ohio power company attorneys for relator, attorney …...john d. ferrero (reg. no. 0018590) stark...

In TheSUPREME COURT OF OHIO

State of Ohio, ex rel.,Ohio Power Company,

Relator,

V.

Lee Sinclair, Judge,Stark County Court of Common Pleas,115 Central Plaza NorthCanton, Ohio 44702,

Respondent.

.

10 -

RELATOR OHIO POWER COMPANY'S COMPLAINT FORWRIT OF PROHIBITION ,

Marilyn McConnell(Reg. No. 0031190)Counsel of RecordSteven T. Nourse(Reg. No. 0046705)American Electric PowerService Corporation1 Riverside Plaza, 29th FloorColumbus, OH 43215(614) 716-2964Fax: (614) [email protected] e aep.com

Original Action in Prohibition

Supreme Court of OhioCase No

John D. Ferrero(Reg. No. 0018590)Stark County Prosecutor110 Central Avenue South, Suite 510Canton, Ohio 44702(330) 451-7935

Attorney for Respondent

EDAttorneys for Relator,Ohio Power Company AUG 02 7010

CLERK OF COURTSUPREME CC1UR'i OF OHIO

COMPLAINT FOR WRIT OF PROHIBITION

Now comes Ohio Power Company and for its complaint states:

1. Ohio Power Company (OPCo) is a "public utility" under Ohio Revised Code

(R.C.) 4905.02.

2. The Public Utilities Commission of Ohio (Commission) was created by the

Ohio General Assembly and empowered with broad authority to administer

and enforce the provisions of R.C. Title 49, which provisions include

authority for utilities to charge deposits and disconnect service to customers

under specified circumstances.

3. The Commission possesses extensive and exclusive regulatory authority over

public utilities (subject to review only by this Court), including but not limited

to provisions found within R.C. Chapter 4905 granting the Commission

supervisory oversight of utility rates, services, disconnect procedures, deposits

and other terms and conditions of services, service standards and utility

practices.

4. The Commission, pursuant to its statutory authority, approved a tariff

provision for OPCo governing the terms and conditions of. service which

allow OPCo in specified situations to require a customer to pay a deposit and

to disconnect service to a customer for non-payment of its electric bill

(Exhibit A), and promulgated detailed rules in the Ohio Administrative Code

regarding procedures for electric utilities to follow when doing so.

2

5. On May 21, 2009, Comerica Bank (hereinafter referred to as "Comerica")

filed a Complaint in the Stark County Court of Common Pleas, Case No. 2009

CV 2030, against one of OPCo's customers, Precision Powder Coating, Inc.,

regarding the property located at 1530 Raff Road, S.W., Canton, Ohio. OPCo

was not a party to this action. (Complaint, Exhibit B1).

6. On May 21, 2009, Comerica filed a motion requesting the appointment of a

receiver. The Respondent entered an Agreed Order Appointing Liquidating

Receiver. (Exhibit D).

7. The Order states in part: "Any individual or entity receiving a copy of this

Order is hereby enjoined and restrained from discontinuing service to the

Receiver or the Receivership estate based up on the non-payment of ...

utilities prior to July 9, 2010 and from attempting to collect ... utility charges

from the Receiver prior to July 9, 2010. (Exhibit D, ¶4).

8. OPCo first received the Order in an email from the Receiver to OPCo on July

25, 2010. (Exhibit E).

1 The Exhibits to the Complaint filed in the Stark County Common Pleas Court havenot been included in Exhibit B as they are voluminous and do not relate to the issuesaddressed in the Complaint for Writ. They consist of: Exhibit A Note; Exhibit BVariable Rate Installment Note; Exhibit C Variable Rate Installment Note; Exhibit DVariable Rate Installment Note; Exhibit E Variable Rate Installment Note; Exhibit FPrivate Access Line Variable Rate-Demand Note; Exhibit G Letter; Exhibit H Letter;Exhibit I Letter; Exhibit J Letter; Exhibit K Guaranty; Exhibit L Guaranty; Exhibit MGuaranty; Exhibit N Security Agreement; Exhibit 0 Security Agreement; and ExhibitP Open-End Mortgage.

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9. By entering the Order, the Court is interfering with OPCo's tariff, which is an

order of the Commission, as well as the regulatory scheme set up by the

legislature pursuant to the Revised Code.

10. R.C. 4903.12 provides as follows: "No court other than the supreme court

shall have power to review, suspend, or delay any order made by the public

utilities commission, or enjoin, restrain, or interfere with the commission or

any public utilities commissioner in the performance of official duties. A writ

of mandamus shall not be issued against the commission or any commissioner

by any court other than the supreme courtl"

11. This Court has original jurisdiction in this proceeding based on Article IV,

Section 2(B)(1)(d) of the Ohio Constitution, and Rule X of the Rules of

Practice of the Supreme Court of Ohio.

12. The Respondent's Order was an exercise of judicial power over OPCo's tariff

and the Order made clear that the Respondent has and will continue to

exercise judicial power with respect to regulated utilities' ability to disconnect

service to the Customer or charge a deposit

13. Disconnection of a customer who is indebted to Relator for electric service

under its tariff is a regular practice of OPCo, and the expertise of the

Commission is required for resolution of this dispute.

14. In the absence of a writ restraining its ongoing exercise of judicial power, the

Respondent's Order prohibits Relator's ability to follow its tariff procedures,

Iawfully invading the exclusive jurisdiction of the Commission.

15. The Order and fiirther proceedings before the Court of Common Pleas in

support of the Order are unauthorized by law and will cause injury to Relator

for which there is no adequate legal remedy.

16. The Respondent patently and unambiguously lacks jurisdiction to issue or

enforce an order prohibiting the Relator disconnecting a customer or charging

a deposit.

WHEREFORE, Relator Ohio Power Company, prays for this Court (i) to

issue a Peremptory Writ of Prohibition to restrain the Court of Common Pleas

from continuing or allowing further judicial proceedings of any kind or nature in

connection with the Order Appointing a Receiver as it relates to regulated

utilities, and ordering that the portions of the Order pertaining to regulated

utilities declared void; or (ii) in the alternative, to issue an Alternative Writ

commanding the Court of Common Pleas to refrain from continuing or allowing

further judicial proceedings of any kind or nature in connection with the Order as

it relates to regulated utilities, and ordering that the portions of the Order

pertaining to regulated utilities declared void, or to show cause why a permanent

writ should not issue.

Respectfully submitted,^----^

arilyn McConnell(Reg; No. 0031190)Counsel of RecordSteven T. Nourse(Reg. No. 0046705)American Electric PowerService Corporation1 Riverside Plaza, 29th FloorColumbus, OH 43215(614) 716-2964Fax: (614) [email protected]@aep.com

Attorneys for Relator,Ohio Power Company

PROOF OF SERVICE

I hereby certify that a true copy of the foregoing Complaint submitted on behalf

of the Ohio Power Company, was served by regular U.S. mail, postage prepaid, or hand-

delivered, upon the following parties of record, thisA7 day of

2010.

PARTIES OF RECORD:

John D. Ferrero(Reg. No. 0018590)Stark County Prosecutor110 Central Avenue South, Suite 510Canton, Ohio 44702(330) 451-7935

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EXHIBIT A

OHIO POWER COMPANY Original Sheet No. 3-2

P.U.C.O. NO. 19

TERMS AND CONDITIONS OF SERVICE

Written agreements will be requi red, before se rvice will be commen ced, from ea chcustomer with annual av erage dema nd greate r tha n 500 KW. A written agreement may berequired by the Co mpany for a cu stomer whose annual average demand does not exce ed 500KW that has unusual or special service characteristics. If the customer refuses to sign a writtenagreement, an agreem ent will still be effective as if the custom er had signed and said customerwill be charged under the appropriate schedule. A copy of the written agreement, contained on aform provided by the Company, will be furnished to the customer upon request at any time duringthe term of the agreement.

When the customer desires delivery of energy at more than one point, each delivery pointwill be billed separately under a schedule applicable to the customer's class of business at suchpoint. Separate written agreements, if required under the above paragraph, will be made for eachpoint of delivery.

3. DEPOSITS

Security for the payment of bills will be govemed, as specified in Chapter 4901:1-10-14 ofthe Ohio Administrative Code, which is herein incorporated by reference as it is from time to timeamended.

The Company will be entitled to pursue adequ ate assurance of payment f or electri cservice if a customer files for protection under provisions of the United States Bankruptcy Code.

The Compa ny will pay intere st on depo sits so made in accordance with legalrequirements. The Comp any will not pay intere st on dep osits more th an o ne month afterdiscontinuance of service to the customer. Retention by the Company, prior to final settlement, ofany deposit or guarantee is not a payment or part payment of any bill for service. The Com panyshall have a reasonable ti me in whi ch to read and remove the m eters and to ascertain that theobligations o f the custo mer have b een fully performed befo re being required to return anydeposit.

4. PAYMENTS

Bills will be rende red by the Com pany to the customer monthly in accordance with theschedule selected applicable to the customer's service with the following exception:

(Continued on Sheet No. 3-3)

Filed pursuant to Orders dated March 18 and March 30, 2009 in Case No. 08-918-EL-SSO

Issued: March 30, 2009 Effective: Cycle I April 2009Issued by

Joseph Hamrock, PresidentAEP Ohio

OHIO POWER COMPANY 15' Revised Sheet No. 3-14Cancels Original Sheet No. 3-14

P.U.C.O. NO. 19


Where a single-family house is converted to include separate living quarters or dwellingunits for more than one family, or where two or more families oc cupy a single-family house withseparate cooking facilities, the owner may, instead of providing separate wiring for each dwellingunit, take service through a single meter under the residential service schedule. In such case,there will be a single customer ch arge, but t he quantity of kilowatt-h ours i n each blo ck willmultiplied by the number of dwelling units or families occupying the building.

The residential service schedule shall cease to apply to that portion of a residence whichbecomes primarily used for business, professional, institutional or gainful purposes. Under thesecircumstances, customer shall have the choice: (1) of separating the wiring so that the residentialportion of the premises is served through a separate meter under the residential service scheduleand the other uses as enumerated above are served through a separate meter or meters underthe appropriate general service schedule; or (2) of taking the entire service under the appropriategeneral se rvice sche dule. Motors of 10 HP or le ss may b e served u nder the ap propriateresidential service sch edule. La rger motors m ay be served where, in th e Co mpany's sol ejudgment, the existing facilities of the Company are adequate.

Detached building or buildings, actually appurtenant to the residence, such as a garage,stable or barn, may be se rved by an extension of the customer's residence wiring through theresidence meter provided no business activities are transacted in the detached buildings.

