Document:

exv10w27

EXHIBIT 10.27

SECURITY AGREEMENT

     This Security Agreement (the “Agreement”) is made effective as of July 3, 2008, by GREAT
PLAINS NATURAL GAS COMPANY, an Ohio corporation, whose address is 8500 Station Street, Mentor, Ohio
44060 (the “Debtor”), and CITIZENS BANK, with an address at 328 S. Saginaw Street, Flint, Michigan
48502, for itself and as agent for any affilitate of Citizens Republic Bancorp (the “Secured
Party”). Debtor and Secured Party hereby agree as follows:

WITNESSETH:

     WHEREAS, Debtor is indebted to Secured Party pursuant to, among other things, (i) that certain
Credit Agreement dated of even date herewith by and between Debtor and Secured Party (the “Credit
Agreement”), (ii) that certain Term Note dated of even date herewith executed by Debtor and made
payable to the order of Secured Party, in the principal amount of Two Million Six Hundred
Forty-Five Thousand and no/100 Dollars ($2,645,000.00) (said Term Note, as increased, decreased,
amended, modified, revised, supplemented, substituted, renewed, extended or restated from time to
time, is hereinafter collectively referred to as the “Note”), and (iii) such other agreements,
instruments and documents executed or delivered by Debtor in connection with the Credit Agreement
or the Note, or as security therefor or otherwise related thereto (the Credit Agreement, the Note
and all other aforesaid agreements, instruments and documents, as amended, modified, revised,
supplemented, substituted, renewed, extended or restated from time to time, are hereinafter
collectively referred to as the “Loan Documents”).

	1.	 	SECURITY INTEREST; OBLIGATIONS: In consideration of and as security for the full and
complete payment, performance and observance of all Obligations (as hereinafter defined)
Debtor hereby assigns as collateral and grants to Secured Party a security interest in and to
all items of property described in Paragraph 2 of this Agreement. This assignment of
collateral and grant of security interest shall secure all loans, advances, indebtedness and
each and every other obligation or liability of Debtor owed to Secured Party or any affiliate
of Citizens Republic Bancorp, however created, of every kind and description, whether now
existing or hereafter arising and whether direct or indirect, joint or several, primary or as
guarantor or surety, absolute or contingent, due or to become due, liquidated or unliquidated,
matured or unmatured, secured or unsecured, participated in whole or in part, created by trust
agreement, lease, overdraft, agreement, promissory note, guaranty, indemnification, letter of
credit, rate management obligations and/or agreements, credit accommodations or otherwise,
whether or not secured by additional collateral, whether originated with Secured Party or owed
to others and acquired by Secured Party by purchase, assignment or otherwise, and including,
without limitation, all loans, advances, indebtedness and each and every other obligation or
liability arising under the Credit Agreement, the Note and/or the other Loan Documents,
letters of credit, rate management agreements, ISDA Master Agreements and related schedules
and confirmations, and any other indebtedness or obligations, whether now existing or
hereafter arising and issued by Secured Party or any affiliate of Citizens Republic Bancorp
for the benefit of or at the request of Debtor, all obligations to perform or forbear from
performing acts, and all agreements, instruments and documents evidencing, guarantying or securing or otherwise

 

 

	 	 	executed in connection with any of the foregoing, together with any and all increases,
decreases, amendments, modifications, revisions, supplements, substitutions, renewals,
extensions or restatements thereof, and all expenses and attorneys’ fees incurred or other
sums disbursed by Secured Party under this Agreement or any other document, instrument or
agreement related to any of the foregoing (all of the foregoing obligations set forth in this
Paragraph 1 are hereinafter, collectively referred to as the “Obligations”).

	2.	 	COLLATERAL: Debtor hereby grants to Secured Party a continuing security interest in
all right, title and interest of Debtor in the collateral now existing and hereafter arising
or acquired by Debtor, regardless of where it is located, and is defined as follows (together
with all proceeds and products thereof and all additions and accession thereto, replacements
thereof, supporting obligations therefor, guaranties thereof, insurance or condemnation
proceeds thereof, documents related thereto, all sales of accounts constituting a right to
payment therefrom, all tort or other claims against third parties arising out of damage
thereto or destruction thereof, all property received wholly or partly in trade or exchange
thereof, all fixtures attached or appurtenant thereto, all leases thereof, and all rents,
revenues, issues, profits and all proceeds arising from the sale, lease, license, encumbrance,
collection or any other temporary or permanent disposition thereof, or any other interest
therein, collectively, the “Collateral”):

	 	(a)	 	All Accounts, all Accounts Receivable, all Cash Security, all Inventory, all
Equipment, all General Intangibles, and all Investment Property, in each case whether now
owned or hereafter acquired or received by Debtor; and
	 
	 	(b)	 	All Instruments, Documents, chattel paper, electronic chattel paper, securities,
moneys, cash, letters of credit, letter of credit rights, promissory notes, warrants,
dividends, distributions, commercial tort claims, contracts, agreements, contract rights
or other property, owned by Debtor or in which Debtor has an interest, including but not
limited to, those which are now or hereafter in the possession or control of Secured
Party or in transit by mail or carrier to or in the possession of any third party acting
on behalf of Secured Party, without regard to whether Secured Party received the same in
pledge, for safekeeping, as agent for collection or transmission or otherwise or whether
Secured Party had conditionally released the same, and the proceeds thereof, all rights
to payment from, and all claims against Secured Party, and any deposit accounts of Debtor
with Secured Party, including all demand, time, savings, passbook or other accounts and
all deposits therein; and
	 
	 	(c)	 	All of the Proceeds, products, profits, and rents of Debtor’s Accounts, Accounts
Receivable, Inventory, Equipment, Cash Security, Investment Property and General
Intangibles and all books and records, including computer software, used in connection
with any of the Collateral.

