Document:

Unassociated Document

Exhibit 10.4

Prepared Out of State by:

Charles E. Kohlhoss

8120 Woodmont Ave.

Suite 350

Bethesda, MD 20814

Tax Map No. 26-94

Tax Map No. 26-94A

Tax Map No. 27·2

Tax Map No. 27-2B

Tax Map No. 27-8A

 

FORBEARANCE AGREEMENT

 

THIS FORBEARANCE AGREEMENT (hereinafter referred to as the "Agreement") is made effective May 5, 2010 by and between SEAWRIGHT SPRINGS, LLC (hereinafter referred to as the "Borrower"), and CHARTER HOUSE, LLC, a Maryland limited liability company having an address of 8120 Woodmont Ave., Suite 830, Bethesda, MD 20814 (hereinafter referred to as the "Lender"), who, in consideration of the mutual covenants herein and for Ten Dollars and other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, agree as follows:

 

1.           Introductory Provisions. The Lender is the owner and holder of that certain Deed of Trust Note dated June 8, 2006, which has been executed and delivered by the Borrower to the order of the Lender, in the principal amount of $350,000.00, which Deed of Trust Note, as Modified and Increased by that certain Modification Agreement dated October 5, 2006 and recorded in Liber 060015260 at folio 0235 increasing the principal balance to $515,000.00; further Modified and Increased by that certain Second Modification Agreement dated February 1, 2007 and recorded in Liber 070001464 at folio 0172 increasing the principal balance to $645,000.00; as further modified and increased to the aggregate principal balance of$928,000.00 by that certain Third Modification Agreement dated November 27, 2007 and recorded in Liber 070014345 at folio 0253; as further modified by that certain Confirmatory Third Modification Agreement made effective November 27,2007 and recorded as Instrument No. 080004397; and as further modified hereby is hereinafter referred to as the "Note".

 

The Borrower's obligations under the Note are secured by, among other things, that certain Deed of Trust and Security Agreement dated June 8, 2006 made by Borrower to PALMA COLLINS, Trustee and recorded June 26, 2006 in Liber 060008323 at folio 0270 among the Land Records for Augusta County, covering certain real property and improvements thereon, more particularly described on "EXHIBIT A" attached thereto and made a part hereof, which Deed of Trust and Security Agreement, as modified and increased by the Modification Agreements referred to above, is hereinafter referred to as the "Deed of Trust".

 

  

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All liens, security interests, assignments, superior titles, rights, remedies, powers, equities and priorities securing the Note or providing recourse to Lender with respect thereto are hereinafter collectively called the "Liens". The land encumbered by the Deed of Trust and the improvements, now existing or hereafter constructed, and fixtures thereon and appurtenances thereto are hereinafter collectively called the "Property".

 

The Borrower's obligations under the Note and the Deed of Trust, and all renewals, extensions, amendments, supplements and restatements thereof, are hereinafter collectively called the "Obligations". The Note, the Deed of Trust and any other document now or hereafter executed and delivered in connection with the obligations or any part thereof, as such documents or any of them may be renewed, extended, amended, supplemented or restated from time to time, are hereinafter collectively called the "Loan Documents". Terms defined in the Loan Documents and not redefined in this Agreement shall have the same meanings in this Agreement as assigned in the Loan Documents.

 

The Borrower and the Lender now agree to confirm the amount of the indebtedness outstanding under the Note, to ratify the Liens as to all other collateral and confirm that the Liens continue to secure the Obligations, all as set forth in the following provisions of this Agreement (which shall prevail over any conflicting or inconsistent provisions in this section).

 

2.           Principal Balance. On or about July 8, 2008 Borrower paid off all outstanding interest, fees and charges then due and outstanding under the note and paid the principal balance down to the sum of $375,000.00. Simultaneous with the execution hereof Borrower shall pay $140,225.25 toward the balance of all penalties, fees, costs and interest due and outstanding under the Loan Documents which will bring the resulting balance of said charges to the sum of $44,774.75 (which sum is hereinafter referred to as the "Deferred Interest"). As of the date hereof, after credit for said payment, the outstanding principal balance of the Note remains $375,000.00 (excluding the "Deferred Interest"). The outstanding balance of the Note including Deferred Interest and principal is $419,774.75 as of the date hereof. Borrower hereby unconditionally and irrevocably acknowledges and confirms said principal balance and waives and quitclaims all claims and challenges at law and in equity as to all payments made through and including the date hereof to the Lender, its attorneys and agents, whether for interest, late fees, extension fees, forbearance fees, attorneys fees, closing costs, expenses or otherwise, including, without limitation all interest, fees, expenses and other charges paid or to be paid on the settlement sheet(s) of even date herewith prepared by Rhea & Miller, P.C. in connection with the closing of the transaction evidenced hereby.

