WWW.EXFILE.COM, INC. -- 888-775-4789 -- CAPITAL CITY ENERGY GROUP, INC. -- EXHIBIT 10.1 TO FORM 8-K


     

    EXHIBIT 10.1

    
 

    ACCOUNTS RECEIVABLE
FINANCING AGREEMENT

     

    
      


      This
Summary Disclosure is merely a summary of the attached Agreement provided
for the convenience of the Client and the Client is urged to read the entire
Agreement for all details.  In any conflict between this Summary Disclosure
and the Agreement, the Agreement prevails.  Further, the Client understands
that Crestmark assumes no responsibility for the accuracy of this Summary
Disclosure, and is not liable for any conflict between this Summary Disclosure
and the Agreement, absent gross negligence or willful misconduct.

      


    

    
      SUMMARY
DISCLOSURE

      (all
terms subject to the terms and conditions of this Agreement)

      


       

      
        	

                Initial
      Purchase Price (up to):

                Purchase
      Discount:

                Incremental
      Discount:

              	
                80%

                1.25% for the first 30 days

                an additional 1.25% for each incremental 30
      days

              


      

       

    

    This
AGREEMENT is entered into by and between HOTWELL SERVICES, INC., a(n)
Delaware corporation, having its principal place of business at 1611 North Main
Street, Suite A, North Canton, Ohio 44720 ("Client"), and CRESTMARK COMMERCIAL CAPITAL LENDING
LLC located at 726 Highlandia Drive, Baton Rouge, Louisiana 70810
(hereinafter referred to as "Crestmark").

     

    AGREEMENT

     

    1. Purpose,
Definitions and Construction.  The purpose of this Agreement
and the financing provided herein is commercial in nature and is not for
household, consumer, family and/or personal use.  The following terms
have been given the following meanings:

     

    1.1.  “Account Debtor” - the obligor
on an Account.

     

    1.2.  “Account Due Date” - with
respect to a Purchased Account, thirty (30)
calendar days from the date on which the Initial Purchase Price is
paid.

     

    1.3. “Accounts” - accounts (as
defined in the Uniform Commercial Code) created by the Client.

     

    1.4. “Agreement” - This Accounts
Receivable Financing Agreement as modified or amended from time to time, and any
exhibits or attachments to this Agreement.

     

    1.5. “Avoidance Claim” - any claim
that any payment received by Crestmark from or for the account of an Account
Debtor is avoidable under the Bankruptcy Code or any other debtor relief
statute.

     

    1.6. “Crestmark” - see
preamble.

     

    1.7. “Crestmark Investment” - with
respect to a Purchased Account, the sum of (i) the Initial Purchase Price, plus
(ii) all past due fees and charges owed by Client to Crestmark relating to said
Purchased Account.

     

    1.8. “Crestmark Investment
Percentage” - 100% less the Reserve Percentage.

     

    1.9. “Clearance Days” – Three (3)
calendar days.

     

    1.10. “Client” - see
Preamble.

     

    1.11. “Closed” -a Purchased Account
is closed upon the first to occur of (i) receipt of full payment by Crestmark or
(ii) the unpaid balance has been charged to the Reserve Account by Crestmark
pursuant to the terms hereof.

     

    1.12. “Collateral” - all now owned
and hereafter acquired personal property and fixtures, and proceeds thereof,
(including proceeds of proceeds) including without limitation Accounts, Chattel
Paper, Goods Inventory, Equipment, Instruments, including Promissory Notes,
Investment Property, Documents, and General Intangibles.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    1.13. “Early Termination Fee” - the
sum of (i) all fees paid or payable by Client pursuant to Section 5 hereof in the ninety (90) day period preceding the
date on which the termination is to be made, and (ii) all Purchase Discounts
earned in the ninety (90) day period preceding the date on which the termination
is to be made.

     

    1.14.  “Eligible Account” - an Account
which is not an Ineligible Account.

     

    1.15. “Events of Default” - see
Section 15.

     

    1.16. “Exposed Payments” – Payments
received by Crestmark from an Account Debtor which has become subject to a
bankruptcy proceeding, to the extent such payments cleared said Account Debtor’s
deposit account within ninety days of the commencement of said bankruptcy
case.