	3.	 	DEFINITIONS: Capitalized terms not otherwise defined in this Agreement shall have the
meanings attributed thereto in the applicable version of the Uniform Commercial Code adopted
in the jurisdiction in the state in which Debtor is organized, or where appropriate, the
jurisdiction in which the collateral is located, as such definitions may be enlarged or expanded from time
to time by legislative amendment thereto or judicial decision (the

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	 	 	“Uniform Commercial Code”). As used herein the following capitalized terms will have the following
meanings:

(a) “Deposit Account”, “Document”, “Goods”, “Instrument”, and “Proceeds”, have the meanings
as set forth in Ohio Revised Code Sections 1309.102 from time to time, including any
amendments thereof and any substitutions therefor, which definitions are hereby incorporated
by reference as though fully rewritten herein.

	 	(b)	 	“Accounts” means all accounts, accounts receivable, health-care-insurance
receivables, credit card receivables, contracts, contract rights, instruments, documents,
tax refunds from federal, state or local governments and all obligations in any form
including without limitation those arising out of the sale or lease of goods or the
retention of services by Debtor; all guaranties, letters of credit and other security and
supporting obligations for any of the above; all merchandise resumed to or reclaimed by
Debtor, and all books and records (including computer programs, tapes and data processing
software) evidencing an interest in or relating to the above; all winnings in a lottery
or other game of chance operated by a governmental unit or person licensed to operate
such game by a governmental unit and all rights to payment therefrom; and any “Account”
as the same is now or hereafter defined in the Uniform Commercial Code.
	 
	 	(c)	 	“Accounts Receivable” means:

(i) any account receivable, Account, Document, or Instrument owned, acquired, or
received by a Person,

(ii) any other indebtedness owed to or receivable owned, acquired, or received by a
Person of whatever kind and however evidenced, and

(iii) any right, title, and interest in a Person’s Goods which were sold, leased, or
furnished by that Person and gave rise to either (i) or (ii) above, or both of them.
This includes, without limitation,

(A) any rights of stoppage in transit of a Person’s sold, leased, or
furnished Goods,

(B) any rights to reclaim a Person’s sold, leased, or furnished Goods, and

(C) any rights a Person has in such sold, leased, or furnished Goods that
have been returned to or repossessed by that Person.

	 	(d)	 	“Cash Security” means all cash, Instruments, Deposit Accounts, and other cash
equivalents, whether matured or unmatured, whether collected or in the process of
collection, upon which Debtor presently has or may hereafter have any claim, that are
presently or may hereafter be existing or maintained with, issued by, drawn upon, or in
the possession of a bank or is subject to a Deposit Account Control Agreement or Account
Control Agreement as defined herein.

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	 	(e)	 	“Deposit Account Control Agreement” means any authenticated record from a bank or
other financial institution providing that the bank or other financial institution will
comply with instructions originated by a secured party directing disposition of the funds
in the Deposit Account without further consent of the Debtor.
	 
	 	(f)	 	“Equipment” means all goods (excluding inventory, farm products or consumer goods),
machinery, machine tools, equipment, fixtures, office equipment, furniture, furnishings,
motors, motor vehicles, tools, dies, parts, jigs, goods (including, without limitation,
each of the items of equipment set forth on any schedule which is either now or in the
future attached to Secured Party’s copy of this Agreement), and all attachments,
accessories, accessions, replacements, substitutions, additions and improvements thereto,
and all supplies used or useful in connection therewith, and all “Equipment” as same is
now or hereafter defined in the Uniform Commercial Code.
	 
	 	(g)	 	“General Intangibles” means all general intangibles, choses in action, causes of
action, obligations or indebtedness owed to Debtor from any source whatsoever, payment
intangibles, software and all other intangible personal property of every kind and nature
(other than Accounts) including without limitation patents, trademarks, trade names,
service marks, copyrights and applications for any of the above, and goodwill, trade
secrets, permits, licenses, certifications, franchises, rights under agreements,
operating rights, distributorship and distribution agreements, tax refund claims, and all
books and records including all computer programs, disks, tapes, printouts, customer
lists, credit files and other business and financial records, and the equipment
containing any such information, and all “General Intangibles” as same is now or
hereafter defined in the Uniform Commercial Code.
	 
	 	(h)	 	“Inventory” means all goods, supplies, wares, merchandises and other tangible
personal property including raw materials, work in process, supplies and components, and
finished goods, whether held for sale or lease, or furnished or to be furnished under any
contract for service, or used or consumed in business, and also including products of and
accessions to inventory, packing and shipping materials, and all documents of title,
whether negotiable or non-negotiable, representing any of the foregoing, and all
“Inventory” as same is now or hereafter defined in the Uniform Commercial Code.
	 
	 	(i)	 	“Investment Property” means a security, whether certificated or uncertificated,
security entitlement, securities account, commodity contract or commodity account and all
“Investment Property” as same is now or hereafter defined in the Uniform Commercial Code.
	 
