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DOCKET NO.: CV-14-6049274-S : SUPERIOR COURT
CITIZENS BANK, NATIONAL
ASSOCIATION : JUDICIAL DISTRICT OF NEW HAVEN
VS. : AT NEW HAVEN
FLOOR SYSTEMS, INC, : SEPTEMBER 3, 2014
NOTICE OF SERVICE
Pursuant to Practice Book Section 10-29, the Plaintiff, Citizens Bank, Nationa! Association, files
Exhibit A of the Complaint and gives notice that it has served a copy of such exhibits upon Floor
Systems, Inc.
THE PLAINTIFF,
CITIZENS BANK, NATIONAL ASSOCIATION
By: /s/ Peter J. Royer
Peter J. Royer
Mayo Crowe LLC
CityPlace II
185 Asylum Street
Hartford, CT 06103-3426
Telephone: (860) 275-6800
Juris No. 423839
Its Attorneys
M:General\Citizb\Floor Systems\NS-PB141.doc 1CERTIFICATION
Thereby certify that a copy of the foregoing was mailed, postage pre-paid, to all counsel and pro
se parties on September 3, 2014, as follows:
Stephen I. Smail, Esq.
Stephen I Small LLC
203 Campbell Avenue
West Haven, CT 06516
/s/ Peter J. Royer
Peter J, Royer
MAGeneral\Citizb\Floor Systems\NS-PB141.doc 2EXHIBIT A
a CITIZENS BANK
aw
Borrower(s) Name and Address:
FLOOR SYSTEMS, INC. D/B/A AMITY FLOOR & VACUUM
CENTER
61 AMITY ROAD
NEW HAVEN, CT 06515
Date of Agreement; 04/04/2005 Initial Rate:__ 6.250%
Margin: 50 % Meximum Rate: 18.00 _% — Principal Amount: $_ 75,000.00
If checked here, this loa is guaranteed by the Small Business Administration (“SBA”).
‘LENDER:
Oo Citizens Bank of Rhode Island Citizens Bank New Hampshire Citizens Bank of Pennsylvania
1Cllzens Plaza O Ps {733 Market Sirost
Providence, RI02903 Fee eee oatat Ehifceipiia, PA 19109
Citizens Bank of Connecticut Giftzens Bank
gs Eugene O'Nelll Drive « LA giizens Bank of Massachusetts CSIR Ra Bati ot stroot, suite 200
New London, ev 06320 Boston, MA 02109 ‘Wilmington, DE 40804
COMMERCIAL LINE NOTE
PROMISE TO PAY: FOR VALUB RECEIVED, the undersigned (the "Borrower" or "you")
promises to pay to the order of the lender named above (the "Lender't, "we", "us", or "our") the
principal amount shown above, or such lesser amount as may be outstanding hereunder, plus interest,
costs and fees as described herein.
REVOLVING FEATURE: This Note possesses a revolving feature, Upon satisfaction of
the conditions set forth in this Note, and subject 1o any restrictions and limitations stated herein,
Borrower shall be entitled to borrow up to the full principal amount of the Note and to repay and
reborrow fiom time to time during the term of the Note.
_ Information with regard to any loans or advances or lelfers of credit issued under this Note
shall be recorded and maintained by Lender in its internal records and such records shall be
conclusive as to the information set forth therein absent manifest error, Lender's failure to record the
date and amount of any loan or advance or letters of credit shall not limit or otherwise affect the
obligations of the Borrower under this Note to repay the principal amount of the loans or advances or
letters of credit together with all interest accruing thereon, Lender shall not be obligated to provide
Borrower with a copy of the record on a periodic basis, Bowower shall be entitled to inspect or
obtain a copy of the record during Lender’s business hours.
CONDITIONS FOR ADVANCES: IE there is no Default (as defined below) under this
Note, Borrower shall be entitled to borrow monies under this Note (subject to the limitations described
above) under the following conditions:
At the time of each advance requested by Borrower under this Note, the Borrower shall have
complied with all of the terms, conditions and requirements of that certain Business Loan and Security
Agreement between Borrower and Lender and dated the date hereof (the "Loan Agreement"), The
Lender reserves the right to request evidence satisfactory to it that, af the time of each advance, there
exists no Default or event of Defuuit under this Note, the Loan Agreement or any docoment or
ingtroment delivered pursuant to or in connection with this Note, Lender may terminate any further
advances upon Default by Borrower or, absent Default, upon demand for payment of this Note.
Lender may demand payment in fall under this Note at any time, in its sole disoretion and without
cause.
‘SBLine Note - Rey. O6/02Page 2
LETTERS OF CREDIT: If thero is no Default under this Note, Borrower shall be entitled
to xequest that the Bank issue commercial or standby letters of credit under this Note (subject to the
Himitations described above) pursuant to the following conditions:
(@) Issuance of Letters of Credit. From time to time on any business day occurring prior to
Default or demand hereunder, the Borrower may request the issuance of commercial or standby letters
of credit (each a "Letter of Credit" and collectively, “Letters of Credit") for its ows account in respect
of obligations of the Borrower in stated face amounts (each such stated face amount not to be less
than $1,000) requested by the Borrower on such day with an expiry date not later than the carlier of
one year from the date of such issuance; or extend the expiry date of an existing Letter of Credit
previously issued hereunder to a date not Jater than one year from the date of such extension.
‘No issuance or extension of a Letter of Credit shall be made if, after giving effect thereto: (2) the
aggregate face antount of all outstanding Letters of Credit, plus (b) the aggregate outstanding principal
amount of all outstanding advances under this Note ig greater thay (¢) the principal amount of this
Note.
‘To request the issuance of a Letter of Credit (or the extension of an outstanding Letter of Credit) the
Borrower shall hand detiver to the Bank a notice requesting the issuance of a Letter of Credit, ot
identifying the Letter of Credit to bs extended, the date of issuance or extension, the date on which
such Letter of Credit is to expire (which shall comply with the limitations set out above) as well as.
submitting the appropriate letter of credit application on the Bank’s standard form.
‘Bach Letter of Credit issued by the Bank shall be, in addition to the terms hereof, subject to the terms
and conditions of any form of letter of credit application or other agreement submitted or entered into
‘by the Borrowor in connection with the issuance of any Leiter of Credit. In the event of any
inconsistency between the terms and conditions of this Note, the Loan Agreement, and the terms of
any form letter of oxedit application or other agreement submitted or entered into by the Borrower in.
‘comection with the issuance of any Letter of Credit, the terms and condition of such letter of credit
application or other agreement shall contzol.
(b) Reimbursement, If the Bank shall honor or otherwise make any disbursement in respect
ofa Letter of Credit, the Borrower shail reimburse the Bank in the full principal amount ofsuch
disbursement by paying to the Bank an amount equal to such disbursement not later than the close of
‘business on the day such disbursement is made. Notwithstanding the foregoing, the Borrower may,
subject to the terms and conditions of this Note, request that such reimbursement payment be financed
‘by means of an advance hercunder, ‘The Borrower acknowledges and agrees that the Bank is under
no obligation to so honor any such zequest and that unless the Borrower shall reimburse the Bank in
full on the date such disbursement is made, the unpaid amount thereof shall bear interest, for each day
from and including the date of such un-reimbursed disbursement is made to but excluding the date
‘that the Borrower reimburses such disbursement, at the rate per anmum then applicable to advances
hereunder.