     

    1.17. “Ineligible Accounts” -
Purchased Accounts:

     

    1.17.1. that do
not conform with the representations and warranties set forth in Section 12 of
this Agreement;

     

    1.17.2. or any
portion thereof, for which payment has not been received by Crestmark, for any
reason, within ninety (90) days of the date of invoice;

     

    1.17.3. which are
owned by Crestmark at the time that Client has committed an Event of Default
hereunder.

     

    1.18. “Initial Purchase Price” - the
Purchase Price less the Reserve Percentage relating to that Purchased
Account.

     

    1.19. “Incremental Discount” - with
respect to any Purchased Account which is unpaid in whole or in part, the
product of the Incremental Discount Percent multiplied by the Net Face Amount of
such Purchased Account.

     

    1.20. “Incremental Discount Percent”
– One and one-quarter percent (1.25%).

     

    1.21. “Incremental Discount Period” -
a thirty (30) day period.

     

    1.22. “Invoice” – the document that
evidences or is intended to evidence an Account.  Where the context so
requires, reference to an Invoice shall be deemed to refer to the Account to
which it relates.

     

    1.23. “Maximum Crestmark Investment”
- the product of the Net Face Amount of Purchased Accounts multiplied by the
Crestmark Investment Percentage.

     

    1.24. “Misdirected Payment Fee” -
fifteen percent (15%) of the amount of any payment on account of a Purchased
Account where said payment has been received by Client and not immediately
delivered in kind or the proceeds paid by Client to Crestmark.

     

    1.25. “Missing Notation Fee” –
fifteen percent (15%) of the Net Face Amount.

     

    1.26.  “Net Face Amount” - the gross
amount of a Purchased Account, based on shortest selling terms, less all
credits, discounts, and allowances to which the Account Debtor is
entitled.

     

    1.27. “Obligations” - all present and
future obligations owing by Client to Crestmark, whether or not for the payment
of money, whether or not evidenced by any note or other instrument, whether
direct or indirect, absolute or contingent, due or to become due, joint or
several, primary or secondary, liquidated or unliquidated, secured or unsecured,
original or renewed or extended, whether arising before, during or after the
commencement of any Bankruptcy Case in which Client is a debtor, and all
principal, interest, fees, charges, expenses, attorneys’ fees and accountants’
fees chargeable to Client or incurred by Crestmark in connection with this
Agreement and/or the transaction(s) related thereto.

     

    1.28. “Primary Defaults” - Events of
default as set forth in Sections 15.1, 15.2, 15.4, or 15.7 herein.

     

    1.29. “Purchase Discount” – One and
one-quarter percent (1.25%).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    1.30. “Purchase Price” - with respect
to a Purchased Account, the product of (i) the Net Face Amount multiplied by
(ii) 100% minus the Purchase Discount.

     

    1.31. “Purchase Schedule” – a
numbered schedule prepared by Crestmark listing those Accounts purchased by
Crestmark from Client.

     

    1.32. “Purchased Account” - an
Account which has been purchased by Crestmark from Client
hereunder.

     

    1.33.  “Reserve Account” - an account
established in the records of Crestmark (and not a segregated or separate
account), representing the difference between the Crestmark Investment and the
Net Face Amount of Purchased Accounts.

     

    1.34. “Reserve Percentage” – Eighteen
and three-quarters percent (18.75%).

     

    1.35. “Settlement Amount”- payments
received by Crestmark as proceeds of Purchased Accounts listed on a Purchase
Schedule in excess of the Crestmark Investment relating thereto.

     

    2. Sale and
Acceptance of Accounts.

     

    2.1. The
Client may tender to Crestmark for purchase pursuant to this Agreement certain
of its Accounts by delivering to Crestmark copies of the Invoices or the
original Invoices and any additional backup documentation relating thereto as
directed by Crestmark.

     

    2.2. Crestmark
will conduct such examination and verification of the Accounts, and such credit
investigation of the Account Debtors, as it considers necessary or desirable,
and will notify the Client as to which of the individual Accounts tendered by
the Client, if any, Crestmark elects to purchase from the
Client.  Crestmark shall have the absolute right, in its sole
discretion, to reject any or all of the Accounts tendered to it by the Client,
irrespective of whether or not Crestmark has previously purchased Accounts from
the Client or has purchased Accounts of any particular Account
Debtor.

     

    2.3. Those
Accounts which Crestmark elects to purchase from the Client shall be listed in a
Purchase Schedule sent by Crestmark to Client.  Client shall have been
deemed to have sold to Crestmark, and Crestmark shall be deemed to have
purchased all right, title, and interest of the Client in and to the Accounts
listed on the Purchase Schedule.

