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ELECTRONIC PROCESSING, INC. EXCHANGE NATIONAL BANK Loan Number 80336
000 XXXXXX XXXXXX 00000 XXXX XXXXXX Date JULY 21, 0000
XXXXXX XXXX, XX 00000 XXXXXXX, XX 00000 Maturity Date AUGUST 1, 1998
Loan Amount $1,000,000.00
Renewal of______________
XXXXXXXX'S NAME AND ADDRESS XXXXXX'S NAME AND ADDRESS
"I" includes each borrower "You" means the lender, its
above, joint and severally. successors and assigns.
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For value received, I promise to pay to you, or your order, at your address
listed above the PRINCIPAL sum of ONE MILLION AND NO/100*
* * * * * * * * * * * * * * * * * * * * * * * * * * * * Dollars $1,000,000.00
-------------------------------------------------------- ---------------
/ / SINGLE ADVANCE: I will receive all of this principal sum on
_______________. No additional advances are contemplated under this note.
/X/ MULTIPLE ADVANCE: The principal sum shown above is the maximum amount of
principal I can borrow under this note. On JULY 21, 1997 I will receive the
amount of $__________ and future principal advances are contemplated.
CONDITIONS: The conditions for future advances are ALL FUTURE ADVANCES
MUST BE REQUESTED IN PERSON, IN WRITING OR BY PHONE AND ARE SUBJECT TO
APPROVAL OR DISAPPROVAL AT THE SOLE DISCRETION OF EXCHANGE NATIONAL BANK,
MANAGEMENT.
/X/ OPEN END CREDIT: You and I agree that I may borrow up to the
maximum amount of principal more than one time. This feature is
subject to all other conditions and expires on AUGUST 1, 1998.
/ / CLOSED END CREDIT: You and I agree that I may borrow up to the
maximum only one time (and subject to all other conditions).
INTEREST: I agree to pay interest on the outstanding principal balance from
JULY 21, 1997 at the rate of 9.000% per year until JULY 22, 1997.
/X/ VARIABLE RATE: This rate may then change as stated below.
/X/ INDEX RATE: The future rate will be 0.500% OVER the following
index rate: PRIME RATE AS QUOTED IN THE WALL STREET JOURNAL UNDER
MONEY RATES (CODE 143)
/ / NO INDEX: The future rate will not be subject to any internal or
external index. It will be entirely in your control.
/X/ FREQUENCY AND TIMING: The rate on this note may change as often as
DAILY
A change in the interest rate will take effect ON THE SAME DAY
/ / LIMITATIONS: During the term on this loan, the applicable annual
rate interest rate will not be more than ________% or less than
__________%. The rate may not change more than ________%
each _________________________.
EFFECT OF VARIABLE RATE: A change in the interest rate will have the
following effect on the payments:
/X/ The amount of each scheduled /X/ The amount of the final
payment will change. payment will change.
/ / ____________________________________________________________________.
ACCRUAL METHOD: Interest will be calculated on a ACTUAL/360 basis.
POST MATURITY RATE: I agree to pay interest on the unpaid balance of this
note owing after maturity, and until paid in full, as stated below:
/X/ on the same fixed or variable rate basis in effect before maturity
(as indicated above).
/ / at a rate equal to _________________________________________________.
/X/ LATE CHARGE: If a payment is made more than 10 days after it is due, I
agree to pay a late charge of 5.000% OF THE LATE PAYMENT WITH A MINIMUM OF
$5.00 AND A MAXIMUM OF $25.00.
/ / ADDITIONAL CHARGES: In addition to interest, I agree to pay the following
charges which / / are / / are not included in the principal amount above:_____
_______________________________________________________________________________.
PAYMENTS: I agree to pay this note as follows:
/X/ INTEREST: I agree to pay accrued interest ON DEMAND, BUT IF NO DEMAND IS
MADE THENON THE 1ST DAY OF EACH MONTH BEGINNING SEPTEMBER 1, 1997
/X/ PRINCIPAL: I agree to pay the principal ON DEMAND, BUT IF NO DEMAND IS
MADE THEN ON AUGUST 1, 1998
/ / INSTALLMENTS: I agree to pay this note in ______ payments. The first
payment will be in the amount of $______________ and will be due __________
____________. A payment of $_______________ will be due ___________________
thereafter. The final payment of the entire unpaid balance of principal and
interest will be due ____________________________________.