In the event a detached g arage or oth er facility on a resi dential customer's property isseparately served and metered, such facility shall accordingly be metered and billed according tothe appropriate general service rate.

18. DENIAL OR DISCONTINUANCE OF SERVICE

The Co mpany reserves the right to refuse a ny applicant for serv ice if the applica nt isindebted to t he Company for any service the retofore re ndered at any locat ion, p rovided theCompany shall advise a pplicant to such effect, and provided that indebted ness for on e class ofservice shall not ca use t he refusal of se rvice to a different class of se rvice. The Com panyreserves the right to discontinue to serve any customer without notice in case of an emergency orto prevent theft from or fraud upon the Company. Subject to the further provisions for residentialcustomers contained in Chapter 4 901:1-18 of the Ohio Admin istrative Cod e whi ch i s h ereinincorporated by reference as it is from time to time amended, the Company also reserves theright after at least 5 days' notice in writing to di scontinue to serve any cu stomer (1 ) wh o isindebted to the Com pany for any service theretof ore rend ered a t any location (on othe r thanequal payment plan a ccounts having a credit bala nce), and p rovided that in debtedness for oneclass of service shall not cause the disconnection of service to a d ifferent class of service (2) forfailure to p rovide and mai ntain adequate security fo r the payme nt of bills as requested by theCompany, or (3) fo r failure to com ply with t hese Terms and Conditions. Any disco ntinuance ofservice shall not te rminate the contra ct between t he Company and the customer nor shall itabrogate any minimum charge which may be effective.


Filed pursuant to Order dated December 2, 2009 in Case No. 09-1003-EL-ATA

Issued: December 9, 2009 Effective: December 9, 2009Issued by


OHIO POWER COMPANY V` Revised Sheet No. 3-15Cancels Original Sheet No. 3-15

P.U.C.O. NO. 19


When a Company employee is dispatched to a customer's premises for the purpose ofperforming collection activities due to the customer's delinquency, the customer will be charged$18.00, the cost to the Comp any of having t he employee at the cu stomer's premises. ACompany employee performing a disconnection is not authorized to make any extended paymentarrangements with the customer, but will, in lieu of di sconnection, accept payment of thedelinquent a mount plus $18.00, the co st to the Company of having the employe e a t thecustomer's premises to perform the disconnection. The Company may, when in itsjudgment itsemployees would be su bject to physical harm, require the payment to be by mean s other thancash. The collection trip charge will not be assessed more than once in any billing period.

If a cu stomer h as be en disco nnected, upo n pay ment o r p roof of payme nt of thedelinquent amount plus a reconnection fee as specified below, which represents the cost to th eCompany of discon necting and reconnecting a customer during the Com pany's normal workinghours, the Company will reconnect the electric service on this same day, if such payment or proofof payment is made at th e Company's office by 12:30 p.m., a nd otherwise as soon as possiblebut not later than the clo se of the Comp any's next7egular working day. When su ch payment ismade after 12:30 p.m. and the Company's employees cannot reconnect the service prior to theend of their normal workday, and the customer prefers to be reconnected prior to the beginning ofthe next re gular workday, the disconne ction and re connection ch arge payable prior toreconnection will be the overtime ra te sp ecified below, an a mount which re cognizes theCompany's average additional cost of reconnecting a customer outside of normal working hours.

Reconnection Service Charges:

Reg ular OvertimeSingle Phase $36.00 $ 92.00All Other $90.00 $145.00

19. INTERVAL METERING INSTALLATIONS

A customer may request an interval m eter. The cost of any interval meterin g facilitiesinstalled by the Company as a result of such request shall be paid by the customer. The customershall make a one-time payment for the met ering facilities at t he time of i nstallation of therequested facilities, or, at the customer's option, up to 24 co nsecutive equal monthly paymentsreflecting an annual interest charge as determined by the Company, but not to exceed the cost ofthe Comp any's mo st recent issu e of long -term d ebt. If the customer el ects the i nstalimentpayment option, the Company shall require an initial payment equal to 25% of the total cost of themetering facilities.

In addition, t he custo mer shall pay a net c harge to cove r th e increm ental co st ofoperation and maintenance and mete r data management associated with such interval meteringas follows. Charges are for service performed on a Company installed standard interval meter.


Filed pursuant to Order dated December 2, 2009 in Case No. 09-1003-EL-ATA

Issued: December 9, 2009 Effective: December 9, 2009Issued by


EXHIBIT B

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-,[7{Tl y.:yT J :'7„

IN THE COURT OF COMMON PLEASENSTARK COUNTY, O

r^pq cvo 2o 3oCOMERICA BANK ) CASE500 WoodwardAvenue ) ,-TDetroit, Michigan 48226-3259, ) JUDGE

Plaintiff,

V.

PRECISION POWDER COATING, INC.1530 Raff Road, S.W.Canton, Ohio 44710,

C. PAXOS, INC.1530 Raff Road, S.W.Canton, Ohio 44710,

CHRISTOPHER PAXOS6495 Yost StreetCanton, Ohio 44718,

and

STARK COUNTY TREASURERCounty Administration Building110 Central Plaza, Suite 250Canton, OH 44702-1410,

Defendants.

COMPLAINT

Now comes Comerica Bank ("Comerica") and for its Complaint against the

defendants hereby states as follows:

1. Comerica is a cooperation organized under the laws of the state of Texas

with its headquarters located in Dallas, Texas. Comerica is licensed to do business in the

state of Ohio.

2. Defendants, Precision Powder Coating, Inc. ("Precision Powder"),

C. Paxos, Inc. ("CPP') and Christopher Paxos ("Paxos") are located in Canton, Ohio.

THE NOTES

3. Precision Powder executed and delivered to Comerica that certain

promissory note dated March 9, 2005 in the original face amount of $1,000,000.00,

which promissory note was amended by agreement on March 23, 2006 to extend the

maturity date to April 1, 2007, by agreement dated March 28, 2007 to extend the maturity

date to May 1, 2008, by amendment dated May 1, 2008 to extend the maturity date until

July 1, 2008, and by amendment dated July 31, 2008 to extend the maturity date until

November 1, 2008. The promissory note, as amended, shall be referred to as "Note #1."

Note #1 is attached hereto as Exhibit A.

4. On or about November 29, 2007, Precision Powder executed and delivered

that certain promissory note to Comerica in the original face amount of $324,000.00,

which note was amended by agreement dated May 1, 2008 to change the interest rate and

by agreement dated July 31, 2008 to change the interest rate. The promissory note, as

amended, shall be referred to as "Note #2." Note #2 is attached hereto as Exhibit B.


that certain promissory note in the original face amount of $1,461,203.20, which

promissory note was amended by agreement dated May 1, 2008 to change the interest

rate and by agreement dated July 31, 2008 to change the interest rate. The promissory

2

note, as amended, shall be referred to as "Note #3." Note #3 is attached hereto as Exhibit

C.


to Coinerica that certain promissory note in the original face amount of $701,537.27,

which promissory note was amended by agreement dated May 1, 2008 to change the

interest rate and by agreement dated July 31, 2008 to change the interest rate. The

promissory note, as amended, shall be referred to as "Note #4." Note #4 is attached

hereto as Exhibit A.

7. On or about November 30, 2006, CPI executed and delivered to Comerica

that certain promissory note in the original face amount of $3,592,778.57. The

promissory note shall be referred to as "Note #5." Note #5 is attached hereto as Exhibit

E.

8. On or about March 9, 2005, Paxos, in his individual capacity, executed

and delivered that certain promissory note to Comerica in the original face amount of

$100,000.00. The promissory note shall be referred to as "Note #6." Note #6 is attached

hereto as Exhibit F.

9. On November 25, 2008, Precision Powder, CPI and Paxos entered into a

forbearance agreement ("Forbearance Agreement") wherein Precision Powder, CPI and

Paxos acknowledged and agreed that they were in default under the loans from Comerica,

specifically, Notes #1 - #6, and that, provided certain conditions were adhered to and

payments as specified were made when due, the bank agreed to forbear until May 1,

2009. The Forbearance Agreement is attached hereto as Exhibit G.

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10. On November 11, 2008, Precision Powder and CPI were notified that they

were in breach of the Forbearance Agreement. The November 11, 2008 notification is

attached hereto as Exhibit H.

11. On May 6, 2009, Comerica demanded payment of Notes #1 - #6 by reason

of default in payment and other defaults by Precision Powder, CPI and Paxos. Copies of

the May 6, 2009 demand letters are attached hereto as Exhibits I and J.

12. Notes #1 - #6 are in default for lack of payment and other defaults and

there is due and owing pursuant to Notes #1- #6 as of May 12, 2009 as follows:

Note Principal Interest Late Charge Last Payment

1 $ 585,403.05 $ 5,855.93 $ 119.35 December, 20082 $ 292,500.00 $ 3,018.19 $ 61.64 March, 2009

3 $ 1,352,965.88 $ 13,964.18 $ 1,943.22 March, 20094 $ 633,089.27 $ 6,534.22 $ 775.33 March, 2009

5 $ 3,282,572.94 $ 33,923.19 $ 1,580.55 December, 2008

6 $ 100,000.00 $ 548.26 $ 18.22 April, 2008

THE GUARANTEES


its unlimited guaranty of all existing and future indebtedness of CPI to Comerica (the

"Precision Powder Guarantee"). A copy of the Precision Powder Guarantee is attached

hereto as Exhibit K.

14. On or about November 8, 2002, CPI executed and delivered its unlimited

guaranty of all existing and future indebtedness of Precision Powder to Comerica (the

"CPI Guarantee"). A copy of the CPI Guarantee is attached hereto as Exhibit L.

15. On or about November 29, 2007, Paxos executed and delivered his

unlimited guaranty of all axisfing and future indebtedness of Precision Powder and CPI to

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Comerica (the "Paxos Guarantee," collectively with the Precision Powder and the CPI

Guarantees, the "Guarantees"). A copy of the Paxos Guarantee is attached hereto as

Exhibit M.

THE SECURITY AGREEMENTS

16. To secure the repayment of all existing and future indebtedness of CPI and

Precision Powder to Comerica, Precision Powder executed and delivered that certain

security agreement, dated November 8, 2002, thereby granting to Comerica a security

interest in and to substantially all assets of Precision Powder ("Security Agreement #1").

Security Agreement #1 is attached hereto as Exhibit N.

17. The seaurity interest granted in Security Agreement #1 was perfected by

filing a UCC-1 Financing Statement with the Ohio Secretary of State on November 12,

2002 (Doc. No. OH00056468874), which was continued on June 7, 2007 (Doc. No.

20071590218).