     

    3. Payment
of Purchase Price.

     

    3.1. The
Initial Purchase Price for each Purchased Account, less any amounts due by
Client to Crestmark hereunder, shall be paid to the Client in immediately
available funds at the time of purchase.

     

    3.2. Client
shall not permit the Crestmark Investment to exceed the Maximum Crestmark
Investment, and any such excess shall be paid by Client to Crestmark on
demand.

     

    4. Reserve
Account.

     

    4.1. Refund of
Reserve Account.  At Crestmark’s discretion, Crestmark shall pay the
Settlement Amount to Client, net of any amount due to Crestmark by Client
hereunder.

     

    4.2. Crestmark
may reduce the Reserve Account by any amounts due from Client to Crestmark
hereunder.

     

    4.3. Crestmark
may increase the Reserve Account at any time without notice if in the exercise
of its reasonable discretion such increase is necessary to reflect events,
conditions, contingencies or risks which do or may affect the value of the
Collateral or Client’s ability to perform its obligations
hereunder.

     

    4.4. Crestmark
may pay any amounts due Client hereunder by a credit to the Reserve
Account;

     

    4.5. Upon
termination of this agreement, Crestmark may retain the Reserve Account unless
and until Client has executed and delivered to Crestmark a general release in
the form of Exhibit A hereto.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.6. Exposed
Payments.

     

    4.6.1. Upon
termination of this Agreement, Client shall pay to Crestmark (or Crestmark may
retain), to hold in a non-segregated non-interest bearing account, the amount of
all Exposed Payments (the “Preference Reserve”).

     

    4.6.2. Crestmark
may charge the Preference Reserve with the amount of any Exposed Payments which
Crestmark pays to the bankruptcy estate of the Account Debtor which made the
Exposed Payment, on account of a claim asserted under Section 547 of the
Bankruptcy Code.

     

    4.6.3. Crestmark
shall refund to Client from time to time that balance of the Preference Reserve
for which a claim under Section 547 of the Bankruptcy Code can no longer be
asserted due to the passage of the statute of limitations, settlement with the
bankruptcy estate of the Account Debtor or otherwise.

     

    5. Fees.

     

    5.1. Incremental
Discount.  Client shall pay to Crestmark, when a Purchased
Account is Closed, the Incremental Discount computed at the end of each
Incremental Discount Period (or portion thereof) relating to a Purchased Account
from the Account Due Date until the date Closed.

     

    5.2. Misdirected Payment
Fee.  Client shall pay any Misdirected Payment Fee to
Crestmark, immediately upon accrual.

     

    5.3. Missing Notation
Fee.  Client shall pay the Missing Notation Fee on any Account
that is sent by Client to an Account Debtor which does not contain the notice as
required by Section 8.1 hereof, immediately upon accrual.

     

    6. Clearance
Days.  For all purposes under this Agreement, Clearance Days
will be added to the date on which Crestmark receives any payment.

     

    7. Repurchase
of Accounts.  Crestmark may require that Client repurchase, by
payment of the Crestmark Investment, on demand, or, at Crestmark's option, by
Crestmark's charge to the Reserve Account:

     

    7.1. Any
Purchased Account which becomes an Ineligible Account;

     

    7.2. Any
Purchased Account, the payment of which has been disputed by the Account Debtor
obligated thereon, Crestmark being under no obligation to determine the bona
fides of such dispute;

     

    7.3. Any
Purchased Account for which Client has breached its warranty under Section 12
hereunder;

     

    7.4. Any
Purchased Account owing from an Account Debtor which in Crestmark’s reasonable
credit judgment has become insolvent; and

     

    7.5. All
Purchased Accounts upon the occurrence of an Event of Default or upon the
termination date of this Agreement.

     

    8. Collection of Accounts;
Special Power of Attorney.

     

    8.1. Client
shall direct the Account Debtors on Accounts to make payment as directed by
Crestmark by providing such notation on an Invoice as Crestmark shall
direct.

     

    8.2. Any
payments from Account Debtors received by Client contrary to payment
instructions given to such Account Debtors shall be delivered in kind to
Crestmark immediately upon receipt.