ADDITIONAL TERMS:
THIS NOTE IS SECURED BY:
1. A SECURITY AGREEMENT DATED JULY 21, 1997.
2. A LINE OF CREDIT AGREEMENT DATED JULY 21, 1997.
A PRINCIPAL REDUCTION EQUAL TO 1/36TH OF THE OUTSTANDING PRINCIPAL BALANCE
WILL BE DUE ON THE 1ST DAY OF EACH MONTH.
/X/ SECURITY: This note is separately secured PURPOSE: The purpose of this
by (describe separate document by type and date): loan is BUSINESS: EQUIPMENT
SEE ABOVE SECURITY FINANCING
SIGNATURES: I AGREE TO THE
TERMS OF THIS NOTE INCLUDING
THOSE ON PAGE 21. I have
received a copy on today's
date.
(This section is for your Internal use. Failure
to list a separate security document does not mean
the agreement will not secure this note.)
Signature for Lender ELECTRONIC PROCESSING, INC.
X /s/ Xxxxxxx X. Xxx Xxxxx BY:
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XXXXXXX X. XXX XXXXX, EXECUTIVE VICE PRESIDENT XXX X. XXXXXXX, PRESIDENT
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UNIVERSAL NOTE Page 1 of 2
DEFINITIONS: As used on page 1, "/x/" means the terms that apply to this
loan, "I," "me" or "my" means each Borrower who signs this note and each
other person or legal entity (including guarantors, endorsers, and sureties)
who agrees to pay this note (together referred to as "us"). "You" or "your"
means the Lender and its successors and assigns.
APPLICABLE LAW: The law of the state in which you are located will govern
this note. Any term of this note which is contrary to applicable law will not
be effective, unless the law permits you and me to agree to such a variation.
If any provision of this agreement cannot be enforced according to its
terms, this fact will not affect the enforceability of the remainder of this
agreement. No modification of this agreement may be made without your express
written consent. Time is of the essence in this agreement.
PAYMENTS: Each payment I make on this note will first reduce the amount I
owe you for charges which are neither interest nor principal. The remainder
of each payment will then reduce accrued unpaid interest, and then unpaid
principal. If you and I agree to a different application of payments, we will
describe our agreement on this note. I may prepay a part of, or the entire
balance of this loan without penalty, unless we specify to the contrary on
this note. Any partial prepayment will not excuse or reduce any later
scheduled payment until this note is paid in full (unless, when I make the
prepayment, you and I agree in writing to the contrary).
INTEREST: Interest accrues on the principal remaining unpaid from time to
time, until paid in full. If I receive the principal in more than one
advance, each advance will start to earn interest only when I receive the
advance. The interest rate in effect on this note at any given time will
apply to the entire principal advanced at that time. Notwithstanding anything
to the contrary, I do not agree to pay and you do not intend to charge any
rate of interest that is higher than the maximum rate of interest you could
charge under applicable law for the extension of credit that is agreed to
here (either before or after maturity). If any notice of interest accrual is
sent and is in error, we mutually agree to correct it, and if you actually
collect more interest then allowed by law and this agreement, you agree to
refund it to me.
INDEX RATE: The index will serve only as a device for setting the rate on
this note. You do not guarantee by selecting this index, or the margin, that
the rate on this note will be the same rate you charge on any other loans or
class of loans to me or other borrowers.
ACCRUAL METHOD: The amount of interest that I will pay on this loan will be
calculated using the interest rate and accrual method stated on page 1 of
this note. For the purpose of interest calculation, the accrual method will
determine the number of days in a "year." If no accrual method is stated,
then you may use any reasonable accrual method for calculating interest.
POST MATURITY RATE: For purposes of deciding when the "Post Maturity Rate"
(shown on page 1) applies, the term "maturity" means the date of the last
scheduled payment indicated on page 1 of this note or the date you accelerate
payment on the note, whichever is earlier.
SINGLE ADVANCE LOANS: If this is a single advance loan, you and I expect that
you will make only one advance of principal. However, you may add other
amounts to the principal if you make any payments described in the "PAYMENTS
BY LENDER" paragraph below.
MULTIPLE ADVANCE LOANS: If this is a multiple advance loan, you and I expect
that you will make more than one advance of principal. If this is closed end
credit, repaying a part of the principal will not entitle me to additional
credit.
