**Exhibit 10(h)**

 

**REVOLVING LINE OF CREDITPROMISSORY NOTE**

**(FOR BANK HOLDINGCOMPANY)**

**UNSECURED LOAN**

 
| **Principal** | ** **   | **Loan Date** | ** **          | **Maturity** | ** **       | **Loan No.** | ** ** | **Officer** | ** ** |
|---------------|--------------|---------------|---------------------|--------------|------------------|--------------|------------|-------------|------------|
| ** **    | ** **   | ** **    | ** **          | ** **   | ** **       | ** **   | ** ** | ** **  | ** ** |
| $             | 2,000,000.00 |          | April 21, 2005 |         | May 1, 2007 |         |       |        |       |   |
|               |              |               |                     |              |                  |              |            |             |            |  |

 

References above are for Lender’s use onlyand do not constitute any part of the terms and provisions of this RevolvingLine of Credit Promissory Note.

 

| **Borrower**: | **Frederick County  Bancorp, Inc.** | ** ** | **Lender**: | **Atlantic Central Bankers Bank** |
|---------------|------------------------------------------|------------|-------------|-----------------------------------|
| ** **    | **P.O. Box 1100**                   | ** ** |        | **1400 Market Street**            |
| ** **    | **Frederick, MD 21702-0100**             | ** ** |        | **P.O. Box 1109**            |
|          |                                     |       |        | **Camp Hill, PA 17001-1109**      |

 

Principal Amount: $2,000,000.00       InitialRate:    5.75%    Date ofNote:     April 21, 2005

 

**PROMISE TO PAY.**  Borrower promises to pay to ATLANTIC CENTRALBANKERS BANK, or its order, in lawful money of the United States of America,the principal amount of Two Million and No/100 Dollars ($2,000,000.00) or asmuch as may be outstanding from time to time under the Revolving Line of Creditextended by ATLANTIC CENTRAL BANKERS BANK to Borrower, together with intereston the unpaid outstanding principal balance of each advance under the RevolvingLine of Credit from the date of each advance until repayment of each advance atthe rate or rates of interest set forth in herein.

 

1.**            **DEFINITIONS.** **The following words, terms and/orphrases shall have the following meanings and definitions for purposes of thisRevolving Line of Credit Promissory Note:

 

| **TERMS**                                               | ** ** | **DEFINITION**                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|---------------------------------------------------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                    |       |                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| “Borrower”                                    |       | Frederick County Bancorp, Inc., its successors  and assigns.                                                                                                                                                                                                                                                                                                                                                                                |
|                                                    |       |                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| “Lender”                                      |       | Atlantic Central Bankers Bank, its successors and  assigns.                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                    |       |                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| “Note”                                        |       | This Revolving Line of Credit Promissory Note.                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                    |       |                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| “Wall Street Journal  Prime Rate of Interest” |       | The annual interest rate announced and published  from time to time in the Money Section of the Wall Street Journal as the  Wall Street Journal Prime Rate.

The Wall Street Journal  Prime Rate may be greater or lesser than interest rates which Lender charges  for loans made to other borrowers and is not solely based on or dependent  upon the interest rate(s) which Lender may charge to other borrowers or class  of borrowers. |

 

2.**            **RELATED DOCUMENTS.  The terms, provisions, covenants andconditions of the Loan Agreement: (a) are incorporated into this Note; and(b) shall govern this Note.  Alldefinitions of capitalized words, phrases and/or terms set forth in the LoanAgreement shall apply to words, terms and/or phrases set forth in this Notewhich are not expressly defined in this Note.

 

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3.             ADVANCESUNDER REVOLVING LINE OF CREDIT.  Borrowerhas requested that Lender make loans and/or advances to Borrower under theRevolving Line of Credit from time to time during the Commitment Period in anamount and/or amounts, which at any one time shall not exceed the CommitmentAmount.  Lender agrees, subject to theterms, provisions, conditions and covenants set forth in the Loan Agreement andin this Note and in reliance upon the warranties and representations extendedby Borrower to Lender in the Loan Agreement, to make such loans and/or advancesto Borrower under the Revolving Line of Credit during the Commitment Period,which loans and/or advances shall not exceed at any one time the CommitmentAmount.

