kelly, Esquire Sup. Ct. I.D. No. 86291 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Attorneys for Defendants i f MAGNOLIA PORTFOLIO, LLC, : IN THE COURT OF COMMON PLEAS OF Plaintiff : CUMBERLAND COUNTY, PENNSYLVANIA v. : NO. 14-5007 CARILLO, LLC and JEFFREY GOSS, Defendants SUBPOENA TO PRODUCE DOCUMENTS OR THINGS FOR DISCOVERY PURSUANT TO RULE 4009.22 TO: Records Custodian, Orrstown Bank, 22 S. Hanover Street, Carlisle, PA 17013 (Name of Person or Entity) Within twenty (20) days after service of this Subpoena, you are ordered by the Court to produce the following documents or things: Your entire loan file relating to Loan No. 26474100101 ("Loan") dated September 5, 2007 in the original principal amount of $50,000 between Carillo, LLC and Orrstown Bank and guaranteed by Jeffrey Goss, including but not limited to: 1) any and all correspondence that refer, relate or pertain to the referenced Loan including any commitment letter; 2) a detailed payment history including dates payments were made and how payments were applied; and 3) a complete copy of the Loan Purchase Agreement between Orrstown Bank and Magnolia Portfolio, LLC relating to the referenced Loan. at Mette, Evans & Woodside, P.O. Box 5950, Harrisburg, PA 17110-0950_ (Address) You may deliver or mail legible copies of the documents or produce things requested by this subpoena, together with the Certificate of. Compliance, to the party making this request at the address listed above. You have the right to seek, in advance, the reasonable cost of preparing the copies or producing the things sought. If you fail to produce the documents or things required by this subpoena, within twenty (20) days after its service, the party serving this subpoena may seek a court order compelling you to comply with it. THIS SUBPOENA WAS ISSUED AT THE REQUEST OF THE FOLLOWING PERSON: Name: Heather Z. Kelly, Esquire Address: Mette, Evans & Woodside 3401 North Front Street, P. O. Box 5950, Harrisburg, PA 17110-0950 Telephone: (717) 232-5000 Supreme Court ID# 86291 ATTORNEY FOR: Defendants DATE: Seal of the Court 748251v1 BY THE COURT: Prothonotary Return of Service: On the day of , 2014, I, , served with the foregoing subpoena by: (Name of Person Served) (Describe method of service) I verify that the statements in this return of service are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa.C.S.A. § 4904 relating to unsworn falsification to authorities. Date: (Signature) CERTIFICATE OF SERVICE I certify that I am this day serving a copy of the foregoing document upon the person(s) via electronic mail addressed as follows, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire RHOADS & SINON, LLP One South Market Square, 12th Flr. P.O. Box 1146 Harrisburg, PA 17108-1146 METTE, EVANS & WOODSIDE ATHER Z. KELLY, ESQ Sup. Ct. I.D. No. 86291 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 - Phone (717) 236-1816 - Fax Attorneys for Defendants Date: October 23, 2014 748252v1 CERTIFICATE OF SERVICE I certify that I am this day serving a copy of the foregoing document to the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of same in the United States Mail at Harrisburg, Pennsylvania, with first-class postage, prepaid, addressed as follows: Stephanie E. DiVittore, Esquire Kathryn D. Sallie, Esquire RHOADS & SINON, LLP One South Market Square, 12th Flr. P.O. Box 1146 Harrisburg, PA 17108-1146 By: Date: November 19, 2014 753176v1 Respectfully submitted, METTE, EVANS & WOODSIDE 7e.W Heather Z. Kelly, Esquire uire Sup. Ct. I.D. No. 86291 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Attorneys for Defendants i LEJ..O i Iv'. THE PROTHCINO lAR 2 1� NOV 26 AM 9: L 7 MAGNOLIA PORTFOLIO LLCC;OMEERLAN i COUNTY Plaintiff PENNSYL/ANIA 010 v. CARILLO, LLC, and JEFFREY A GOSS, Defendants Couatp of Cumberinna IN THE COURT OF COMMON PLEAS OF THE NINTH JUDICIAL DISTRICT 14-5019 CIVIL ACTION IN RE: UNCONTESTED MOTION TO CONSOLIDATE, ISSUE DISCOVERY SCHEDULE & SCHEDULE A HEARING ORDER OF COURT AND NOW, this 24th day of November 2014, upon consideration of Plaintiff's Uncontested Motion to Consolidate, Issue Discovery Schedule & Schedule a Hearing, the Motion is GRANTED. It is hereby ORDERED that the parties have 90 days from the date of this Order to conduct discovery on the issues raised in Defendants' Petitions to Open or Strike. The oral argument previously scheduled for 22 December 2014 is hereby RESCHEDULED to 7 March 2015 at 11:00 a.m. in Courtroom Number Six (6) of the Cumberland County Courthouse. Furthermore, it is ORDERED that the above -captioned actions are hereby consolidated to the Docket 14-5003 CIVIL ACTION with Plaintiff described as and MAGNOLIA PORTFOLIO LLC, and Defendants described as CARILLO, LLC, G&C ASSOCIATES, MT. HOLLY BEVERAGE, LLC, PINEXPRESS, LLC, JULIE A. CASSIDY, and JEFFREY A GOSS. Distribution List: Stephanie E. DiVittore, Esq. Heather Z. Kelly, Esq. Cep.re waile Ja.1,1� �/L