PAYMENTS BY LENDER: If you are authorized to pay, on my behalf, charges I am
obligated to pay (such as property insurance premiums), then you may treat
those payments made by you as advances and add them to the unpaid principal
under this note, or you may demand immediate payment of the charges.
SET-OFF: I agree that you may set off any amount due and payable under this
note against any right I have to receive money from you.
"Right to receive money from you" means:
(1) any deposit account balance I have with you;
(2) any money owed to me on an item presented to you or in your
possession for collection or exchange; and
(3) any repurchase agreement or other nondeposit obligation.
"Any amount due and payable under this note" means the total amount of
which you are entitled to demand payment under the terms of this note at the
time you set off. This total includes any balance the due date for which you
properly accelerate under this note.
If my right to receive money from you is also owned by someone who has
not agreed to pay this note, your right of set-off will apply to my interest
in the obligation and to any other amounts I could withdraw on my sole
request or endorsement. Your right of set-off does not apply to an account or
other obligation where my rights are only as a representative. It also does
not apply to any Individual Retirement Account or other tax-deferred
retirement account.
You will not be liable for the dishonor of any check when the dishonor
occurs because you set off this debt against any of my accounts. I agree to
hold you harmless from any such claims arising as a result of your exercise
of your right of set-off.
REAL ESTATE OR RESIDENCE SECURITY: If this note is secured by real estate or
a residence that is personal property, the existence of a default and your
remedies for such a default will be determined by applicable law, by the
terms of any separate instrument creating the security interest and, to the
extent not prohibited by law and not contrary to the terms of the separate
security instrument, by the "Default" and "Remedies" paragraphs herein.
DEFAULT: I will be in default if any one or more of the following occur: (1)
I fail to make a payment on time or in the amount due; (2) I fail to keep the
property insured, if required; (3) I fail to pay, or keep any promise, on any
debt or agreement I have with you; (4) any other creditor of mine attempts to
collect any debt I owe him through court proceedings; (5) I die, am declared
incompetent, make an assignment for the benefit of creditors, or become
insolvent (either because my liabilities exceed my assets or I am unable to
pay my debts as they become due); (6) I make any written statement or provide
any financial information that is untrue or inaccurate at the time it was
provided; (7) I do or fail to do something which causes you to believe that
you will have difficulty collecting the amount I owe you; (8) any collateral
securing this note is used in a manner or for a purpose which threatens
confiscation by a legal authority; (9) I change my name or assume an additional
name without first notifying you before making such a change; (10) I fail to
plant, cultivate and harvest crops in due season if I am a producer of crops;
(11) any loan proceeds are used for a purpose that will contribute to
excessive erosion of highly erodible land or to the conversion of wetlands to
produce an agricultural commodity, as further explained in 7 C.F.R. Part
1940, Subpart G, Exhibit M.
REMEDIES: If I am in default on this note you have, but are not limited to,
the following remedies:
(1) You may demand immediate payment of all I owe you under this note
(principal, accrued unpaid interest and other accrued charges).
(2) You may set off this debt against any right I have to the payment of
money from you, subject to the terms of the "Set-Off" paragraph herein.
(3) You may demand security, additional security, or additional parties
to be obligated to pay this note as a condition for not using any other
remedy.
(4) You may refuse to make advances to me or allow purchases on credit by
me.
(5) You may use any remedy you have under state or federal law.
By selecting any one or more of these remedies you do not give up your right
to later use any other remedy. By waiving your right to declare an event to
be a default, you do not waive your right to later consider the event as a
default if it continues or happens again).
COLLECTION COSTS AND ATTORNEY'S FEES: I agree to pay all costs of collection,
replevin or any other or similar type of cost if I am in default. In
addition, if you hire an attorney to collect this note, I also agree to pay
any fee you incur with such attorney plus court costs (except where
prohibited by law). To the extent permitted by the United States Bankruptcy
Code, I also agree to pay the reasonable attorney's fees and costs you incur
to collect this debt as awarded by any court exercising jurisdiction under
the Bankruptcy Code.
WAIVER: I give up my rights to require you to do certain things. I will not
require you to:
(1) demand payment of amounts due (presentment);
(2) obtain official certification of nonpayment (protest); or
(3) give notice that amounts due have not been paid (notice of dishonor).
I waive any defenses I have based on suretyship or impairment of
collateral.