18. To secure the repayment of all existing and future indebtedness of

Precision Powder and CPI to Comerica, CPI executed and delivered a security agreement

dated November 8, 2002, thereby granting to Comerica a security interest in and to

substantially all assets of CPI ("Security Agreement #2"). Security Agreement #2 is

attached hereto as Exhibit O.

19. The security interest granted in Security Agreement #2 was perfected by

filing a UCC-1 Financing Statement with the Ohio Secretary of State on November 12,

2002 (Doc. No. OH00056469119), which was continued on June 7, 2007 (Doc. No.

20071590222).

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THE REAL ESTATE MORTGAGE

20. On or about November 8, 2002, CPI executed and delivered that certain

open-end real estate mortgage (as amended, the "Mortgage") covering the property

connnonly referred to as 1530 Raff Road, S.W., Canton, Ohio, PPN 04-00835 and 02-

46176, more fully described in the Mortgage which is attached hereto as Exhibit P (the

"Mortgaged Property"). The Mortgage was amended as of January 10, 2006 to increase

the maximum indebtedness to $7,524,894.66.

21. The Mortgage was filed with the Stark County Recorder's Office on

November 8, 2002 as Instrument No. 200211080091182.

22. The Mortgage was given to secure all existing and future indebtedness of

CPI and Precision Powder to Comerica.

23. Comerica is entitled to foreclosure its interest in the property, have the

property appraised, advertised and sold in accordance with the law and have the proceeds

applied to the payment of its indebtedness.

COUNT I - JUDGMENT ON THE NOTES AND GUARANTEES

24. Comerica restates and re-avers the allegations contained in paragraphs 1-

23 as if fully rewritten herein.

25. Comerica is the holder and possessor of Notes #1-#6 and the respective

Guarantees executed and delivered by Precision Powder, CPI and Paxos.

26. Precision Powder, CPI and Paxos have defaulted under the Notes #146

and the respective Guarantees by, among other things, failing to make all payments when

due pursuant to the loan documents.

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27. By virtue of Precision Powders, CPI and Paxos' failure to make payments

when due under the loan documents, Comerica has declared and/or hereby declares the

entire indebtedness under Notes #1-#6 to be immediately due and payable.

28. By virtue of the respective Guarantees, Precision Powders, CPI and Paxos

absolutely, unconditionally and irrevocably liable for the amounts due and owing to

Comerica under Notes #L#6.

29. Comerica demands judgment as follows:

a, as to Note #1 and the Guarantees, against Precision Powder, CPI

and Paxos, jointly and severally, in the aggregate amount of $591,378.33,

plus interest at the default contract rate from May 12, 2009;

b. as to Note #2 and the Guarantees, against Precision Powder, CPI



o, as to Note #3 and the Guarantees, against Precision Powder, CPI

and Paxos, jointly and severally, in the aggregate amount of

$1,368,873.28, plus interest at the default contract rate from May 12,

2009;

d. as to Note #4 and the Guarantees, against Precision Powder, CPI



e. as to Note #5 and the Guarantees, against Precision Powder, CPI

and Paxos, jointly and severally, in the aggregate amount of

7

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$3,318,076.68, plus interest at the default contract rate from May 12,

2009; and

f. as to Note #6, against Paxos in the aggregate amount of

$100,566.48, plus interest at the default contract rate from May 12, 2009.

& for attomeys' fees and costs as provided for under the loan

documents attached hereto and the forbearance agreement attached hereto

as Exhibit G.

COUNT II - PERSONAL PROPERTY AND FORECLOSURE



31. With the exception of a few discrete pieces of equipment, Comerica has a

first and best security interest in the assets of Powder Precision and CPI.

32. The conditions of Security Agreement #1 and Security Agreement #2 have

been breached and Comerica is entitled to have all assets subject to the Security

Agreements sold at public or private sale as provided under the terms of the Security

Agreements and Ohio law and the proceeds applied to the amounts due and owing to

Comerica plus costs and attorneys' fees.

COUNT III - REAL PROPERTY AND FORECLOSURE



34. Defendant Stark County Treasurer may have or claim an interest in the

Mortgage Property.

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•35. The conditions of the Mortgage have been breached. Comerica is entitled

to foreclose its interest in the Mortgage, have all those who claim an interest in the

property come forth an assert their interests, have the equity of redemption cut off and

forever barred and have the property appraised, advertised and sold according to law and

the proceeds applied to repay the amounts due Comerica.

COUNT IV -APPOINTMENT OF RECEIVER



37. Both the Security Agreements and the Mortgage provide for the

appointment of a receiver upon default. The Borrowers are in default and Comerica

requests the immediate appointment of a receiver without bond to take possession of the

assets of Precision Powder and CPI and to sell those assets to satisfy the liens of

Comerica and any others who claim an interest in the assets.

WHEREFORE, Comerica prays for the following relief:

A. Judgment in favor of Comerica

a. as to Note #1 and the Guarantees, against PrecisionPowder, CPI and Paxos, jointly and severally, in the aggregate amount of$591,378.33, plus interest at the default contract rate from May 12, 2009;

b. as to Note #2 and the Guarantees, against PrecisionPowder, CPI and Paxos, jointly and severally, in the aggregate amount of$295,579.83, plus interest at the default contract rate from May 12, 2009;

c. as to Note #3 and the Guarantees, against PrecisionPowder, CPI and Paxos, jointly and severally, in the aggregate amount of$1,368,873.28, plus interest at the default contract rate from May 12,2009;

d. as to Note #4 and the Guarantees, against PrecisionPowder, CPI and Paxos, jointly and severally, in the aggregate amount of$640,398.82, plus interest at the default contract rate from May 12, 2009;

9

C. as to Note #5 and the Guarantees, against PrecisionPowder, CPI and Paxos, jointly and severally, in the aggregate amount of$3,318,076.68, plus interest at the default contract rate from May 12,2009; and

f. as to Note #6 against Paxos in the aggregate amount of$100,566.48, plus interest at the default contract rate from May 12, 2009;

g. for attorneys' fees and costs as provided for under the loandocuments attached hereto and the forbearance agreement attached heretoas Exhibit G.

B. That the Mortgage be declared a valid and subsisting first and bestlien upon the Mortgaged Property, subject only to the lien of the Treasurer of StarkCounty, Ohio for real estate taxes; that the Mortgage be foreclosed; that the equity ofredemption of all defendants be forever cut off, barred and foreclosed; that the MortgagedProperty be sold in accordance with law; that all defendants be required to set forth anyclaim, lien or interest which they may have in the Mortgaged Property or be foreverbarred therefrom; and that, upon the sale of the Mortgaged Property, the proceeds thereofbe paid to Comerica to satisfy the indebtedness of Precision Powder, CPI and Paxos;

C. the appointment of a receiver to take possession and control of allassets of Precision Powder and CPI and to foreclosure Comerica's interest in the assetssubject to the Security Agreements and Mortgage; and

D. Such other and further relief to which it may be entitled at law orequity.

Respect$illy submitted,

VORYS, SATER, SEYMOUR AND PEASE LLP

G- ^ Gu ^OSI J SJ. Bruce Hunsicker (0018194)106 S. Main Street, Suite 1100Akron, Ohio 44308(330) 208-1000, (330) 208-1001 facsimilej bhunsicker(a?vorys. com

Carrie Mae Brosius (0075484)2100 One Cleveland Center1375 East Ninth StreetCleveland, OH 44114-1724(216) 479-6100, (216) 479-6060facsBmilecmbrosius(aworys. com,4ttorneys for Comereca Bank

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05120/2009 AKron 63059.4

EXHIBIT C

• metSYamr 1t7lp^P OmjLY

IN THE COURT OF COMMON PLEASSTARK COUNTY, OHIO

COMERICA BANK,

Plaintiff,V.

PRECISION POWDER COATING, INC., etat.,

CASENO?.PP9 rVn 2 n 30

JUDGE ,^j 1yac.

MOTION FOIL APPOINTMENT OFRECEIVER AND EXPEDITEDHEARING(ORAL HEARING REQUESTED)

Defendants.

Plaintiff Comerica Bank ("Comerica") hereby moves this Court for an Order appointing a

receiver for the real and personal property described in Plaintiffs Complaint (collectively, the

"Property") and authorizing said receiver: to take possession of, hold, manage, control and

protect the Property during the pendency of this action; to collect the rents and profits therefrom,

and to apply the same toward the payment of expenses, including management and operating

expenses, taxes, assessments, utilities, and insurance premiums for the Property and the payment

of any judgment rendered herein; to maintain the Property in a reasonable state of repair so that

there will be no excessive depreciation or devaluation of the Property during the pendency of this

action; make a determination regarding the appropriate disposition of the Property; subject to

further order of the Court, to sell at public or private sale all or any part of the collateral

belonging to the Plaintiff; to undertake all actions necessary to carry out the provisions of the

Order Appointing Receiver filed contemporaneously herewith; and to undertake all other actions

and exercise all other rights and remedies available to receivers under Ohio law.

0

This Motion should be granted because (1) Comerica has a valid, perfected security

interest in all of the Property; (2) Precision Powder and CPI have defaulted on their obligations

to Comerica; (3) Comerica has the right to appoint a receiver upon any event of default pursuant

to the loan documents; (4) upon information and belief, the Defendants Precision Powder, Inc.

and C. Paxos, Inc. have violated and continue to violate the "Dominion of Funds" agreement set

forth in the November 25, 2008 Forbearance Agreement, thereby diverting funds away from

Comerica; and (5) a receiver would ensure that the Comerica's collateral is preserved and not

diverted and dissipated in order to achieve the highest possible values in satisfaction of Precision

Powder and CPI's obligations to Comerica and other creditors.

These grounds are fally explained in the memorandum attached hereto and incorporated

herein by reference. Comerica specifically requests that this Court conduct an expedited hearing

on the Motion. A proposed Order Appointing Receiver and a proposed Order granting an

expedited hearing on this Motion are attached hereto.

Respectfully submitted,


J. Bruce Hunsicker (0018194)106 S. Main Street, Suite 1100Akron, Ohio 44308(330) 208-1000, (330) 208-1001 facsimilejbhunsicker(a vorys. com

Carrie Mae Brosius (0075484)2100 One Cleveland Center1375 East Ninth StreetCleveland, OH 44 1 1 4-1 724(216) 479-6100, (216) 479-6060 facsimilecmbrosius(d,vorvs. com

Attorneys for Comerica Bank

2


COMERICA BANK, . CASE NO.

V.

Plaintiff,JUDGE

PRECISION POWDER COATING, INC., etal.,

Defendants.