(© Letter of Credit Fees, The Borrower agrees to pay to the Bank a Letter of Credit fee in
‘an amount equal to the then applicable interest rate for advances hereunder multiplied by the stated
face amount of all Letters of Credit outstanding, such fee to be paid monthly in arrears in accordance
‘with the payment scheduled set out below. ‘Ihe Borrower further agrees to pay to the Bank (i) on the
dato of (x) the issuance of each Letter of Credit, (y) cach increase in the stated face amount thereof
and (z) cach extension (automatic or otherwise) of the stated expiry date thereof, an issuance fee as
provided for in the letter of credit application or other agreement submitted or entered into by the
Borrower in connection with such issuance, increase or extension, and (ii) all reasonable costs and
expenses incurred by the Bank in connection with such Letter of Credit,
(@) Cash Collateralization. If the Bank shall make demand hereunder or upon the
‘occurrence of any Default, on the day that the Borrower receives notices from the Bank demanding
the deposit of cash collateral, the Borrower shall deposit in an account with the Bank, in the name of
and for the benefit of the Bank, an amount in cash equal to the aggregate amount of all Letters of
Credit then outstanding. Such deposit shall be held by the Bank as collateral for the payment and
porformance of the obligations of the Borrower with respect to such outstanding Letters of Credit, this
Note, the Loan Agreement, and any application or agreement submitted or entered into by the
‘Borrower in connection with the issuance of any Lelter of Credit. The Bank shall have exclusive
dominion and control, including the exclusive right of withdrawal, over such account, Other than
interest earned on the investment of such deposits, which such investments shall be at the option and
sole discretion of the Bank and at the Borrower’s risk and expense, such deposits shall not bear
interest, Interest or profits, if any, on such investments shall accumulate in such account. Moncys in.
such account shall be applied by the Bank to reimburse the Bank for Letter of Credit disbursements
for which it has not been reimbursed and, to the extent not so applied, shall be held for the
satisfaction of the reimbursement obligations of the Borrower for outstanding Letters of Credit, or, if
demand has been made hereunder, bs applied to satisfy ather obligations of the Borrower under thi
Note. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the
‘ocowrence of a Default, and the Bank shall refrain from demanding payment hereunder, such amount
(to the extent not applied as aforesaid) shall be retumed to the Borrower within 3 business days after
all Defaults have been cured or waived.Page3
VARIABLE INTEREST RATE: Interest shall acorne on this Note beginning at the Initial Rate
set forth above. ‘This Note has a variable interest rate feature, ‘The interest rate may change from time to time if
the Index Rate identified below changes, Interest shall be caloulated at a variable rate equal to the sum of the
‘Margin shown above, plus the Index Rate, Any change in the interest rate resulting from. a change in the Index
Rate will be efffective on the date of oach chonge in the Index Rate, For SBA guaranteed loans, the interest rate
will change on the first day of the calendar month following a chiange it. the Index Rate. ‘This interest rate change
will not ocour more often than once each month. Interest shall be computed on the basis of actual days elapsed
over a 365-day year, In the event of a Default (69 defined below), Lender may declare that Interest shall acorue
on this Note at the Default Rate, as provided for in the section below regarding "Powers Upon Default."
INDEX RATE: ‘The Index Rate for this Note shall be The Wall Street Journal Prime Rate. The
“Vall Street Journal Prime Rute" is defined as the "Prime Rate" for domestic banks, as published in The Wall
‘Strect Jounal, in the “Money Rates" seotion. If more than one such rate is published on any given day, the
highest published rate shall be used to determine tho Index Rate, The "Prime Rate” is not necessarily the lowest
rate offered by Lender, nor by the lenders whose rates are surveyed by Ihe Wall Street Journal. Tf The Wall
Strect Journal ceases to publish a "Prime Rate," the Lender may choose a substitute source for the Prime Rate or
may choose a substitute index, If the Lender chooses a substitute index, it may also choose a substitute margin so
that the new index aod margin result in an interest rate substantially similar to the Interest Rate in effect at the
time the Prime Rate ceases to be published in The Wall Street Joumal,
MAXIMUM RATE: The interest rate on this Note shall not exceed the Maximum Rate set forth
above.
PAYMENT SCHEDULE: This Note is payable ON DEMAND. Uniil demand is made,
Borrower shall pay the principal and interest according to the following schedule:
Borrower must make regular monthly payments beginning one month fom the date hereof and on
the same day of each month thereafter, in the following amounts:
fi] Ef the box at the boginning of this paragraph is checked, Botrower’s regular monthly payments
will be equal to the sum of (a) accrued interest and any other charges posted by Lender at the close of the billing
cycle, pius (b) any amount which is past due, plus (c) any amount by which the outstanding principal balance
under this Note exceeds the maximum principal amount of this Note (set forth at the beginning of this Note).
This minimum monthly payment will not reduce the principal that is outstanding under this Note, and will result
in greater exponses over the life of this Note. In addition to the minimum monthly payment set forth above,
Borrower agrees that at least once during each 12 consecutive calendar month period (beginning on the date of
this Note) Borrower will reduce, for 30 consecutive days, the outstanding principal balance of this Note to not
more than fifty percent (50%) of the highest outstanding principal balance under this Note fox the preceding 12
calendar months.
‘Unless the box at the beginning of the preceding paragraph has been checked, Botrower’s regular monthly
payment will be equal to the sum of (a) accrued interest and any other charges posted by Lender at the close of
the billing cycle, plus (b) principal in the minimum amount of @) $200.00 or (ii) two percent (2%) of the
outstanding principal balance at the close of the biDing cycle, whichever is greater (however, the minimum.
payment will never exceed the entire amount outstanding), plus (0) any amount which is past due, plus (d) any
amount by which the outstanding principal balance of this Note exoceds the maximum principal amount of this
Note (set forth at the beginning of this Note).
If you have so indicated on the Application and have completed an authorization on the form we
provided to you, you authorize us to debit your Citizons Bank business checking account with us for all sums
(inchiding, without limitation, principal, interest and fecs) payable under this Note und the Loan Documents (as
dcfined below); provided, however, that this provision shail not obligate us to create ot allow any overdraft, and
farther provided that such authority shall not relieve you of the obligation to assure that payments are made when
due if there are not sufficient good funds i your account. You understand that in exchange for your
anthorization to deduct your payments from your checking account we have reduced the interest rate payable
under this Note by one percent (1%). Ifyou close your checking account, if you revoke yout authorization to
debit payments from your checking account, or if automatic payments are otherwise terminated for any reason, we
have the right to increase the Margin disclosed at the beginning of this Note by one percent (1%) without any
prior notice fo you, *
Unless payments are made by automatic debit of your checking account, you must make payments
to Lendor at the address on the billing statement in lawfal currency of the United States of America.
If Borrower wants to pay the outstanding balance of this Note in full with a check or similar
instrament that has such special notations or instructions on it or with it, but nof terminate this Note, Borrower
must send the payment (including special notations or instructions) to the address for such payments listed on the
billing statement.
I Borrower wants to pay the outstanding balance of this Note ix full with a check or similar
instrament that has such special notations or instructions on it or with it, and terminate this Note, Borrower must
send the payment (inclading special notations or instructions) to the address for such payments listed on the
billing statement.
I payment in fill is received at any other address, (i) Lender may ignore any special notations or
instractions, and (i) Lender’s crediting auy such check or other instmnsent to the Credit Line does not mean that
‘Lender has agreed to the special notations or instructions.Paget
REQUESTING ADVANCES: You may request an advance on this Note by using the
special loan checks we will give you. The following rules apply to your use of special loan checks:
a) Lost Or Stolen Special Loan Checks. You agree to tell-us if special loan checks are lost
or stolen, or if'you believe someone is taking advances on this Note without your permission. The fastest
‘way to notify us is by calling us at 1-800-4-BUSINESS.
b) Forged Special Loan Checks. You agree that we do not have to pay any of your special
loan checks if we believe the signature on the check has been forged, unless you tell us to. .
c) Postdated Special Loan Checks. If you date a special loan check with a date that is later
than the date on which you actually wrote the special loan oheok, you agiee that we may pay the special loan
check, even if we pay it or post it to the principal balance of this Note on a date which is earlier than the date
on the special loan cheek.
d) Stopping Payment on a Special Loan Check. You can ask us ta stop payment on any
special Joan check you have written that has not been paid by calling us at the telephone mumber shown on
your statement. An oral stop payment order will stay in effect for fourteen (14) days, unless you confirm if in
writing or tell us to cancel it.
‘You can confirm your stop payment order by writing to us at the address shown on your
statement. A written stop payment request will stay in effect for six (6) months, unless you tell us to cancel
it.
©} We Are Not Liable. We will not be liable if anyone fails to honor a special loan check
written by you. :
f) Paying Special Loan Checks in Excess of Your Credit Limit, We do not have to pay
aay special loan check that would cause the principal balance of fhis Note to exceed fhe Principal Amount of
this Note, However, we may do so if we choose.
2) Paying Special Loan Checks After Termination, We will not pay any additional special
Joan checks presented to us for payment after we send you notice of termination of this Note. Ifyou
torminate this Note, you will be responsible for paying any additional advances we make to pay special loan
checks which ate presented to us for payment before we have had a reasonable amount of time to implement
your termination notice. Once we have implemented your termination notice, we will not pay any additional
special Joan checks presented to us for payment.
PREPAYMENT: This Note may be prepaid in part or in {ull at any time without penalty.
LATE BEE: If any payment of principal or interest due hereunder is not paid within ten (10)
days of the due date, Lender may reguire Borrower to pay a late fee equal to five percent (5%) of the overdue
amount or $35.00, whichever is greater, in addition to and not in lieu of further accrual of interest on any
overdue amount. For business loans to non-corporation borrowers in amounts less than or equal to $10,000,
+the lender may assess a delinquency charge of twenty dollars ($20) or ten percent (10%) of cach installment
or payment, whichever is higher, which is in default for more than 15 days.