     

    8.3. Client
hereby grants Crestmark an irrevocable power of attorney (which, being coupled
with an interest, is irrevocable) for the purpose of acting on Client’s behalf
to:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.3.1. endorse
or sign Client’s name on any checks or other instruments which come into
Crestmark’s possession with respect to Accounts;

     

    8.3.2. negotiate,
transfer, deposit, and otherwise deal with such checks or other instruments as
the sole owner thereof; and

     

    8.3.3. to
settle, compromise, enforce and attempt to collect any Purchased Account or,
after the occurrence of an Event of Default, any Account.

     

    8.4. After an
Event of Default, Client hereby grants Crestmark an irrevocable power of
attorney (which, being coupled with an interest, is irrevocable) for the purpose
of acting on Client’s behalf to change the address for the delivery of mail to
Crestmark’s address and to receive and open mail addressed to
Client.

     

    8.5. In
granting this Power of Attorney, Client hereby cancels and revokes all previous
powers of attorney in respect of the matters comprised herein which have been
granted to any other person.

     

    9. Security
Interest.

     

    9.1. As
collateral securing the Obligations, Client grants to Crestmark a continuing
first priority security interest in and to the Collateral.

     

    9.2. Notwithstanding
the creation of the above security interest, the relationship of the parties
shall be that of purchaser and seller of accounts, and not that of lender and
borrower.

     

    10. Affirmative
Covenants.

     

    10.1. Client
shall provide Crestmark with:

     

    10.1.1. copies of
Client’s bank deposit records periodically, if requested by
Crestmark;

     

    10.1.2. Client’s
financial statements within thirty (30) days of the close of the Client’s prior
calendar month, which shall be certified by a responsible officer of
Client.  Any supporting detail which Crestmark may request in
connection with its review and analysis of the monthly financial statements of
Client shall be furnished to Crestmark upon request.

     

    10.2. Client
shall allow Crestmark to enter Client’s premises during normal business hours to
perform its review of Client’s records relating to the Collateral, or for any
other purpose reasonably necessary to facilitate this Agreement.

     

    10.3. Client
shall pay when due all payroll and other taxes, and shall provide proof thereof
to Crestmark in such form as Crestmark shall reasonably require.

     

    11. Notification
to Account Debtors.  Crestmark may at any time give notice to
Account Debtors that payments on Accounts shall be made directly to
Crestmark.  Such notice may be in the form of Exhibit “B”
hereto.  Client will execute a letter in the form of Exhibit “C”
hereto in support thereof.

     

    12. Representations
and Warranties.

     

    12.1. Client
expressly warrants, represents and covenants as follows:

     

    12.1.1. Client
shall immediately notify Crestmark in writing upon it acquiring any facts which
would cause a Purchased Account to become an Ineligible Account;

     

    12.1.2. Client
has good and indefeasible clear title to the Collateral and has the right, power
and authority, subject to all applicable governmental regulations, to sell
Purchased Accounts hereunder, and to grant a security interest in the Collateral
to Crestmark;

     

    12.1.3. the
Collateral is not subject to, and is free and clear of, any lien, claim, pledge,
security interest or encumbrance of any kind;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    12.1.4. Client is
properly licensed and authorized to operate its business under all applicable
State and Federal laws in the name designated for Client on the signature page
of this Agreement;

     

    12.1.5. Client
will not assign, pledge, subordinate, give a security interest in or otherwise
transfer any Collateral to any entity other than Crestmark or its
assigns;

     

    12.1.6. this
Agreement is binding upon Client as well as upon Client’s successors,
representatives and assigns, and is legally enforceable in accordance with its
terms;

     

    12.1.7. Client
will record its sale of Purchased Accounts to Crestmark and make notations
recording such sales in its accounting records and books.  Client
hereby binds itself, its successor and assigns to warrant and forever defend
title in and to the Collateral unto Crestmark, its successors and assigns,
against any and every person whomsoever may assert any claim to the Collateral
or any part thereof.

     

    12.1.8. The
Purchased Accounts are and will remain:

     

    12.1.8.1. bona fide
existing obligations created by the sale and delivery of goods or the rendition
of services in the ordinary course of Client’s business;

     

    12.1.8.2. unconditionally
owed and will be paid to Crestmark without defenses, disputes, offsets,
counterclaims, or rights of return or cancellation;

     

    12.1.8.3. not sales
to any entity which is affiliated with Client or in any way not an “arms length”
transaction.