A. FACTS

MEMORANDUM IN SUPPORT OFMOTION FOR APPOINTMENT OFRECEIVER AND EXPEDITEDHEAItING

1. The Notes.

Precision Powder Coating, Inc. ("Precision Powder") executed and delivered to Comerica

that certain promissory note dated March 9, 2005 in the original face amount of $1,000,000.00,

which promissory note was amended by agreement on March 23, 2006 to extend the maturity

date to April 1, 2007, by agreement dated March 28, 2007 to extend the maturity date to May 1,

2008, by amendment dated May 1, 2008 to extend the maturity date until July 1, 2008, and by

amendment dated July 31, 2008 to extend the maturity date until November 1, 2008. The

promissory note, as amended, shall be referred to as "Note #1." Note #1 is attached hereto as

Exhibit A.

On or about November 29, 2007, Precision Powder executed and delivered that certain

promissory note to Comerica in the original face amount of $324,000.00, which note was

amended by agreement dated May 1, 2008 to change the interest rate and by agreement dated

July 31, 2008 to change the interest rate. The promissory note, as amended, shall be referred to

as "Note #2." Note #2 is attached hereto as Exhibit B.

On or about November 29, 2007, Precision Powder executed and delivered that certain

promissory note in the original face amount of $1,461,203.20, which promissory note was

amended by agreement dated May 1, 2008 to change the interest rate and by agreement dated

July 31, 2008 to change the interest rate. The promissory note and note, as amended, shall be

referred to as "Note #3." Note #3 is attached hereto as Exhibit C.

On or about November 29, 2007, Precision Powder executed and delivered to Comerica

that certain promissory note in the original face amount of $701,537.27, which promissory note

was amended by agreement dated May 1, 2008 to change the interest rate and by agreement

dated July 31, 2008 to change the interest rate. The promissory note, as amended, shall be

referred to as "Note #4." Note #4 is attached hereto as Exhibit D.

On or about November 30, 2006, C. Paxos, Inc. ("CPI") executed and delivered to

Comerica that certain promissory note in the original face amount of $3,592,778.57. The

promissory note shall be referred to as "Note #5." Note #5 is attached hereto as Exhibit E.

On November 25, 2008, Precision Powder, CPI and Christopher Paxos ("Paxos") entered

into a forbearance agreement ("Forbearance Agreement") wherein Precision Powder, CPI and

Paxos acknowledged and agreed that they were in default under the loans from Comerica and

that, provided certain conditions were adhered to and payments as specified were made when

due, the bank agreed to forbear until May 1, 2009. The Forbearance Agreement is attacbed

hereto as Exhibit F.

On November 11, 2008, Precision Powder and CPI were notified that they were in breach

of the Forbearance Agreement. On May 6, 2009, Comerica demanded payment of Notes #1 - #5

by reason of default in payment and other defaults by Precision Powder, CPI and Paxos. Notes

#1 - #5 are in default for lack of payment and other defaults and there is due and owing pursuant

to Notes #1- #5 as of May 12,2009 as follows:

2

Note Principal hiterest Late Charge Last Payment

1 $ 585,403.05 $ 5,855.93 $ 119.35 December, 2008

2 $ 292,500.00 $ 3,018.19 $ 61.64 March, 2009

3 S 1,352,965.88 $ 13,964.18 $ 1,943.22 March, 20094 $ 633,089.27 $ 6,534.22 $ 775.33 March, 20095 $ 3,282,572.94 $ 33,923.19 $ 1,580.55 December, 2008

2. The Guarantees.

On or about November 8, 2002, Precision Powder executed and delivered its unlimited

guaranty of all existing and future indebtedness of CPI to Comerica (the "Precision Powder

Guarantee"). A copy of the Precision Powder Guarantee is attached hereto as Exhibit G.

On or about November 8, 2002, CPI executed and delivered its unlimited guaranty of all

existing and future indebtedness of Precision Powder to Comerica (the "CPI Guarantee"). A

copy of the CPI Guarantee is attached hereto as Exhibit H.

3. The Security Agreements.

To secure the repayment of all existing and future indebtedness of CPI and Precision

Powder to Comerica, Precision Powder executed and delivered that certain security agreement,

dated November 8, 2002 ("Security Agreement #1"), thereby granting to Comerica a security

interest in and to substantially all assets of Precision Powder (the "Precision Powder Assets').

Security Agreement #1 is attached hereto as Exhibit I. The security interest granted in Security

Agreement #1 was perfected by filing a UCC-1 Financing Statement with the Ohio Secretary of

State on November 12, 2002 (Doc. No. OH00056468874), wbich was continued on June 7, 2007

(Doc. No. 20071590218).

To secure the repayment of all existing and future indebtedness of Precision Powder and

CPI to Comerica, CPI executed and delivered a security agreement dated November 8, 2002

("Security Agreement #2"), thereby granting to Comerica a security interest in and to

substantially all assets of CPI (the "CPI Assets"). Security Agreement #2 is attached hereto as

3

0

Exhibit J. The security interest granted in Security Agreement #2 was perfected by filing a

UCC-1 Financing Statement with the Ohio Secretary of State on November 12, 2002 (Doc. No.

OH00056469119), which was continued on June 7, 2007 (Doc. No. 20071590222).

4. The Real Estate Mortgage.

On or about November 8, 2002, CPI executed and delivered that certain open-end real

estate martgage (as amended, the "Mortgage") covering the property commonly referred to as

1530 Raff Road, S.W., Canton, Ohio, PPN 04-00835 and 02-46176, more fully described in the

Mortgage which is attached hereto as Exhibit K (the "Mortgaged Property," collectively with the

Precision Powder Assets and CPI Assets, the "Property"). The Mortgage was amended as of

January 10, 2006 to increase the maximum indebtedness to $7,524,894.66. (See Exhibit K.) The

Mortgage was filed with the Stark County Recorder's Office on November 8, 2002 as Instrument

No. 200211080091182. The Mortgage was given to secure all existing and future indebtedness

of CPI. and Precision Powder to Comerica.

B. LAW & ARGUMENT

1. Comerica is entitled to the appointment of a receiver pursuant to the loandocuments.

Security Agreement #1 and Security Agreement #2 give Comerica the right to appoint a

receiver upon the occurrence of any event of default. Comerica negotiated for the right to

appoint a receiver in the event of default and Precision Powder and CPI consented.

4.2 Upon the occurrence of any Event of Default, Bank may at itsdiscretion and without prior notice to Debtor declare any and all of theIndebtedness to be immediately due and payable, and shall have and mayexercise any one or more of the following rights and remedies:

*sw

(d) Personally or by agents, attorneys, or appointment of receiver, enterupon any premises where Collateral may then be located, and takepossession of all and any of it and/or render it unusable; and without beingresponsible for loss or damage to such Collateral, hold, operate, sell, lease,dispose of all or any Collateral at one or more public or private sales,

4

leasings or other disposition, at plaoes and times and on tertns andconditions as Bank may deem fit, without any previous demand oradvertisement; ...

(Exh. I and J, pp. 5-6.)

The Mortgage also gives Comerica the right to appoint a receiver upon the occurrence of

any event of default.

13. hnmediately upon the occurrence of any Event of Default, Mortgageeshall have the option to do any or all of the following: ...obtain a receiver tomanage the Premises and collect the rents, profits and income from it....

(Exh. K, p. 7.)

It is well-settled under Ohio law that, a party is entitled to have a receiver appointed

where the loan documents contain a provision authorizing such an appointment. See, e.g.,

Metropolitan Life Ins. Co. v. Trisketttllinois, Inc., 97 Ohio App.3d 228, 236 (Hamilton Cty.

App. 1994) (acknowledging appointment of receiver pursuant to terms of mortgage is

appropriate); see also Manufacturers Life Ins. Co. v. Patterson, (Cuyahoga Cty. 1988), 51 Ohio

App. 3d 99 (upholding mortgage provision authorizing appointment of a receiver without prior

notice); Federal Land Bank ofLouisville v. DeRan, 74 Ohio App. 365 (Sandusky Cty. 1944)

(holding that where the mortgage provides for the appointment of a receiver and conveys rents

and profits, the court has the authority to appoint a receiver under Section 11894(6) of the

General Code (the precursor of subparagraph (F) of Ohio Revised Code § 2735.01(F)t).

Precision Powder and CPI defaulted on Notes #1-#5 by failing to make payments.

Consequently, Precision Powder and CPI are in default under the Security Agreements and the

Mortgage. Comerica has the contractual right to have a receiver appointed over the Precision

Powder and CPI's assets.

'R.C. § 2735.01(F) states, in relevant part, that a receiver may be appointed "...in all...cases in which receivers havebeen appointed by usage in equity."

5

^

2. Comerica is entitled to tbe appointment of a receiver pursuant to Ohio law.

Under Ohio Revised Code §2735.01:

A receiver may be appointed by ... the court of conunon pleas or a Judgethereof... in the following cases:

(A) In an action by a... creditor to subject property or a fund to his claim... on the application of plaintiff, or of a party whose right to or interest inthe property or fund, or the proceeds thereof is probable, and when it isshown that the property or fund is in danger of being lost, removed, ormaterially injured;

* * *

(B) In an action by a mortgagee, for the foreclosure of his mortgage andsale of the mortgaged property, when it appears that the mortgagedproperty is in danger of being lost, removed, or materially injured, or thatthe condition of the mortgage has not been performed, and the property isprobably insufficient to discharge the mortgaged debt;

***

Pursuant to Ohio Revised Code § 2735.01(A) allows the appointment of a receiver when

the mortgagor breached the terms of the mortgage and the secured debt exceeds the value of the

mortgaged property. Pursuant to section I of the Mortgage, CPI is obligated to pay all

indebtedness owed to Comerica. (Exh. K, p. 2.) As discussed above, CPI defaulted on its

obligations pursuant to the Notes and the CPI Guaranty, thus CPI breached the Mortgage.

Further, the Stark County Auditor's records provided that the Property's value equals

$3,904,400.00. This value is significantly less than $6,214,306.94 owed by CPI to Comerica

pursuant to the Notes and the CPI Guarantee. Consequently, Comerica is entitled to the

appointment of a receiver under Ohio Revised Code § 2735.01(B).

Ohio law also permits the appointment of a receiver by a creditor if a fund or property

subject to its claim is in danger of being lost. Upon infonnation and belief, Precision Powder

and CPI have violated the "Dominion of Funds" agreement contained in the Forbearance

Agreement. (See Exh. F.) They have been diverting funds away from Comerica and

6

jeopardizing Comerica's status as a secured creditor. Thus, Comerica is entitled to the

appointment of a receiver under Ohio Revised Code § 2735.01 (B).