	 	(j)	 	“Person” has the meaning as set forth in Ohio Revised Code Section 1301.01 from
time to time, including any amendments thereof and any substitutions therefor, which
definitions are hereby incorporated by reference as though fully rewritten herein.

	4.	 	WARRANTIES AS TO DEBTOR: Debtor hereby represents and warrants to Secured Party as follows:

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	 	(a)	 	It is a corporation with its principal place of business located at the address
otherwise set forth herein, and is duly organized, validly existing and in good standing
under the laws of the State of Ohio.
	 
	 	(b)	 	Debtor further warrants that its exact legal name is set forth in the initial
paragraph of this Agreement, and its Taxpayer I.D. No. is ___, and its
Charter No. is 1377445.
	 
	 	(c)	 	Exhibit A attached to this Agreement and incorporated herein by reference
lists the locations of any and all of the Collateral of Debtor.

	5.	 	WARRANTIES AS TO COLLATERAL: Debtor hereby represents and warrants to Secured Party
that:

	 	(a)	 	Except for the security interest hereby granted, Debtor is, and as to any property
which at any time forms a part of the Collateral, shall be, the sole owner of, with good
and marketable title in, each and every item of the Collateral, or otherwise shall have
the full right and power to grant a security interest in the Collateral, free from any
lien, security interest or encumbrance whatsoever.
	 
	 	(b)	 	Each item described as Collateral is, and shall be, valid, and all information
furnished to Secured Party with regard thereto is, and shall be, accurate and correct in
all respects when furnished;
	 
	 	(c)	 	None of the Collateral shall be sold (except for Inventory sold in the ordinary
course of business), assigned, transferred, discounted, hypothecated, or otherwise
subjected to any lien, encumbrance or security interest (except as otherwise provided in
Paragraph 5(a) above), and that Debtor shall defend such Collateral and each and every
part thereof against claims of all persons at any time claiming such Collateral or
claiming any interest therein adverse to Secured Party except as aforesaid;
	 
	 	(d)	 	The provisions of this Agreement are sufficient to create in favor of Secured Party
a valid and continuing first lien on, and valid first security interest in, the types of
Collateral in which a security interest may be perfected by the filing of UCC Financing
Statements, and when such UCC Financing Statements are filed in the requisite filing
offices, and the requisite filing fees are paid, such filings shall be sufficient to
perfect such security interest (other than Equipment affixed to real property so as to
become fixtures);
	 
	 	(e)	 	If any of the Collateral is or will be attached to real estate in such a manner as
to become a fixture under applicable state law, that said real estate is not encumbered
in any way except in favor of Secured Party, or if said real estate is encumbered, Debtor
will secure from the lien holder or the party in whose favor it is or will become so
encumbered a written acknowledgment and subordination to the security interest hereby
granted or a written disclaimer of any interest in the Collateral, in such form as is
acceptable to Secured Party; and

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	 	(f)	 	The financial statements of Debtor submitted to the Secured Party are true and
correct and there are no material adverse changes in the conditions, financial or
otherwise, of Debtor since the date of said financial statements.

	6.	 	DEBTOR’S RESPONSIBILITIES: Debtor covenants with, and represents and warrants to
Secured Party, that Debtor shall:

	 	(a)	 	Upon Secured Party’s request, furnish to Secured Party, in writing, a current list
of all Collateral for the purpose of identifying the Collateral and, further, execute and
deliver such supplemental instruments, documents, agreements and chattel paper, in the
form of assignments or otherwise, as Secured Party shall reasonably require for the
purpose of confirming and perfecting, and continuing the perfection of, Secured Party’s
security interest in any or all of such Collateral, or as is necessary to provide Secured
Party with control over the Collateral or any portion thereof;
	 
	 	(b)	 	At its expense and upon request of Secured Party, furnish copies of invoices issued
by Debtor in connection with the Collateral, furnish certificates of insurance evidencing
insurance on Collateral, furnish proof of payment of taxes and assessments on Collateral,
make available to Secured Party, any and all of Debtor’s books, records, written
memoranda, correspondence, purchase orders, invoices and other instruments or writings
that in any way evidence or relate to the Collateral;
	 
	 	(c)	 	Keep the Collateral insured at all times against risks of loss or damage by fire
(including so-called extended coverage), theft and such other casualties including
collision in the case of any motor vehicle, all in such amounts, under such forms of
policies, upon such terms, for such periods and written by such companies or underwriters
as is satisfactory to Secured Party. In all cases losses shall be payable to Secured
Party and any surplusage shall be paid to Debtor. All policies of insurance shall
provide for at least thirty (30) days prior written notice of cancellation to Secured
Party. Should Debtor at any time fail to purchase or maintain insurance, pay taxes, or
pay for any expense, incident or such insurance, Secured Party may, but is not obligated
to, pay such taxes, order and pay for such necessary items of preservation, maintenance
or protection of the Collateral, and Debtor agrees to reimburse Secured Party for all
expenses incurred under this paragraph;
	 
	 	(d)	 	Pay all taxes or assessments imposed on or with respect to the Collateral;
	 
	 	(e)	 	Keep all of the Collateral in good condition and repair and working order, ordinary
wear and tear excepted, protecting it from weather and other contingencies which might
adversely affect it as secured hereunder, and not permit any waste or damage with respect
thereto;
	 
	 	(f)	 	Notify Secured Party immediately in writing of any information which Debtor has or
may receive which might in any way adversely affect the value of the Collateral or the
rights of Secured Party with respect thereto;