ANNUAL FEE: On each yearly anniversary of the date of this Nots, you shall pay us an
Annual Feo of $100 by means of an Advance under the Credit Line which shall not be subject to any refund
‘upon termination.
SECURITY: This Note is secured by all collateral described in the Loan Agreement,
together with all securities or other property of Borrower now or hereafter held by Lender and all
deposits (other than IRA accounts) of Borrower, ‘held by Lender. Borrower gives Lender an express
tight of setoff against any such deposit accounts.
BUSINESS LOAN AND SECURITY AGREEMENT: This Note is subject to the terms and
entitled to the benefits of the Loan Agreement. Tn the event there is any inconsistency between the provisions
of this Note and the provisions of the Loan Agreement, the provisions of this Note shall govern. This Note,
the Loan Agreement, and every other document executed in conneotion therewith are referred to in this Note
as the “Loan Docnments." Borrower's obligations under the Loan Documents are referred to in this Note as
the "Obligations",
EVENTS OF DEFAULT: This Note is payable on demand. The includsion of events of
Defautt hereunder shall not limit Londer’s right to demand payment in its sole discretion, The following shail
be events of default under this Note (each referred to herein as a "Default"):
(1) Pailue by Borrower, or by any Co-Obligor, endorser, guarantor or sutety for or under
any of the Obligations (cach referred to herein as a "Co-Obligor"), to make full and prompt payment when.
due, of eny amount required to be paid to Lender under any of the Loan Documents or any other agreenient;Page 5
(2) Failure by Borrower or any Co-Obligor to perform, keep or observe any other term,
provision, condition, covenant, agreement, warranty or representation contained in any of the Loan.
Documents or any ofher agreement with or in favor of Lender, which failure continues for ten (10) days
after notice thereof by Lender to the person or entity required fo perform, keep or observe such tetm,
provision, condition, covenant, agreement, warranty or representation;
(3) If aty representation, statement, report or certificate made or delivered by Borrower
or auy Co-Obligor is false ar incorrect in any material respect when made or delivered;
(4) Hany attachment, trustee process, Ken, exeoution, levy, injunction, or receivership
issued or made against the Borrower, any Co-Obligor or any Collateral securing the Obligations (referred
to hercin as "Collaterai") is not removed within thirty (30) days or if any final judgment and execution
issned against Borrower or any Co-Obligor remains unsatistied for thirty (30) days,
(3) Tho entry of a dectec or order for relief with respect to the Borrower or any
Co-Obligor in an involuntary case under the federal bankruptcy law, as now or hereafter constituted, or
any other applicable federal or state baukrugtey, insolvency or other similar law, or appointing a receiver,
liquidator, trustee, custodian (or similar official) of or for the Borrower or any Co-Obligor, or ordering the
winding-up or liquidation of its affairs which is not promptly contested and released or discharged within
sixty (60) days;
(©) The commencement by the Borrower or any Co-Obligor of a voluntary case under the
federal bankruptey law, as now constituted or hereafter amended, or any other applicable federal or state
bankmptey, insolvency or other similar law, or the consent by Borrower or any Co-Obligor to the
appointment of or taking possession by a receiver, liquidator, trustee, custodian (or other sitnilar official)
of or for the Borrower or any Co-Obligor or for any substantial part of its property, or the making by
Borrower or any Co-Obligor of any assignment for the benefit of creditors, or the insolvency or the failure
of the Borrower or any Co-Obligor generally to pay its debts as such debt become due, or the taking of
action by the Borrower or any Co-Obligor in furthecance of any of the foregoing;
(7) Loss or destruction of or substantial damage to any material portion of any Collateral
for this Note;
(8) Default which has not been cured during any applicable cure period in the prompt
payment, performance or observance of any term, provision, condition, covenant, warranty or
Tepresentation set forth in any mortgage, lien or encumbrance affecting any Collateral for this Note,
whether or not such mortgage, lien or encumbrance is senior or junior to Lender's interest therein and
whether or not such mortgage, lien or encumbrance has been consented to by Lender, provided, however,
that nothing herein shall be deemed to bea consent by Lender, implied or otherwise, to the granting of
any mortgage, lien or encumbrance on the Collateral; or
(9) Such a change in the condition or affairs (financial or otherwise) of the Borrower or
any Co-Obligor, or decline in the value of the Collateral as, in the opinion of the Lender, materially
impairs the Lender’s security or increases its risk or if the Lender in good faith deems itself insecure.
POWERS UPON DEFAULT: Upon the occurrence of any Default or at any time
thereafter, Lender may, at its option, without notice or demand, do any one or more of the following, in
addition to any other right or remedy that Lender may have at Jaw or in equity or given to Lender under
any of the Loan Documents, all of which are hereby authorized by Borrower:
(1) Declare the Obligations immediately due and payable;
(2) Cease advancing money or extending oredit to or for the benefit of the Borrower
under any agreement;
(3) Set-off against any and all deposits, acconnts, certificate of deposit balances, claims,
or other sums at any time credited by or due from the Lender to the Borrower and against all other
property of Borrower in the possession of Londer or under its control;
(4) Realize immodiately upon any Collateral;
(S) Declare that interest shall accrue on this Note at a zate (the “Default Rate") equal to
the lesser of (i) the sum of the Index Rate identified below, plus the Margin shown above, plus four
percent (4%); and (i) the Maximum Rate set farth at the beginning of this Note.
COLLECTION EXPENSES: ‘The Borrower agrees to pay all actual costs of collection
and attempted collection, inchiding, without limitation: (1) those expenses inourred or paid to protect,
preserve, collect, lease, sell, repair, improve, 2dvertise, locale, take possession of, liquidate or otherwise
deal with any Collateral for this Note, (2) expenses of dealing with any person or entity in any bankruptey
proceeding, (3) all out-oftpocket expenses inoured by the Lender for the Lender’s attorney and paralegal
fees, disbursements, and costs, oll at such rates and with respect to such services as the Lender in its sole
discretion may elect to pay (as such rates may vary from time to time during the course of the
performance of such services) including the costs of attorneys who are employees of the Lender, and (4)
‘the costs of appraisers, engincers, investment bankers, environmental consultants and other experts that
may be retained by the Lender in connection with such collection efforts. Such costs will be added to the
unpaid balance of the loan,Page 6
WAIVER OF RIGHTS: The Borrower waives the rights of demand, protest, notice
of acceptance of this Note, notice of default or dishonor, presentment, notice of loans made, aredlit
extended, collateral received or delivered or other action taken by the Lender hereunder and all other
domands and notices of any description,
MULTIPLE BORROWERS: In the event that the word "Borrower" refers to more
than one person or entity, all representations and obligations under this Note shall be joint and several.
LENDER’S RIGHTS: The Lender shall not be deemed to have waived any of its
rights under this Note or otherwise unless such waiver is in writing and signed by the Lender.
‘Lender's failure to require strict performance of the terms, covenants and agreements of this Note or
any other of the Loan Documents, or any delay or omission on the part of the Lender in exercising
any tight, or any acceptance of partial or adequate payment or performance shall not waive, affect or
diminish such right or Bortower’s énty of compliance and performance therewith. A waiver on any
one occasion shall nof be construed as a bar to or waiver of the same or any other right on the same
orany fature occasion. All rights and remedies of the Londer under this Note or any other of the
Loan Docements, shall be cumulative and may be exercised singularly or concurrently. This Note
may be negotiated, extended or renewed by the Lender without releasing the Borrower or any
Co-Obligor.
GOVERNING LAW; SEVERABILETY: This Note shall be construed in all
respects in accordance with, and governed by, the intemal aws of the State set forth in Lender's
address, above (the "State"), Wherever possible, each provision of this Note shall be interpreted in
such manner as to be effective and valid under applicable law, but if any provisions of this Note shall
‘be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the reraainder of such provision or the remaining
provisions of this Note. This Note has been delivered to Lender and accepted by Lender in the State,
¥f there is a lawsuit involving this Note, Borrower hereby irrevocably submits to the jurisdiction of the
courts of the State (and the federal courts located in the State).
MODIFICATION: This Nolte may not be altered or amended except by an
agreement in writing signed by both Lender and Borrower.
APPLICATION OF PAYMENT: Borrower irrevocably waives the right to direct
the application of any and all payments at any time or times hereafter received by Leader from
Borrower, or from any other source, and Borrower does hercby irrevocably agree that Lender shall
have the continuing exclusive right to apply and reapply any and all payments received at any time or
times heres{ter against the Obligations in such manner as Lender may deem advisable.