 

  

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3.           Forbearance/Maturity. The Note matured on October 10, 2008. In exchange for the Forbearance Fee and in consideration of the covenants and agreements made by Borrower herein, the Lender shall refrain from pursuing any remedies against the Borrower on account of said maturity until December 31, 2010. In the event the Borrower defaults in any of its obligations under the Loan Documents as modified hereby and such default continues beyond any applicable cure period the Lender's obligation to forbear shall terminate and the Lender shall be entitled to pursue any and all remedies available at law and in equity. Lender's obligation to forbear shall terminate upon the occurrence of an Event of Default under any of the Loan Documents.

 

4.           Forbearance Fee - Interest - Payments. On the date hereof Borrower shall pay to Lender a Forbearance Fee in the amount of $7,500.00, which fee is earned due and non-refundable as of the date hereof and is separate and apart from the interest or other charges payable hereunder. Any other term or provision in the Loan Documents to the contrary notwithstanding, all amounts due and owing under the Note from time to time (including Deferred Interest) shall accrue interest at the rate of twenty-one percent (21%) per annum from the date hereof until paid in full. Borrower shall prepay to the Lender interest in the amount of $51,477.59 for interest that is expected to accrue between the date hereof and December 31, 2010. In the event all amounts due and owing hereunder are paid prior to December 31,2010 Borrower shall receive a credit or refund of any unearned pre-paid interest. Provided Borrower does not breach any of the covenants terms or conditions of the Loan Documents as modified hereby, Borrower shall not be obligated to make any payment towards principal or interest on the Note until December 31, 2010 when the outstanding balance of all amounts due and payable under the Loan Documents shall be paid in full without any further notice or demand.

 

5.           Default Interest. Upon the occurrence of an Event of Default, all amounts due and owing under the Note from time to time (including Deferred Interest) shall accrue interest at the rate of twenty-four percent (24%) per annum from the date hereof until paid in full..

 

6.            Late Payment. If the Borrower shall fail to make payment in full of all amounts due and owing under the Loan Documents on or before December 31, 2010, the Borrower promises to pay to the Lender a late charge equal to ten percent (10%) of such payment. The "late charge" is imposed for Lender's the purpose of defraying the expenses of the Lender incident to handling such delinquent payment and offsetting other obligations. This charge shall be in addition to, and not in lieu of, any other remedy the Lender may have and is in addition to any fees and charges of any agents or attorneys which the Lender may employ upon any Event of Default hereunder, whether authorized herein or by law.

 

7.           Title Insurance; Lien Searches. At the time of execution of this Agreement, Borrower shall cause to be issued to Lender, at Borrower's sale cost and expense, such endorsements of any title policy previously issued to insure the lien of the Deed of Trust as Lender may request and are available for issuance under the current applicable title insurance rules and regulations. Simultaneously with the execution and delivery of this Agreement, Lender shall be provided with a title bring down with respect to the Property showing that the Property is free of liens, charges and other encumbrances other than those shown on the title insurance policy previously issued in connection with the Note. In addition, if requested by Lender, judgment and lien searches, showing no judgments or other liens filed against the Borrower shall be delivered to the Lender.

 

  

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8.           Borrower's Representations and Warranties. Borrower hereby represents and warrants that (a) Borrower is the sole legal and beneficial owner of the Property; (b) the execution and delivery of this Agreement do not contravene, result win a breach of, or constitute a default under, any deed of trust, loan agreement, indenture or other contract or agreement to which Borrower is a party or by which Borrower or any of its properties may be bound (nor would such execution and delivery constitute such a default with the passage of time or the giving of notice or both) and do not violate or contravene any law, order, decree, rule, regulation or restriction to which Borrower or the Property is subject; (c) Borrower has full power and authority to execute this Agreement; (d) this Agreement constitutes the legal, valid and binding obligations of Borrower enforceable in accordance with its terms; (e) the execution and delivery of, and performance under, this Agreement are within Borrower's power and authority without the joinder or consent of any other party, and do not violate any indenture, agreement or undertaking to which Borrower is a party or by which he is bound; (f) to the best of Borrower's knowledge, there exists no default under the Note or any other Loan Document, and (g) all of the debt evidenced by the Note is and shall be for business, commercial, investment or other similar purpose and not primarily for personal, family, household or agricultural use. Borrower agrees to indemnify and hold Lender harmless against any loss, (claim, damage, liability or expense (including, without limitation, attorneys' fees) incurred as a result of any representation or warranty made by Borrower herein which proves to be untrue or inaccurate in any respect.