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	 	(g)	 	Notify Secured Party promptly, in writing, of any change in the location of the
Collateral or of any place of business or mailing addresses or the establishment of any
new place of business or mailing address;
	 
	 	(h)	 	Pay all costs of filing any financing, continuation or termination statements with
respect to the security interest created hereby;
	 
	 	(i)	 	Upon the occurrence of an Event of Default or breach of any provision of this
Security Agreement, pay all expenses and reasonable attorneys’ fees of Secured Party; and
Debtor agrees that said expenses and fees shall be secured under this Agreement;
	 
	 	(j)	 	Maintain possession of all Collateral at the location disclosed to Secured Party
and not to remove the Collateral from that location;
	 
	 	(k)	 	Not sell, contract to sell, lease, encumber, or otherwise transfer the Collateral
(other than inventory sold in the ordinary course of business) until the Obligations have
been paid and performed, Debtor acknowledging nonetheless that Secured Party has a
security interest in the proceeds of such Collateral; and
	 
	 	(l)	 	Take any other and further action necessary or desirable as requested by Secured
Party to grant Secured Party control over the Collateral, as “control” is defined in the
applicable version of the Uniform Commercial Code, including without limitation (i)
executing and/or authenticating any assignments, third party agreements, Deposit Account
Control Agreement or any other account control agreement (“Account Control Agreement”),
in a form acceptable to Secured Party; (ii) delivering, or causing the delivery of, any
of the Collateral to the possession of Secured Party; and (iii) obtaining written
acknowledgments of the lien of Secured Party and agreements of subordination to such lien
from third parties in possession of the Collateral in a form acceptable to Secured Party.
Debtor consents to and hereby authorizes any third party in an authenticated record or
agreement between Debtor, Secured Party, and the third party, including but not limited
to depository institutions, securities intermediaries, and issuers of letters of credit
or other support obligations, to accept direction from Secured Party regarding the
maintenance and disposition of the Collateral and the products and proceeds thereof, and
to enter into agreements with Secured Party regarding same, without further consent of
the Debtor.
	 
	 	(m)	 	By signing below, Debtor authenticates this Security Agreement and authorizes
Secured Party, as a secured party, to complete and file with the appropriate filing
office(s): (i) one or more Uniform Commercial Code Financing Statement(s) (UCC-1), describing the
Collateral against which Secured Party has been granted a security interest by Debtor,
pursuant to the terms of this Security Agreement and/or any Collateral described on any
schedules or exhibits attached hereto and incorporated herein by reference; and (ii) one
or more Uniform Commercial Code Financing Statement(s) (UCC-3) to terminate, continue,
assign and/or ammend any previously

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	 	 	 	filed financing statement relating to this Security Agreement and/or the Collateral described herein.

	7.	 	ACCOUNTS RECEIVABLE: Debtor hereby agrees that notwithstanding the fact that all or
any part of the Obligations is not matured and Debtor is current in payment according to the
terms of the Obligations, Secured Party shall have the absolute right to take any one or more
of the following actions, upon the occurrence of an Event of Default (as hereinafter defined):

	 	(a)	 	Secured Party may serve written notice on Debtor instructing Debtor to deliver to
Secured Party all subsequent payments on Accounts Receivable which Debtor shall do until
notified otherwise;
	 
	 	(b)	 	Secured Party may notify the account debtor(s) of its security interest and
instruct such account debtor(s) to make further payments on such accounts to Secured
Party instead of to Debtor; and
	 
	 	(c)	 	Secured Party may serve written notice upon Debtor that all subsequent billings or
statements of account rendered to any account debtor shall bear a notation directing the
account debtor(s) to make payment directly to Secured Party. Any payment received by
Secured Party pursuant to this paragraph shall be retained in a separate non-interest
bearing account as security for the payment and performance of all Obligations of Debtor.

	8.	 	POWER OF ATTORNEY: Debtor hereby makes, constitutes and appoints Secured Party its
true and lawful attorney-in-fact to act, with full power of substitution, with respect to the
Collateral in any transaction, legal proceeding, or other matter in which Secured Party is
acting pursuant to this Agreement, including, but not limited to, executing, authentication
and/or filing on its behalf: (i) UCC Financing Statements reflecting the lien of Secured Party
upon the Collateral and any other documents necessary or desirable to perfect or otherwise
continue the security interest granted herein; and (ii) any third party agreements or
assignments to grant Secured Party control over the Collateral, including but not limited to,
third party agreements between Debtor, Secured Party, and depository institutions, securities
intermediaries, and issuers of letters of credit or other support obligations, which third
party agreements direct the third party to accept direction from Secured Party regarding the
maintenance and disposition of the Collateral and the products and proceeds thereof.
	 
	9.	 	EVENTS OF DEFAULT: Any of the following events shall be an “Event of Default”
hereunder:

     (a) An event of default occurs (after any applicable grace period has expired) under any
agreement, instrument or document evidencing, guarantying, securing or otherwise executed or
delivered in connection with any of the Obligations, as “Event of Default” shall be defined
therein, including, but not limited to, the Credit Agreement or the Note.

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     (b) Any representation or warranty of Debtor set forth in this Agreement or in any
agreement, instrument, document, certificate or financial statement evidencing, guarantying,
securing or otherwise related to, this Agreement or any other Obligation shall be materially
inaccurate or misleading.

