Facility F Note between PDG Environmental, Inc. and Affiliates and Sky Bank dated June 22, 2005

Summary

PDG Environmental, Inc. and its affiliates have jointly agreed to borrow up to $400,000 from Sky Bank under the terms of a loan agreement. The borrowers must repay the loan, plus interest, by the specified expiry date or earlier if required by the loan agreement. The note allows Sky Bank to accelerate repayment if certain events occur and includes provisions for the bank to obtain a court judgment against the borrowers without prior notice if they default. The agreement is governed by Pennsylvania law and waives the borrowers' right to a jury trial.

EX-10.3 5 j1460701exv10w3.txt EX-10.3 EXHIBIT 10.3 FACILITY F NOTE $400,000.00 Pittsburgh, Pennsylvania June 22, 2005 FOR VALUE RECEIVED, the undersigned, PDG Environmental, Inc., a Delaware corporation, Project Development Group, Inc., a Pennsylvania corporation, Enviro-Tech Abatement Services, Co., a North Carolina corporation, and PDG, Inc., a Pennsylvania corporation (collectively and jointly and severally, "Borrowers"), hereby jointly and severally promise to pay to the order of Sky Bank, an Ohio banking institution having an office at 101 East Washington Street, New Castle, Pennsylvania 16103 ("Bank"), on or before the Facility F Expiry Date, and at such earlier dates as may be required by the Loan Agreement (as defined below), the lesser of (i) the principal sum of Four Hundred Thousand Dollars and 00/100 Dollars ($400,000.00), or (ii) the aggregate unpaid principal amount of all Facility F Loans made by Bank to Borrowers pursuant to the Loan Agreement. Borrowers hereby further jointly and severally promise to pay to the order of Bank interest on the unpaid principal amount of this Facility F Note from time to time outstanding at the rate or rates per annum determined pursuant to Article II of, or as otherwise provided in, the Loan Agreement, and with such amounts being payable on the dates set forth in Article II of, or as otherwise provided in, the Loan Agreement. All payments and prepayments to be made in respect of principal, interest, or other amounts due from Borrowers under this Facility F Note shall be payable at 12:00 noon, New Castle, Pennsylvania time, on the day when due, without presentment, demand, protest or notice of any kind, all of which are expressly waived, and an action therefor shall immediately accrue. All such payments shall be made to Bank at its designated office located at 101 East Washington Street, New Castle, Pennsylvania, in lawful money of the United States of America in immediately available funds without setoff, counterclaim or other deduction of any nature. Except as otherwise provided in the Loan Agreement, if any payment of principal or interest under this Facility F Note shall become due on a day which is not a Business Day, such payment shall be made on the next following Business Day and such extension of time shall be included in computing interest in connection with such payment. This Facility F Note is one of the Notes referred to in, and is entitled to the benefits of, that certain Loan Agreement dated as of August 3, 2000, as amended by Amendment to Loan Agreement dated as of June 14, 2001, that certain Second Amendment to Loan Agreement dated as of May 6, 2002, that certain Third Amendment to Loan Agreement dated as of August 30, 2002, that certain Fourth Amendment to Loan Agreement dated as of December 31, 2002, that certain Fifth Amendment to Loan Agreement dated as of February 28, 2003, that certain Sixth Amendment to Loan Agreement dated as of July 22, 2003, that certain Seventh Amendment to Loan Agreement dated as of January 28, 2004, that certain Eighth Amendment to Loan Agreement, dated July 8, 2004, that certain Ninth Amendment to Loan Agreement, dated November 3, 2004, that certain Tenth Amendment to Loan Agreement, dated December 21, 2004 and further amended by the Eleventh Amendment to Loan Agreement dated as of June 22, 2005, as further amended by letter agreement dated June 13, 2005 by and between Borrowers and Bank (as such agreement may be further amended, modified or supplemented from time to time, the "LOAN AGREEMENT"), which among other things, provides for the acceleration of the maturity hereof upon the occurrence of certain events and may provide for prepayments in certain circumstances and upon certain terms and conditions. This Facility F Note is secured by, and is entitled to the benefits of, the Loan Documents, as the same may be amended, modified or supplemented from time to time. Capitalized terms used in this Facility F Note which are defined in the Loan Agreement shall have the meanings assigned to them therein unless otherwise defined in this Facility F Note. This Facility F Note