 

3.1           LENDER MAY EXTEND THE COMMITMENT PERIOD FROM TIME TO TIME BY ISSUINGTO BORROWER A “NOTICE OF RENEWAL” IN WRITING AND REFERENCING THIS NOTE ANDEXTENDING THE TERMINATION DATE TO SUCH DATE AND ON SUCH TERMS AND CONDITIONS ASLENDER IN ITS SOLE DISCRETION ELECTS.

 

3.2           During the Commitment Period, Borrower may borrow, repay and re-borrowunder the Revolving Line of Credit provided that at any one time the amountborrowed under the Revolving Line of Credit does not exceed the CommitmentAmount.

 

3.3           This Note evidences a Revolving Line of Credit.Loans and advances under this Note, as well as directions for debits fromBorrower’s accounts for payments of Obligations, may be requested orally or inwriting by Borrower or by an authorized designated employee and/or officer ofBorrower. Lender will require that all oral requests for loans and advances areconfirmed in writing by said authorized employee and/or officer of Borrower.Borrower agrees to be liable for all sums either: (A) advanced inaccordance with the written instructions of said authorized employee and/orofficer of Borrower; and/or (B) credited to any of Borrower’s accountswith Lender. The unpaid principal balance owing on this Note at any time may beevidenced by endorsements on this Note or by Lender’s internal records,including daily computer printouts.

 

3.4           Lender shall have no obligation to advance fundsunder this Note if: (A) An Event of Default has occurred; and/or(B) Borrower has utilized funds loaned and/or advanced by Lender toBorrower under the Revolving Line of Credit for purposes other than thoseauthorized by the Loan Agreement.

 

4.             PAYMENT.  Borrower will pay regular monthly payments ofall accrued and unpaid interest due at the rate(s) set forth in Paragraph 5 ofthis Note as of each payment date, beginning May 1, 2005, with allsubsequent interest payments to be due on the same day of each successive monthuntil the Termination Date. Borrower will pay all outstanding principal on thisNote on the Termination Date. In addition, on the Termination Date, Borrowerwill also pay any accrued and unpaid interest at the rate(s) set forth in thisNote and any late charges and fees, costs and expenses, if any, to which Lenderis entitled pursuant to this Note and the Loan Agreement. Except as provided inParagraph 5 hereof, or unless otherwise agreed to by Lender or required byapplicable law, payments by Borrower on account of the Revolving Line of Creditwill be applied first to accrued unpaid interest at the rate(s) set forth inthis Note, then to principal and any remaining amount to any unpaid collectioncosts and late charges, if any.

 

5.             VARIABLEINTEREST RATE.

 

5.1           Subject to the provisions of Paragraph 8 hereof,the interest rate on all loans and advances on the Revolving Line of Creditwill be the Wall Street Journal Prime Rate of Interest. The Wall Street JournalPrime Rate of Interest is a variable rate of interest, which changes from timeto time as the Wall Street Journal Prime Rate of Interest changes. The WallStreet Journal Prime Rate currently is five and three-quarters of one percent(5.75%) per annum.

 

NOTICE: Under no circumstances will theinterest rate on this Note be more than the maximum rate allowed by applicablelaw.

 

5.2           The interest rate set forth in Section 5.1 hereof will be computedand calculated on a year consisting of 360 days but billed and charged for theactual number of days of each month.