 

9.           Further Assurances. Borrower agrees to execute and deliver to Lender, promptly upon request from Lender, such additional documents as may be necessary or appropriate to consummate the transactions contemplated herein or to perfect, or continue the perfection of, the Liens.

 

10.         Default Under Deed of Trust. If Borrower shall fail to keep or perform any of the covenants or agreements contained herein or in any of the Loan Documents, or if any statement, representation or warranty contained herein is false, misleading or erroneous in any material respect, Borrower shall be deemed to be in default under the Deed of Trust and Lender shall be entitled at its option to exercise any and all of the rights and remedies granted pursuant to the Deed of Trust, as amended hereby, or any other Loan Document, or to which Lender may otherwise be entitled, whether at law or in equity.

 

 

  

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11.         Reaffirmation; Lien Continuation; No Novation. Borrower hereby reaffirms the Note and the other Obligations and promises to pay and perform the Note and all Obligations as modified by this Agreement. The Liens are hereby ratified and confirmed as valid, subsisting and continuing to secure the Note and the Obligations, as modified hereby. The Liens are further ratified and confirmed as to all of the property described on Exhibit A attached hereto. Any former release of any such property is hereby declared null and void. Any failure to describe any such property in any of the Loan Documents is hereby reformed and corrected to include all of the property described on Exhibit A hereto as though such description was originally included in such document. Nothing herein shall in any manner diminish, impair or extinguish the Note, the Obligations or the Liens. The Liens are not waived. The execution and delivery of this Agreement shall not constitute a novation of the debt evidenced and secured by the Loan Documents. Borrower ratifies and acknowledges the Loan Documents as valid, subsisting and enforceable and agrees and warrants that there are no offsets, claims or defenses with respect to the Obligations.

 

12.         No Waiver by Lender. Borrower acknowledges and agrees that the execution of this Agreement by Lender is not intended nor shall it be construed as (a) an actual or implied waiver of any, default under the Note, the Deed of Trust or any other Loan Document, or (b) an actual or implied waiver of any condition or obligation imposed upon Borrower pursuant to the Note, the Deed of Trust or any other Loan Document, except to the extent, if any, specified herein.

 

13.         Borrower's Performance. If Borrower should fail to comply with any of the agreements, covenants or obligations of Borrower under this Agreement or any other Loan Document, then Lender (in Borrower's name or in its own name) may, but is under no obligation to, perform them or cause them to be performed for the account of the Borrower at Borrower's sole expense. Any and all expenses thus incurred or paid by Lender shall be Borrower's demand obligations to Lender and shall bear interest, from the date of Lender's payment of any such obligation or expense for Borrower's account until the date on which Borrower repays it to Lender, at the default rate of interest set forth herein. Upon making any such payment or incurring any such expense, Lender shall be fully subrogated to all of the rights of the person or entity receiving such payment. Any amounts owing by Borrower to Lender pursuant to this provision or any other provision of this Agreement shall automatically and without notice constitute a portion of the Obligations evidenced by the Note secured by the Deed of Trust and the other Loan Documents. The amount and nature of any such expense and the time when paid shall be fully established by the affidavit of Lender or any of the Lender's officers or agents.

 

14.         Professional Services. Promptly upon Lender's request, Borrower, at Borrower's sale cost and expense, shall: (a) pay for any appraisal report of the Property; and (b) cause to be conducted or prepared any other written report, summary opinion, inspection, review, survey, audit or other professional service relating to the Property or any operations in connection with it (all as designated in Lender's request) as Lender may reasonably request; including (without limitation) any accounting, auctioneering, architectural, consulting, engineering, design, legal, management, pest control, surveying, title abstracting or other technical, managerial or professional service relating to the Property or its operations. Lender may elect to deliver any such request orally, by telegram, by mail or by hand delivery addressed to Borrower as provided herein or by any other legally effective method, and it may be given at any time and from time to time before the complete and final release and discharge of the Deed of Trust.