     (c) Debtor shall fail to maintain in force the insurance required in this Agreement or in
any agreement, instrument, document, certificate or financial statement evidencing,
guarantying, securing or otherwise related to, this Agreement or any other Obligation, or
Debtor shall otherwise default in the observance or performance of any covenant or agreement
set forth in any of the foregoing for a period of thirty (30) days.

	10.	 	REMEDIES. Upon the occurrence of an Event of Default, Secured Party may, without
further notice to Debtor, at Secured Party’s option, declare the Note and all of the
Obligations to become due and payable in its aggregate amount; provided that the Obligations
shall be accelerated automatically and immediately if the Event of Default is a filing under
the Bankruptcy Code. Secured Party may resort to the rights and remedies of a secured party
under the Uniform Commercial Code, including but not limited to the right of a secured party
to (a) enter any premises of Debtor, with or without legal process and take possession of the
Collateral and remove it and any records pertaining thereto and/or remain on such premises and
use it for the purpose of collecting, preparing and disposing of the Collateral; (b) ship,
reclaim, recover, store, finish, maintain and repair the Collateral; and (c) sell the
Collateral at public or private sale. Debtor will be credited with the net proceeds of such
sale only when they are actually received by Secured Party, and any requirement of reasonable
notice of any disposition of the Collateral will be satisfied if such notice is sent to Debtor
ten (10) days prior to such disposition. Debtor will, upon request, assemble the Collateral
and any records pertaining thereto and make them available at a place designated by Secured
Party. Secured Party may use, in connection with any assembly or disposition of the
Collateral, any trademark, trade name, trade style, copyright, patent right, trade secret or
technical process used or utilized by Debtor. No remedy set forth herein is exclusive of any
other available remedy or remedies, but each is cumulative and in addition to every other
remedy given under this Agreement, and of the Obligations, or now or hereafter existing at law
or in equity or by statute. Secured Party may proceed to protect and enforce its rights by an
action at law, in equity or by any other appropriate proceedings. No failure on the part of
Secured Party to enforce any of the rights hereunder shall be deemed a waiver of such rights
or of any Event of Default and no waiver of any Event of Default shall be deemed to be a
waiver of any subsequent Event of Default.
	 
	11.	 	MISCELLANEOUS PROVISIONS:

	 	(a)	 	All rights of Secured Party shall inure to the benefit of its successors and
assigns and all obligations of Debtor shall bind the successors and assigns of Debtor.
	 
	 	(b)	 	Debtor acknowledges and agrees that, in addition to the security interests granted
herein, Secured Party has a banker’s lien and common law right of set-off in and to
Debtor’s deposits, accounts and credits held by Secured Party and Secured Party may

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	 	 	 	apply or set-off such deposits or other sums against the Obligations upon the occurrence of an
Event Default as set forth in this Agreement.
	 
	 	(c)	 	This Agreement contains the entire agreement of the parties with respect to the
subject matter hereof and no oral agreement whatsoever, whether made contemporaneously
herewith or hereafter shall amend, modify or otherwise affect the terms of this
Agreement.
	 
	 	(d)	 	DEBTOR HEREBY WAIVES THE RIGHT TO A TRIAL BY JURY OF ANY MATTERS ARISING OUT OF
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
	 
	 	(e)	 	All rights and liabilities hereunder shall be governed by and construed in
accordance with the laws of the State of Ohio.
	 
	 	(f)	 	Any provision herein which may prove limited or unenforceable under any law or
judicial ruling shall not affect the validity or enforceability of the remainder of this
Agreement.
	 
	 	(g)	 	Debtor hereby further authorizes Secured Party to file UCC Financing Statements on
behalf of Debtor and Secured Party with respect to the Collateral.

Remainder of this page intentionally left blank

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	 	(h)	 	Secured Party is hereby authorized to fill in all blank spaces herein, to correct
patent errors herein, to complete or correct the description of the Collateral, and to
date this Agreement.

	 	 	 	 	 	 	 	 	 
	SECURED PARTY:	 	DEBTOR:	 	 
	 
	 	 	 	 	 	 	 	 
	CITIZENS BANK	 	GREAT PLAINS NATURAL GAS COMPANY,

an Ohio corporation	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ David Tholt
	 	By:
	 	/s/ Thomas J. Smith
	 	 
	 

	 	 
	 	 	 	 	 	 
	 

	 	David Tholt
	 	 	 	Thomas J. Smith,	 	 
	 

	 	Vice President
	 	 	 	Treasurer and Secretary	 	 

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EXHIBIT “A”

Location(s) of Debtor

8500 Station Street, Mentor, Ohio 44060

12exv10w28xay

EXHIBIT 10.28(a)

GUARANTY

     THIS GUARANTY (this “Guaranty”) is executed and delivered effective as of July 3, 2008, by
RICHARD M. OSBORNE, individually as a natural person, who is a resident of the State of Ohio, with
an address at 8500 Station Street, Mentor, Ohio 44060 (“Guarantor”), in favor of CITIZENS BANK,
having an address at 328 S. Saginaw Street, Flint, Michigan 48502 (“Bank”).