A receiver is necessary under the circumstances to (1) operate the businesses of the

Powder Precision and CPI, assess the viability of the businesses, and make recommendations

regarding their future, (2) provide ongoing and adequate financial information to Comerica, (3)

conduct forensic accounting to explore accounting policies and records, movement of collateral,

trade relationships with vendors and customers, and any transfers of economic benefit to the

Powder Precision's and/or CPI's owners, officers and related interests, (4) to enforce the

"Dominion of Funds" agreement set forth in the November 25, 2008 Forbearance Agreement,

and (5) determine whether adequate sources of repayment exist for outstanding loans and to

ascertain the maximize value of the business assets through a sale of such assets and to facilitate

the collection of accounts receivable.

C. CONCLUSION

In short, a receiver should be appointed to assume control of the Property and business

affairs to ensure the maximum satisfaction of Precision Powder's and CPI's debts to Comerica

and other creditors. An independent receiver, authorized by, and accountable to, this Court, will

best protect the interests of all parties concemed: Comerica, Precision Powder, CIP and

Precision Powder's and CPI's other creditors.

7

For all of the foregoing reasons, this Motion for Appointment of Receiver should be

granted. Comerica respectfully recommends Mr. Terry Hurnphrey of Centrus Group, Inc. for the

role of receiver. Mr. Humphrey's credentials are attached as Exhibit L. A proposed Order

Appointing Receiver and a proposed Order granting an expedited hearing on this Motion are

attached hereto.

Respectfitlly submitted,


L^- y^ ^. bs c J^

J. Bruce Hunsicker (0018194)106 S. Main Street, Suite 1100Akron, Ohio 44308(330) 208-1000, (330) 208-1001 facsimilei 8hunsickerCa4vorvs. com

Carrie Mae Brosius (0075484)2100 One Cleveland Center1375 East Ninth StreetCleveland, OH 44114-1724(216) 479-6100, (216) 479-6060 facsimilecmbrosius vo s.comgttorneys for Comerica Bank

8

0

CERTIFICATE OF SERVICE

A true and correct copy of the foregoing has been sent via regular U.S. mail, first class,

postage prepaid this Zjsf day of May, 2009 to:

Precision Powder Coating, Inc.1530 Raff Road, S.W.Canton, Ohio 44710

C. Paxos, Ino.1530 Raff Road, S.W.Canton, Ohio 44710

Cluistopher Paxos6495 Yost StreetCanton, Ohio 44718

Stark County TreasurerCounty Administration BuildingI 10 Central Plaza, Suite 250Canton, OH 44702-1410

(r LT't^^Sru ^

One of the attorneys forComerica Bank

9

05120r2009 C!eve!and 1218105.4

EXHIBIT D


COMERICA BANIC,

Plaintiff,

V.

PRECISION POWDER COATING, INC.,et at.,

Defendants.

CASE NO. 2009 CV 2030

JUDGE SINCLAIR

AGREED ORDER APPOINTINGLIQUIDATING RECEIVER

In accordance with the confidential settlement terms agreed to by Comerica Bank

("Comerica"), Precision Powder Coating, Inc. ("PPC") and C.Paxos, Inc. ("CPI") and

Christopher Paxos (collectively, with PPC and CPI, the "Defendants") and the Court's approval

of the same, as applicable, the Court finds as follows:

1. Comerica made certain loans and other extensions of credit available to the PPC,

CPI and Christopher Paxos (collectively, the "Loans"), which Loans were evidenced and secured

by certain promissory notes, security agreements, mortgages and other agreements, documents

and instruments which evidence, secure or support the indebtedness owing from the Defendants

to Comerica (collectively, the "Loan Documents"), as described in greater detail in Comerica's

underlying complaint.

2. By virtue of the Loan Documents, Comerica has a first and best, properly-

perfected security interest in and lien on substantially all of PPC's and CPI's personal property.

Detroit 1014261 2

3. PPC and CPI have agreed to surrender all of the personal and real property assets

in which Comerica possesses a first and best security interest to a receiver, duly appointed by this

Court.

IT IS THEREFORE ORDERED, ADJUDGED, AND DECREED:

l. Terry Humphrey of Centrus Group, Inc. (the "Receiver") is hereby appointed the

receiver for all of PPC's and CPI's personal property assets, wherever located, in which

Cometica possesses a security interest, including, but not limited to, the assets listed on Exhibit

A, and the real property commonly known as 1530 Raff Road, SW, Canton, Ohio and described

further in Exhibit B attached hereto (collectively, the "Assets") and the Receiver shall have all

authority and power of a receiver under Ohio law and as ordered by this Court. Notwithstanding

the forgoing, the Assets specifically exclude PPC's accounts receivable owing to PPC for

fo d i ld ii h di f b iserv ces per rme or nventory so n t e or nary course o us ness and the assets listed on

(9 rethe attached Exhibit C that are subject to a};:i > lien in favor of I ational City Bank (previded^

(jp

2V^^PV\I,S ^ OI^C^ ^^P Ca S^'P^tS CJ^ rCl^Vlrbli C llf 1^ Lems o /I/

is expressly reserved). Nothing in this Order shall prevent any third party having either a

perfected security interest in the Assets senior to Comerica's or having an interest in the Assets

under a true lease from asserting its rights with respect to the Assets.

2. The Receiver shall take immediate possession, control and charge of the Assets.

3. Pursuant to Ohio Revised Code Section 2735.04, and under the control of this

Court, the Receiver shall have the following additional powers and duties:

a) The Receiver shall have the authority to possess, control, protect, market

and sell the Assets as he deems prudent in his sole discretion. The Receiver shall

2 Detroit_1014261_2

preserve and care for any and all of the Assets and utilize any and all of the Assets to

preserve and maximize the value of the Assets.

b) Until July 9, 2010, PPC may utilize the Assets to operate and conduct

business (the "Wind Down Period") while the Receiver works through and executes on a

marketing plan for the Assets. PPC and CPI shall be solely responsible for all costs and

expenses associated with the operation of PPC's business and Receiver shall have no

responsibility for such costs.

c) During the Wind Down Period, the Receiver shall have unrestricted access

and control to the Assets provided that he does not interfere with PPC's right to operate

its business.

d) During the Wind Down Period, if the Receiver has reasonable cause to

believe that the Assets are in danger of being harmed in any way or the Assets' salable

value is impaired, the Receiver may deny or restrict the access of PPC, CPI, Christopher

Paxos and their respective agents and employees to the Assets, subject to PPC's right to

seek the Court's intervention should access be restricted.

e) The Receiver shall have the authority to maintain or purchase insurance

from any agent or carrier, of any type reasonably necessary or desirable, on all the Assets,

subject to maintaining adequate coverage appropriately assigned to Comerica and naming

Comerica as a loss payee thereof. Further, the Receiver may elect to continue the

property insurance coverage in place at the conception of the receivership, provided the

insurance is of proper form, provides sufficient coverage and names the Receiver as an

insured.

f) The Receiver is authorized to establish one or more bank accounts in the

Receiver's name to facilitate the sale of the Assets at any federally insured bank with

3 Detroit_I014261_2

offices in Ohio. The Receiver shall keep a true and accurate account of any and all

receipts and disbursements which the Receiver shall receive or make as Receiver in the

course of carrying out his duties and obligations pursuant to this Order.

g) Without further approval of the Court, the Receiver is authorized to

contract with one or more third parties that is/are knowledgeable and specialize in the

sale of the Assets and to advertise, negotiate, effect and conclude an orderly sale, transfer,

assignment or other disposition of (i) all or a portion of the Assets in or outside of the

ordinary course of business of PPC and CPI; or (ii) all or a portion of PPC's and/or CPI's

businesses as a going concern and, from the proceeds of any of the foregoing, to pay the

secured and unsecured indebtedness of the Defendants, including indebtedness which

arises during the course of the Receiver performing his duties, in accordance with the

respective priorities of such obligations. The Receiver is authorized to conduct such a

sale of the Assets in any manner which he, in his good faith and reasonable discretion,

believes will maximize the proceeds received from the sale within a time frame deemed

reasonable and appropriate in the exercise of his good faith and reasonable discretion. A

sale of all or part of the Assets may be consummated prior to the termination of the Wind

Down Period, provided the terms of the sale do not interfere with PPC's business

operations. However, no sale of the Assets shall take place without the express consent

and authorization of Comerica, and its successors and assigns. Upon the conclusion of

the Receiver's sale of the Assets, the Receiver shall file a Report of Sale with the Court.

h) The Receiver is authorized to employ any assistants, appraisers,

auctioneers, agents, counsel or other persons deemed necessary or desirable to assist the

Receiver in diligently executingthe duties imposed upon the Receiver by this Order and

Ohio law.

4 Detroit_I014261_2

i) On or before July 9, 2010 or pursuant to terms in paragraph 3(d) above,

PPC and CPI shall terminate business operations. Upon the termination of PPC's

business operations, the Assets will not be necessary for operations and the Receiver is

authorized to shut down immediately the facility from which PPC and CPI conduct

business.

4. Notwithstanding the foregoing, the Receiver and the Receivership estate shall not

be liable for the payment of taxes, assessments or utility charges pre-dating July 9, 2010. Any

individual or entity receiving a copy of this Order is hereby enjoined and restrained from

discontinuing service to the Receiver or the Receivership estate based upon the non-payment of

such taxes or utilities prior to July 9, 2010 and from attempting to collect taxes and utility

charges from the Receiver prior to July 9, 2010.

5. The Defendants and any persons, firms or agents acting under the direction of the

Defendants, and any third parties, persons or firms shall, upon presentation of a copy of this

Order, identify the location of and deliver to the Receiver the Assets, in the possession or under

the control of such parties; and all persons are enjoined and restrained from in any way

disturbing or interfering with the collection, management or sale of any of the Assets.

6. All creditors, claimants, bodies politic, parties in interest, and their respective

attorneys, servants, agents, and employees, and all other persons, firms, and corporations be, and

they hereby are, enjoined and stayed from commencing or continuing any action at law or suit or

proceeding in equity to foreclose any lien or enforce any claim against the Assets, or against the

Receiver in any court. The parties are further stayed from executing or issuing or causing the

execution or issuance out of any Court of any writ, process, summons, attachment, subpoena,

replevin, execution, or other process for the purpose of impounding or taking possession of or

interfering with, or enforcing any claim or lien upon the Assets or the Receiver, and from doing

5 Detroit_1014261_2

any act or thing whatsoever to interfere with the Receiver in the discharge of his duties in this

proceedings or with the exclusive jurisdiction of this Court over the Assets and the said Receiver.

7. Except as directed by the Receiver, the Defendants and their affiliates, agents,

officers, directors, shareholders, members, employees, representatives or creditors, and all other

persons, are hereby prohibited from interfering in any way with the acts of the Receiver, and

from in any way, manner or means, wasting, disposing of, transferring, selling, assigning,

pledging, canceling, concealing, interfering with, or hypothecating any of the Assets. Upon the

request of the Receiver, the foregoing persons and the Defendants shall cooperate and

affirmatively assist the Receiver in making available to the Receiver or his agents the Assets.