 

  

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15.         Expenses. To the extent not prohibited by applicable law, Borrower will pay all costs and expenses and reimburse Lender for any and all expenditures of every character incurred or expended from time to time, regardless of whether a default shall have occurred, in connection with (a) this Agreement; (b) the evaluation, monitoring and protection of the Property pursuant to rights given in the Loan Documents or by law, and (c) the creation, perfection or realization upon the Liens, and all costs and expenses relating to Lender's exercise of any of its rights and remedies under any of the Loan Documents or at law, including, without limitation, all filing fees, taxes, brokerage fees and commissions, title review and abstract fees, recordation and transfer taxes, Uniform Commercial Code search fees, other fees and expenses incident to title searches, reports and security interests, escrow fees, attorneys fees, legal expenses, court costs, fees and expenses incurred in connection with any complete or partial liquidation of the Property, and all fees and expenses for any professional service relating to Property or any operations conducted in connection with it; provided, however, no right or option granted by Borrower to Lender or otherwise arising pursuant to any provision of this Agreement or any other document shall be deemed to impose or admit a duty on Lender to supervise, monitor or protect any aspect of the Property or any operations conducted in connection with it.

 

16.         Cross Defaults/Advances to Cure Defaults or Purchase Carr Note. If any default should occur under the terms of any document executed in connection with any loan to the Borrower from any third party including, without limitation, the loan evidenced by that certain Note ("Carr Note") made by Borrower of even date herewith payable to Kent Carr in the original principal amount of $750,000.00, such default shall constitute an Event of Default under the Loan Documents. Lender has the right but not the obligation to cure any such default and any monies expended or costs incurred by Lender to cure any such default shall be evidenced by the Note and secured by the Deed of Trust and shall accrue interest at the rate of24% per annum. Lender further has the right but not the obligation to purchase the Carr Note and documents securing the Carr Note in the event of a default by the Borrower thereunder or under the terms of the Loan Documents and in such event the interest rate on the Carr Note shall increase to 24% per annum commencing on the date Lender purchases the Carr Note.

 

17.         Additional Events of Default. In addition to the events of default that are described in the Loan Documents, the occurrence or happening of anyone or more of the following events shall constitute an event of default (individually, an "Event of Default" and collectively, the "Events of Defaults") under the terms of the Loan Documents:

 

  

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If the Borrower or Joel P. Sens, guarantees or assumes the debt or financial obligation of another entity or endorses a note or other obligation of another entity unless such guaranty, assumption or endorsement is deemed, in the sole and absolute discretion of the Lender, to be in the normal course of the Borrower's business.

 

If Borrower fails to enter into a valid option contract or contract for the sale of the Borrower's property to CG Roxane or other third party reasonably acceptable to Lender under terms reasonably acceptable to Lender on or before September 30, 2010.

 

If Borrower enters into a valid option contract or contract for the sale of Borrower's property that is reasonably satisfactory to the Lender and said third party purchaser terminates its option or contract to purchase the property and Borrower fails to payoff the balance of all sums due under the Note on or before: a) the date which is thirty (30) days after the termination; or b) September 30, 2010, which ever is later.

 

If there is a change in the control or key management of the Borrower or its assets as determined in the sole and absolute discretion of the Lender.

 

16.         Waiver of Automatic Stay. Borrower hereby acknowledges and agrees that the Lender has agreed to enter into this Agreement in order to permit the Borrower additional time to repay and satisfy the obligations in a mutually acceptable, consensual manner, rather than through the Lender's exercise and enforcement of its rights and remedies under the Loan Documents and applicable laws. Borrower further acknowledges and agrees that because of the existing defaults under and in connection with the Obligations, the Lender would otherwise be entitled to exercise immediately any and all such rights and remedies if the Borrower and Lender did not enter into this Agreement. Borrower further acknowledges and agrees that although the Lender's interest in its collateral and security is not presently being adequately protected, the Lender has been induced to enter into this Agreement in reliance upon the understanding that upon the occurrence of any subsequent Event of Default, in the event the Lender hereafter exercises any of its rights or remedies under Loan Documents and/or under any applicable laws, the Borrower will cooperate with the Lender in the Lender's efforts to exercise any and all such rights and remedies available to the Lender. Borrower further acknowledges and agrees that Lender's forbearance, as well as Lender's consent to Borrower's incurring certain additional debt and Borrower's creation of a lien in the Property senior in priority to the Liens was granted by Lender in lieu of relief Borrower intended to seek in a voluntary case under Chapter 11 of title 11, United States Code. Accordingly, Borrower agrees that if Borrower becomes the subject of a any bankruptcy case under title 11, United States Code, the Borrower waives the protection of 11 U.S.C. Section 362, and agrees to consent to relief from the automatic stay in favor of Lender to allow the Lender to exercise any and all rights and remedies available to Lender with respect to its collateral and security.