W I T N E S S E T H:

     WHEREAS, Bank has agreed to lend to Great Plains Natural Gas Company, an Ohio corporation
(“Borrower”), a term loan in the principal amount of Two Million Six Hundred Forty-Five Thousand
and no/100 Dollars ($2,645,000.00) (the “Loan”), pursuant to and in accordance with the Credit
Agreement dated of even date herewith by and between Borrower and Bank (the “Credit Agreement”);
and

     WHEREAS, Borrower has executed and delivered to Bank, among other things, a Term Note dated of
even date herewith, in the principal amount of Two Million Six Hundred Forty-Five Thousand and
no/100 Dollars ($2,645,000.00), to evidence its obligation to repay the Loan to be made to it by
Bank and to perform all of its obligations under the Loan Documents (the Term Note, as the same may
from time to time be increased, decreased, amended, modified, revised, supplemented, renewed,
extended or restated, is hereinafter referred to as the “Note”); and

     WHEREAS, the Loan is secured by, among other things, a Security Agreement dated of even date
herewith, by and between Borrower and Bank (the “Security Agreement”) and such other documents
executed in connection with the Credit Agreement, the Note or the Security Agreement (the Credit
Agreement, the Note and the Security Agreement, together with such other documents executed in
connection with any of the foregoing, as the same may from time to time be amended, modified,
revised, supplemented, substituted, renewed, extended or restated, are hereinafter collectively
referred to as the “Loan Documents”); and

     WHEREAS, Guarantor has a direct economic interest in Borrower, and the Loan to Borrower is
given in consideration of this Guaranty and such Loan will inure directly or indirectly to the
benefit of Guarantor, and such benefit is sufficient consideration for the execution and delivery
of this Guaranty in favor of Bank; and

     WHEREAS, Guarantor has agreed to execute and deliver this Guaranty to Bank at the request of
Borrower in order to induce Bank to make and close the Loan and to satisfy a condition precedent to
closing and funding the Loan.

     NOW, THEREFORE, in consideration of the premises and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and to induce Bank to make the Loan
to Borrower, Guarantor does hereby agree with Bank as follows:

     1. Guarantor hereby irrevocably, absolutely and unconditionally, and jointly and severally with all
other guarantors of the Loan, guarantees to Bank, its successors and assigns, and all subsequent
holders of the Note, the full and prompt payment and performance of the following

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(hereinafter collectively referred to as the “Obligations”): all loans, advances, debts,
liabilities, indebtedness, obligations, covenants, undertakings, promises, agreements, and duties
now or hereafter owing to Bank or any affiliate of Citizens Republic Bancorp from Borrower of any
kind or nature whatsoever, present or future, whether arising by reason of an extension of credit,
opening of a letter of credit, loan, promissory note, guarantee, endorsement, indemnification,
agreement, undertaking, contract, rate management agreement, or in any manner whatsoever, whether
direct or indirect (including those acquired by assignment, participation, purchase, negotiation,
discount or otherwise), matured or unmatured, liquidated or unliquidated, primary or secondary,
absolute or contingent, joint or several, due or to become due, now existing or hereafter arising
and whether or not contemplated by Borrower or Bank on the date hereof, including, but not limited
to, the Note or the other Loan Documents, and all amendments, modifications, revisions,
supplements, substitutions, renewals, extensions or restatements thereof, and all principal,
interest, charges, expenses, costs, fees (including reasonable attorneys’ fees), indemnification
obligations and other sums of any kind thereunder or relating thereto whatsoever. Upon failure of
Borrower to pay or perform any of the Obligations when and as the same becomes due and payable and
the same is not made by Borrower within any applicable grace period, if any, Bank may, at its sole
option, accelerate the payment of the Obligations, all accrued interest and other charges payable
thereunder, in which event Guarantor shall pay to Bank, on demand, the entire amount of the
Obligations. Bank shall not be obligated to proceed against, or exhaust any other remedies it may
have under the Loan Documents or any other documents, or resort to any other security held by Bank,
or proceeding against any other guarantor, and Bank may, at its option, proceed directly and at
once, without notice, against Guarantor, to collect and recover the full amount of the liability
hereunder or any portion thereof. Any and all payments due hereunder shall be made in lawful money
of the United States of America at 328 S. Saginaw Street, Flint, Michigan 48502, or such other
address as Bank may from time to time designate.

     2. Guarantor agrees (a) to furnish to Bank on or prior to the date hereof and on an annual
basis thereafter on or before November 30th of each calendar year, and upon Bank’s
written request during the occurrence of any ongoing default or event of default hereunder or under
any Loan Documents, a copy of the current personal financial statement of Guarantor, certified by
Guarantor, in such form and substance as Bank shall require; (b) to furnish to Bank within fourteen
(14) days after filing, a copy of the current federal income tax return of Guarantor together with
all schedules and corresponding K-1’s, and if any such return is the subject of any extension, a
copy of each such extension shall be provided to Lender within thirty (30) days after filing of
same; and (c) to promptly notify Bank of any pending or threatened litigation, the outcome of which
could have a material adverse effect on the assets, properties, finances or prospects of Guarantor.
Failure to comply with the requirements of this paragraph shall constitute a default hereunder and
under the Loan Documents.

     3. Guarantor acknowledges that: Guarantor has a direct economic investment or interest in
Borrower, as a partner, shareholder, member, trust beneficiary, or otherwise; that Guarantor is
making this Guaranty in Guarantor’s individual capacity; that Guarantor shall remain liable
hereunder whether or not Guarantor retains any financial interest in Borrower; and that Guarantor
has received sufficient consideration for the execution and delivery of this Guaranty in favor of
Bank.