8. The Receiver, and his agents, including his counsel and any professionals that are

appointed by the Court, shall be entitled to reasonable compensation for services rendered and

reimbursement for expenses incurred which are (a) related to the Receiver's duties, rights; and

obligations under this order or any future orders of the Court and applicable law; (b) related to

the administration, management, protection or liquidation of the Assets; or (c) the defense or

prosecution of any claim or suit brought by or against the Receiver or by the Receiver against

any person or entity. Such compensation of the Receiver and his agents, his counsel and his

accountants shall be reviewed by the Court and awarded from the Receivership estate and/or

pursuant to Ohio Revised Code Section 2333.27.

9. The Receiver shall be compensated based upon his normal hourly billing rate of

$325.00 and the Receiver shall be reimbursed for all reasonable and necessary out of pocket

costs and expenses.

10. The Receiver shall have full and unrestricted access to all of the Assets, and the

Defendants and their officers, directors, shareholders, employees and agents, and any other party,

are directed to take all steps necessary to give the Receiver access to the business locations,

6 Detroit_1014261_2

facilities and premises and the Defendants' storage facilities for the Assets, provided he does not

interfere with PPC's right to operate its business during the Wind Down Period.

11. Nothing in this Order shall be read or interpreted as requiring Comerica to

continue to extend credit to the Defendants, and Comerica shall continue to have all rights and

remedies to which it is entitled under its agreements with the Defendants and pursuant to Ohio

law, subject to the terms of this Order.

12. The Receiver may, from time to time, make payments to Comerica from

realization of its collateral, including, but not limited to sale of the real and personal property in

which Comerica has a perfected security interest, provided however, that no sale of the Comerica

collateral shall take place without the express consent and authorization of Comerica.

13. The terms of this Order shall continue in full force and effect unless and until

further order of this Court.

IT IS SO ORDERED.

Date JUDGE LEE SINCLAIR

Submitted by:

VORYS, SATE13, WYMOUR AND PEASE LLP

)Main Street, Suite 1100

hio 44308(330) 208-1013, (330) 208-1066 facsimileiwsolomon(@vorvs.comCarrie Mae Brosius (0075484)2100 One Cleveland Center1375 East Ninth StreetCleveland, OH 44 1 1 4-1 724(216) 479-6100, (216) 479-6060 [email protected] for Comerica Bank

7 Detroit_1014261_2

Robert Konstand (0025516)2500 First National Tower106 South Main StreetAkron, OH 44308

Attorney for Precision Powder Coating, Inc.,C.Paxos, Inc. and Christopher Paxos

8fi49841?

EXHIBIT A

1- Olsen 60" Wide/10,000-Lb. Per Hour High-Volume Direct Gas Fired Roller HearthFumace, S/N 02-050, Asset #N2, (1978); (Upgraded By Olsen in 2002) 1,100°F to1,800°F Temperature Range; 4-Zone; 52' Long High Heat Section; 15" Max. Clearance;60" Wide; (44) Burners; Refractory Lined; Trunnion Type Roller Oscillation; 25-hp DCGear Motor Drive;. High Heat Rollers; Valves; Piping; Fittings; (4) Yokogawa DigitalReadout Controls; Personal Computer System; 60" Wide Hydraulic Tote Dumper; (2)Rail Mounted Gross Feed Transfer Carts; 70' Long x 60" Wide Power Roller ConveyorCooling Bed; Blower; Disdharge Chute; 1 Hour - 3 Day Dwell Cycle; Normalizing; Iso-Thermal; LP Anneal; Stress Relieving Capabilities (Alloy Upgraded to 2,000° F) (2005-2006 Upgraded Heat Divider Curtains, Shrouds, Tray Liners, Furnace Trays and Screens)

2. 1- 1,750°F Max. Operating Temperature; 3-Zone; 35' Long High Heat Section; 14 fpmNormal Belt Speed; 96"W Inconel Belt (New 2008); (15) Burners; 7,000,000-Btu's; AirCooling Section; Flame Safety System; (3) Combustion Fans; (3) Yokogawa DigitalTemperature Controllers; Master Control Panel; Procidia Touch Screen ProgrammableControl; Personal Computer System; Complete with All Related Burners, Blowers,Valves, Regulators, Gauges, Piping & Fittings; Duct Work, Controls 4.

3. 1- Surface Combustion Model RX Generator Size S-2-EN 2,400-cfh Electric Air CooledEndothermic Generator, S/N CC-11536-1, (1978); with 1,875°F Max. Temperature;Control Panel; Digital Temperature Controllers

4. 1- Surface Combustion Model RX Generator Size T-3-N 5,600-cfh Natural Gas FiredWater Cooled Endothermic Generator, S/N C-8210-1B, (1966); with 1,950°F Max,Temperature; 1,000- Btu/Cu.Ft.; Control Panel; (Not Yet In Service At Time OfInspection - Value Assumes Complete And Fully Operational)

5. 1- Surface Combustion Model RX Generator Size T-3-N 5,600-cth Natural Gas FiredWater Cooled Endothermic Generator, S/N C-5909-1, (1959); with 1,950°F Max.Temperature; 1,000Btu/Cu. Ft.; Control Panel; (Not Yet In Service At Time OfInspection - Value Assumes Complete And Fully Operational)

6. 5- Lee Wilson 102" x 84" I.D./35,000-Lb. Capacity Atmosphere Controlled Bell TypeAnnealing Furnaces; (4-Rebuilt Furnaces) (1-New Furnaces Added 2006/2007) with GasAtmosphere; (12) Burners; 3,000,000-Btu's; Fan Motor; (4) Retorts; (8) Fumace Bases(4-New Bases Added 2006/2007); Procidia Touch Screen Programmable Control;Honeywell Temperature Controller; Radcon Automatic Atmosphere Control System; (8)Valve-Tronic Flow Scopes; S/N VT-3882; VT-3885; VT-3883; VT- 3884; VT-208764;VT-208767; VT- 208765; VT-208766; (2008 (1) Furnace Currently Being Rebuilt inIndiana - Not Inspected) -1-Each Value: $45,000/$85,000

7. 1- Pangborn Model GNM Rotoblast 26 Cu. Ft. Abrasive Shot Blast Machine, S/N26GNM-735, (1973); (Rebuilt 2002 By Pangborn); with Manganese Flights; 62" WideBelt x 48" Diameter Barrel; Skip Hoist Loader; Bucket Elevator; Farr Dust Collector;

Ap rm s /vc as coIIQ^.V(

Automatic Door; Shaker Table; Control Panel

8. 1- Pangbom Model GNM Rotoblast 26 Cu. Ft. Abrasive Shot Blast Machine, S/N26GNM-676, (1967); (Rebuilt 2002 By Pangborn); with Manganese Flights; 62" WideBelt x 48" Diameter Barrel; Skip Hoist Loader; Bucket Elevator; Dust Collector;Automatic Door; Bulk Equipment Systems Model TMF3996- 5280-6 Shaker Table, S/N990125; Control Panel

9. 1- Bethel Engineering Zinc PhosphateCoating Line (2007), To Include:(10) 6' x 12' x 5' Stainless Steel Dip Tanks(1) 4' x 6' x 5' Carpenter 20 Dip Tank (4) 6' x 12' x 5' Steel Dip Tanks(1) Acid Fume Scrubber System (10) Stainless Steel Baskets(6) Carpenter 20 Baskets(1) 32,000-Lbs. Per Hour Capacity(1) Conlift 5-Ton x 25' Span Double Girder Rail Mounted Traveling Gantry Crane, S/N

RG-5503-1 (2004); 100 Linear Foot Floor Mounted Rails; Steam Guard; (2) Wright2.5-Ton Capacity Hoists; Operator Platform

(Phosphate & White Lube Capability; Phosphate & Black Lube Capability; Phosphate &Polymer Phosphate Only Capability; Sulfuric Acid Pickling Capability)

10. 1- Wheelabrator 28 Cu. Ft. Abrasive Shot Blast Machine, S/N A118618, (1965); (Rebuilt2003); with 60" Wide Barrel; Manganese Flights; Skip Hoist Loader; Bucket Elevator;Farr Dust Collector; Control Panel

11. 1- Pangborn Model GN-1M Rotoblast 34 Cu. Ft. Abrasive Shot Blast Machine, S/N34GN1M-752, Asset #P2, (1975); (Rebuilt 2005 by Pangborn) v3ith Manganese Flights;62" Wide Belt x 48" Diameter Barrel; Skip Hoist Loader; Bucket Elevator; Farr ModelGS-12S0 Dust Collector, S/N 663981 (2004); Automatic Door

12. 1- Pangborn Model Rotoblast 6LK 72"D Abrasive Shot Blast Machine, S/N Unknown;with Clam Shell Door; Farr Model 116788001 Dust Collector, S/N 96DC23668, (1996)

13. 1- Pangborn Model 26 26 Cu. Ft. Abrasive Shot Blast Machine, S/N Unknown; IncludesSpare Pangborn Mode126 Carcass; (Disassembled At Time of Inspection - ValueAssumes Complete And Operational)

14. 1- Amada Model HFA-400W 16" x 16" Automatic Horizontal Band Saw,. S/N 40760044,Asset #1, (1998); with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readout; (3) 20"W x 80"L Roller InfeedConveyors; Coolant System.

