PROMISSORY NOTE $41,500.00, 2017 FOR VALUE RECEIVED, without defalcation, and intending to be legally bound hereby, CHARLES A MELTON ARTS & EDUCATION CENTER, a Pennsylvania nonprofit corporation, with an address of 501 East Miner Street, West Chester, Pennsylvania 19380 ("Borrower"), hereby unconditionally promises, covenant and agree to pay to the order of THE BOROUGH OF WEST CHESTER ("Lender"), with an office at 401 East Gay Street, West Chester, PA 19380, or at such other address as Lender may from time to time designate, the principal sum of FORTY-ONE THOUSAND FIVE HUNDRED DOLLARS ($41,500.00) or so much thereof as may be advanced by Lender to Borrower, together with interest thereon at the rate of interest hereinafter specified (the "Loan"), upon the terms and conditions specified in this Note. 1. Term and Interest. 1.1 Term. The term of this Note and the credit accommodations hereunder will be available to Borrower during the period commencing with the date hereof and ending on the Maturity Date. "Maturity Date" means the earliest of (i) at Lender's option upon the occurrence of an Event of Default hereunder or under any documents executed in connection with this Note, or (iii) the date that is ten (10) years after the date of this Note. 1.2 Interest. Interest shall accrue on the outstanding principal balance at a variable rate equal to the Prime Rate in effect from time to time (the "Interest Rate"). For purposes hereof, the "Prime Rate" shall mean the prime rate (or other similar index) for commercial loans as announced in The Wall Street Journal (or such successor publication as determined by Lender in its reasonable discretion) from time to time during the term of this Note. Interest under this Note shall be calculated on the basis of a year consisting of three hundred sixty (360) days, and shall be charged on the basis of the actual number of days elapsed in any calendar year or part thereof. 2. Payment of Principal and Interest. 2.1 Payments. During the term of this Note, Borrower shall pay to Lender as follows: 2.1.1 Commencing on the first day of the first calendar month following the date of this Note, and continuing on the first day of each and every month thereafter, Borrower shall pay to Lender monthly payments of principal and accrued interest on the outstanding principal balance of this Note, amortized over a period of ten (10) years. Payments shall be made in accordance with the Schedule attached to this Note. 2.1.3 On the Maturity Date, the entire outstanding principal balance of the Loan, together with all accrued and unpaid interest and all other obligations hereunder shall be immediately due and payable in full.
2.2 Payment Terms. All payments made hereunder shall be made on the due date thereof, in immediately available funds and in lawful currency of the United States of America. If the due date for any payment of principal or interest hereunder falls on a day other than a Business Day, such payment shall be due on the next succeeding Business Day. For purposes hereof, "Business Day" means any day which is not a Saturday, Sunday or a legal holiday on which commercial banks are authorized or required to be closed in Philadelphia, Pennsylvania. 2.3 Late Charge. If any installment of interest or principal is not paid within fifteen (15) days after it is due and payable under the terms of this Note, Borrower shall pay to Lender a late charge at the rate of five cents ($0.05), for each dollar which is not paid within such fifteen (15) day period. 