     4. The obligations of Guarantor under this Guaranty shall be irrevocable, absolute and
unconditional, and joint and several with all other guarantors of the Loan and shall remain in full
force and effect until the principal balance of the Note, all accrued but unpaid interest on the
Note,

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and all other Obligations referred to above in Section 1, shall have been irrevocably and
indefeasibly paid in full and Bank has no further obligation to make advances under the Note.

     5. The obligations of Guarantor under this Guaranty shall not be affected, modified or
impaired upon the happening of any event, including, without limitation, any of the following,
whether or not with notice to or the consent of Guarantor:

     (a) The amendment, modification, revision, supplement, substitution, renewal, extension or
restatement of any security given by Borrower to Bank to secure repayment of the indebtedness
hereby being guaranteed;

     (b) The waiver, release or termination of any of the covenants, agreements or obligations of
Borrower under the Note or Borrower and/or any other guarantor or under any of the other Loan
Documents or the Obligations;

     (c) The amendment, modification, revision, supplement, substitution, renewal, extension or
restatement (whether material or otherwise) of the Note, any other Loan Documents, the Obligations
or any obligation, covenant or agreement as set forth in the Note, in any of the other Loan
Documents or the Obligations;

     (d) Any failure, omission, delay or lack on the part of Bank to enforce, assert or exercise
any right, power or remedy conferred upon it in this Guaranty, in the Note, in any of the other
Loan Documents or the Obligations, or any other acts or omissions on the part of Bank;

     (e) The voluntary or involuntary liquidation, dissolution, sale or other disposition of all or
substantially all of the assets of Borrower or Guarantor, however effected, or receivership,
insolvency, bankruptcy, assignment for the benefit of creditors, reorganizations, arrangement,
composition with creditors or readjustment or other similar proceedings affecting Borrower,
Guarantor, any other guarantor, or any of the assets of Guarantor, or any allegation or contest of
the validity of this Guaranty, the Note, any of the other Loan Documents or the Obligations, or the
disaffirmance of the Note, any of the other Loan Documents or the Obligations in any such
proceeding;

     (f) The invalidity, illegality or unenforceability of the Note, any of the other Loan
Documents or the Obligations; or of any provision of the Note, any of the other Loan Documents or
the Obligations;

     (g) The existence, value or condition of any other security or guaranty, or failure by Bank to
perfect any lien against, or obtain any security for the Obligations or obtain any other guaranty
of the Obligations, or any action or the absence of any action by Bank in respect of such security
or guaranty (including, without limitation, the release of any such security or guaranty); or

     (h) Any other event or action that would, in the absence of this clause, result in the release
or discharge by operation of law of Guarantor from the performance or observance of any obligation,
covenant or agreement contained in this Guaranty.

     6. If after receipt of any payment of all or any part of the Obligations, Bank is for any
reason compelled to surrender such payment to any person or entity, because such payment is
determined to be void or voidable as a preference, impermissible setoff, diversion of trust funds
or

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for any other reason (including, without limitation, insolvency, bankruptcy, liquidation or
reorganization of Borrower or any other guarantor) then to the extent of that payment, the
Obligations shall be revived and the obligations of Guarantor under this Guaranty shall be continued in effect without reduction
or discharge for that payment, and this Guaranty shall continue in full force notwithstanding any
contrary action which may have been taken by Bank in reliance upon such payment, and any such
contrary action so taken shall be without prejudice to any Bank’s rights under this Guaranty and
shall be deemed to have been conditioned upon such payment having become final, irrevocable and
indefeasible.

     7. No setoff, counterclaim or reduction, no diminution of an obligation, and no defense of any
kind or nature that Guarantor has or may have against Borrower, Bank or any other guarantor shall
affect, modify or impair the obligations hereunder of Guarantor.

     8. For so long as this Guaranty remains in effect, Guarantor shall not have, and Guarantor
hereby expressly waives, releases and discharges during such time, any and every right of
exoneration, subrogation, contribution, reimbursement and indemnity whatsoever, and any and every
right of recourse to security for the debts and Obligations guaranteed hereby, whether against
Borrower, any other guarantor or otherwise, until the Obligations have been irrevocably and
indefeasibly paid in full. Guarantor hereby indemnifies Bank and agrees to defend and hold
harmless Bank from and against the loss, mitigation, subordination or other consequences adverse to
Bank by reason of this Guaranty being challenged as a preference or suffering any other subjugation
under any bankruptcy or other law, whether state or federal, affecting debtors, creditors and/or
the relationship between and among them. Without limiting the generality of the foregoing, for so
long as this Guaranty remains in effect, any and all debts and obligations of Borrower to Guarantor
(or any other guarantor) whether past, present or future are hereby waived, satisfied and
discharged until the Obligations have been irrevocably and indefeasibly paid in full and Bank has
no further obligations to make advances under the Note.

     9. Guarantor hereby expressly waives notice in writing or otherwise from Bank of Bank’s
acceptance of and reliance on this Guaranty. Guarantor agrees to pay and shall be liable for all
costs, expenses and fees, including all reasonable attorneys’ fees, which may be incurred by Bank
in enforcing or attempting to enforce this Guaranty against Guarantor, whether the same shall be
enforced by suit or otherwise and except as may be limited by law or judicial order or decision
entered in an action to seek recovery of such costs, expenses and fees. Guarantor hereby waives
presentment, demand, protest, notice of non-payment, notice of dishonor and all suretyship
defenses.