15. 1- Amada Model HFA-400W 16" x 16" Automatic Horizontal Band Saw, S/N 40760042,Asset #2, (1998); with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readout; (3) 20"W x 80"L Roller InfeedConveyor; Coolant System

16. 1- Amada Model HFA-400W 16" x 16" Automatic Horizontal Band Saw, S/N

40760050, Asset #3, (1998); with Hydraulic Shuttle hifeed; Hydraulic Clamping; Vari-Speed Blade; Programmable Digital Length & Count Readout; (3) 20"W x 80"L RollerInfeed Conveyor; Coolant System

17. 1- Amada Model HFA-400W 16" x 16" Automatic Horizontal Band Saw, S/N 40760049,Asset #4, (1998); with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readout; (3) 20"W x 80"L Roller InfeedConveyors; Coolant System

18. 1- Amada Model CM100-AN Automatic Carbide Circular Saw, S/N 10500003, Asset #1,(1999); 14.137" Diameter Blade; .787" - 3.937" Round Capacity; .787" - 3.150" SquareCapacity; with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readout; Extended Load Capacity Infeed Table;Coolant System; Chip Conveyor; Control Panel

19. 1- Amada Model CM100-AN Automatic Carbide Circular Saw, S/N 10500008, Asset #2,(1999); 14.137" Diameter Btade; .787" - 3.937" Round Capacity; .787" - 3.150" SquareCapacity; with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readouts; Extended Load Capacity Infeed Table;Coolant System; Chip Conveyor; Control

20. 1- Amada Model CM100-AN Automatic Carbide Circular Saw, S/N 10500002, Asset #3,(1999); 14.137" Diameter Blade; .787" - 3.937" Round Capacity; .787" - 3.150" SquareCapacity; with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readouts; Extended Load Capacity Infeed Table;Coolant System; Chip Conveyor; Control Panel; (Not In Service At Time of Inspection -Being Repaired - Value Assumes Complete & Operational)

21. 1- Amada Model CMIOO-AN Automatic Carbide Circular. Saw, S/N 10500007,. Asset#4, (1999); 14.137" Diameter Blade; .787" - 3.937" Round Capacity; .787" - 3.150"Square Capacity; with Hydraulic Shuttle Infeed; Hydraulic Clamping; Vari-Speed Blade;Programmable Digital Length & Count Readouts; Extended Load Capacity Infeed Table;Coolant System; Chip Conveyor; Control Panel

22. 1- Electric Furnace Company 5,000-Lb. Per Hour High Heat Direct Gas FiredAtmosphere Controlled Normalizing Furnace, S/N 4705E2, (1966); (Rebuilt 2005 - InService 2007), 1,750° F Max. Temperature; with EFC 1,450° F/5,000- Lb. Per Hour LowHeat Stress Relieving Tempering Furnace; Atmosphere Controlled and Rapid CoolingSections; Independent or Tandem Chamber Operation; Parts Loader; IMHNersaConveyor Sections; Alloy Upgraded to 2,000°F; Capable of Normalizing; isothermalAnnealing; Stress Relieving; Process Annealing (Electric Furnace Company TandemNormalizing/Tempering Furnace Chamber, S/N 54705F2 - In Process Of Being Put IntoOperation - Value Assumes Complete, Leak Tested And Fully Operational)

23. 1- Electric Furnace Company 50,000-Lb. Charge Capacity Car Bottom Direct FireNormalizing Furnace, S/N Unknown; with 10' x 6' x 4' Work Chamber; 10' x 6' RailMounted Cart; 1,850°F Max. Temperature; (Being Installed At Time of Inspection -

12/16/2008 - Value Assumes Complete And Operational)

24. 1- Standard Fuel Engineering 60" Wide/4,000-Lb. Per Hour Direct Gas Fired ConveyorType Stress Relief Draw Furnace, S/N 1359-F, Asset #SRl, (1985); (Upgraded 2005)1,250°F Max. Operating. Temperature; 2-Zone; Yokogawa Digital Readout Control;Personal Computer Controlled Interface; 60" W; 12" High Max. Clearance; 25' LongHigh Heat Section; Wire Mesh Belt Conveyor; Honeywell Fluid Power Gas Valves;Maxon Burners; Portable Graphite Coater (2005 Added New Mesh Belt and Carrier Belt)

25. 1- Hobart Model TG-301 300-Amp Arc Welder, S/N 12RT-7266, (1972); with WeldingLeads & Accessories

26. l- Hypertherm Model Power MAX 1000 Plasma Cutting System, S/N 100-23814; withCart; Cables & Gun

27. 1- Lincoln Model ldealarc SP-250 250-Amp Arc Welder, S/N U1930601998, (1993)

28. 1- Lincoln Model ldea'arc DC-600 600-Amp Arc Welder, S/N U1930313259, (1993);Lincoln LN-7 Wire Feeder; Cart

29. 1- Lincoln Model Power Mig 255 250-Amp Arc Welder, S/N U1060807207, (2006)

30. 1- Beaver Model Speed-O-Matic Pipe Threader, S/N 448; with Cart & Accessories

31. 1- Manufacturer Unknown 10,000 Lb. Capacity Above Ground Platform Scale, S/NUnknown; DRO; 72" x 72" Above Ground Platform

32. 1- Hammond Footburt Model No. 2 6" x 18" Hand Feed Surface Grinder, S/N 562; with6" x 18" Permanent Magnetic Chuck

33. 1- Beckwood Press 4-Post Downacting Hydraulic Press, S/N Unknown; with 36" x 48"Bed

34. 1- Kohler Model 125R0781 125-kW Back-Up Power Generator, S/N 10316A; with 6-Cylinder Gas Engine; Controller (495- Hours On Meter At Time Of Inspection on12/16/2008); (Disconnected - Not In Service At Time Of Inspection)

35. 1- Daito Model GA260W 10"x12" Automatic Horizontal Metal Cutting Band Saw, S/N180KY5-4; with Hydraulic Shuttle Infeed; Hydraulic Clamping; Coolant System;Operator Control Console; Digital Display; 10' Roller Conveyor

36. 1- Modern Mill Mode12VS Variable Speed Vertical Milling Machine, S/N 2937, (1985);with 9" x 42" Power Feed Table; 2 hp; Spindle Speeds from 80 - 5440 rpm; Pathfinder1000 2-Axis Digital Readout

37. 1- Ingersoll-Rand Model T30 7-1/2 hp Tank Mounted Vertical Air Compressor, S/N 301-897028

38. 1- Granier & Associates Model G610M Type 2 100"L Magnetic Particle InspectionMachine, S/N 186A, ( 1987); 6,000-Amp; Hood; Blacklight; 6,000 D.C. Output; 5,000A.C. Output

39. 1- Pointing Line, To Include:

(1) Tubar Hydraulic Tote Dump(1) Feedall Model 2500 Feed Elevator, S/N 7959(1) Bliss/England Model 22KJ 150- Ton Capacity Straight-Side Press, S/N B629-17959-

1972, (1972); with 3" Stroke; 12" Shut Height; 80-SPM(1) AP Parts Mfg. Co. Model In- Motion SRI Series Check Verification Weigh System,

S/N 08040334, (2008); with Digital Readout

40. 1- 401- Fenn Model 150 1-1/2"D Capacity Impact Cut-OffMachine, S/N Unknown; 1-1/4"D to 7/8"D Round Stock Capacity; 1-1/16" to 3/4" Square Stock Capacity; 60,000 to120,000-psi; I 80/Minute at Minimum Diameter; 60/90/Minute at Maximum Diameter;40-Ton Cut-Off . Pressure; 15- Hp; with Gravity Style Bar Feed Table

41. 1- LotThroughout Production Areas, To Include: Pallet Racks; Self-DumpingHoppers; Pedestal Fans; Time Clock; Misc. Office Furniture; Air Receiving Tanks; JennyModel 1223-C Steam Cleaner; Shelf Units; Hand Tools; Power Tools; MaintenanceEquipment; Tooling; Bench Grinder; Inspection Instruments & Gauges; PortableAcetylene Torch Outfits; Fire Extinguishers; Drum Pumps; Digital Bench Scales;Machinery In Storage; Spare Parts; Spare Motors; Battery Charger; Fiberglass StepLadders; Electric Floor Sweeper, (Not In Service); Horizontal Band Saw, (Not InService); Hoists; Halogen Work Lights; Double Door Supply Cabinets; Bench Vises;Machine Vises; Fork Extenders; Diapliragm Puinps; Fiberglass Step Ladders; etc.

Total Production Areas:

Cranes

42. 1- Abell-Howe 1/2-Ton Capacity x 8' Span Free-Standing Jib Crane, S/N 84B 16806,(1984); with Coifing 1/2-Ton Electric Chain Hoist; Pendant Control

43. 1- Crane America Services 10-Ton Capacity x 58' Span Top Riding Double GirderOverhead Bridge Crane, S/N 103036-1; Shaw-Box Series 700 10-Ton Capacity VariableSpeed Motorized Trolley; Wire Rope Hoist; Motorized End Trucks; Pendant Control

44. 1- Crane America Services 10-Ton Capacity x 58' Span Top Riding Double GirderOverhead Bridge Crane, S/N 103036-2; Shaw-Box Series 700 10-Ton Capacity 2- SpeedMotorized Trolley; Wire Rope Hoist; Motorized End Trucks; Pendant Control

45. 1- Hoist Equipment 10-Ton Capacity x 58' Span Double Girder Top Riding OverheadBridge Crane, S/N 2404800; Yale 10-Ton Capacity Hoist; Telemotive Radio ControlUnit

46. 1.- Shepard Niles 10-Ton Capacity x 58' Span Double Girder Top Riding Overhead

Bridge Crahe, S/N 68186; 10- Ton Capacity Hoist; Pendant Control

47. 1- Hoist Equipment 10-Ton Capacity x 58' Span Double Girder Top Riding OverheadBridge Crane, S/N 2406800; Yale 10-Ton Capacity Hoist; Telemotive Remote ControlUnit(Stored Outside - Not In Service At Time Of Inspection - Value Assumes Complete AndFully Operational)

48. 1- Kone 2-Ton Capacity Free Standing Jib Crane, S/N Unknown; with Budgit 2-TonCapacity Hoist; Pendant Control

49. 1- Spanco Model 100-0806-1010 1/2-Ton Capacity Free Standing Jib Crane, S/N91110844, (1991); CM 1/2-Capacity Hoist; Pendant Control

50. 1- David Round 1/2-Ton Capacity Free Standing Jib Crane, S/N Unknown; (Not InService At Time Of Inspection - Value Assumes Complete And Fully Operational)

51. 1- Caldwell Model 20-10-10 10-Ton Capacity x 10'L Spreader Bar, S/N 98740, (1998)

52. 1- Caldwell Model 20-10-16 10-Ton Capacity x 16'L Spreader Bar, S/N 0560566, (2005)

Total Cranes:

Material Handling/Rolling Stock

53. 1- Advance Mode12060 Diesel Sit Down Rider Type Floor Scrubber, S/N 1618793,(2002); (Capital Lease)

54. 1- Linde-Baker Model H30D-02 6,000-Lb. Capacity Diesel Forklift Truck, S/N351H09A10330, (1997); with 3-Stage Mast; Overhead Guard; Solid Tires; (Not InService At Time of Inspection)

55. 1- Linde-Baker Model H45D-600 10,000-Lb. Capacity Diesel Forklift Truck, S1N352H10006845, (1998); with 3-Stage Mast; Overhead Guard; Cushion Tires; (NotInspected At Time of Inspection)

56. 1- Linde-Baker Model H45D-600 10,000-Lb. Capacity Diesel Forklift Truck, S/NH2X352P01483, (2003); with 3-Stage Mast; Overhead Guard; Cushion Tires; (BeingRepaired At Time of Inspection - 12/16/2008) -(Capital Lease)

57. 1- Snorkelift Model TBA42RD 500-Lb. x 42' Lift Rubber Tired Extended Boom AerialLift, S/N 875960887, (1987); with 2- Wheel Drive; 30" x 60" Platform

58. 1- MEC Model 3068ES Scissor Lift, SIN 08900125, ( 1998); with Battery Charger; (NotInspected At Time of Inspection)

59. 1- Snorkelift Model ATB60-ALCU 4X4 Aerial Lift, S/N 9426671094, (1994); 500-Lb.