OBLIGATIONS INDEPENDENT: I understand that I must pay this note even if
someone else has also agreed to pay it (by, for example, signing this form
or a separate guarantee or endorsement). You may sue me alone, or anyone else
who is obligated on this note, or any number of us together, to collect this
note. You may do so without any notice that it has not been paid (notice of
dishonor). You may without notice release any party to this agreement
without releasing any other party. If you give up any of your rights, with or
without notice, it will not affect my duty to pay this note. Any extension of
new credit to any of us, or renewal of this note by all or less than all of
us will not release me from my duty to pay it. (Of course, you are entitled
to only one payment in full.) I agree that you may at your option extend this
note or the debt represented by this note, or any portion of the note or
debt, from time to time without limit or notice and for any term without
affecting my liability for payment of the note. I will not assign my
obligation under this agreement without your prior written approval.
CREDIT INFORMATION: I agree and authorize you to obtain credit information
about me from time to time (for example, by requesting a credit report) and
to report to others your credit experience with me (such as a credit reporting
agency). I agree to provide you, upon request, any financial statement or
information you may deem necessary. I warrant that the financial statements
and information I provide to you are or will be accurate, correct and
complete.
NOTICE: Unless otherwise required by law, any notice to me shall be given by
delivering it or by mailing it by first class mail addressed to me at my last
known address. My current address is on page 1. I agree to inform you in
writing of any changes in my address. I will give any notice to you by
mailing it first class to your address stated on page 1 of this agreement, or
to any other address that you have designated.
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DATE OF PRINCIPAL BORROWER'S PRINCIPAL PRINCIPAL INTEREST INTEREST INTEREST
TRANSACTION ADVANCE INITIALS PAYMENTS BALANCE RATE PAYMENTS PAID
(NOT REQUIRED) THROUGH:
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(page 2 of 2)
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ELECTRONIC PROCESSING, INC.
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501 KANSAS AVENUE
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KANSAS CITY, KS 66105
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TAXPAYER I.D. NUMBER : -
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DEBTOR'S NAME, ADDRESS AND SSN OR TIN
("I" means each Debtor who signs.)
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EXCHANGE NATIONAL BANK
00000 XXXX XXXXXX
XXXXXXX, XX 00000
SECURED PARTY'S NAME AND ADDRESS
("You" means the Secured Party, its successors and assigns.)
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I am entering into this security agreement with you on JULY 21, 1997 (date).
SECURED DEBTS. I agree that this security agreement will secure the payment
and performance of the debts, liabilities or obligations described below that
(Check one) /X/ I / / (name) ________________________________________________
____________________________________________ owe(s) to you now or in the
future:
(Check one below):
/ / Specific Debt(s). The debt(s), liability or obligations evidenced by
(describe): __________________________________________________________
_____________ ________________________________________________ and all
extensions, renewals, refinancings, modifications and replacements of
the debt, liability or obligation.
/X/ All Debt(s). Except in those cases listed in the "LIMITATIONS" paragraph
on page 2, each and every debt, liability and obligation of every type
and description (whether such debt, liability or obligation now exists
or is incurred or created in the future and whether it is or may be
direct or indirect, due or to become due, absolute or contingent,
primary or secondary, liquidated or unliquidated, or joint, several or
joint and several).
Security Interest. To ensure the payment and performance of the above described
Secured Debts, liabilities and obligations, I give you a security
interest in all of the property described below that I now own and that I may
own in the future (including, but not limited to, all parts, accessories,
repairs, improvements, and accessions to the property), wherever the property
is or may be located, and all proceeds and products from the property.
/ / Inventory: All Inventory which I hold for ultimate sale or lease, or
which has been or will be supplied under contracts of service, or which
are raw materials, work in process, or materials used or consumed in my
business.
/X/ Equipment: All equipment including, but not limited to, all machinery,
vehicles, furniture, fixtures, manufacturing equipment, farm machinery
and equipment, shop equipment, office and recordkeeping equipment, and
parts and tools. All equipment described in a list or schedule which I
give to you will also be included in the secured property, but such a
list is not necessary for a valid security interest in my equipment.
/ / Farm Products: All farm products including, but not limited to:
(a) all poultry and livestock and their young, along with their products,
produce and replacements;
(b) all crops, annual or perennial, and all products of the crops; and
(c) all feed, seed, fertilizer, medicines, and other supplies used or
produced in my farming operations,
/ / Accounts, Instruments, Documents, Chattel Paper and Other Rights to
Payment: All rights I have now and that I may have in the future to the
payment of money including, but not limited to:
(a) payment for goods and other property sold or leased or for services
rendered, whether or not I have earned such payment by performance;
and
(b) rights to payment arising out of all present and future debt
instruments, chattel paper and loans and obligations receivable.