 

  

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IN WITNESS WHEREOF, the Borrower and the Lender have executed and delivered this Agreement or caused this Agreement to be executed and delivered. This Agreement has been executed on the date or dates of the acknowledgments hereof, but shall be effective as of the date first stated in this Agreement.

 

SIGNATURES AND NOTARY APPEAR ON FOLLOWING PAGE

 

 

 

 

 

 

 

 

  

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BORROWER:

	 
	 	 	 
	 	 
SEAWRIGHT SPRINGS, LLC

	 
	 	 	 	 
	
 

	
By: 

	/s/ Joel P. Sens (SEAL)	 
	 	 	 
Joel P. Sens, Manager

	 
	 	 	 	 
	 	By:	Seawright Holdings, Inc., Sole Member	 
	 	 	 	 
	 	By:	/s/ Joel P. Sens (SEAL)	 
	 	 	 
Joel P. Sens, President

	 

 

STATE OF     Maryland

 

COUNTY OF      Prince George’s

 

I HEREBY CERTIFY that on this 4th  day of May, 2010, before me, the subscriber, a Notary Public in and for the jurisdiction aforesaid, personally appeared in said jurisdiction Joel P. Sens, personally well known to me (or satisfactorily proven) to be the Manager of Seawright Springs, LLC as well as the President of Seawright Holdings, Inc. which is the sole member of SEAWRIGHT SPRINGS, LLC, and personally well known to me (or satisfactorily proven) to be the person who executed the foregoing instrument; and acknowledged that, having authority so to do, he executed the foregoing instrument as Manager of Seawright Springs, LLC and as President of Seawright Holdings, Inc. acting as sole member of SEAWRIGHT SPRINGS, LLC for the purposes therein contained, and delivered the same as such.

 

WITNESS my hand and Notarial Seal the year and day first above written.

 

	
 

	
 

	/s/ Irene S. Lefever	 
	 	 	 
Notary Public

	 

 

	 	 
LENDER:

	 
	 	 	 
	 	 
CHARTER HOUSE, LLC

	 
	 	 	 	 
	
(SEAL)

	
By: 

	/s/ Charles E. Kohlhoss 	 
	 	 	Charles E. Kohlhoss, President	 

 

  

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EXHIBIT

 

A Legal Description

 

 

All those certain tracts of parcels of real estate, lying and being between State Routes 616 and 804, in North River District, Augusta County, Virginia, and more particularly described according to the attached "Map of the Baker Seawright Corp, Prop." By Robert E. Funk, Land Surveyor, dated January 13 1986, and shown thereon to contain a total of 144.739 acres more or less.

 

Together with all that certain tract or parcel of land, with all improvements thereon and appurtenances thereto belonging, situate in North River District, Augusta County, Virginia, near the Seawright Lithia Spring, adjoining the old Salem Church lot containing 22 poles, and being more particularly described by metes and bounds description of record in deed of Margaret F. Root, dated August 21, 1899 or record in the Clerk's Office of the Circuit Court of Augusta County, Virginia, in Deed Book 400, page 269, as follows:

 

Beginning at a corner of the old Salem Church lot, S. 69° W. 4.64 poles, thence S 20° 34'E. 4 poles to a stone, thence N. 69* E. 6.36 poles to Ocheltree's line; thence N. 43-1/4° W. 4.40 poles to the beginning.

 

Including, without limitation, all of the land and appurtenances conveyed to SEAWRIGHT SPRINGS, LLC by BAKER SEAWRIGHT CORPORATION by that certain deed dated October 7, 2003 and recorded as Instrument No. 030016981 among the Land Records of Augusta County, Virginia. 9

 

 

 

 

10Unassociated Document

Exhibit 10.5

 

DEED OF TRUST NOTE

 

	
$375,000.00

	  	
April 14, 2008

 

Bethesda, Maryland

 

FOR VALUE RECEIVED, the undersigned (hereinafter collectively called the "Borrower") unconditionally, and jointly and severally, promise to pay to the order of PIERRE L. PALIAN (hereinafter called the "Lender"), with its main office located at 229 Midsummer Cir., Gaithersburg, MD 20878, the principal sum of THREE HUNDRED THOUSAND AND NO/100 DOLLARS ($375,000.00), together with interest at the rate or rates hereinafter provided until paid, in accordance with the following;

 

Term of Loan. The term of the loan evidenced hereby shall commence on the date hereof and continue until October 13, 2008, (hereinafter called the "Maturity Date"), when the outstanding principal balance, together with all accrued interest, shall be due and payable in full.