Capacity; 43.1' Max. Reach; 60' Max. Lift Height (Outside)

60. 1- Linde-Baker Model H3OD 6,000-Lb. Capacity Diesel Forklift Truck, S/N351H02044130, (1997); with 3-Stage Mast; Overhead Guard; Solid Tires; (Not InspectedAt Time of Inspection - 1 2/26 1 200 8)

61. 1- Jungheinrich Model DFG540s 10,000-Lb. Capacity Diesel Hydrostatic Forklift Truck,S/N 1260, (2008); with Cushion Tires; Overhead Guard

(Capital Lease)

Total Material Handling/Rolling Stock:

Air Compressors

62. 1- Ingersoll-Rand Model SSR-EP5OSE 50 hp Packaged Type Rotary Screw AirCompressor, S/N G4451 U96048, (1996); with Sound Enclosure; IntellisysProgrammable Control

63. 1- Ingersoll-Rand Model DXR-230 Refrigerated Air Dryer, S/N 954DXR3579, (1995)

64. 1- Ingersoll-Rand Model SSR-EPSOSE 50 hp Packaged Type Rotary Screw AirCompressor, S/N G7774U99139, (1999); with Sound Enclosure; Intellisys ProgrammableControl

65. 1- Ingersoll-Rand Model DXR-200 Refrigerated Air Dryer, S/N 99DXR1027, (1999)

66. 1- Vertical Air Receiving Tank

Total Air Compressors

Waste Water Treatment System

67. Plymouth Technologies, Inc. Waste Water Treatment System (2007), To Include:(2) 9;000-Gallon Capacity Stainless

Steel Bulk Retention Mix Tanks

(1) 8,500-Gallon Capacity Stainless Steel Cone Bottom Neutralization Tank(1) 1,500-Gallon Capacity Poly Tank(1) Plas-Tanks Ind. 33-Ton Capacity Fiberglass Reinforced Plastic Tank, S/N 81 (1999);

Job #9969; Ambient Max. Temp.; Atmospheric Pressure Rated; 1.2 Gravity Specific;10-20 MIL C Glass Lined Wall; Aropol 7241T15 Resin

(1) Water Management, Inc. 75-GPM Water Softener System; with Booster Pump(1) Water Management, Inc. 75-GPM Reverse Osmosis System(1) Water Management, Inc. 75-GPM Clarifier(1) Plymouth Technologies 3-Tank Metals Removal System; with Booster Pumps;

Chemical Pumps; ORP/PH Flow Meters; PLC(1) Bethel Engineering, Inc. Automation(1) JWI 27-Plate Hydraulic Filter Press; 32" x 32" Filters

(1) Allen Bradley Versa-View CE700H PLC Control(1) Aqua Fine Model CSL-4R UV Disinfectant Unit, S/N 1590101

Total Waste Water Treatment System:

Inspection Areas

68. Wilson lnstron Model AP 5,000 kg Brinell Hardness Tester, S/N BRINP1811, (2000);with Power Clamp; Accessories

69. 1- King Scan Model III Hardness Tester, (2004); with PC Computer Interface; Monitor;Accessories

70. 1- Newage Model ATI3ORDB Test-Surface-Referenced Digital Hardness Tester, S/N4624; with Accessories

71. 1- Duncan Model The Teacher Electronic Kiln, S/N Unknown

72. 1- Buehler Model Phoenix 4000 Sample Preparation System, (2000)

73. 1- Buehler Model Simplimet 1000 Automatic Mounting Press, (2000)

74. I- Nikon Model Epiphot 200 Inverted Stage Microscope, S/N 025763, (2000); with 5-Stage; Binocular; Light Source; Polaroid Video Camera; Pentium III PC interface

75. 1- Yates-American 16"D Disc Grinder, S/N Unknown

76. 1- Tru Stone 36" x 24" x 6" Granite Surface Plate

77. 1- VFP, Inc. Graphite Tester, S/N Unknown, (2004)

78. 1- Lot Throughout Inspection Areas, To Include: Chairs; File Cabinets; Benches; Desk;Supply Cabinets; Gages; Etc.

Total Inspection Areas:

Office Areas

79. 1- Lot Throughout Office Areas, To Include: Executive Furniture; Conference RoomFurniture; Modular Office Work Stations; Sofas; Lounge Chairs; Tables; Lateral Files;Lobby Furniture; Desks; Credenzas; Cabinets; Bookcases; Audio Visual Equipment; Etc.

Total Office Areas

Office Eguipment

80. 1- Lot Miscellaneous Office Equipment, To Include: Deli Dimension 3000 Pentium4/2.8Gig Personal Computer Systems; Phone System; Laminating Machine; NetworkServers; Hewlett Packard Printers; Laptop Computers; Monitors; Scanner; Plotter;

Network Gear; Routers; Etc.

Total Office Equipment:

Truck & Trailer

81. 1- 2001 Volvo Model VNL64T Conventional Style Semi Tractor, VIN4V4NC9JK71N309474; with Integral Sleeper; 6X4; Cummins 525E 525-Hp DieselEngine (335,000-Miles On Odometer As Of 12/16/2008)

82. 1- 2001 Dorsey Model AIDT 48' Tandem Axle Van Trailer, VIN IDTVI1Z231A286023

Total Truck & Trailer:

Equipment Stored Offsite at CSC Steel, Warren, Ohio

83. 1- Lot of Idle Fumace Equipment, Consisting of:(1) Surface Combustion 25000Lb./Per Hour Gas Fired Atmosphere Type Roller Hearth

Furnace S/N C7715 (1966); with 1,650° F. Max. Temperature; 250' Length; 60"Width; Combustion Blower; Refractory Lined

(Note-Furnace Located At CSC Steel, Warren, Ohio And Is Idle And Disassembled AsOf The Appraisal Inspection Date - 12/16/2008 - Not Inspected By Appraiser At Time OfInspection - Information Provided By PPC Personnel - Value Assumes Furnace To BeComplete And Fully Operational)

SFt

Order No. 70879

SCHEDULE ADESCRII'TION OF REAL ESTATE

Situated in the State of Ohio, County of Stark, City of Canton, and being part of Out Lot664 of said City of Canton, and Out Lot 1034 of said City of Canton and being part of aparcel now or formerly owned by Diano Tr. (1356-470) and being further described asfollows:

Commencing for reference at a 5/8" bar found at the northwest corner of Lot 30643 ofsaid City of Canton; Thence S. 04 deg. 04' 47" W. along the east line of said Out Lot664, a distance of 115.29 feet to a 5/8" bar set at the True Place of Be 'gtnning of theparcel herein described:

l. Thence S. 04 deg, 04' 47" W. along the east line of said Out Lot 664, adistance of 419.85 feet to a 5/8" bar found;

2. Thence along the south line of said Diano parcel which is the arc of a curve tothe right having a radius of 3769.83 feet, a tangent of 260.73 feet, a centralangle of 07 deg. 54' 45", a chord of 520.21 feet bearing S. 83 deg, 18' 47" W.,a distance of 520.62 feet (passing over•a 5/8"bar set at an arc distance of465.62 feet);

3. Thence N. 03 deg. 39' 30" W. (basis of bearings from said K. Diano Tr. Deed)along the west line of said K. Diano Tr. Parcel, a distance of 523.12 feet;

4. Thence S. 85 deg. 47' 20" E., a distance of 581.48 feet (passing over a 5/8"bar set at a distance of 55.52 feet) to the True Place of Beginning andcontaining 5.993 acres of which 0.292 of an acre is in said Out Lot 664 and5.701 acres are in said Out Lot 1034, as surveyed by Ronald C. Hinton, S-6270 in March, 1999.

Subject to the right. of way of said Raff Road containing 0.656 of an acre.

Parcel Nos. 04-00835 and 02-46176

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Page 1

EXHIBIT E

[email protected]

07/25/2010 09:45 AM To [email protected]

cc [email protected]

Subject Re: PPC Inc Canton Receivership

Larry, Attached is the order from the court appointing Terry Humphrey as Receiver on case #2009cv2030.Please advise ASAP if you need anything else from me or my attorney. I will call you tomorrow to confirmthat you have what your need.

Terry L Humphrey, ReceiverPPC Inc. and C. Paxos Inc.330-388-3237

-----Original Message-----From: [email protected]: [email protected]: [email protected]: Fri, Jul 23, 2010 1:15 pmSubject: Re: PPC Inc Canton Receivership

Terry,

The electric service at the PPC Inc. property is going to be disconnected for non-payment unless youhave a court order to the contrary and supply me with a copy of that order by 3:00 PM Monday, July 26,2010.

Larry

Larry J. KlettlingerCustomer Services Account Manager Sr.AEPPO Box 24400Canton, OH 44701-4400Phone: 330-438-7748Fax: 330-438-7330Internal: 920-7748

This message, including any attachments, contains confidential information intended for a specificindividual and purpose, and is protected by law. If you are not the intended recipient, you should deletethis message and are hereby notified that any disclosure, copying or distribution of this message, or taking

any action base on it is strictly prohibited.

thefixer500aol.com

07/13/2010 11:10 AMTo iJklettlinger(a)aeo.com

cc

Subject Re: PPC Inc Canton Receivership

Larry, As a follow up to our conversation this is to confirm that the case number for the PPC Receivershipis 2009CV2030. The case is before Judge Sinclair, Stark County. I will send you a copy of the order inanother email. Thanks for your help.

Terry L Humphrey, ReceiverPrecision Powder Coating and C Paxos,lnc.330-388-3237

-----Original Message-----From: Larry Klettlinger <liklettlinger(aDaep.com>To: Terry Humphrey <thumphrevCcDcentrusgroup.com>Sent: Tue, Jul 13, 2010 10:01 amSubject: PPC Inc Canton Receivership

Please provide a copy of the receivership order,case number and city wherefiled.

Thank you.

Larry KlettlingerCustomer Services Account Manager Sr.AEPP0 Box 24400Canton, OH 44701-4400Phone: 330-438-7748Fax: 330-438-7330Interna1:920-7748

This message, including any attachments, contains confidential informationintended for a specifc individual and purpose, and is protected by law. If youare not the intended recipient, you should delete this message and are herebynotified that any disclosure, copying or distribution of this message, or takingany action based on it is strictly prohibited.