The above include any rights and interests (including all liens and
security interests) which I may have by law or agreement against any
account debtor or obligor of mine.
/ / General Intangibles: All general intangibles including, but not limited
to, tax refunds, applications for patents, patents, copyrights,
trademarks, trade secrets, good will, trade names, customer lists,
permits and franchises, and the right to use my name.
/ / Government Payments and Programs: All payments, accounts, general
intangibles, or other benefits (including, but not limited to, payments
in kind, deficiency payments, letters of entitlement, warehouse receipts,
storage payments, emergency assistance payments, diversion payments, and
conservation reserve payments) in which I now have and in the future may
have any rights or interest and which arise under or as a result of any
preexisting, current or future Federal or state governmental program
(including, but not limited to, all programs administered by the Commodity
Credit Corporation and the ASCS).
/ / The secured property includes, but is not limited by, the following:
If this agreement covers timber to be cut, minerals (including oil and gas),
fixtures or crops growing or to be grown, the legal description is:
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I a(n) / / individual / / partnership /X/ corporation
/ /_____________________________________________
/ / if checked, file this agreement in the real estate records.
Record Owner (if not me):__________________________________
___________________________________________________________
_________________________________________________________ .
The property will be used for / / personal /X/ business
/ / agricultural / /_______________________ reasons.
EXCHANGE NATIONAL BANK
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(Secured Party's Name)
By: /s/ XXXXXXX X. XXX XXXXX
----------------------------
XXXXXXX X. XXX XXXXX
Title: EXEC. VICE PRESIDENT
--------------------------
I AGREE TO THE TERMS SET OUT ON BOTH PAGE 1 AND PAGE 2 OF THIS AGREEMENT. I
have received a copy of this document on today's date.
ELECTRONIC PROCESSING, INC.
(Debtor's Name)
By:
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XXX X. XXXXXXX
Title: PRESIDENT
---------------------------
By:
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Title:
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(page 1 of 2)
GENERALLY - "You" means the Secured Party identified on page 1 of this
agreement. "I," "me" and "my" means each person who signs this security
agreement as Xxxxxx and who agrees to give the property described in this
agreement as security for the Secured Debts. All terms and duties under this
agreement are joint and individual. No modification of this security
agreement is effective unless made in writing and signed by you and me. This
security agreement remains in effect, even if the note is paid and I owe no
other debt to you, until discharged in writing. Time is of the essence in
this agreement.
APPLICABLE LAW - I agree that this security agreement will be governed by the
law of the state in which you are located. If property described in this
agreement is located in another state, this agreement may also, in some
circumstances, be governed by the law of the state in which the property is
located.
To the extent permitted by law, the terms of this agreement may vary
applicable law. If any provision of applicable law may not be varied by
agreement, any provision of this agreement that does not comply with that law
will not be effective. If any provision of this agreement cannot be enforced
according to its terms, this fact will not affect the enforceability of the
remainder of this agreement.
OWNERSHIP AND DUTIES TOWARD PROPERTY - I represent that I own all of the
property, or to the extent this is a purchase money security interest I will
acquire ownership of the property with the proceeds of the loan. I will defend
it against any other claim. Your claim to the property is ahead of the claims
of any other creditor. I agree to do whatever you require to protect your
security interest and to keep your claim in the property ahead of the claims
of other creditors. I will not do anything to harm your position.
I will keep books, records and accounts about the property and my business
in general. I will let you examine these records at any reasonable time. I
will prepare any report or accounting you request, which deals with the
property.
I will keep the property in my possession and will keep it in good repair
and use it only for the purpose(s) described on page 1 of this agreement. I
will not change this specified use without your express written permission. I
represent that I am the original owner of the property and, if I am not, that
I have provided you with a list of prior owners of the property.
I will keep the property at my address listed on page 1 of this agreement,
unless we agree I may keep it at another location. If the property is to be
used in another state, I will give you a list of those states. I will not try
to sell the property unless it is inventory or I receive your written
permission to do so. If I sell the property I will have the payment made
payable to the order of you and me.