 

Points. Any brokerage fees Borrower has agreed to pay to third parties in connection with the loan evidenced hereby are non- refundable and shall not apply towards any amounts payable to Lender hereunder.

 

Rates of Interest. Interest shall be computed on the basis of a 360-day year and shall be charged for the actual number of days elapsed in each interest calculation period. Interest shall be charged on the outstanding principal balance at the annual rate of 15%:

 

Payments. At closing the Borrower shall prepay the interest due for the term of the loan ($28,125.00) which interest payment shall be non-refundable in the event the loan is pre-paid in whole or in part prior to the Maturity Date. On the Maturity Date the outstanding principal balance together with all accrued and unpaid interest, if any, thereon shall be due and payable in full.

 

Application and Place of Payments. Payments made on account hereof shall be applied first to the payment of any outstanding loan fees, extension fees or prepayment fees, then to any late charges, then to the payment of accrued and unpaid interest and the remainder, if any, shall be applied to principal. All payments on account of this Note shall be paid in lawful money of the United States of America in immediately available funds to Lender at 200 Ledgewood Place, Suite 201, Rockland, MA 02370; or at such other times and places as the Lender may at any time and from time to time designate in writing to the Borrower.

 

Security. This Note, which evidences a loan from the Lender to the Borrower in the principal amount recited hereinabove, is secured by that certain Deed of Trust and Security Agreement (the "Deed of Trust") of even date herewith from the Borrower for the benefit of the Lender, and encumbers certain real property, more particularly described on "EXHIBIT A" attached hereto and made a part hereof.

 

  

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Late Charges. lithe Borrower shall fail to make any payment under the terms of this Note within five (5) days after the date such payment is due, the Borrower promises to pay to the Lender a late charge equal to ten percent (10%) of such payment. Such five (5) day period shall not be construed as in any way extending the due date of any payment. The "late charge" is imposed for the purpose of defraying the expenses of the Lender incident to handling such delinquent payment. This charge shall be in addition to, and not in lieu of, any other remedy the Lender may have and is in addition to any fees and charges of any agents or attorneys which the Lender may employ upon any Event of Default hereunder, whether authorized herein or by law. If the Borrower shall fail to make the final payment due at maturity within fifteen days of the Maturity Date, the Borrower promises to pay to the Lender a late charge equal to five percent (5%) of the outstanding principal balance; which charge shall earn interest payable to the Lender at the Default Interest rate described below from the Maturity Date until the date said fee is paid in full.

 

Prepayment. Each prepayment shall be accompanied by interest accrued and unpaid on the amount so prepaid to the date of such prepayment. Any partial prepayment shall not postpone the due date of any subsequent payment or change the amount of any monthly principal payment, unless the Lender shall first otherwise agree in writing. Upon ten (10) days' prior written notice from the Borrower to the Lender, the Borrower may prepay the outstanding principal balance, in whole or in part, without premium or penalty.

 

Events of Default. The occurrence of anyone or more of the following events shall constitute an event of default (individually, an "Event of Default" and collectively, the "Events of Default") under the terms of this Note.

 

(a) The failure of the Borrower to pay to the Lender when due, any and all amounts payable by the Borrower to the Lender under the terms of this Note, including, but not limited to, any principal payment, interest payment, loan fee, extension fee or late charge; or

 

(b) The occurrence of any other Event of Default, as defined in the Deed of Trust or any other document executed in connection with this Note.

 

Default Interest. Upon the occurrence of an Event of Default and/or after the maturity of this Note (whether by acceleration, declaration, extension or otherwise), the Borrower promises to pay to the Lender, interest on the outstanding principal balance at a rate equal to the rate of interest then due and payable under the terms of this Note, plus six percent (6%) per annum, so long as the Event of Default continues or, after maturity, until payment in full of the outstanding principal balance together with any and all accrued and unpaid interest thereon and any and all other sums due and payable hereunder.