ASSIGNMENT; SUCCESSORS AND ASSIGNS: Borrower shall not be entitled to *
assign any of its rights or obligations under this Note without Lender’s prior written cousent, Lender
shall be entitled to assign some or all of its rights under this Note without notice to or consent of
Borrower, ‘his Note shall be binding upon and inure to the benefit of Borrower, Lender and their
respective successors, assigns, trustees, recsivers, administrators, personal representatives, legatees and.
devisees.
WAIVER OF JURY TRIAL: LENDER AND BORROWER EXPRESSLY AND
VOLUNTARILY WAIVE ANY AND ALL RIGHTS, WHETHER ARISING UNDER THE UNITED
STATES OR ANY STATE CONSTITUTION, ANY RULES OF CIVIL PROCEDURE, COMMON
LAW OR OTHERWISE, TO DEMAND A TRIAL BY JURY IN ANY ACTION, LAWSUIT,
PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE, BASED UPON,
OR ARISING OUT OE, THIS NOTE OR THE LOAN DOCUMENTS, ANY AGREEMENTS
ARISING UNDER OR RELATING TO THIS NOTE, ANY COLLATERAL SECURING THE
OBLIGATIONS, OR THE DEALINGS OR RELATIONSHIPS BETWEEN OR AMONG LENDER.
AND BORROWER, OR ANY OF THEM. NEITHER LENDER NOR BORROWER, INCLUDING
ANY ASSIGNEB OR SUCCESSOR OF LENDER OR BORROWER, SHALL SEEK A JURY
TRIAL IN ANY SUCH ACTION. NEITHER LENDER NOR BORROWER SHALL SEEK TO
CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION WHEN A JURY TRIAL
CANNOT BE OR HAS NOT BEEN WAIVED. ‘THESE PROVISIONS SHALL BE SUBJECT TO
NO EXCEPTIONS. NEITHER LENDER NOR BORROWER HAS IN ANY WAY AGREED WITH
OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL
NOT BE FULLY ENFORCED IN ALL INSTANCES.
BORROWER EXPRESSLY AGREES THAT ‘THE INTEREST RATES SPECIFIED IN
‘THIS NOTE SHALL BE THE APPLICABLE INTEREST RATES DUE (A) ON AMOUNTS
OUTSTANDING DURING THE TERM OF THIS NOTE, SUBJECT TO THE MAXIMUM RATE
PRESCRIBED ABOVE, AND (B) WITH RESPECT TO ANY AMOUNT OUTSTANDING ON AND
AFTER THB MATURITY DATE OF THIS NOTE.Page 7
WALVER: If the "State" (as defined above) is Connecticut, the following applies:
BORROWER ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A
PART IS A COMMERCIAL TRANSACTION AND TO THE EXTENT ALLOWED UNDER
CONNECTICUT GENERAL STATUTES SECTIONS 52-2784 TO 52-278n, INCLUSIVE, OR BY
OTHER APPLICABLE LAW, BORROWER WAIVES ANY RIGHTS THAT BORROWER HAS TO
NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH
LENDER, OR ITS SUCCESSORS OR ASSIGNS, MAY DESIRE TO USE; AND BORROWER
FURTHER WAIVES ANY REQUIREMENT THAT LENDER POST A BOND OR OTHER,
SECURITY IN CONNECTION WITH SUCH PREJUDGMENT REMEDY.
MAINE: If the address for the Borrower is Maine, the following notice applics:
Notice. Under Maine law, no promise, contract or agreement to lend money, extend credit, forbear
from collection of a debt or make any other accommodation for the repayment of a debt for more than
$250,000 may be enforced in court against Lender, unless the promise, contract or agreement is in
wlling and signed by Lender. Accordingly, Borrower cannot enforce any oral promise to extend
credit unless it is contained in a written document signed by Lender, nor can any change,
forebearanes, or ofher accommodation relating to any extension of oredit by Lender to Borrower be
enforced, unless it is in wiiting signed by Lender.
Possession: CONFESSION OF JUDGMENT: If the collateral address is
Pennsylvania, the following applies: Grantee may enter upon and take possession of the Premises
with or without legal action, and by force if necessary, collect therefrom all rentals (which term
shail also include sums payable for use and occupation) and, after deducting all costs of
collection and administration expense, apply the net rentals to any one or more of the following
items in such manner and in such order of priority as Grantee, ia Grantee's sole discretion, may
elect: the payment of any sums due under any prior lien, taxes, water and sewer rents, charges
and claims, insurance premiums and all other carying charges, and to the mainteuance, repair
or restoration of the Premises, or on account of the Liabilities; in and for that purpose Grantor
hereby assigns to Grantee all reutals due and fo become due under any lease or Jeases or rights
to.use and occupation of the Premises hereafter created, as well as all rights and remedies
provided in such lease or leases or at law or in equity for the collection of the rentals, FOR
‘THE PURPOSE OF OBTAINING POSSESSION OF THE PREMISES FOLLOWING ANY
DEFAULT HEREUNDER OR UNDER ANY OF THE LIABILITIES, GRANTOR
IRREVOCABLE AUTHORIZES AND EMPOWERS ANY ATTORNEY OF RECORD, OR
THE PROTHONOTARY, CLERK OR SIMILAR OFFICER, OF ANY COURT IN THE
COMMONWEALTH OF PEENSYULVANIA OR ELSEWHERE, AS ATTORNEY FOR
GRANTOR, AS WELL AS FOR THE PERSONS CLAIMING UNDER, BY, OR: THROUGH
GRANTOR, TO SIGN AN AGREEMENT FOR ENTERING THEREERN AN APPROPRIATE
ACTION IN EJECTMENT FOR POSSESSION OF THE PREMISES (WITHOUT THE
NECESSITY OF FILING ANY BOND AND WITHOUT ANY STAY OF EXECUTION OR
APPEAL) AGAINST GRANTOR AND ALL, PERSONS CLAIMING UNDER, BY, OR
THROUGH GRANTOR, AND THEREIN CONFESS JUDGMENT FOR THE RECOVERY BY
GRANTEE OF POSSESSION OF THE PREMISES FOR WHICH THIS INSTRUMENT (OR A
COPY THEREOF VERIFIED BY AFFIDAVIT) SHALL BE A SUFFICIENT WARRANT;
‘WHEREUPON A WRIT OF POSSESSION OF THE MORTGAGED PREMISES MAY BE
ISSUED FORTH WITH, WITHOUT ANY PRIOR WRIT OR PROCEEDING WHATSOEVER,
GRANTOR HEREBY RELEASING AND AGREEING TO RELEASE GRANTRE AND ANY
SUCH ATTORNEY FROM ALL PROCEDURAL ERRORS AND DEFECTS WHATSOEVER
IN ENTERING SUCH ACTION OR JUDGMENT OR IN CAUSING SUCH WRIT OR
PROCESS TO BE ISSUED OR IN ANY PROCEEDING THEREON OR CONCERNING THE
SAME, PROVIDED THAT GRANTEE SHALL HAVE FILED IN SUCH ACTION AN
AFFIDAVIT MADE ON GRANTEE’S BEHALF SETTING FORTH THE FACTS NECESSARY
TO AUTHORIZE THE ENTRY OF SUCH JUDGMENT ACCORDING TO THE TERMS OF
‘THIS INSTRUMENT, OF WHICH FACTS SUCH AFFIDAVIT SHALL BE PRIMA FACTE
EVIDENCE, IT IS HEREBY EXPRESSLY AGREED THAT Uf FOR ANY REASON AFTER
ANY SUCH ACTION HAS BEEN COMMENCED, THE SAME SHALL BE DISCONTINUED,
MARKED SATISFIED OF RECORD, OR TERMINATED, OR POSSESSION OF THE
MORGAGED PREMISES REMAIN IN OR BE RESTORED TO GRANTOR OR ANYONE
CLAIMING UNDER, BY, OR THROUGH GRANTOR, GRANTEE MAY, WHEREVER AND
AS OFTEN AS GRANTEE SHALL HAVE THE RIGHT TO TAKE POSSESSION AGAIN OF
THE MORTGAGED PREMISES, BING ONE OR MORE FURTHER ACTIONS IN THE
MANNER HEREINBEFORE SET FORTH TO RECOVER POSSESSION OF THE PREMISES
AND TO CONFESS JUDGMENT THEREIN AS HERINABOVE PROVIDED, AND THE
AUTHORITY AND POWER ABOVE GIVEN TO ANY SUCH ATTORNEY SHALL EXTEND
‘TO ALL SUCH FURTHER ACTIONS IN EJECTMENT AND CONFESSION OF JUDGMENT
‘THEREIN AS HEREINABOVE PROVIDED, WHETHER BEFORE OR AFTER AN ACTION
OF MORTGAGE FORECLOSURE IS BROUGHT: OR OTHER PROCEEDINGS IN
EXECUTION ARE INSTITUTED UPON THIS MORTGAGE OR UPON ANY INSTRUMENT
‘THEN EVIDENCING ANY OF THE LIABILITIES, AND AFTER JUDGMENT THEREON OR
‘THEREIN AND AFTER A JUDICIAL SALE OF THE PREMISES.BORROWER.