You may demand immediate payment of the debt(s) if the debtor is not a
natural person and without your prior written consent (1) a beneficial
interest in the debtor is sold or transferred or (2) there is a change in
either the identity or number of members of a partnership or (3) there is a
change in ownership of more than 25 percent of voting stock of a corporation.
I will pay all taxes and charges on the property as they become due. You
have the right of reasonable access in order to inspect the property. I will
immediately inform you of any loss or damage to the property.
LIMITATIONS - This agreement will not secure a debt described in the section
entitled "Secured Debts" on page 1:
1) if you fail to make any disclosure of the existence of this security
interest required by law for such other debt;
2) if this security interest is in my principal dwelling and you fail to
provide (to all persons entitled) any notice of right of rescission
required by law for such other debt;
3) to the extent that this security interest is in "household goods" and
the other debt to be secured is a "consumer" loan (as those terms are
defined in applicable federal regulations governing unfair and
deceptive credit practices);
4) if this security interest is in margin stock subject to the
requirements of 12 C.F.R. Section 207 or 221 and you do not obtain a
statement of purpose if required under these regulations with respect
to that debt; or
5) if this security interest is unenforceable by law with respect to that
debt.
PURCHASE MONEY SECURITY INTEREST - For the sole purpose of determining the
extent of a purchase money security interest arising under this security
agreement: (a) payments on any non-purchase money loan also secured by this
agreement will not be deemed to apply to the purchase money loan, and (b)
payments on the purchase money loan will be deemed to apply first to the
non-purchase money portion of the loan, if any, and then to the purchase
money obligations in the order in which the items of collateral were acquired
or if acquired at the same time, in the order selected by you. No security
interest will be terminated by application of this formula. "Purchase money
loan" means any loan the proceeds of which, in whole or in part, are used to
acquire any collateral securing the loan and all extensions, renewals,
consolidations and refinancings of such loan.
AUTHORITY OF SECURED PARTY TO MAKE ADVANCES AND PERFORM FOR DEBTOR - I agree
to pay you on demand any sums you advanced on my behalf including, but not
limited to, expenses incurred in collecting, insuring, conserving, or
protecting the property or in any inventories, audits, inspections or other
examinations by you in respect to the property. If I fail to pay such sums,
you may do so for me, adding the amount paid to the other amounts secured by
this agreement. All such sums will be due on demand and will bear interest at
the highest rate provided in any agreement, note or other instrument
evidencing the Secured Debt(s) and permitted by law at the time of the
advance.
If I fail to perform any of my duties under this security agreement, or
any mortgage, deed of trust, lien or other security interest, you may without
notice to me perform the duties or cause them to be performed. I understand
that this authorization includes, but is not limited to, permission to: (1)
prepare, file, and sign my name to any necessary reports or accountings; (2)
notify any account debtor of your interest in this property and tell the
account debtor to make the payments to you or someone else you name, rather
than me; (3) place on any chattel paper a note indicating your interest in
the property; (4) in my name, demand, collect, receive and give a receipt
for, compromise, settle, and handle any suits or other proceedings involving
the collateral; (5) take any action you feel is necessary in order to realize
on the collateral, including performing any part of a contract or endorsing
it in my name; and (6) make an entry on my books and records showing the
existence of the security agreement. Your right to perform for me shall not
create an obligation to perform and your failure to perform will not preclude
you from exercising any of your other rights under the law or this security
agreement.
INSURANCE - I agree to buy insurance on the property against the risks and
for the amounts you require and to furnish you continuing proof of coverage.
I will have the insurance company name you as loss payee on any such policy.
You may require added security if you agree that insurance proceeds may be
used to repair or replace the property. I will buy insurance from a firm
licensed to do business in the state where you are located. The firm will be
reasonably acceptable to you. The insurance will last until the property is
released from this agreement. If I fail to buy or maintain the insurance (or
fail to name you as loss payee) you may purchase it yourself.
WARRANTIES AND REPRESENTATIONS - If this agreement includes accounts, I will
not settle any account for less than its full value without your written
permission. I will collect all accounts until you tell me otherwise. I will
keep the proceeds form all the accounts and any goods which are returned to me
or which I take back in trust for you. I will not mix them with any other
property of mine. I will deliver them to you at your request. If you ask me
to pay you the full price on any returned items or items retaken by myself, I
will do so.