 

Remedies. Upon the occurrence of an Event of Default, at the option of the Lender, the outstanding principal balance, any and all accrued and unpaid interest thereon, and all other amounts payable by the Borrower to the Lender under the terms of this Note shall immediately become due and payable by the Borrower to the Lender without notice to the Borrower or any other person. In addition, the Lender shall have all of the rights, powers and remedies available under the terms of this Note, the Deed of Trust, any other document which is executed in connection with this Note, and all applicable laws, including but not limited to the right to set off against and apply any funds of the Borrower on deposit with, or under the control of, the Lender to the payment of the debt evidenced hereby, without notice and without resort to any judicial proceeding. The Borrower and all endorsers, guarantors, and other parties who may now or in the future be primarily or secondarily liable for the payment of the indebtedness evidenced by this Note hereby waive demand, presentment, protest, notice of protest and notice of dishonor.

 

  

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Confession of Judgment. Upon the occurrence of an Event of Default, the Borrower hereby authorizes any attorney designated by the Lender or any clerk of any court of record in the State of VA or anywhere in the United States of America to appear for the Borrower in any court of record in one or more proceedings and confess judgment against the Borrower without prior hearing in favor of the Lender for, and in the amount of, the outstanding principal balance, all accrued and unpaid interest thereon, all other amounts payable by the Borrower to the Lender under the terms of this Note, costs of suit and attorneys' fees of fifteen percent (15%) of the outstanding principal balance. The Borrower hereby releases, to the extent permitted by applicable law, all errors and all rights of exemption, appeal, stay of execution, inquisition and other rights to which the Borrower may otherwise be entitled under the laws of the United States of America or of any state or possession of the United States of America now in force and which may hereafter be enacted. The Borrower hereby consents to the immediate execution of such judgment. The authority and power to appear for and enter judgment against the Borrower shall not be exhausted by one or more exercises thereof or by any imperfect exercise thereof and shall not be extinguished by any judgment entered pursuant thereto. Such authority may be exercised on one or more occasions or from time to time in the same or different jurisdictions as often as the Lender shall deem necessary and desirable, for all of which this Note shall be a sufficient warrant.

 

Expenses. The Borrower promises to pay to the Lender, upon demand by the Lender, all costs and expenses incurred by the Lender in connection with the collection and enforcement of this Note, including, without limitation, all attorneys' fees, expenses arid court costs.

 

Waiver of Jury Trial. The Borrower and the Lender hereby jointly and severally waive trial by jury in any action or proceeding to which the Borrower and the Lender may be parties, arising out of, in connection with or in any way pertaining to, this Note, the Deed of Trust and any other document which secures this Note. It is agreed and understood that this waiver constitutes a waiver of trial by jury of all claims against all parties to such actions or proceedings, including claims against parties who are not parties to this Note. This waiver is knowingly, willingly and voluntarily made by the Borrower, and the Borrower hereby represents that no representations of fact or opinion have been made by any individual to induce this waiver of trial by jury or to in any way modify or nullify its effect. The Borrower further represents and warrants that it has been represented in the signing of this Note and in the making of this waiver by independent legal counsel, or has had the opportunity to be represented by independent legal counsel selected of its own free will, and that it has had the opportunity to discuss this waiver with counsel.

 

Consent to Jurisdiction. The Borrower irrevocably submits to the jurisdiction of any state or federal court sitting in the State of VA over any suit, action or proceeding arising out of, or relating to, this Note. The Borrower irrevocably waives, to the fullest extent permitted by law, any objection that the Borrower may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in any such court and any claims that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Final judgment in any such suit, action or proceeding brought in any such court shall be conclusive and binding upon the Borrower and maybe enforced in any court of which the Borrower is subject to jurisdiction, by a suit upon such judgment provided that service of process is effected upon the Borrower as provided in this Note or as otherwise permitted by applicable law.

 

Service of Process. The Borrower hereby consents to process being served in any suit, action or proceeding instituted in connection with this Note by the mailing of a copy thereof by registered or certified mail, postage prepaid, return receipt requested to the Borrower at the address set forth below, or at such other address as the Borrower may furnish in writing to the Lender. The Borrower irrevocably agrees that such service shall be deemed in every respect effective service of process upon the Borrower in any such suit, action or proceeding, and shall, to the fullest extent permitted by law, be taken and held to be valid personal service upon the Borrower. Nothing in this Section shall affect the right of the Lender to serve process in any manner otherwise permitted by law, and nothing in this Section will limit the right of the Lender otherwise to bring proceedings against the Borrower in the courts of any jurisdiction or jurisdictions.