 

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6.             PREPAYMENT.  During the Commitment Period, Borrower mayrepay without penalty any or all of the loans and advances made by Lender toBorrower under the Revolving Line of Credit. Such repayments of loans and advances made under the Revolving Line ofCredit by Borrower shall reduce the outstanding principal balance due on theRevolving Line of Credit.  Any suchrepayments of loans and advances on the Revolving Line of Credit by Borrowershall not be applied to interest on the outstanding loans and advances on theRevolving Line of Credit, shall not be a substitute for regular monthlypayments of accrued and unpaid interest required under Paragraph 4 hereof andshall not relieve the obligation of Borrower to make monthly payments ofaccrued and unpaid interest under Paragraph 4 hereof. Borrower agrees not tosend Lender any payments of principal and/or interest marked “paid in full”,“without recourse”, or similar language. If Borrower sends such a payment, suchinstructions or conditions by Borrower shall be null and void, of no legaleffect and non-binding on Lender so that Lender may accept said payment withoutlosing any of Lender’s rights under this Note, and Borrower will remainobligated to pay any and all amount or amounts owed to Lender. All writtencommunications concerning disputed amounts, including any check or otherpayment instrument that indicates that the payment constitutes “payment infull” of the amount owed, “without recourse” or similar language or that istendered with other conditions or limitations or as full satisfaction of adisputed amount must be mailed or delivered to: Loan Operations 1400 MarketStreet, P.O. Box 1109, Camp Hill, PA 17001-1109.

 

7.             LATECHARGE.  If any monthly payment ofaccrued and unpaid interest required under Paragraph 4 hereof is 16 days ormore late, Borrower will be charged the greater of: (a) 5% of theregularly scheduled payment; or (b) $50.00.

 

8.             INTERESTAFTER DEFAULT.  Upon the occurrence of anEvent of Default, as defined herein, or on the Termination Date, Lender, at itsoption, and without notice to Borrower, may, if permitted under applicable law,increase the interest rate on the outstanding loans and advances on the RevolvingLine of Credit, which have not been repaid, to three (3) percentage pointsover the Wall Street Journal Prime Rate. This default interest rate will notexceed the maximum rate permitted by applicable law.  The Default Rate of Interest as provided forherein will be computed and calculated on a year consisting of 360 days butbilled and charged for the actual number of days of each month.

 

9.             DEFAULT.

 

9.1.          List.  Each of the following shallconstitute an event of default (“Event of Default”) under this Note:

 

A.            PaymentDefault.  Borrower fails to make anymonthly payment of accrued and unpaid interest at the rate(s) set forth inParagraph 5 of this Note within fifteen (15) days of being due under this Noteand/or fails to pay in full all outstanding loans and advances on the RevolvingLine of Credit on the Termination Date and all accrued and unpaid interest atthe rate(s) set forth in Paragraph 5 of this Note, as well as all late chargesand fees, costs and expenses, if any, to which Lender is entitled pursuant tothis Note and the Loan Agreement on the Termination Date.

 

B.            Payment Default-Other Obligations.  Borrower fails to pay within fifteen (15)days of being due any principal, interest and costs due Lender under anyObligations of Borrower to Lender.

 

C.            Other Defaults.  Borrower fails to comply with or to performany Obligations of Borrower within sixty (60) days of the date Borrower is toperform and/or comply with said Obligations of Borrower other than as providedfor in Paragraphs 9.1.A and 9.1.B hereof.

 

D.            Default in Favor of Third Parties.  Borrower defaults under any Indebtedness toany third Persons that may materially affect any of Borrower’s property,Borrower’s ability to repay this Note or ability of Borrower to perform and/orpay Obligations of Borrower.

 

E.             False Statements.  Any warranty, representation or statementmade or furnished to Lender by Borrower set forth in the Loan Agreement isfalse or misleading in any material respect, either now or at the time made orfurnished, or becomes false or misleading at any time thereafter.

 