If this agreement covers inventory, I will not dispose of it except in my
ordinary course of business at the fair market value for the property, or at
a minimum price established between you and me.
If this agreement covers farm products I will provide you, at your
request, a written list of the buyers, commission merchants or selling
agents to or through whom I may sell my farm products. In addition to those
parties named on this written list, I authorize you to notify at your sole
discretion any additional parties regarding your security interest in my farm
products. I remain subject to all applicable penalties for selling my farm
products in violation of my agreement with you and the Food Security Act. In
this paragraph the terms farm products, buyers, commission merchants and
selling agents have the meanings given to them in the Federal Food Security
Act of 1986.
DEFAULT - I will be in default if any one or more of the following occur: (1)
I fail to make a payment on time or in the amount due; (2) I fail to keep the
property insured, if required; (3) I fail to pay, or keep any promise, on any
debt or agreement I have with you; (4) any other creditor of mine attempts to
collect any debt I owe him through court proceedings; (5) I die, am declared
incompetent, make an assignment for the benefit of creditors, or become
insolvent (either because my liabilities exceed my assets or I am unable to
pay my debts as they become due); (6) I make any written statement or provide
any financial information that is untrue or inaccurate at the time it was
provided; (7) I do or fail to do something which causes you to believe that
you will have difficulty collecting the amount I owe you; (8) I change my name
or assume an additional name without first notifying you before making such a
change; (9) failure to plant, cultivate and harvest crops in due season; (10)
if any loan proceeds are used for a purpose that will contribute to excessive
erosion of highly erodible land or to the conversion of wetlands to produce
an agricultural commodity, as further explained in 7 C.F.R. Part 1940,
Subpart G, Exhibit M.
REMEDIES - If I am in default on this agreement, you have the following
remedies:
1) You may demand immediate payment of all I owe you under the obligation
secured by this agreement.
2) You may set off any obligation I have to you against any right I have
to the payment of money from you.
3) You may demand more security or new parties obligated to pay any debt
I owe you as a condition of giving up any other remedy.
4) You may make use of any remedy you have under state or federal law.
5) If I default by failing to pay taxes or other charges, you may pay
them (but you are not required to do so). If you do, I will repay to
you the amount you paid plus interest at the highest contract rate.
6) You may require me to gather the property and make it available to you
in a reasonable fashion.
7) You may repossess the property and sell it as provided by law. You may
repossess the property so long as the repossession does not involve a
breach of the peace or an illegal entry onto my property. You may sell
the property as provided by law. You may apply what you receive from
the sale of the property to: your expenses; your reasonable attorneys'
fees and legal expenses (where not prohibited by law); any debt I owe
you. If what you receive from the sale of the property does not
satisfy the debts, you may take me to court to recover the difference
(where permitted by law).
I agree that 10 days written notice sent to my address listed on page
1 by first class mail will be reasonable notice to me under the
Uniform Commercial Code.
If any items not otherwise subject to this agreement are contained in
the property when you take possession, you may hold these items for me
at my risk and you will not be liable for taking possession of them.
8) In some cases, you may keep the property to satisfy the debt. You may
enter upon and take possession of all or any part of my property, so
long as you do not breach the peace or illegally enter onto the
property, including lands, plants, buildings, machinery, and equipment
as may be necessary to permit you to manufacture, produce, process,
store or sell or complete the manufacture, production, processing,
storing or sale of any of the property and to use and operate the
property for the length of time you feel is necessary to protect your
interest, all without payment or compensation to me.
By choosing any one or more of these remedies, you do not waive your right
to later use any other remedy. You do not waive a default if you choose not
to use any remedy, and, by electing not to use any remedy, you do not waive
your right to later consider the event a
FILING - a carbon, photographic or other reproduction of this security
agreement or the financing statement covering the property described in this
agreement may be used as a financing statement where allowed by law. Where
permitted by law, you may file a financing statement which does not
contain my signature, covering the property secured by this agreement.
CO-MAKERS - If more than one of us has signed this agreement, we are all
obligated equally under the agreement. You may sue any one of us or any of us
together if this agreement is violated. You do not have to tell me if any
term of the agreement has not been carried out. You may release any co-signer
and I will be still be obligated under this agreement. You may release any of
the security and I will still be obligated under this agreement. Waiver by
you of any of your rights will not affect my duties under this agreement.
Extending this agreement or new obligations under this agreement, will not
affect my duty under the agreement.
(page 2 of 2)