     10. This Guaranty shall bind Guarantor and Guarantor’s heirs, executors, administrators,
personal representatives, successors and assigns, and shall inure to the benefit of Bank and its
successors and assigns. Guarantor’s liabilities and other obligations under this Guaranty shall
survive Guarantor’s death, incompetency or legal disability.

     11. If any clause or provision of this Guaranty is held illegal, invalid or unenforceable by
any court, this Guaranty shall be construed and enforced as if such illegal, invalid or
unenforceable clause or provision had not been contained herein.

     12. No remedy herein conferred upon or reserved to the Bank is intended to be exclusive of
any other available remedy or remedies, but each and every such remedy shall be cumulative and
shall be in addition to every other remedy given under this Guaranty or now or hereafter existing
at law or in equity or by statute. No delay or omission to exercise any right or

Page 4 of 6

 

power accruing upon any default, omission or failure of performance hereunder shall impair any such right or
power or shall be construed to be a waiver thereof, but any such right and power may be exercised
from time to time and as often as may be deemed expedient by the Bank. In order to entitle the
Bank to exercise any remedy reserved to it in this Guaranty, it shall not be necessary to give any
notice, other than such notice as may be herein expressly required. If any provision contained in
this Guaranty should be breached by any party and thereafter duly waived by the other party, such
waiver shall be limited to the particular breach so waived and shall not be deemed to waive any
other breach hereunder. No waiver, amendment, release or modification of this Guaranty shall be
established by conduct, custom or course of dealing, but solely by an instrument in writing duly
executed by the parties hereto. This Guaranty may be amended only by a written agreement signed by
the parties hereto and accepted by the Bank.

     13. Guarantor hereby authorizes any attorney at law to appear in any court of record in the
State of Ohio, or in any other state or territory of the United States after the obligations of
Guarantor become due, whether by lapse of time, acceleration of maturity or otherwise, waive the
issuance and service of process, admit the maturity of the obligations of Guarantor, confess
judgment against Guarantor in favor of any holder of this Guaranty for the amount then appearing
due, together with interest thereon and costs of suit, and thereupon to release all errors and
waive all rights of appeal and stay of execution. Guarantor expressly (a) waives a conflict of
interest as to any attorney retained by Bank to confess judgment against Guarantor upon this
Guaranty, and (b) consents to the attorney retained by Bank receiving a legal fee from Bank for
legal services rendered for confessing judgment against Guarantor, upon this Guaranty. The death
of Guarantor shall not impair the authority herein granted as to the survivor(s) of Guarantor. A
copy of this Guaranty, certified by Bank, may be filed in each such proceeding in place of filing
the original as a warrant of attorney. The authority and power to appear for and enter judgment
against Guarantor, additional exercises thereof or any imperfect exercise thereof, shall not be
extinguished by any judgment entered pursuant thereto.

     14. This Guaranty is a continuing and unconditional guaranty of payment and performance and
not of collection and Guarantor’s obligations hereunder shall be primary and absolute. This
Guaranty shall be deemed to be a contract made under the laws of the State of Ohio and for all
purposes shall be governed by and construed in accordance with the laws of said State. Guarantor
represents and warrants that this Guaranty is being executed and delivered in the State of Ohio.

     15. GUARANTOR HEREBY, AND BANK BY ITS ACCEPTANCE HEREOF, EACH WAIVES THE RIGHT OF A JURY TRIAL
IN EACH AND EVERY ACTION ON THIS GUARANTY OR ANY OF THE OTHER LOAN DOCUMENTS, IT BEING ACKNOWLEDGED
AND AGREED THAT ANY ISSUES OF FACT IN ANY SUCH ACTION ARE MORE APPROPRIATELY DETERMINED BY THE
COURTS. FURTHER, GUARANTOR HEREBY CONSENTS AND SUBJECTS GUARANTOR TO THE JURISDICTION OF COURTS OF
THE STATE OF OHIO AND, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, TO THE VENUE OF SUCH
COURTS IN ANY COUNTY IN WHICH BANK IS LOCATED.

     16. Except for a notice required under applicable law to be given in another manner, any
notice or other communication required or permitted to be given by this Guaranty or the other Loan
Documents or by applicable law shall be in writing and shall be deemed received (a) on the date
delivered, if sent by hand delivery to the address set forth on the first page of this Guaranty,
(b) three (3) business days following the date deposited in U.S. mail, certified or registered,
with return

Page 5 of 6

 

receipt requested, or (c) one (1) business day following the date deposited with
Federal Express or other nationally recognized overnight carrier, and in each case delivered to the
address set forth on the first page of this Guaranty. Either party may change its address to another single address by
notice given as herein provided, except any change of address notice must be actually received in
order to be effective. Notwithstanding the foregoing, routine communications such as statements,
invoices, copies of documents, and the like, may be sent by First Class U.S. Mail.

     17. If the Loan is guaranteed by more than one guarantor, whether in this instrument or by
other instruments, the obligations of Guarantor under this Guaranty shall be joint and several with
all other guarantors.

     IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be executed and delivered to Bank in
the State of Ohio as of the date first above written.

WARNING — BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT TRIAL. IF YOU
DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE
POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE
CREDITOR WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE
AGREEMENT, OR ANY OTHER CAUSE.

	 	 	 	 	 
	 	 	 
	 	                                   /s/ Richard M. Osborne
 	 
	 	RICHARD M. OSBORNE, 	 
	 	Individually as a Natural Person 	 

Page 6 of 6

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