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F.             Insolvency, etc.  (1) The cessation of Borrower’s and/orSubsidiary’s business activities; (2) the dissolution or termination ofBorrower’s and/or Subsidiary’s existence as a going business concern and/orBorrower’s and/or Subsidiary’s corporate existence; (3) the insolvency ofBorrower and/or Subsidiary; (4) the appointment of a receiver, conservatorand/or custodian for all and/or any of Borrower’s and/or Subsidiary’s assetsand/or for Borrower and/or Subsidiary; (5) any assignment for the benefitof creditors of all and/or any of Borrower’s and/or Subsidiary’s assets;(6) any type of creditor workout involving Borrower and/or Subsidiaryand/or all and/or any of Borrower’s and/or Subsidiary’s assets; (7) thecommencement of any proceeding under any federal bankruptcy or insolvency lawsby or against Borrower and/or Subsidiary and/or all and/or any of Borrower’sassets and/or Subsidiary’s assets; (8) the sale and/or liquidation of asubstantial amount of Borrower’s and/or Subsidiary’s assets other than in theordinary course of business; (9) the revocation and/or suspension ofBorrower’s and/or Subsidiary’s charter by any state and/or federal department,agency, bureau, authority, body, subdivision or quasi-government corporationwhich regulates the business conducted by Borrower and/or Subsidiary;(10) merger and/or consolidation of Borrower with any other entity; and/or(11) any action and/or proceeding by any federal and/or state agency, bureau,subdivision, department, body, authority, commission or quasi-governmentcorporation, which regulates the Borrower and/or Subsidiary and/or Borrower’sand/or Subsidiary’s business, which results in the seizure and/or takingcontrol of Borrower’s and/or Subsidiary’s business and/or Borrower’s and/orSubsidiary’s assets and/or which results in the closing and terminating thebusiness operations of Borrower and/or Subsidiary.

 

G.            Creditor or Forfeiture Proceedings.  Commencement of any creditor, foreclosure,execution or forfeiture proceedings, whether by judicial proceeding, self-help,repossession or any other method, by any Person against any of Borrower’sassets. This includes a garnishment of any of Borrower’s accounts, includingdeposit accounts, with Lender. However, this Event of Default shall not applyif there is a good faith dispute by Borrower as to the validity orreasonableness of the claim which is the basis of the creditor, foreclosure,execution or forfeiture proceeding and provided that Borrower:(1) provides Lender with written notice of the creditor, foreclosure,execution or forfeiture proceeding; and (2) deposits with Lender monies ora surety bond for the creditor, foreclosure, execution or forfeitureproceeding, in an amount, in a form and containing terms and provisions asrequired and determined by Lender, in its sole discretion.

 

H.            Change In Ownership.  Any change in ownership of Borrower and/orSubsidiary.

 

9.2           Nature of Default.

 

A.            An Event of Default shall automatically occurwithout the need for Lender

 

to issue any written demand and/or notice toBorrower.

 

B.            No Event of Default shall be deemed waived byLender unless the waiver is in writing and executed by a duly authorizedcorporate officer of Lender.

 

C.            No failure of Lender to take any action orexercise any rights and/or remedies upon the occurrence of an Event of Defaultshall constitute a waiver by Lender of any existing dissimilar or futuresimilar or dissimilar Event of Default on the part of or by Borrower.

 

10.           LENDER’SRIGHTS.

 

10.1         List.  Upon the occurrence of anEvent of Default, Lender may, after giving such notices as maybe required byapplicable law:

 

A.            Declare the entire unpaid principal balanceon this Note and all accrued unpaid interest immediately due and payable infull:

 

B.            Cease making any loans and/or advances toBorrower under the Revolving Line of Credit;

 

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C.            Invoke the default rate of interest asprovided in Paragraph 8 hereof;

 

D.            Exercise all rights and remedies available toLender under this Note and/or under the Loan Agreement; and/or

 

E.             Exercise all rights and remedies available toLender under the Laws, case decisions of the Commonwealth of Pennsylvania,United States of America and Rules of Civil Procedure of the Commonwealthof Pennsylvania and under the Federal Rules of Civil Procedure.

 

10.2.        Nature of Remedies.

 

A.            All remedies are cumulative and the failureof Lender to exercise one, several or all remedies shall not be deemed anelection of remedies so as to preclude the Lender from subsequently exercisingremedies not originally exercised by Lender.

 

B.            Except as required by the case decisions,Laws and Rules of Civil Procedure of the Commonwealth of Pennsylvania andunder the Federal Rules of Civil Procedure, Lender shall not be requiredto give any notice to Borrower prior to the exercise of any rights and remediesby Lender.

 

C.            In exercising its rights and remedies, Lendermay proceed against any assets of Borrower, whether pledged to Lender or not,simultaneously and/or in any order as Lender in its sole discretion deemsadvisable.