2.4 Prepayment. Borrower has the privilege of prepaying the unpaid principal balance of the Loan in whole or in part at any time or from time to time, without penalty or premium. The acceptance of any prepayment when there is an Event of Default (as defined herein) in existence hereunder shall not constitute a waiver, release or accord and satisfaction thereof or of any rights in respect thereto by Borrower. No partial prepayment shall postpone or interrupt payments required hereunder, all of which shall continue to be due and payable at the times and in the manner set forth above. 2.5 Application of Payments. Except as otherwise specified herein, each payment or prepayment, if any, made under this Note shall be applied to pay late charges, accrued and unpaid interest, principal, and any other fees, costs and expenses which Borrower is obligated to pay under this Note, in such order as Lender may elect from time to time in its reasonable discretion. 3. Events of Default. 3.1 The occurrence of any one or more of the following events shall constitute an event of default ("Event of Default") under this Note: 3.1.1 If Borrower fails to pay when due any principal, interest or other sums due and payable hereunder; or 3.1.2 Failure of Borrower to observe or perform any of the agreements, undertakings, conditions or obligations in this Note, the Cooperation Agreement or the Mortgage or any other agreement between Borrower and Lender, whether entered into prior to, concurrently with or subsequent to the date hereof. 3.1.3 The existence and continuance of any Event of Default as defined in any mortgage executed as collateral for this Loan, or any other documents executed in connection with this Note. 3.2 Lender shall give Borrower written notice of a nonmonetary Event of Default. Borrower shall have thirty (30) days from receipt of such default notice to cure the Event of 2
Default. If Borrower does not cure its default within such cure period, Lender may exercise the remedies set forth in Section 4. Provided, however, if such non-performance is susceptible of being cured but such cure cannot reasonably be effected within such thirty (30) day cure period, such non-performance shall not constitute an Event of Default if Borrower shall commence such cure within the aforesaid thirty (30) day period and thereafter diligently pursue such cure. Lender shall not be required to give Borrower notice of any default under Section 3.1.1 above. 4. Remedies. 4.1 Remedies on Default. Upon the occurrence of an Event of Default, after notice and opportunity to cure: 4.1.1 The entire unpaid balance of principal, together with accrued interest thereon, shall, at the option of Lender, become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived; and/or 4.1.2 Lender may, at its option, exercise any of the rights and remedies available to Lender hereunder, under any of the other documents executed as collateral for the Loan, or in connection herewith, or any rights or remedies available to Lender at law, equity, by statute or otherwise. 4.1.3 CONFESSION OF JUDGMENT. A. THE FOLLOWING PARAGRAPH SETS FORTH A WARRANT OF AUTHORITY FOR ANY ATTORNEY TO CONFESS JUDGMENT AGAINST BORROWER. IN GRANTING THIS WARRANT OF ATTORNEY TO CONFESS JUDGMENT AGAINST BORROWER, BORROWER, FOLLOWING CONSULTATION WITH (OR DECISION NOT TO CONSULT) SEPARATE COUNSEL FOR BORROWER AND WITH KNOWLEDGE OF THE LEGAL EFFECT HEREOF, HEREBY BORROWER IS VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY GIVING UP ANY AND ALL RIGHTS, INCLUDING CONSTITUTIONAL RIGHTS, THAT BORROWER HAS OR MAY HAVE TO NOTICE AND A HEARING BEFORE JUDGMENT CAN BE ENTERED AGAINST BORROWER AND BEFORE BORROWER'S ASSETS, INCLUDING, WITHOUT LIMITATION, ITS ACCOUNTS, MAY BE GARNISHED, LEVIED, EXECUTED UPON AND/OR ATTACHED. BORROWER UNDERSTANDS THAT ANY SUCH GARNISHMENT, LEVY, EXECUTION AND/OR ATTACHMENT SHALL RENDER THE PROPERTY GARNISHED, LEVIED, EXECUTED UPON OR ATTACHED IMMEDIATELY UNAVAILABLE TO BORROWER. IT IS SPECIFICALLY ACKNOWLEDGED BY BORROWER THAT LENDER HAS RELIED ON THIS WARRANT OF ATTORNEY AND THE RIGHTS WAIVED BY BORROWER HEREIN IN RECEIVING THIS NOTE AND AS AN INDUCEMENT TO GRANT FINANCIAL ACCOMMODATIONS TO BORROWER. B. UPON AND FOLLOWING THE OCCURRENCE OF AN EVENT OF DEFAULT AND WHILE IT IS CONTINUING, BORROWER HEREBY 3