     

    12.1.9. Client
has not received notice of actual or imminent bankruptcy, insolvency, or
material impairment of the financial condition of any applicable Account Debtor
regarding Purchased Accounts.

     

    12.2. The
foregoing representations, covenants and warranties will run to the benefit of
Crestmark’s successors and assigns and will be continuing in nature and will
remain in full force and effect until all obligations and sums owing to
Crestmark by Client have been fully performed, paid and satisfied, whether or
not this Agreement is canceled or terminated.  Client does hereby bind
itself, its successors and assigns, to indemnify and hold Crestmark (and its
successors and assigns) harmless from any and all cost incurred by Crestmark and
its successors and assigns, including attorney’s fees and court costs, for
breach of any warranty expressed in this Section.

     

    13. ACH
Authorization.  In order to satisfy any of the Obligations,
Crestmark is hereby authorized by Client to initiate electronic debit or credit
entries through the ACH system to any deposit account maintained by Client
wherever located.

     

    14. Avoidance
Claims.

     

    14.1. Client
shall indemnify Crestmark from any loss arising out of the assertion of any
Avoidance Claim and shall pay to Crestmark on demand the amount
thereof.

     

    14.2. Client
shall notify Crestmark within two (2) business days of it becoming aware of the
assertion of an Avoidance Claim.

     

    14.3. This
Section 14 shall survive termination of this Agreement.

     

    15. Events of
Default.  Client will be in default of this Agreement upon the
happening of any of the following events (herein called “Events of
Default”):

     

    15.1. the
failure by Client to pay any sums due to Crestmark;

     

    15.2. the
happening of any event which results in the creation of a Misdirected Payment
Fee;

     

    15.3. the
failure by Client to provide any reports or other information to Crestmark as
required hereunder;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    15.4. the
denial to Crestmark of access to Client’s premises or records as required
herein;

     

    15.5. the
breach of any warranty, covenant or representation made herein or in connection
herewith;

     

    15.6. the
commencement of any insolvency or debtor-relief proceeding by or against
Client;

     

    15.7. Client’s
failure to pay any State or Federal tax when due;

     

    15.8. The
Client or any present or future guarantor of the Obligations becoming indicted
or the target of any criminal investigation by any law enforcement authority, or
the service of a subpoena or other discovery on the Client in connection with
any claim asserted against the Client or any guarantor by any governmental
authority;

     

    15.9. A sale,
hypothecation or other disposition is made of twenty percent (20%) or more of
the beneficial interest in any class of voting stock of Client, without the
written consent of Crestmark.

     

    16. Remedies.

     

    16.1. Upon the
occurrence of a Primary Default, or an Event of Default other than a Primary
Default which has not been cured within three (3) business days after notice by
Crestmark to Client, Crestmark may:

     

    16.1.1. elect to
declare any and all Purchased Accounts to be Ineligible Accounts;

     

    16.1.2. declare
that all Obligations are immediately due and payable without notice and without
opportunity for cure;

     

    16.1.3. commence
and effect collection of any and all Collateral by whatever means Crestmark
deems reasonable and necessary, without recourse to judicial proceedings against
Client. Client expressly relieves and releases Crestmark and its assigns, as the
secured party, of any and all liability or responsibility whatever which might
arise because of Crestmark's or its assign's failure to enforce by judicial
process, or otherwise, any Account, or because of its failure to give any notice
or make any demand with regard thereto.

     

    16.2. Crestmark
shall have all rights and remedies of a secured party under applicable law,
including the right to enter, during normal business hours, upon the premises
where any Collateral is located and take immediate possession of such Collateral
and remove same from such premises.

     

    16.3. To the
extent deemed reasonably necessary by Crestmark to aid in the collection of the
Collateral, Crestmark will have the right to the use of any computer hardware,
software, account ledgers, books, records, files and computer disks used by
Client pertaining to the Collateral.

     

    16.4. Crestmark
may avail itself of all such other rights and remedies as may now or hereafter
exist at law or in equity for collection of said sums due and the enforcement of
the covenants, warranties and representations herein and resort to any one or
combination of such remedies provided hereunder will not prevent the concurrent
or subsequent employment of any other appropriate remedy.

     

    17. Survival.  All
representations, warranties and agreements herein contained on the part of
Client shall be effective so long as Obligations remain
outstanding.