 

11.           ATTORNEYS’FEES; EXPENSES.  Upon the occurrence ofan Event of Default, in the event Lender enforces its rights and remedies underthis Note, in the event Borrower files any federal bankruptcy, dissolution,insolvency or receivership proceeding or any federal bankruptcy, dissolution,insolvency or receivership proceeding is filed against Borrower, in the eventof any litigation between Lender and Borrower, and/or in the event any federaland/or state agency, bureau, department, subdivision, commission, body,authority and/or quasi-government corporation, which regulates the Borrowerand/or Borrower’s business, seizes and/or takes control of Borrower’s businessand/or Borrower’s assets and/or closes and terminates the business operationsof Borrower, Lender shall be entitled to reasonable legal fees and costs inconnection with: (1) the enforcement of the terms and provisions of thisNote; (2) collection of amounts owed by Borrower to Lender under thisNote; (3) any bankruptcy, dissolution, insolvency or receivershipproceeding filed by and/or against Borrower and/or Subsidiary; (4) defenseof any lawsuit filed against Lender by Borrower; (5) execution againstassets of Borrower; and/or (6) any action and/or proceeding by any federaland/or state agency, bureau, department, commission, body, authority,subdivision or quasi-government corporation, which regulates the Borrowerand/or Subsidiary and/or Borrower’s business and/or Subsidiary’s business whichresults in the seizure and/or taking control of Borrower’s business and/orBorrower’s assets and/or Subsidiary’s business and/or Subsidiary’s assetsand/or which results in the closing and terminating of the business operationsof Borrower and/or Subsidiary.  Costs andexpenses include but are not limited to Lender’s attorneys’ fees and legalexpenses whether or not there is a lawsuit, including attorneys’ fees and legalexpenses for bankruptcy, dissolution, insolvency or receivership proceedings(and including efforts to modify or vacate any automatic stay or injunction),appeals, and any anticipated post-judgment collection services.

 

12.           WAIVERS. Borrower hereby waives:

 

12.1         All rights to trial by jury with regards toany and all issues, matters, actions, causes of action, and/or claims soundingin contract, law, equity, tort or otherwise, arising directly or indirectly outof or relating directly or indirectly to the Revolving Line of Credit, thisNote and/or the Loan Agreement, the enforcement and/or to the interpretation ofthe Revolving Line of Credit, this Note and/or the Loan Agreement and/or anyaction or conduct taken or omitted from being taken by Lender and its presentand former officers, agents, employees, representatives, attorneys andservants. Lender may file an original counterpart or copy of thisSection of this Note with any court as written evidence of the consent ofBorrower to the waiver of Borrower’s right to a trial by jury.  Borrower hereby acknowledges that Borrowerhas had ample opportunity to consult with counsel for Borrower concerning theimpact on Borrower’s legal rights

 

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andremedies of this waiver and Borrower hereby voluntarily, intelligently andknowingly waives the right to a trial by jury.

 

12.2             The right to any notice of the occurrence ofa default under this Note.

 

12.3             Benefits and protections of the legal andequitable doctrines of marshalling of assets and election of remedies.

 

12.4             The right to any notice that Lender hasceased making advances to Borrower under the Revolving Line of Credit.

 

12.5             The right to any notice prior to Lenderexercising any rights and remedies against Borrower, including but not limitedto right of Lender to accelerate and right to impose the default rate ofinterest as provided for in the Note.

 

12.6             Notice of default, dishonor, notice ofdishonor, protest, notice of protest presentment and any and all noticesrequired under Article 3 of the Uniform Commercial Code as enacted in theCommonwealth of Pennsylvania.

 

13.           GOVERNINGLAW.  This Note will be governed by,interpreted, construed and enforced in accordance with federal law and the lawsof the Commonwealth of Pennsylvania. This Note has been accepted by Lender in the Commonwealth ofPennsylvania.