AUTHORIZES AND EMPOWERS ANY ATTORNEY OF ANY COURT OF RECORD OR THE PROTHONOTARY OR CLERK OF ANY COUNTY IN THE COMMONWEALTH OF PENNSYLVANIA, OR IN ANY JURISDICTION WHERE PERMITTED BY LAW OR THE CLERK OF ANY UNITED STATES DISTRICT COURT, TO APPEAR FOR BORROWER IN ANY AND ALL ACTIONS WHICH MAY BE BROUGHT HEREUNDER AND ENTER AND CONFESS JUDGMENT AGAINST BORROWER OR ANY OF THEM IN FAVOR OF LENDER FOR SUCH SUMS AS ARE DUE OR MAY BECOME DUE HEREUNDER, TOGETHER WITH COSTS OF SUIT AND COLLECTION COSTS INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES IN THE AMOUNT OF FIVE PERCENT (5%) OF THE FOREGOING SUMS THEN DUE AND OWING BUT IN NO EVENT LESS THAN $2,000, WITH OR WITHOUT DECLARATION, WITHOUT PRIOR NOTICE, WITH RELEASE OF ALL PROCEDURAL ERRORS AND WITH THE RIGHT TO ISSUE EXECUTIONS FORTHWITH. TO THE EXTENT PERMITTED BY LAW, BORROWER WAIVES THE RIGHT OF INQUISITION ON ANY REAL ESTATE LEVIED ON, VOLUNTARILY CONDEMNS THE SAME, AUTHORIZES THE PROTHONOTARY OR CLERK TO ENTER UPON THE WRIT OF EXECUTION THIS VOLUNTARY CONDEMNATION AND AGREES THAT SUCH REAL ESTATE MAY BE SOLD ON A WRIT OF EXECUTION; AND ALSO WAIVES ANY RELIEF FROM ANY APPRAISEMENT OR EXEMPTION LAW OF ANY STATE NOW IN FORCE OR HEREAFTER ENACTED. TO THE EXTENT PERMITTED BY LAW, BORROWER FURTHER WAIVES THE RIGHT TO ANY NOTICE AND HEARING PRIOR TO THE EXECUTION, LEVY, ATTACHMENT OR OTHER TYPE OF ENFORCEMENT OF ANY JUDGMENT OBTAINED HEREUNDER, INCLUDING, WITHOUT LIMITATION, THE RIGHT TO BE NOTIFIED AND HEARD PRIOR TO THE GARNISHMENT, LEVY, EXECUTION UPON AND ATTACHMENT OF BORROWER'S BANK ACCOUNTS AND OTHER PROPERTY. IF A COPY OF THIS NOTE VERIFIED BY AFFIDAVIT OF ANY OFFICER OF LENDER SHALL HAVE BEEN FILED IN SUCH ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL THEREOF AS A WARRANT OF ATTORNEY, ANY PRACTICE OR USAGE TO THE CONTRARY NOTWITHSTANDING. THE AUTHORITY HEREIN GRANTED TO CONFESS JUDGMENT SHALL NOT BE EXHAUSTED BY ANY SINGLE EXERCISE THEREOF, BUT SHALL CONTINUE AND MAY BE EXERCISED FROM TIME TO TIME AS OFTEN AS LENDER SHALL FIND IT NECESSARY AND DESIRABLE AND AT ALL TIMES UNTIL FULL PAYMENT OF ALL AMOUNTS DUE HEREUNDER. LENDER MAY CONFESS ONE OR MORE JUDGMENTS IN THE SAME OR DIFFERENT JURISDICTIONS FOR ALL OR ANY PART OF BORROWER'S OBLIGATIONS ARISING HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT TO WHICH BORROWER IS A PARTY, WITHOUT REGARD TO WHETHER JUDGMENT HAS THERETOFORE BEEN CONFESSED ON MORE THAN ONE OCCASION FOR THE SAME OBLIGATIONS. IN THE EVENT THAT ANY JUDGMENT CONFESSED AGAINST BORROWER IS STRICKEN OR OPENED UPON APPLICATION BY OR ON BEHALF OF BORROWER FOR ANY REASON, LENDER IS HEREBY AUTHORIZED AND EMPOWERED TO AGAIN APPEAR FOR AND CONFESS JUDGMENT AGAINST BORROWER FOR ANY PART OR ALL OF THE OBLIGATIONS DUE AND OWING UNDER THIS NOTE AND THE OTHER 4
LOAN DOCUMENTS, AS HEREIN PROVIDED. NOTWITHSTANDING ANY CONFESSION OF JUDGMENT FOR A FIXED AMOUNT OF ATTORNEY S FEE, LENDER WILL ONLY COLLECT THE ATTORNEYS FEES ACTUALLY INCURRED. 4.2 Default Rate. Following the occurrence of any Event of Default and continuing either until such Event of Default is cured, or until the principal sum outstanding hereunder, and all other sums payable are paid in full, the principal sum outstanding hereunder shall bear interest at the rate of five percent (5%) above the Interest Rate then in effect. 5. Costs. Borrower shall be responsible to pay to Lender a fee of $35.00 for each dishonored check presented to Lender by Borrower for payment of any sums due hereunder. If Lender retains the services of counsel by reason of a claim of a default or an Event of Default hereunder or under any of the other documents executed in connection herewith, all costs of suit and all reasonable attorneys' fees and such other reasonable expenses so incurred by Lender shall be paid by Borrower, within a period of ten (10) days following written demand by Lender. If Borrower fails to pay, within the required time period, any of the costs, expenses and reasonable counsel fees incurred and/or paid by Lender, such costs, expenses and reasonable counsel fees shall be deemed to be part of the indebtedness evidenced by this Note and shall bear interest at the Default Rate until paid. 6. Waivers. 6.1 WAIVER OF JURY TRIAL. BORROWER AND LENDER HEREBY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS NOTE OR ANY OF THE DOCUMENTS EXECUTED IN CONNECTION HEREWITH TO THE FULLEST EXTENT PERMITTED BY LAW. 6.2 Any failure to exercise any such right of remedy shall in no event be construed as a waiver or release thereof. Lender shall not be deemed by any act of omission or commission to have waived any of its rights or remedies hereunder or under any other documents executed in connection herewith unless such waiver is in writing and signed by Lender, and then only to the extent specifically and expressly set forth in such writing. Any waiver as to any one event shall not be construed as a continuing waiver or as a bar to or waiver of any right or remedy as to any subsequent event, similar or dissimilar, or as to any remedy not specifically waived. 7. Severability. If any provision hereof is found by a court of competent jurisdiction to be prohibited or unenforceable, it shall be ineffective only to the extent of such prohibition or unenforceability and such prohibition or unenforceability shall not invalidate the balance of such provision to the extent it is not prohibited or unenforceable, nor invalidate the other provisions hereof. The prohibition or unenforceability of any provision of this Note in any one jurisdiction shall not affect the enforceability of such provision of this Note in any other jurisdiction in which such provision is or may be enforceable. 8. Governing Law; Amendment, Successors and Assigns. This Note is executed and delivered in, and shall be governed by and construed in accordance with the laws of, the 5
Commonwealth of Pennsylvania. Borrower's obligations hereunder shall be binding upon Borrower, and Borrower's successors and assigns. This Note may only be amended by written instrument executed by Borrower and Lender. This Note shall inure to the benefit of Lender, its successors and assigns, and all holders of this Note. 9. Jurisdiction and Venue. IN ANY PROCEEDINGS TO COLLECT THE INDEBTEDNESS EVIDENCED BY THIS NOTE OR TO ENFORCE THE TERMS AND CONDITIONS OF THIS NOTE OR ANY DOCUMENT EXECUTED IN CONNECTION HEREWITH, BORROWER HEREBY IRREVOCABLY CONSENTS TO THE JURISDICTION OF THE COURT OF COMMON PLEAS OF CHESTER COUNTY, PENNSYLVANIA AND THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA. [REMAINDER OF PAGE LEFT BLANK INTENTIONALLY] 6
IN WITNESS WHEREOF, Borrower has caused this Note to be executed by its duly authorized representatives as of the day and year first above written. ATTEST: By: Name: Title: CHARLES A MELTON ARTS & EDUCATION CENTER, a Pennsylvania nonprofit corporation By: Name: Title: 7
COMMONWEALTH OF PENNSYLVANIA : :ss COUNTY OF CHESTER : On the day of, 2017, before me the undersigned, a notary public for the Commonwealth of Pennsylvania, residing in the County of Chester, personally appeared who acknowledged himself to be the _ of CHARLES A MELTON ARTS & EDUCATION CENTER, a Pennsylvania nonprofit corporation and that he/she as such officer, being authorized to do so, executed the foregoing instrument for the purposes therein contained. IN WITNESS WHEREOF, I hereunto set my hand and official seal. Notary Public 8