THOMAS KAJTOR
oy CarMate ate
: v
‘Witness “SS Tier 7 One mo a IK
ORIGINAL
BORROWER
Witness Title:
Preview
DOCKET NO.: CV-14-6049274-S : SUPERIOR COURT CITIZENS BANK, NATIONAL ASSOCIATION : JUDICIAL DISTRICT OF NEW HAVEN VS. : AT NEW HAVEN FLOOR SYSTEMS, INC, : SEPTEMBER 3, 2014 NOTICE OF SERVICE Pursuant to Practice Book Section 10-29, the Plaintiff, Citizens Bank, Nationa! Association, files Exhibit A of the Complaint and gives notice that it has served a copy of such exhibits upon Floor Systems, Inc. THE PLAINTIFF, CITIZENS BANK, NATIONAL ASSOCIATION By: /s/ Peter J. Royer Peter J. Royer Mayo Crowe LLC CityPlace II 185 Asylum Street Hartford, CT 06103-3426 Telephone: (860) 275-6800 Juris No. 423839 Its Attorneys M:General\Citizb\Floor Systems\NS-PB141.doc 1CERTIFICATION Thereby certify that a copy of the foregoing was mailed, postage pre-paid, to all counsel and pro se parties on September 3, 2014, as follows: Stephen I. Smail, Esq. Stephen I Small LLC 203 Campbell Avenue West Haven, CT 06516 /s/ Peter J. Royer Peter J, Royer MAGeneral\Citizb\Floor Systems\NS-PB141.doc 2EXHIBIT A a CITIZENS BANK aw Borrower(s) Name and Address: FLOOR SYSTEMS, INC. D/B/A AMITY FLOOR & VACUUM CENTER 61 AMITY ROAD NEW HAVEN, CT 06515 Date of Agreement; 04/04/2005 Initial Rate:__ 6.250% Margin: 50 % Meximum Rate: 18.00 _% — Principal Amount: $_ 75,000.00 If checked here, this loa is guaranteed by the Small Business Administration (“SBA”). ‘LENDER: Oo Citizens Bank of Rhode Island Citizens Bank New Hampshire Citizens Bank of Pennsylvania 1Cllzens Plaza O Ps {733 Market Sirost Providence, RI02903 Fee eee oatat Ehifceipiia, PA 19109 Citizens Bank of Connecticut Giftzens Bank gs Eugene O'Nelll Drive « LA giizens Bank of Massachusetts CSIR Ra Bati ot stroot, suite 200 New London, ev 06320 Boston, MA 02109 ‘Wilmington, DE 40804 COMMERCIAL LINE NOTE PROMISE TO PAY: FOR VALUB RECEIVED, the undersigned (the "Borrower" or "you") promises to pay to the order of the lender named above (the "Lender't, "we", "us", or "our") the principal amount shown above, or such lesser amount as may be outstanding hereunder, plus interest, costs and fees as described herein. REVOLVING FEATURE: This Note possesses a revolving feature, Upon satisfaction of the conditions set forth in this Note, and subject 1o any restrictions and limitations stated herein, Borrower shall be entitled to borrow up to the full principal amount of the Note and to repay and reborrow fiom time to time during the term of the Note. _ Information with regard to any loans or advances or lelfers of credit issued under this Note shall be recorded and maintained by Lender in its internal records and such records shall be conclusive as to the information set forth therein absent manifest error, Lender's failure to record the date and amount of any loan or advance or letters of credit shall not limit or otherwise affect the obligations of the Borrower under this Note to repay the principal amount of the loans or advances or letters of credit together with all interest accruing thereon, Lender shall not be obligated to provide Borrower with a copy of the record on a periodic basis, Bowower shall be entitled to inspect or obtain a copy of the record during Lender’s business hours. CONDITIONS FOR ADVANCES: IE there is no Default (as defined below) under this Note, Borrower shall be entitled to borrow monies under this Note (subject to the limitations described above) under the following conditions: At the time of each advance requested by Borrower under this Note, the Borrower shall have complied with all of the terms, conditions and requirements of that certain Business Loan and Security Agreement between Borrower and Lender and dated the date hereof (the "Loan Agreement"), The Lender reserves the right to request evidence satisfactory to it that, af the time of each advance, there exists no Default or event of Defuuit under this Note, the Loan Agreement or any docoment or ingtroment delivered pursuant to or in connection with this Note, Lender may terminate any further advances upon Default by Borrower or, absent Default, upon demand for payment of this Note. Lender may demand payment in fall under this Note at any time, in its sole disoretion and without cause. ‘SBLine Note - Rey. O6/02Page 2 LETTERS OF CREDIT: If thero is no Default under this Note, Borrower shall be entitled to xequest that the Bank issue commercial or standby letters of credit under this Note (subject to the Himitations described above) pursuant to the following conditions: (@) Issuance of Letters of Credit. From time to time on any business day occurring prior to Default or demand hereunder, the Borrower may request the issuance of commercial or standby letters of credit (each a "Letter of Credit" and collectively, “Letters of Credit") for its ows account in respect of obligations of the Borrower in stated face amounts (each such stated face amount not to be less than $1,000) requested by the Borrower on such day with an expiry date not later than the carlier of one year from the date of such issuance; or extend the expiry date of an existing Letter of Credit previously issued hereunder to a date not Jater than one year from the date of such extension. ‘No issuance or extension of a Letter of Credit shall be made if, after giving effect thereto: (2) the aggregate face antount of all outstanding Letters of Credit, plus (b) the aggregate outstanding principal amount of all outstanding advances under this Note ig greater thay (¢) the principal amount of this Note. ‘To request the issuance of a Letter of Credit (or the extension of an outstanding Letter of Credit) the Borrower shall hand detiver to the Bank a notice requesting the issuance of a Letter of Credit, ot identifying the Letter of Credit to bs extended, the date of issuance or extension, the date on which such Letter of Credit is to expire (which shall comply with the limitations set out above) as well as. submitting the appropriate letter of credit application on the Bank’s standard form. ‘Bach Letter of Credit issued by the Bank shall be, in addition to the terms hereof, subject to the terms and conditions of any form of letter of credit application or other agreement submitted or entered into ‘by the Borrowor in connection with the issuance of any Leiter of Credit. In the event of any inconsistency between the terms and conditions of this Note, the Loan Agreement, and the terms of any form letter of oxedit application or other agreement submitted or entered into by the Borrower in. ‘comection with the issuance of any Letter of Credit, the terms and condition of such letter of credit application or other agreement shall contzol. (b) Reimbursement, If the Bank shall honor or otherwise make any disbursement in respect ofa Letter of Credit, the Borrower shail reimburse the Bank in the full principal amount ofsuch disbursement by paying to the Bank an amount equal to such disbursement not later than the close of ‘business on the day such disbursement is made. Notwithstanding the foregoing, the Borrower may, subject to the terms and conditions of this Note, request that such reimbursement payment be financed ‘by means of an advance hercunder, ‘The Borrower acknowledges and agrees that the Bank is under no obligation to so honor any such zequest and that unless the Borrower shall reimburse the Bank in full on the date such disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date of such un-reimbursed disbursement is made to but excluding the date ‘that the Borrower reimburses such disbursement, at the rate per anmum then applicable to advances hereunder. (© Letter of Credit Fees, The Borrower agrees to pay to the Bank a Letter of Credit fee in ‘an amount equal to the then applicable interest rate for advances hereunder multiplied by the stated face amount of all Letters of Credit outstanding, such fee to be paid monthly in arrears in accordance ‘with the payment scheduled set out below. ‘Ihe Borrower further agrees to pay to the Bank (i) on the dato of (x) the issuance of each Letter of Credit, (y) cach increase in the stated face amount thereof and (z) cach extension (automatic or otherwise) of the stated expiry date thereof, an issuance fee as provided for in the letter of credit application or other agreement submitted or entered into by the Borrower in connection with such issuance, increase or extension, and (ii) all reasonable costs and expenses incurred by the Bank in connection with such Letter of Credit, (@) Cash Collateralization. If the Bank shall make demand hereunder or upon the ‘occurrence of any Default, on the day that the Borrower receives notices from the Bank demanding the deposit of cash collateral, the Borrower shall deposit in an account with the Bank, in the name of and for the benefit of the Bank, an amount in cash equal to the aggregate amount of all Letters of Credit then outstanding. Such deposit shall be held by the Bank as collateral for the payment and porformance of the obligations of the Borrower with respect to such outstanding Letters of Credit, this Note, the Loan Agreement, and any application or agreement submitted or entered into by the ‘Borrower in connection with the issuance of any Lelter of Credit. The Bank shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account, Other than interest earned on the investment of such deposits, which such investments shall be at the option and sole discretion of the Bank and at the Borrower’s risk and expense, such deposits shall not bear interest, Interest or profits, if any, on such investments shall accumulate in such account. Moncys in. such account shall be applied by the Bank to reimburse the Bank for Letter of Credit disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for outstanding Letters of Credit, or, if demand has been made hereunder, bs applied to satisfy ather obligations of the Borrower under thi Note. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the ‘ocowrence of a Default, and the Bank shall refrain from demanding payment hereunder, such amount (to the extent not applied as aforesaid) shall be retumed to the Borrower within 3 business days after all Defaults have been cured or waived.Page3 VARIABLE INTEREST RATE: Interest shall acorne on this Note beginning at the Initial Rate set forth above. ‘This Note has a variable interest rate feature, ‘The interest rate may change from time to time if the Index Rate identified below changes, Interest shall be caloulated at a variable rate equal to the sum of the ‘Margin shown above, plus the Index Rate, Any change in the interest rate resulting from. a change in the Index Rate will be efffective on the date of oach chonge in the Index Rate, For SBA guaranteed loans, the interest rate will change on the first day of the calendar month following a chiange it. the Index Rate. ‘This interest rate change will not ocour more often than once each month. Interest shall be computed on the basis of actual days elapsed over a 365-day year, In the event of a Default (69 defined below), Lender may declare that Interest shall acorue on this Note at the Default Rate, as provided for in the section below regarding "Powers Upon Default." INDEX RATE: ‘The Index Rate for this Note shall be The Wall Street Journal Prime Rate. The “Vall Street Journal Prime Rute" is defined as the "Prime Rate" for domestic banks, as published in The Wall ‘Strect Jounal, in the “Money Rates" seotion. If more than one such rate is published on any given day, the highest published rate shall be used to determine tho Index Rate, The "Prime Rate” is not necessarily the lowest rate offered by Lender, nor by the lenders whose rates are surveyed by Ihe Wall Street Journal. Tf The Wall Strect Journal ceases to publish a "Prime Rate," the Lender may choose a substitute source for the Prime Rate or may choose a substitute index, If the Lender chooses a substitute index, it may also choose a substitute margin so that the new index aod margin result in an interest rate substantially similar to the Interest Rate in effect at the time the Prime Rate ceases to be published in The Wall Street Joumal, MAXIMUM RATE: The interest rate on this Note shall not exceed the Maximum Rate set forth above. PAYMENT SCHEDULE: This Note is payable ON DEMAND. Uniil demand is made, Borrower shall pay the principal and interest according to the following schedule: Borrower must make regular monthly payments beginning one month fom the date hereof and on the same day of each month thereafter, in the following amounts: fi] Ef the box at the boginning of this paragraph is checked, Botrower’s regular monthly payments will be equal to the sum of (a) accrued interest and any other charges posted by Lender at the close of the billing cycle, pius (b) any amount which is past due, plus (c) any amount by which the outstanding principal balance under this Note exceeds the maximum principal amount of this Note (set forth at the beginning of this Note). This minimum monthly payment will not reduce the principal that is outstanding under this Note, and will result in greater exponses over the life of this Note. In addition to the minimum monthly payment set forth above, Borrower agrees that at least once during each 12 consecutive calendar month period (beginning on the date of this Note) Borrower will reduce, for 30 consecutive days, the outstanding principal balance of this Note to not more than fifty percent (50%) of the highest outstanding principal balance under this Note fox the preceding 12 calendar months. ‘Unless the box at the beginning of the preceding paragraph has been checked, Botrower’s regular monthly payment will be equal to the sum of (a) accrued interest and any other charges posted by Lender at the close of the billing cycle, plus (b) principal in the minimum amount of @) $200.00 or (ii) two percent (2%) of the outstanding principal balance at the close of the biDing cycle, whichever is greater (however, the minimum. payment will never exceed the entire amount outstanding), plus (0) any amount which is past due, plus (d) any amount by which the outstanding principal balance of this Note exoceds the maximum principal amount of this Note (set forth at the beginning of this Note). If you have so indicated on the Application and have completed an authorization on the form we provided to you, you authorize us to debit your Citizons Bank business checking account with us for all sums (inchiding, without limitation, principal, interest and fecs) payable under this Note und the Loan Documents (as dcfined below); provided, however, that this provision shail not obligate us to create ot allow any overdraft, and farther provided that such authority shall not relieve you of the obligation to assure that payments are made when due if there are not sufficient good funds i your account. You understand that in exchange for your anthorization to deduct your payments from your checking account we have reduced the interest rate payable under this Note by one percent (1%). Ifyou close your checking account, if you revoke yout authorization to debit payments from your checking account, or if automatic payments are otherwise terminated for any reason, we have the right to increase the Margin disclosed at the beginning of this Note by one percent (1%) without any prior notice fo you, * Unless payments are made by automatic debit of your checking account, you must make payments to Lendor at the address on the billing statement in lawfal currency of the United States of America. If Borrower wants to pay the outstanding balance of this Note in full with a check or similar instrament that has such special notations or instructions on it or with it, but nof terminate this Note, Borrower must send the payment (including special notations or instructions) to the address for such payments listed on the billing statement. I Borrower wants to pay the outstanding balance of this Note ix full with a check or similar instrament that has such special notations or instructions on it or with it, and terminate this Note, Borrower must send the payment (inclading special notations or instructions) to the address for such payments listed on the billing statement. I payment in fill is received at any other address, (i) Lender may ignore any special notations or instractions, and (i) Lender’s crediting auy such check or other instmnsent to the Credit Line does not mean that ‘Lender has agreed to the special notations or instructions.Paget REQUESTING ADVANCES: You may request an advance on this Note by using the special loan checks we will give you. The following rules apply to your use of special loan checks: a) Lost Or Stolen Special Loan Checks. You agree to tell-us if special loan checks are lost or stolen, or if'you believe someone is taking advances on this Note without your permission. The fastest ‘way to notify us is by calling us at 1-800-4-BUSINESS. b) Forged Special Loan Checks. You agree that we do not have to pay any of your special loan checks if we believe the signature on the check has been forged, unless you tell us to. . c) Postdated Special Loan Checks. If you date a special loan check with a date that is later than the date on which you actually wrote the special loan oheok, you agiee that we may pay the special loan check, even if we pay it or post it to the principal balance of this Note on a date which is earlier than the date on the special loan cheek. d) Stopping Payment on a Special Loan Check. You can ask us ta stop payment on any special Joan check you have written that has not been paid by calling us at the telephone mumber shown on your statement. An oral stop payment order will stay in effect for fourteen (14) days, unless you confirm if in writing or tell us to cancel it. ‘You can confirm your stop payment order by writing to us at the address shown on your statement. A written stop payment request will stay in effect for six (6) months, unless you tell us to cancel it. ©} We Are Not Liable. We will not be liable if anyone fails to honor a special loan check written by you. : f) Paying Special Loan Checks in Excess of Your Credit Limit, We do not have to pay aay special loan check that would cause the principal balance of fhis Note to exceed fhe Principal Amount of this Note, However, we may do so if we choose. 