     

    18. Severability
of Provisions.  In the event any one or more of the provisions
contained in this Agreement is held to be invalid, illegal or unenforceable in
any respect, then such provision shall be ineffective only to the extent of such
prohibition or invalidity, and the validity, legality, and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.

     

    19. Amendment
and Waiver.  This Agreement shall not be changed, modified,
amended, or terminated except by a writing duly executed by Crestmark and
Client.

     

    20. No
Waiver.  No failure to exercise and no delay in exercising any
right, power, or remedy hereunder shall impair any right, power, or remedy which
Crestmark may have, nor shall any such delay be construed to be a waiver of any
of such 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    rights,
powers, or remedies, or any acquiescence in any breach or default hereunder; nor
shall any waiver of any breach or default of Client hereunder be deemed a waiver
of any default or breach subsequently occurring.  All rights and
remedies granted to Crestmark hereunder shall remain in full force and effect
notwithstanding any single or partial exercise of, or any discontinuance of
action begun to enforce, any such right or remedy.  The rights and
remedies specified herein are cumulative and not exclusive of each other or of
any rights or remedies which Crestmark would otherwise have.  Any
waiver, permit, consent or approval by Crestmark of any breach or default
hereunder must be in writing and shall be effective only to the extent set forth
in such writing and only as to that specific instance.

     

    21. Successors
and Assigns.

     

    21.1. This
Agreement shall be binding upon and inure to the benefit of Crestmark, Client,
and their respective successors and assigns.

     

    21.2. Crestmark
may assign its rights and delegate its duties hereunder.  Upon such
assignment, Client shall be deemed to have attorned to such assignee and shall
owe the same obligations to such assignee and shall accept performance hereunder
by such assignee as if such assignee were Crestmark.

     

    22. Waiver of
Statute of Limitations.  Client waives the pleading of any
statute of limitations with respect to any and all actions in connection
herewith.

     

    23. Jurisdiction
and Venue.  Client hereby irrevocably agrees that all actions
and proceedings arising out of or in any way connected with this Agreement shall
be litigated in courts having situs within the City of Baton Rouge, State of
Louisiana, and Client hereby consents and submits to the jurisdiction of any
local, state or federal court located within said
jurisdiction.  Client hereby irrevocably appoints and designates the
Secretary of State of Louisiana as Client's true and lawful attorney and duly
authorized agent for acceptance of service of legal process.  Client
agrees that service of such process upon such person shall constitute personal
service of such process upon Client.  Client hereby waives any right
it may have to transfer or change the venue of any litigation arising out of or
in any way connected with this Agreement.

     

    24. Waiver of Trial by
Jury.  IN RECOGNITION OF THE HIGHER COSTS AND DELAY WHICH MAY
RESULT FROM A JURY TRIAL, THE PARTIES HERETO WAIVE ANY RIGHT TO TRIAL BY JURY OF
ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING HEREUNDER, OR (B) IN
ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO OR ANY OF THEM WITH RESPECT HERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY
COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.

     

    25. Costs and
Expenses.

     

    25.1. Client
agrees to reimburse Crestmark for all costs and expenses, including attorneys'
fees, which Crestmark has incurred or may incur in:

     

    25.1.1. negotiating,
preparing, administering or enforcing this Agreement and any documents prepared
in connection herewith;

     

    25.1.2. protecting,
monitoring, preserving or enforcing any lien, security interest or other right
granted by Client to Crestmark (including travel expenses of Crestmark’s
employees and agents), or arising under applicable law, whether or not suit is
brought,

     

    25.1.3. connection
with any federal or state insolvency proceeding commenced by or against Client,
including those (i) arising out of the automatic stay, (ii) seeking dismissal or
conversion of the bankruptcy proceeding or (iii) opposing confirmation of
Client's plan thereunder;

     

    25.1.4. connection
with Client's sale of the Purchased Accounts and the grant of a security
interest in and to the Collateral (and other accounts receivable) to Crestmark,
filing fees, public records searches, and other expenses directly 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    related
to the sale of the Accounts and the perfection of the security
interest.  All such direct out-of-pocket expenses incurred by
Crestmark shall be reimbursed by Client to Crestmark on demand.

     

    25.2. All such
costs and expenses which have been incurred on or prior to the execution hereof
shall be paid contemporaneously with the execution hereof.  Any such
costs and expenses incurred subsequent to the execution hereof shall become part
of the Obligations when incurred.