 

14.           CHOICE OF VENUE AND JURISDICTION. Borrower consents and agrees that, at the sole discretion of Lender, anyand all legal and equitable proceedings arising directly or indirectly out ofor relating directly or indirectly to the Revolving Line of Credit, this Noteand/or the Loan Agreement, the enforcement and/or to the interpretation of theRevolving Line of Credit, this Note and/or the Loan Agreement and/or any actionor conduct taken or omitted from being taken by Lender and its present andformer officers, agents, employees, representatives, attorneys and servantsshall be maintained in the Courts of Common Pleas of Cumberland County,Pennsylvania.  Borrower herebyvoluntarily, intelligently and knowingly consents to personal jurisdiction andvenue in favor of the Courts of Common Pleas of Cumberland County,Pennsylvania.  Borrower herebyacknowledges that Borrower has had ample opportunity to consult with counselfor Borrower concerning the impact on Borrower’s legal rights and remedies ofthis consent to venue and jurisdiction. Lender may file an original counterpartor copy of this Section of this Note with any court as written evidence ofthe consent of Borrower to jurisdiction and venue of the Court of Common Pleasof Cumberland County, Pennsylvania.

 

15.           RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right ofsetoff against all Borrower’s accounts with Lender and/or in the possession andcontrol of Lender (whether checking, savings, or some other account).  This includes all accounts Borrower holdsjointly with someone else and all accounts Borrower may open in the future. However,this right of set off does not include any trust accounts, escrow accounts,funds or assets which Borrower holds as a fiduciary and/or which setoff wouldbe prohibited by law. Borrower authorizes Lender, to the extent permitted byapplicable law, to charge or setoff all sums owing on Obligations of Borroweragainst any and all such accounts, and, at Lender’s option, to administrativelyfreeze all such accounts to allow Lender to protect Lender’s charge and setoffrights provided in this paragraph.

 

16.           SUCCESSOR INTERESTS.  The terms and provisions of this Note shallbe binding upon Borrower and upon Borrower’s successors and assigns and shallinure to the benefit of Lender and its successors and assigns.  However, Borrower may not assign this Note orthe rights and privileges set forth in this Note without the prior writtenconsent of a duly authorized officer of Lender.

 

17.           PARTICIPATIONS. Lender may transfer, assign and/or sell participation(s) in this Note,the Revolving Line of Credit and Loan Agreement at any time without the consentof Borrower and any requirement on the part of Lender to notify Borrower.

 

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18.           GENERAL PROVISIONS.  Paragraph headings contained herein are fordescriptive purposes only and do not form part of the terms and provisions ofthis Note.

 

19.           ENTIRE AGREEMENT.  This Note and the Loan Agreement contain allof the terms, provisions, covenants and conditions concerning the extension ofthe Revolving Line of Credit and there are no terms, provisions, covenants and conditionsconcerning the Revolving Line of Credit that are not set forth in this Note andthe Loan Agreement.

 

20.           INTEREST RATE ON JUDGMENT.  In the event any judgment is entered in favorof Lender and against Borrower on this Note, the interest rate on any judgmentwill be the rate provided for in this Note.

 

PRIOR TOSIGNING THIS NOTE, BORROWER HAS READ AND UNDERSTOOD ALL THE PROVISIONS OF THISNOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THETERMS OF THE NOTE.

 

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETEDCOPY OF THIS REVOLVING LINE OF CREDIT PROMISSORY NOTE.

 

THIS NOTE IS GIVEN UNDER SEAL AND IT ISINTENDED THAT THIS NOTE IS AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALEDINSTRUMENT ACCORDING TO LAW.

 
| ** ** | ** **                                       | **BORROWER: Frederick County Bancorp, Inc.** |
|------------|--------------------------------------------------|---------------------------------------------------|
| ** ** | ** **                                       | ** **                                        | ** ** |
| ** ** | ** **                                       | ** **                                        | ** ** |
| By:        | /s/ William  R. Talley, Jr.                 | (SEAL)                                            | By: | /s/ Martin S.  Lapera | (SEAL) |
|       | William R. Talley, Jr., Assistant Secretary |                                              | Martin S. Lapera, President |   |
|            |                                                  |                                                   |  |  |  |

 

 

[AFFIX CORPORATE SEAL]

 

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