shall be governed by, and shall be construed and enforced in accordance with, the laws of the Commonwealth of Pennsylvania without regard to the principles applicable to the conflicts of laws thereof. Each Borrower hereby consents to the jurisdiction and venue of the Court of Common Pleas of Allegheny County, Pennsylvania, Court of Common Pleas of Lawrence County, Pennsylvania and the United States District Court for the Western District of Pennsylvania with respect to any suit arising out of, relating to or mentioning this Facility F Note. (Remainder of page intentionally left blank - continued on the following page) 2 - ------------------------------------------------------------------------------ CONFESSION OF JUDGMENT. EACH BORROWER HEREBY IRREVOCABLY Borrowers AUTHORIZES AND EMPOWERS THE PROTHONOTARY, ANY ATTORNEY OR Initials ANY CLERK OF ANY COURT OF RECORD, TO APPEAR FOR AND CONFESS JUDGMENT AGAINST SUCH BORROWER, UPON THE OCCURRENCE OF AN JCR EVENT OF DEFAULT, FOR SUCH SUMS AS ARE DUE AND/OR MAY BECOME DUE UNDER THIS FACILITY F NOTE, THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS, WITH OR WITHOUT DECLARATION, WITH COSTS OF SUIT, WITHOUT STAY OF EXECUTION AND WITH AN AMOUNT EQUAL TO TEN PERCENT (10%) OF THE AMOUNT OF SUCH JUDGMENT, BUT NOT LESS THAN ONE THOUSAND DOLLARS ($1,000), ADDED FOR ATTORNEYS' COLLECTION FEES. NOTWITHSTANDING THE ATTORNEY'S COMMISSION PROVIDED FOR IN THE PRECEDING SENTENCE (WHICH IS INCLUDED IN THE WARRANT FOR PURPOSES OF ESTABLISHING A SUM CERTAIN), THE AMOUNT OF ATTORNEYS' FEES THAT THE BANK MAY RECOVER FROM SUCH BORROWER SHALL NOT EXCEED THE ACTUAL ATTORNEYS' FEES INCURRED BY THE BANK. TO THE EXTENT PERMITTED BY LAW, EACH BORROWER RELEASES ALL ERRORS IN SUCH PROCEEDINGS. IF A COPY OF THIS FACILITY F NOTE, VERIFIED BY AFFIDAVIT BY OR ON BEHALF OF THE HOLDER OF THIS FACILITY F NOTE SHALL HAVE BEEN FILED IN SUCH ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL FACILITY F NOTE AS A WARRANT OF ATTORNEY. THE AUTHORITY AND POWER TO APPEAR FOR AND CONFESS JUDGMENT AGAINST BORROWERS SHALL NOT BE EXHAUSTED BY THE INITIAL EXERCISE THEREOF AND MAY BE EXERCISED AS OFTEN AS THE HOLDER SHALL FIND IT NECESSARY AND DESIRABLE AND THIS FACILITY F NOTE SHALL BE A SUFFICIENT WARRANT THEREFOR. THE HOLDER HEREOF MAY CONFESS ONE OR MORE JUDGMENTS IN THE SAME OR DIFFERENT JURISDICTIONS FOR ALL OR ANY PART OF THE AMOUNT OWING HEREUNDER, WITHOUT REGARD TO WHETHER JUDGMENT HAS THERETOFORE BEEN CONFESSED ON MORE THAN ONE OCCASION FOR THE SAME AMOUNT. IN THE EVENT ANY JUDGMENT CONFESSED AGAINST ANY BORROWER HEREUNDER IS STRICKEN OR OPENED UPON APPLICATION BY OR ON SUCH BORROWER'S BEHALF FOR ANY REASON, HOLDER IS HEREBY AUTHORIZED AND EMPOWERED TO AGAIN APPEAR FOR AND CONFESS JUDGMENT AGAINST SUCH BORROWER FOR ANY PART OR ALL OF THE AMOUNTS OWING HEREUNDER, AS PROVIDED FOR HEREIN, IF DOING SO WILL CURE ANY ERRORS OR DEFECTS IN SUCH PRIOR PROCEEDINGS. - ------------------------------------------------------------------------------ WAIVER OF TRIAL BY JURY. EACH BORROWER EXPRESSLY, KNOWINGLY Borrowers AND VOLUNTARILY WAIVES ALL BENEFIT AND ADVANTAGE OF ANY Initials RIGHT TO A TRIAL BY JURY, AND IT WILL NOT AT ANY TIME INSIST UPON, OR PLEAD OR IN ANY MANNER WHATSOEVER CLAIM OR TAKE THE JCR BENEFIT OR ADVANTAGE OF A TRIAL BY JURY IN ANY ACTION ARISING IN CONNECTION WITH THIS FACILITY F NOTE, THE LOAN AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. - ------------------------------------------------------------------------------ 3 NOTICE - 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 CLAIM YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON ITS PART TO COMPLY WITH THE AGREEMENT, OR ANY OTHER CAUSE. IN WITNESS WHEREOF, and intending to be jointly and severally and legally bound hereby, each Borrower, by its duly authorized officers, has executed, issued and delivered this Facility F Note in Pittsburgh, Pennsylvania on the day and year written above. ATTEST: PDG ENVIRONMENTAL, INC. /s/ Regis O'Hara By: /s/ John C. Regan - ---------------------------------- ------------------------------ Assistant Secretary Title: President & CEO --------------------------- ATTEST: PROJECT DEVELOPMENT GROUP, INC. /s/ Regis O'Hara By: /s/ John C. Regan - ---------------------------------- ------------------------------ Assistant Secretary Title: President & CEO --------------------------- ATTEST: ENVIRO-TECH ABATEMENT SERVICES, CO. /s/ Regis O'Hara By: /s/ John C. Regan - ---------------------------------- ------------------------------ Assistant Secretary Title: President & CEO --------------------------- ATTEST: PDG, INC. /s/ Regis O'Hara By: /s/ John C. Regan - ---------------------------------- ------------------------------ Assistant Secretary Title: President & CEO --------------------------- 4