 

Notices. All notices, requests or demands required under this Note to be made in writing, shall be deemed to have been received when delivered by hand, when delivered to an overnight courier, or when deposited in the mail by first class, registered or certified mail, return receipt requested, postage prepaid. Any and all notices, requests and demands shall be addressed to the Lender at 229 Midsummer Cir., Gaithersburg, MD 20878 and to the Borrower at 600 Cameron Street, Alexandria, VA 22314 or at such other addresses as the Lender or the Borrower shall have furnished to the other in writing.

 

  

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Miscellaneous. Each right, power and remedy of the Lender as provided for in this Note, the Deed of Trust or any other document which secures this Note, or now or hereafter existing under any applicable law or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power or remedy provided for in this Note, the Deed of Trust or in any other document which secures this Note or now or hereafter existing under any applicable law, and the exercise or beginning of the exercise by the Lender of anyone or more of such rights, powers or remedies shall not preclude the simultaneous or later exercise by the Lender of any or all such other rights, powers or remedies. No failure or delay by the Lender to insist upon the strict performance of any term, condition, covenant or agreement of this Note, the Deed of Trust or any other document which secures this Note, or to exercise any right, power or remedy consequent upon a breach thereof, shall constitute a waiver of any such term, condition, covenant or agreement or of any such breach, or preclude the Lender from exercising any such right, power or remedy at a later time or times. By accepting payment after the due date of any amount payable under the terms of this Note, the Lender shall not be deemed to waive the right either to require prompt payment when due of all other amounts payable under the terms of this Note or to declare an Event of Default for the failure to effect such prompt payment of any such other amount. No course of dealing or conduct shall be effective to amend, modify, waive, release or change any provisions of this Note. As used in this Note, the term "Lender" shall mean the party designated as the Lender above, its successors and assigns, and any subsequent holder of this Note. Any paragraph or subparagraph in this Note, which is preceded by parentheses, shall apply and become a provision of this Note, in the event that a check or other mark has been written, typed or otherwise added within such parentheses. The captions hereinafter set forth are for convenience only and shall not be deemed to define, limit or describe the scope or intent of this Note. The provisions of this Note shall be governed by the laws of the State of VA notwithstanding circumstances when the "choice of law" rules of the State of VA would allow or require the laws of another jurisdiction to govern. The Lender is hereby authorized, without notice to or the further consent of the Borrower and without in any manner releasing, lessening or affecting the obligations of the Borrower, to complete any blank in this Note. The Borrower further authorizes the Lender to disclose the financial record of the Borrower to any subsidiary or affiliate of the Lender or to any other financial institution.

 

Partial Invalidity. In the event any provision of this Note (or any part of any provision) is held by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision (or remaining part of the affected provision) of this Note; but this Note shall be construed as if such invalid, illegal or unenforceable provision (or part thereof) had not been contained in this Note, but only to the extent it is invalid, illegal or unenforceable; provided, however, that if any such invalid, illegal or unenforceable provision pertains to the repayment of principal or interest thereon, the occurrence of any such invalidity, illegality or unenforceability shall constitute an Event of Default. In the event that any amounts of interest or other charges due and payable under the terms and conditions of this Note are held to exceed limits prescribed by applicable law, then, to the extent that any such amounts of interest or charges exceed such limits, such amounts of interest or charges shall be deemed to be payments of principal.

 

Commercial Purpose. The Borrower warrants that the loan evidenced by this Note is being made solely to acquire or carry on a business or commercial enterprise, and/or the Borrower is a business or commercial organization. The Borrower further warrants that all of the proceeds of this Note shall be used for commercial purposes and stipulates that the loan evidenced by this Note shall be construed for all purposes as a commercial loan.

 

  

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IN WITNESS WHEREOF, the Borrower has executed under seal and delivered or caused this Note to be executed under seal and delivered as of the date first written above.

 

 

 

BORROWER:

 

SEAWRIGHT SPRINGS, LLC

 

By: Seawright Holdings, Inc. Sole Member and Manager

 

By: /s/ Joel P. Sens (SEAL)

 

Joel P. Sens, President

 

 

 

SEAWRIGHT HOLDINGS, INC.

 

By: /s/ Joel P. Sens (SEAL)

 

Joel P. Sens, President

 

 

THIS IS TO CERTIFY that this is the note described in the Deed of Trust, which encumbers the property described on "EXHIBIT A" from the Borrower to the Trustees named in the Deed of Trust, to secure PIERRE L. PALIAN bearing even the herewith, said Note and Deed of Trust having been executed in my presence.

 

 

(illegible)

 

Notary Public

 

My Commission Expires:

 

 

 

 

 

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