     

    26. Term;
Termination.

     

    26.1. This
Agreement will be effective for an initial term of one (1) year, commencing with
the Effective Date as set forth below and will continue thereafter automatically
renewing annually unless terminated by either party upon written notice of
termination sent not less than thirty (30) nor more than ninety (90) days prior
to the next anniversary date hereof specifying such party's intention to
terminate this Agreement on the next anniversary date.

     

    26.2. Early Termination
Fee.  In the event that Client seeks to terminate this
Agreement other than as set forth in Section 26.1 above, Client shall pay the
Early Termination Fee to Crestmark as a condition to Crestmark's consent
thereto.

     

    26.3. No
termination of this Agreement will in any way affect or impair any right of
Crestmark arising prior thereto or by reason thereof, nor will any such
termination relieve Client of any duty to Crestmark under, nor deny Crestmark
any benefit from, this Agreement or otherwise until all of Obligations have been
fully discharged.

     

    26.4. No Lien Termination Without
Release.  In recognition of Crestmark’s right to have its
attorneys’ fees and other expenses incurred in connection with this Agreement
secured by the Collateral, notwithstanding payment in full of all Obligations by
Client, Crestmark shall not be required to record any terminations or
satisfactions of any of its liens on the Collateral unless and until Client and
all guarantors of its obligations have executed and delivered to Crestmark a
general release in the form of Exhibit A hereto.  Client understands that this
provision constitutes a waiver of its rights under §9-513 of the
UCC.

     

    27. State
Law; Jurisdiction.   This Agreement is accepted, made and
will be governed by the laws of the State of Louisiana without regard to
conflict of laws principles. All sums due hereunder are payable in the State of
Louisiana. Venue and jurisdiction will be exclusively in the state district
courts of the Parish of East Baton Rouge, State of Louisiana. Both parties waive
their right to trial by jury and agree to submit all disputed issues to the
judge of any court in which any litigation is pending.

     

    28. Miscellaneous.   This
Agreement sets forth the entire agreement and understanding between the parties
relating to the subject matter herein and merges all prior discussion between
them. Client may not assign any of its rights or obligations hereunder without
the prior written consent of Crestmark; however, Crestmark may assign any of its
rights and remedies. All notices pursuant to the Agreement must be in writing
and will be deemed given when (1) mailed postage prepaid by certified or
registered mail, return receipt requested, or (2) courier delivered personally
to the party concerned at the address set forth herein, or (3) facsimile
transmitted to the party concerned at the telecopier number given by the
respective party. The provisions of this Agreement are severable and if any of
these provisions will be held by any court of competent jurisdiction to be
unenforceable, void or voidable, such holding will not affect or impair any
other provision hereof. Crestmark may assign its rights and remedies including
assignments for financing and/or collateralization purposes. Client consents to
Crestmark or its assignees conducting a comprehensive due diligence review and
financial history investigation relating to Client. This Agreement may be
modified or amended only in writing signed by both parties.

     

    29. USA
Patriot Act Notification. – The following notification is provided to
Client pursuant to Section 3265 of the USA Patriot Act of 2001, 31 U.S.C.
Section 5318:

    IMPORTANT
INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT.  To help the
government fight the funding of terrorism and money laundering activities,
Federal law requires all financial institutions to obtain, verify, and record
information that identifies each person or entity that opens an account,
including any deposit account, treasury management account, loan or other
extension of credit.  Crestmark will ask for the name, address, date
of birth, and other information that will allow Crestmark to identify all of
Client’s owners.  Crestmark will also ask for a copy of each owner’s
driver’s license or other identifying documents.

    


    SIGNATURE
PAGE TO FOLLOW

     

    
 

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
WITNESS WHEREOF, the respective authorized officers of the parties have executed
this Agreement effective as of the date hereof.

     

    Accepted
in Baton Rouge, Louisiana this

    27 day
of March, 2009.

    
    

     

    
      	
              CRESTMARK COMMERCIAL CAPITAL
      LENDING LLC

               

              
                By: 
      /s/ Patrick Haney

                

                  
      

                 

                Print
      Name: Patrick Haney

                 

                Title:
      President

              

            	
              HOTWELL SERVICES,
      INC.

               

              By:  /s/ Daniel R. Coffee

              

                
      

               

              Print Name: Daniel R. Coffee

               

              Title: VP

            


    

     

     

    Effective
Date:   March 27, 2009