2) Paying Special Loan Checks After Termination, We will not pay any additional special Joan checks presented to us for payment after we send you notice of termination of this Note. Ifyou torminate this Note, you will be responsible for paying any additional advances we make to pay special loan checks which ate presented to us for payment before we have had a reasonable amount of time to implement your termination notice. Once we have implemented your termination notice, we will not pay any additional special Joan checks presented to us for payment. PREPAYMENT: This Note may be prepaid in part or in {ull at any time without penalty. LATE BEE: If any payment of principal or interest due hereunder is not paid within ten (10) days of the due date, Lender may reguire Borrower to pay a late fee equal to five percent (5%) of the overdue amount or $35.00, whichever is greater, in addition to and not in lieu of further accrual of interest on any overdue amount. For business loans to non-corporation borrowers in amounts less than or equal to $10,000, +the lender may assess a delinquency charge of twenty dollars ($20) or ten percent (10%) of cach installment or payment, whichever is higher, which is in default for more than 15 days. ANNUAL FEE: On each yearly anniversary of the date of this Nots, you shall pay us an Annual Feo of $100 by means of an Advance under the Credit Line which shall not be subject to any refund ‘upon termination. SECURITY: This Note is secured by all collateral described in the Loan Agreement, together with all securities or other property of Borrower now or hereafter held by Lender and all deposits (other than IRA accounts) of Borrower, ‘held by Lender. Borrower gives Lender an express tight of setoff against any such deposit accounts. BUSINESS LOAN AND SECURITY AGREEMENT: This Note is subject to the terms and entitled to the benefits of the Loan Agreement. Tn the event there is any inconsistency between the provisions of this Note and the provisions of the Loan Agreement, the provisions of this Note shall govern. This Note, the Loan Agreement, and every other document executed in conneotion therewith are referred to in this Note as the “Loan Docnments." Borrower's obligations under the Loan Documents are referred to in this Note as the "Obligations", EVENTS OF DEFAULT: This Note is payable on demand. The includsion of events of Defautt hereunder shall not limit Londer’s right to demand payment in its sole discretion, The following shail be events of default under this Note (each referred to herein as a "Default"): (1) Pailue by Borrower, or by any Co-Obligor, endorser, guarantor or sutety for or under any of the Obligations (cach referred to herein as a "Co-Obligor"), to make full and prompt payment when. due, of eny amount required to be paid to Lender under any of the Loan Documents or any other agreenient;Page 5 (2) Failure by Borrower or any Co-Obligor to perform, keep or observe any other term, provision, condition, covenant, agreement, warranty or representation contained in any of the Loan. Documents or any ofher agreement with or in favor of Lender, which failure continues for ten (10) days after notice thereof by Lender to the person or entity required fo perform, keep or observe such tetm, provision, condition, covenant, agreement, warranty or representation; (3) If aty representation, statement, report or certificate made or delivered by Borrower or auy Co-Obligor is false ar incorrect in any material respect when made or delivered; (4) Hany attachment, trustee process, Ken, exeoution, levy, injunction, or receivership issued or made against the Borrower, any Co-Obligor or any Collateral securing the Obligations (referred to hercin as "Collaterai") is not removed within thirty (30) days or if any final judgment and execution issned against Borrower or any Co-Obligor remains unsatistied for thirty (30) days, (3) Tho entry of a dectec or order for relief with respect to the Borrower or any Co-Obligor in an involuntary case under the federal bankruptcy law, as now or hereafter constituted, or any other applicable federal or state baukrugtey, insolvency or other similar law, or appointing a receiver, liquidator, trustee, custodian (or similar official) of or for the Borrower or any Co-Obligor, or ordering the winding-up or liquidation of its affairs which is not promptly contested and released or discharged within sixty (60) days; (©) The commencement by the Borrower or any Co-Obligor of a voluntary case under the federal bankruptey law, as now constituted or hereafter amended, or any other applicable federal or state bankmptey, insolvency or other similar law, or the consent by Borrower or any Co-Obligor to the appointment of or taking possession by a receiver, liquidator, trustee, custodian (or other sitnilar official) of or for the Borrower or any Co-Obligor or for any substantial part of its property, or the making by Borrower or any Co-Obligor of any assignment for the benefit of creditors, or the insolvency or the failure of the Borrower or any Co-Obligor generally to pay its debts as such debt become due, or the taking of action by the Borrower or any Co-Obligor in furthecance of any of the foregoing; (7) Loss or destruction of or substantial damage to any material portion of any Collateral for this Note; (8) Default which has not been cured during any applicable cure period in the prompt payment, performance or observance of any term, provision, condition, covenant, warranty or Tepresentation set forth in any mortgage, lien or encumbrance affecting any Collateral for this Note, whether or not such mortgage, lien or encumbrance is senior or junior to Lender's interest therein and whether or not such mortgage, lien or encumbrance has been consented to by Lender, provided, however, that nothing herein shall be deemed to bea consent by Lender, implied or otherwise, to the granting of any mortgage, lien or encumbrance on the Collateral; or (9) Such a change in the condition or affairs (financial or otherwise) of the Borrower or any Co-Obligor, or decline in the value of the Collateral as, in the opinion of the Lender, materially impairs the Lender’s security or increases its risk or if the Lender in good faith deems itself insecure. POWERS UPON DEFAULT: Upon the occurrence of any Default or at any time thereafter, Lender may, at its option, without notice or demand, do any one or more of the following, in addition to any other right or remedy that Lender may have at Jaw or in equity or given to Lender under any of the Loan Documents, all of which are hereby authorized by Borrower: (1) Declare the Obligations immediately due and payable; (2) Cease advancing money or extending oredit to or for the benefit of the Borrower under any agreement; (3) Set-off against any and all deposits, acconnts, certificate of deposit balances, claims, or other sums at any time credited by or due from the Lender to the Borrower and against all other property of Borrower in the possession of Londer or under its control; (4) Realize immodiately upon any Collateral; (S) Declare that interest shall accrue on this Note at a zate (the “Default Rate") equal to the lesser of (i) the sum of the Index Rate identified below, plus the Margin shown above, plus four percent (4%); and (i) the Maximum Rate set farth at the beginning of this Note. COLLECTION EXPENSES: ‘The Borrower agrees to pay all actual costs of collection and attempted collection, inchiding, without limitation: (1) those expenses inourred or paid to protect, preserve, collect, lease, sell, repair, improve, 2dvertise, locale, take possession of, liquidate or otherwise deal with any Collateral for this Note, (2) expenses of dealing with any person or entity in any bankruptey proceeding, (3) all out-oftpocket expenses inoured by the Lender for the Lender’s attorney and paralegal fees, disbursements, and costs, oll at such rates and with respect to such services as the Lender in its sole discretion may elect to pay (as such rates may vary from time to time during the course of the performance of such services) including the costs of attorneys who are employees of the Lender, and (4) ‘the costs of appraisers, engincers, investment bankers, environmental consultants and other experts that may be retained by the Lender in connection with such collection efforts. Such costs will be added to the unpaid balance of the loan,Page 6 WAIVER OF RIGHTS: The Borrower waives the rights of demand, protest, notice of acceptance of this Note, notice of default or dishonor, presentment, notice of loans made, aredlit extended, collateral received or delivered or other action taken by the Lender hereunder and all other domands and notices of any description, MULTIPLE BORROWERS: In the event that the word "Borrower" refers to more than one person or entity, all representations and obligations under this Note shall be joint and several. LENDER’S RIGHTS: The Lender shall not be deemed to have waived any of its rights under this Note or otherwise unless such waiver is in writing and signed by the Lender. ‘Lender's failure to require strict performance of the terms, covenants and agreements of this Note or any other of the Loan Documents, or any delay or omission on the part of the Lender in exercising any tight, or any acceptance of partial or adequate payment or performance shall not waive, affect or diminish such right or Bortower’s énty of compliance and performance therewith. A waiver on any one occasion shall nof be construed as a bar to or waiver of the same or any other right on the same orany fature occasion. All rights and remedies of the Londer under this Note or any other of the Loan Docements, shall be cumulative and may be exercised singularly or concurrently. This Note may be negotiated, extended or renewed by the Lender without releasing the Borrower or any Co-Obligor. GOVERNING LAW; SEVERABILETY: This Note shall be construed in all respects in accordance with, and governed by, the intemal aws of the State set forth in Lender's address, above (the "State"), Wherever possible, each provision of this Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provisions of this Note shall ‘be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the reraainder of such provision or the remaining provisions of this Note. This Note has been delivered to Lender and accepted by Lender in the State, ¥f there is a lawsuit involving this Note, Borrower hereby irrevocably submits to the jurisdiction of the courts of the State (and the federal courts located in the State). MODIFICATION: This Nolte may not be altered or amended except by an agreement in writing signed by both Lender and Borrower. APPLICATION OF PAYMENT: Borrower irrevocably waives the right to direct the application of any and all payments at any time or times hereafter received by Leader from Borrower, or from any other source, and Borrower does hercby irrevocably agree that Lender shall have the continuing exclusive right to apply and reapply any and all payments received at any time or times heres{ter against the Obligations in such manner as Lender may deem advisable. ASSIGNMENT; SUCCESSORS AND ASSIGNS: Borrower shall not be entitled to * assign any of its rights or obligations under this Note without Lender’s prior written cousent, Lender shall be entitled to assign some or all of its rights under this Note without notice to or consent of Borrower, ‘his Note shall be binding upon and inure to the benefit of Borrower, Lender and their respective successors, assigns, trustees, recsivers, administrators, personal representatives, legatees and. devisees. WAIVER OF JURY TRIAL: LENDER AND BORROWER EXPRESSLY AND VOLUNTARILY WAIVE ANY AND ALL RIGHTS, WHETHER ARISING UNDER THE UNITED STATES OR ANY STATE CONSTITUTION, ANY RULES OF CIVIL PROCEDURE, COMMON LAW OR OTHERWISE, TO DEMAND A TRIAL BY JURY IN ANY ACTION, LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE, BASED UPON, OR ARISING OUT OE, THIS NOTE OR THE LOAN DOCUMENTS, ANY AGREEMENTS ARISING UNDER OR RELATING TO THIS NOTE, ANY COLLATERAL SECURING THE OBLIGATIONS, OR THE DEALINGS OR RELATIONSHIPS BETWEEN OR AMONG LENDER. AND BORROWER, OR ANY OF THEM. NEITHER LENDER NOR BORROWER, INCLUDING ANY ASSIGNEB OR SUCCESSOR OF LENDER OR BORROWER, SHALL SEEK A JURY TRIAL IN ANY SUCH ACTION. NEITHER LENDER NOR BORROWER SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION WHEN A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. ‘THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. NEITHER LENDER NOR BORROWER HAS IN ANY WAY AGREED WITH OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES. BORROWER EXPRESSLY AGREES THAT ‘THE INTEREST RATES SPECIFIED IN ‘THIS NOTE SHALL BE THE APPLICABLE INTEREST RATES DUE (A) ON AMOUNTS OUTSTANDING DURING THE TERM OF THIS NOTE, SUBJECT TO THE MAXIMUM RATE PRESCRIBED ABOVE, AND (B) WITH RESPECT TO ANY AMOUNT OUTSTANDING ON AND AFTER THB MATURITY DATE OF THIS NOTE.Page 7 WALVER: If the "State" (as defined above) is Connecticut, the following applies: BORROWER ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A COMMERCIAL TRANSACTION AND TO THE EXTENT ALLOWED UNDER CONNECTICUT GENERAL STATUTES SECTIONS 52-2784 TO 52-278n, INCLUSIVE, OR BY OTHER APPLICABLE LAW, BORROWER WAIVES ANY RIGHTS THAT BORROWER HAS TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH LENDER, OR ITS SUCCESSORS OR ASSIGNS, MAY DESIRE TO USE; AND BORROWER FURTHER WAIVES ANY REQUIREMENT THAT LENDER POST A BOND OR OTHER, SECURITY IN CONNECTION WITH SUCH PREJUDGMENT REMEDY. MAINE: If the address for the Borrower is Maine, the following notice applics: Notice. Under Maine law, no promise, contract or agreement to lend money, extend credit, forbear from collection of a debt or make any other accommodation for the repayment of a debt for more than $250,000 may be enforced in court against Lender, unless the promise, contract or agreement is in wlling and signed by Lender. Accordingly, Borrower cannot enforce any oral promise to extend credit unless it is contained in a written document signed by Lender, nor can any change, forebearanes, or ofher accommodation relating to any extension of oredit by Lender to Borrower be enforced, unless it is in wiiting signed by Lender. Possession: CONFESSION OF JUDGMENT: If the collateral address is Pennsylvania, the following applies: Grantee may enter upon and take possession of the Premises with or without legal action, and by force if necessary, collect therefrom all rentals (which term shail also include sums payable for use and occupation) and, after deducting all costs of collection and administration expense, apply the net rentals to any one or more of the following items in such manner and in such order of priority as Grantee, ia Grantee's sole discretion, may elect: the payment of any sums due under any prior lien, taxes, water and sewer rents, charges and claims, insurance premiums and all other carying charges, and to the mainteuance, repair or restoration of the Premises, or on account of the Liabilities; in and for that purpose Grantor hereby assigns to Grantee all reutals due and fo become due under any lease or Jeases or rights to.use and occupation of the Premises hereafter created, as well as all rights and remedies provided in such lease or leases or at law or in equity for the collection of the rentals, FOR ‘THE PURPOSE OF OBTAINING POSSESSION OF THE PREMISES FOLLOWING ANY DEFAULT HEREUNDER OR UNDER ANY OF THE LIABILITIES, GRANTOR IRREVOCABLE AUTHORIZES AND EMPOWERS ANY ATTORNEY OF RECORD, OR THE PROTHONOTARY, CLERK OR SIMILAR OFFICER, OF ANY COURT IN THE COMMONWEALTH OF PEENSYULVANIA OR ELSEWHERE, AS ATTORNEY FOR GRANTOR, AS WELL AS FOR THE PERSONS CLAIMING UNDER, BY, OR: THROUGH GRANTOR, TO SIGN AN AGREEMENT FOR ENTERING THEREERN AN APPROPRIATE ACTION IN EJECTMENT FOR POSSESSION OF THE PREMISES (WITHOUT THE NECESSITY OF FILING ANY BOND AND WITHOUT ANY STAY OF EXECUTION OR APPEAL) AGAINST GRANTOR AND ALL, PERSONS CLAIMING UNDER, BY, OR THROUGH GRANTOR, AND THEREIN CONFESS JUDGMENT FOR THE RECOVERY BY GRANTEE OF POSSESSION OF THE PREMISES FOR WHICH THIS INSTRUMENT (OR A COPY THEREOF VERIFIED BY AFFIDAVIT) SHALL BE A SUFFICIENT WARRANT; ‘WHEREUPON A WRIT OF POSSESSION OF THE MORTGAGED PREMISES MAY BE ISSUED FORTH WITH, WITHOUT ANY PRIOR WRIT OR PROCEEDING WHATSOEVER, GRANTOR HEREBY RELEASING AND AGREEING TO RELEASE GRANTRE AND ANY SUCH ATTORNEY FROM ALL PROCEDURAL ERRORS AND DEFECTS WHATSOEVER IN ENTERING SUCH ACTION OR JUDGMENT OR IN CAUSING SUCH WRIT OR PROCESS TO BE ISSUED OR IN ANY PROCEEDING THEREON OR CONCERNING THE SAME, PROVIDED THAT GRANTEE SHALL HAVE FILED IN SUCH ACTION AN AFFIDAVIT MADE ON GRANTEE’S BEHALF SETTING FORTH THE FACTS NECESSARY TO AUTHORIZE THE ENTRY OF SUCH JUDGMENT ACCORDING TO THE TERMS OF ‘THIS INSTRUMENT, OF WHICH FACTS SUCH AFFIDAVIT SHALL BE PRIMA FACTE EVIDENCE, IT IS HEREBY EXPRESSLY AGREED THAT Uf FOR ANY REASON AFTER ANY SUCH ACTION HAS BEEN COMMENCED, THE SAME SHALL BE DISCONTINUED, MARKED SATISFIED OF RECORD, OR TERMINATED, OR POSSESSION OF THE MORGAGED PREMISES REMAIN IN OR BE RESTORED TO GRANTOR OR ANYONE CLAIMING UNDER, BY, OR THROUGH GRANTOR, GRANTEE MAY, WHEREVER AND AS OFTEN AS GRANTEE SHALL HAVE THE RIGHT TO TAKE POSSESSION AGAIN OF THE MORTGAGED PREMISES, BING ONE OR MORE FURTHER ACTIONS IN THE MANNER HEREINBEFORE SET FORTH TO RECOVER POSSESSION OF THE PREMISES AND TO CONFESS JUDGMENT THEREIN AS HERINABOVE PROVIDED, AND THE AUTHORITY AND POWER ABOVE GIVEN TO ANY SUCH ATTORNEY SHALL EXTEND ‘TO ALL SUCH FURTHER ACTIONS IN EJECTMENT AND CONFESSION OF JUDGMENT ‘THEREIN AS HEREINABOVE PROVIDED, WHETHER BEFORE OR AFTER AN ACTION OF MORTGAGE FORECLOSURE IS BROUGHT: OR OTHER PROCEEDINGS IN EXECUTION ARE INSTITUTED UPON THIS MORTGAGE OR UPON ANY INSTRUMENT ‘THEN EVIDENCING ANY OF THE LIABILITIES, AND AFTER JUDGMENT THEREON OR ‘THEREIN AND AFTER A JUDICIAL SALE OF THE PREMISES.BORROWER. THOMAS KAJTOR oy CarMate ate : v ‘Witness “SS Tier 7 One mo a IK ORIGINAL BORROWER Witness Title: