DFTC Inc provides this sample document solely to illustrate policies and documents employed by other financing entities, and neither DFTC Inc nor any of the organizations that have provided these documents can be held responsible for their use or any claims arising from their use. Your legal counsel, your accountant, and other professionals should be consulted in all relevant matters. COMMITMENT LETTER and LOAN AGREEMENT DATE Dear; I am pleased to inform you that Eastern Maine Bank/CU has approved your application for financing, subject to the following terms and conditions: 1. Borrower: 2. Amount of Loan: $ 3. Purpose of Loan: Loan proceeds will be used to 4. Interest Rate, Term, and Repayment: This loan shall bear interest at (Index + spread %) per annum. The rate will be adjusted XXX. The term of the loan shall be for XXX years. Principal and interest shall be repaid in equal monthly installments sufficient to amortize the loan over a XXX year term. Commitment Fee: In consideration for this commitment, the Borrower shall pay Lender a non-refundable origination fee of one (1) percent ( %) of the loan amount or $ . This fee shall be due and payable upon Borrower’s acceptance of this commitment. 5. 6. Security: Borrowers shall grant to Lender as security for the loan: (a) A mortgage in real property located at (b) A security interest in all business assets of (d) The personal/corporate guarantee of . 1 Conditions of the Loan: Lender shall not disburse the loan proceeds to Borrower unless at the time of closing this Commitment Letter has not been breached, including the warranties in paragraph 11, and the Borrower shall have: (a) Executed and delivered all instruments and documents in connection with the closing of the loan in such form and containing such substance as shall be satisfactory to Lender’s counsel. The loan shall be subject to such further terms and conditions and additional documents as our counsel deem reasonable and necessary; (b) Granted Lender security on the collateral identified in Section 6 and executed appropriate documents in form and substance satisfactory to Lender; (c) Delivered to Lender prior to closing an opinion of Borrower’s counsel as to the existence and authority of Borrower and as to the validity and enforce ability of the loan documents and also that Borrower is in compliance with all applicable laws, regulations and permits in the conduct of its business. Such opinion shall be satisfactory to Lender’s counsel; (d) Prior to closing, have delivered to Lender a title certification prepared by an attorney licensed in XXXX with respect to the property constituting the collateral for the loan committed hereby. Such certification shall not contain any exceptions unacceptable to Lender. At Lender’s request, Borrower agrees to deliver to Lender a title insurance commitment-naming Lender as insured in the most recent ALTA forms, such commitment not containing any exceptions unacceptable to Lender. The premium for such title insurance shall be at Borrower’s expense; (e) Prior to closing, have delivered to Lender a satisfactory appraisal on an “as completed basis” on land and building to be located in (f) Prior to closing, have delivered to Lender copies of all existing mortgages, security agreements and noted to which Borrower is a party for Lender’s review; 2 (g) Provided evidence of construction financing by Bank of $ on terms and conditions satisfactory to Lender; 8. Expenses: Borrower shall pay Lender for all of Lender’s out of pocket expenses in connection with the loan contemplated hereby, including but not limited to the fees and disbursements of Lender’s counsel as well as recording and files fees. Such expenses shall be payable by Borrower whether or not the loan ever closes. 10. Disbursement of Loan Proceeds: closing. 11. Borrower’s Warranties: In order to induce Lender to make the loan provided for in this Commitment Letter, Borrower makes the following Representations and Warranties which shall survive the execution and delivery of the Promissory Note: Loan proceeds shall be disbursed at (a) Borrower duly exists and is in good standing under the laws of the State of XXX and Borrower through a named individual has been validly authorized by all necessary action to execute and deliver the loan documents; (b) At the time of closing, there shall be no outstanding liens, suits, trusteeships, bankruptcies or court actions pending or threatened against the Borrower of the property to be mortgaged hereunder. In addition, Borrower’s financial condition, in the sole judgment of Lender, shall not be materially impaired or changed between the date hereof and closing. Should there be any such proceedings involved the Borrower or should the Borrower’s financial condition be so impaired or changed, Lender retains the right to cancel this commitment without further liability to the Borrower; (c) Borrower and its principals have no other outstanding debt, except those disclosed in the loan application; (e) The principals of the Borrower will not permit without the prior written permission of the Lender any material change in the ownership structure, control, or operation of the Borrower including, but not limited to: (i) merger into or consolidation with any other person, firm, partnership or corporation; 3 (f) 12. (ii) significant issuance of any shared of its capital stock or partnership interests having ordinary voting power for the election of members of the governing body of the Borrower; (iii) changing the nature of its business as carried out at the date hereof; (iv) substantial distribution, liquidation, dissolution or other disposal of the assets or the interest of XXX. The Loan committed hereby is subject to Borrower’s compliance satisfactory to Lender with all applicable Federal, State and local laws and ordinances pertaining to land use and with all approvals and permits granted in connection with Borrower’s ownership and operation of the property to be mortgage to Lender’s option, an opinion of Borrower’s counsel. This loan is also subject to Borrower’s providing Lender satisfactory evidence that Borrower had undertaken reasonable inquiry in the light of best business and land transfer principles and based on the facts surrounding the mortgage property to determine that the mortgage property is free of all hazardous and/or toxic waste, substances or materials and that such substances or material do not exist in any quantities which would require monitoring, reporting, abatement, remedial or responsive action, permitting and/or licensing under Federal, State or local law. At the request of Lender, Borrower shall obtain a hazardous waste site assessment prepared by a qualified licensed professional engineer, which shall be satisfactory in all respects to Lender. In the event that such assessment or any other investigation discloses the presence of such hazardous materials or substances, on or in the mortgage premises in any amounts, Lender shall have no obligation to make this loan. Covenants of the Loan: The Loan Agreement shall contain other items provisions obligating Borrower to: (a) (b) Maintain its form and existence; pay all its taxes; and maintain its property in good repair; Maintain the insurance coverage set forth below, together with such additional coverage as the Lender may require in its discretion. All of the policies set forth below shall name Lender may require in its discretion. All of the policies set forth below shall name Lender as Mortgage and Loss Payee in case of loss and shall contain such form and substance as shall be satisfactory to 4 Lender. Such insurance shall be issued by the company or companies acceptable to Lender. Policy endorsement is also to include Notice of Cancellation to Lender at least ten (10) days prior to cancellation. At or before closing, Borrower shall deliver to Lender either a certificate evidencing such insurance or a duplicate original of the final policy; (i) Fire, hazard and extended coverage insurance in an amount satisfactory to Lender; (ii) Product liability and workman compensation insurance in amounts satisfactory to the Lender; (iii) Flood insurance of applicable; Upon renewal of the policy or at such other time as Lender may request, Borrower shall furnish Lender a certificate or insurance or a duplicate original policy evidencing the required coverage’s. (c) Provide Lender with an assignment of life insurance on XXX in the amount of $ XXX (d) Maintain proper business and accounting records in accordance with generally accepted principles; authorize Lender’s access to the records. (e) Provide Lender with annual financial statements including a profit and loss statement and balance sheet prepared by management. Personal tax returns, business tax returns and annual financial statements shall be submitted within ninety (90) days of the close of the Borrower’s fiscal year and shall be prepared by an independent certified public accountant on a review basis and in accordance with general accepted accounting principles; If Eastern Maine Bank has not received financial reports, tax returns, insurance verification, employment verification, or such other reports or information as required under the terms and conditions of this Commitment Letter and Loan Agreement the borrower may be assessed a default penalty payable to holder in the amount of 5% of the monthly payment of principal and interest for each month that required information remains overdue. (f) Comply with applicable federal regulations regarding procurement, conflicts of interest, political activities, and hiring of personnel; federal, state, local laws, regulations, and ordinances; as well as with the terms of the other financing agreements entered into in conjunction with Lender’s investment; 5 (g) Use the funds for purposes represented to Lender in the loan request; (h) Notify Lender of any breach of the Loan Agreement; (i) Certify annually to Lender as to its compliance with the Loan Agreement; (j) Pay all legal, accounting, and other reasonable costs incurred by lender in collecting the loan, as well as any unusual servicing costs. (k) Comply with all terms of all other agreements to which Borrower is a party and notify Lender of any breaches of such other agreements. The Loan Agreement shall contain among other items provisions prohibiting Borrower, without Lender’s prior consent, from: 13. (a) Declaring any dividends or distribution of, or redeeming or issuing any securities or guarantees; (b) Amending its Charter or By-Laws or changing its fiscal years; (c) Liquidating, dissolving, merging, or transferring all or substantially all of its assets. Defaults: Borrower shall be in default upon a breach of the Loan Agreement, specifically including, but not limited to: (a) Breach of any of the terms of covenants contained in this Commitment Letter and Loan Agreement; (b) Material misrepresentations made by Borrower to Lender; (c) Failure to punctually pay the Note when and is due; (d) Failure to punctually pay other loans when and as due; (e) Bankruptcy or transfer of assets in bulk; (f) Failure to cure other defaults within a grace period of fifteen (15) days; 6 14. Transfer or Assignment: This commitment and the loan committed hereby shall not be transferred or assigned without the express written consent of Lender. 15. Prepayment: Borrower shall have the right to prepay the outstanding loan balance in full at any time during the course of the loan without prepayment penalty. 16. No Adverse Change: This commitment may be terminated by Lender any time prior to closing upon discovery, by Lender, of a material adverse change in or any misrepresentations or erroneous statements about the proposed project or in or about Borrower’s position with respect to solvency, credit worthiness, ability to carry out the proposed project, government regulation, or an other material factor. In the event of such termination, Lender is entitled to collect and retain all commitment fees herein required of Borrower. Such termination shall become effective upon the mailing of notice of termination by Lender by certified mail to Borrower at the address shown on this commitment. 17. Prior Agreements, Changes: This commitment supersedes all prior representations, agreements and other prior dealings between the parties, written or oral. The terms of this commitment may not be waived or altered orally or in writing, directly or by implication, by correspondence or otherwise, expect by a written amendment signed by all parties hereto and explicitly expressing the intention to amend this commitment. 18. Closing: The loan committed hereby will be closed at Eastern Maine CU offices shown at the head of this letter within one hundred twenty (120) days of the date hereof, unless said date is extended in writing by Lender at its sole option. In addition, Lender may require that all documentation to be prepared or produced by Borrower shall be first submitted to Lender’s counsel; after such submission a closing date will be set, after consultation with the Borrower, such dates to be not less than five (5) business days after such submission. 19. Notwithstanding anything contained in the previous paragraph, this commitment shall expire unless accepted within ten days of the date hereof and return executed with so much of the commitment fee then due. To the extent that the terms and conditions stated herein are not incorporated into the loan documents, this commitment letter shall survive the loan closing and will govern our relationship for so long as the loan committed hereby, together with interest and fees, remain outstanding; provided however, that in the event of inconsistencies between this commitment letter and the loan documents the loan documents shall control. 7 Sincerely, Eastern Maine CU Dana P. Sumner, Senior Commercial Loan Officer and Executive Vice President Intending to be legally bound, the Borrower acknowledges receipt of the foregoing commitment and acceptance of and agreement to its terms and conditions. Dated: By: Authorized signer: Dated: By: Individual Guarantors: 8 DFTC Inc provides this sample document solely to illustrate policies and documents employed by other Financial Institutions, and neither DFTC Inc nor any of the organizations that have provided these documents can be held responsible for their use or any claims arising from their use. Your legal counsel, your accountant, and other professionals should be consulted in all relevant matters. GUARANTY GUARANTY GUARANTY dated as of .................., 200 ....... made by ....................., a corporation organized under the laws of ......................... (the "Guarantor"), in favor of .............["the Lender"]. PRELIMINARY STATEMENTS: The Lender has entered, or may from time to time enter, into agreements or arrangements with ...................., a corporation organized under the laws of .................., (the "Counterparty"), providing for credit extensions or financial accommodations to the Counterparty of any kind whatsoever, including but not limited to the making of loans, advances or overdrafts, whether or not secured, discount or purchase of notes, securities or other instruments or property, creation of acceptances, issuance or confirmation of letters of credit, guaranties or indemnities, entering into foreign exchange or precious metals contracts or interest rate or currency swap or protection agreements or any other kind of contract or agreement under which the Counterparty may be indebted to the Lender in any manner (all of the foregoing agreements or arrangements being the "Transactions" and any writing evidencing, supporting or securing a Transaction being a "Transaction Document"). The Guarantor owns .........% of the stock or other ownership interests of the Counterparty and is financially interested in its affairs. Therefore, in consideration of the Guaranty and in order to induce the Lender to enter into or extend or give financial accommodation with respect to the Transactions, the Guarantor agrees as follows: Section 1. Guaranty of Payment. The Guarantor unconditionally and irrevocably guarantees to the Lender and its successors, endorsees, transferees and assigns, as primary obligor and not merely as surety, the punctual payment of all sums now owing or that may in the future be owing by the Counterparty with respect to the Transactions, when the same are due and payable, whether on demand, at stated maturity, by acceleration or otherwise, and whether for principal, interest purchase price, margin or additional payments, fees, expenses, costs of replacement transactions, indemnification or otherwise (all of the foregoing sums being the "Liabilities"). The Liabilities include, without limitation, interest accruing after the commencement of a proceeding under Bankruptcy, insolvency or similar laws of any jurisdiction at the rate or rates provided in the Transaction Documents. This Guaranty is a guaranty of payment and not of collection only. The Lender shall not be required to exhaust any right or remedy or take any action against the Counterparty or any other person or entity or any collateral. The Guarantor 4-8 agrees that, as between the Guarantor and the Lender, the Liabilities may be declared to be due and payable for the purposes of this Guaranty, notwithstanding any stay, injunction or other prohibition that may prevent, delay or vitiate any declaration as regards the Counterparty and that in the event of a declaration or attempted declaration, the Liabilities shall immediately become due and payable by the Guarantor for the purposes of the Guaranty. Section 2. Guaranty Absolute. The Guarantor guarantees that the Liabilities shall be paid strictly in accordance with the terms of the Transactions regardless of any law, regulation or order now or hereafter in effect of any jurisdiction affecting any of such terms or the rights of the Lender with respect thereto. The liability of the Guarantor under this Guaranty is absolute and unconditional irrespective of: (a) any change in the time, manner or place of payment, of or in any other terms of, all or any of the Transaction Documents or Liabilities, or any other amendment or waiver of or any consent to departure from any of the terms of any Transaction Document or Liability; (b) any release or amendment or waiver of, or consent to departure from, any other guaranty or support document, or any exchange, release or nonperfection of any collateral, for all or any of the Transaction Documents or Liabilities; (c) any present or future law, regulation or order of any jurisdiction (whether of right or in fact) or of any agency thereof purporting to reduce, amend, restructure or otherwise affect any term of any transaction Document of Liability; (d) without being limited by the foregoing, any lack of validity or enforceability of any Transaction Document or Liability of any failure to receive an governmental approval relating thereto;(e) any other defense whatsoever that might constitute a defense available to, or discharge of, the Counterparty or a guarantor (including, without limitation, the Bankruptcy or reorganization of the Counterparty). Section 3. Guaranty Irrevocable. This Guaranty is a continuing guaranty and shall remain in full force and effect until payment in full of all Liabilities and other amounts payable under this Guaranty and until the Transactions are no longer in effect. Section 4. Reinstatement. This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Liabilities is rescinded or must otherwise be returned by the Lender on the insolvency, Bankruptcy or reorganization of the Counterparty or otherwise, all as though the payment had not been made. Section 5. Subrogation. The Guarantor shall not exercise any rights that it may acquire by way of subrogation, by any payment made under this Guaranty or otherwise, until all the Liabilities have been paid in fill and the Transactions are no longer in effect; provided that if the Guarantor is an "insider" of the Counterparty, as such term is defined in Section 101 of the Federal Bankruptcy Code, the Guarantor hereby irrevocably waives any and all right to which it may be entitled, by operation of law or otherwise, upon making payment hereunder, to be subrogated to the rights of the Lender against the Counterparty with respect to such payments or otherwise be reimbursed, indemnified or exonerated by the Counterparty in respect thereof. If any amount is paid to the Guarantor on account of subrogation rights under this Guaranty at any time when all the Liabilities 4-8 have not been paid in full, the amount shall be held in trust for the benefit of the Lender and shall be promptly paid to the Lender to be credited and applied to the Liabilities, whether matured or unmatured or absolute or contingent, in accordance with the terms of the Transactions. If the Guarantor makes payment to the Lender of all or any part of the Liabilities and all the Liabilities are paid in full and the Transactions are no longer in effect, the Lender shall (subject to the proviso in the first sentence of this Section), at the Guarantor’s request, execute and deliver to the Guarantor appropriate documents, without recourse and without representation or warranty, necessary to evidence the transfer by subrogation to the Guarantor of an interest in the Liabilities resulting from the payment. Section 6. Subordination. Without limiting the Lender’s rights under any other agreement, any liabilities owed by the Counterparty to the Guarantor in connection with any extension of credit or financial accommodation by the Guarantor to or for the account of the Counterparty, including but not limited to interest accruing at the agreed contract rate after the commencement of a Bankruptcy or similar proceeding, are hereby subordinated to the Liabilities, and such liabilities of the Counterparty to the Guarantor, if the Lender so requests, shall be collected, enforced and received by the Guarantor as trustee for the Lender and shall be paid over to the Lender on account of the Liabilities but without reducing of affecting in any manner the liability of the Guarantor under the other provisions of this Guaranty. Section 7. Payments Generally. All payments by the Guarantor shall be made in the manner, at the place and in the currency (the "Payment Currency") required by the Transaction Documents Section 8. Certain Taxes. (a) The Guarantor further agrees that all payments to be made hereunder shall be made without setoff or counterclaim and free and clear of, and without deduction for, any taxes, levies, imposts, duties, charges, fees, deductions, withholdings or restrictions or conditions of any nature whatsoever now or hereafter imposed, levied, collected, withheld or assessed by any country or by any political subdivision or taxing authority thereof or therein ("Taxes"), but excluding taxes imposed on income or capital of the Lender by the jurisdiction(or any political subdivision thereof) under the laws of which the Lender is organized, or in which its principal place of business or lending office is located. (b) If the Guarantor shall be required by law to withhold any Taxes from any amounts payable to the Lender hereunder, (i) the amounts so payable to the Lender shall be increased to the extent necessary to yield to the Lender (after payment of all taxes) the amounts payable hereunder in the full amount so to be paid, (ii) the Guarantor shall make such withholdings, and (iii) the Guarantor shall pay the full amount withheld to the relevant tax or other authority in accordance with applicable law. Whenever any Tax is paid by the Guarantor, as promptly as possible thereafter the Guarantor shall send the Lender an official receipt showing payment thereof, together with such additional documentary evidence as may be required from time to time by the Lender. 4-8 (c) In addition, the Guarantor agrees to pay any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies that arise from any payment made hereunder or from the execution, delivery, registration, performance and enforcement of this Guaranty (hereinafter referred to as "Other Taxes"). (d) The Guarantor will indemnify the Lender for, reimburse the Lender promptly upon demand, the full amount of any Taxes or Other Taxes (including, without limitation, any Taxes or other Taxes imposed by any jurisdiction on amounts payable under this Section) paid by the Lender (as the case may be), and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly and legally asserted. (e) Without prejudice to the survival of any other agreement of the Guarantor hereunder, the agreements and obligations of the Guarantor contained in this Section shall survive the payment in full of all amounts due on the Transactions. Section 9. Representations and Warranties. (a) The Guarantor represents and warrants that the execution, delivery and performance of this Guaranty: (i) has been duly authorized by all necessary corporate action; (ii) does not violate any agreement, instrument, law, regulation or order applicable to the Guarantor or its charter or bylaws; (iii) to its best knowledge and belief does not require the consent or approval of any person or entity, including but not limited to any governmental authority, or any notice of filing or registration of any kind; and (iv) is the legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, except to the extent that enforcement may be limited by applicable Bankruptcy, insolvency and other similar laws affecting creditors’ rights generally or by general principles of equity. (b) The Guarantor is a corporation duly organized and validly existing under the laws of .................., and has all requisite corporate power and authority to conduct its business, to own its properties and to execute and deliver, and perform all of its obligations under, this Guaranty. (c) There are no actions, suits or proceedings pending or, to the knowledge of the Guarantor, threatened against or affecting the Guarantor before any court, governmental agency or arbitrator, that may, in any one case or in the aggregate, materially adversely affect the financial condition, operations, properties or business of the Guarantor or the ability of the Guarantor to perform its obligations under this Guaranty. Section 10. Covenants. For so long as this Guaranty remains in effect, the Guarantor will: (a) Maintain ownership of ........ percent of the voting shares or other ownership interests of the Counterparty; and 4-8 (b) Furnish to the Lender, or cause the Counterparty to furnish to the Lender, such information respecting the condition or operations, financial or otherwise, of the Guarantor or the Counterparty, as the Lender may from time to time reasonably request. Section 11. Remedies Generally. The remedies provided in this Guaranty are cumulative and not exclusive of any remedies provided by law. Section 12. Formalities. The Guarantor waives presentment, notice of dishonor, protest, notice of acceptance of this Guaranty or incurrence of any Liability and any other formality with respect to any of the Liabilities of this Guaranty. Section 13. Amendments and Waivers. No amendment or waiver or any provision of this Guaranty, nor consent to any departure by the Guarantor therefrom, shall be effective unless it is in writing and signed by the Lender, and then the waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. No failure on the part of the Lender to exercise, and no delay in exercising, any right under this Guaranty shall operate as a waiver or preclude any other or further exercise thereof or the exercise of any other right. Section 14. Expenses. The Guarantor shall reimburse the Lender on demand for all costs, expenses and charges, including without limitation fees and charges of external legal counsel, for the Lender in connection with the performance or enforcement of this Guaranty. The obligations of the Guarantor under this Section shall survive the termination of this Guaranty. Section 15. Assignment. This Guaranty shall be binding on, and shall inure to the benefit of the Guarantor, the Lender and their respective successors and assigns, provided that the Guarantor may not assign or transfer its rights or obligations under this Guaranty, Except to the extent restricted by the relevant Transaction Documents, the Lender may assign, sell participations in or otherwise transfer its rights with respect to the Transactions and the Transaction Documents to any other person or entity and the other person or entity shall then become vested with all the rights granted to the Lender in this Guaranty or otherwise. Section 16. Captions. The headings and captions in this Guaranty are for convenience only and shall not affect the interpretation or construction of this Guaranty. Section 17. Governing Law, etc. THIS GUARANTY SHALL BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. THE GUARANTOR CONSENTS TO THE NONEXCLUSIVE JURISDICTION AND VENUE OF THE STATE OR FEDERAL COURTS LOCATED IN THE CITY OF NEW YORK. SERVICE OF PROCESS BY THE LENDER IN CONNECTION WITH ANY SUCH DISPUTE SHALL BE BINDING ON THE GUARANTOR IF SENT TO THE GUARANTOR BY REGISTERED MAIL AT THE ADDRESS SPECIFIED BELOW OR AS OTHERWISE SPECIFIED BY THE GUARANTOR FROM TIME TO TIME. THE GUARANTOR WAIVES ANY RIGHT THE GUARANTOR MAY HAVE TO JURY TRIAL. TO THE 4-8 EXTENT THAT THE GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OR ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER FROM SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OF A JUDGMENT, EXECUTION OR OTHERWISE), THE GUARANTOR HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS GUARANTY. IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed and delivered by its duly authorized officer. Lender: ……………………………………. By: ………………………………………. Title: ……………………………………. . GUARANTOR: Name of Guarantor ............................................ ............................................ Address: ………………………………… 4-8 LOAN CLOSING DOCUMENTS 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. Loan Approval Commitment Letter Loan Agreement Promissory note Mortgage Security Agreement Assignment of Leases and Rents UCC – Search – before closing UCC – Search – after closing Tax and Judgment Lien Search UCC Financing Statement Certificates of Insurance Guaranties Opinion of Counsel Settlement Statement REAL ESTATE TRANSACTION 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. Title Search Mechanics Lien Affidavit Title Opinion Letter Notice to Senior Lenders Landlords and Mortgagees Waiver ALTA/Category 1 Survey Flood Insurance Determination Flood Insurance if Applicable Subordination Agreement (if applicable) Title Insurance Policy Environmental Compliance and Indemnity Agreement ERAQ OTHER SUPPORTING DOCUMENTS I. II. III. IV. V. VI. VII. VIII. Articles of Incorporation Copy of Bylaws Articles of Organization Operating Agreement (LLC) Good Standing Documents Borrowing Resolution Business Permits Patriot Act Compliance DFTC Inc provides this sample document solely to illustrate policies and documents employed by other financial institutions, and neither DFTC Inc nor any of the organizations that have provided these documents can be held responsible for their use or any claims arising from their use. Your legal counsel, your accountant, and other professionals should be consulted in all relevant matters. MORTGAGE KNOW ALL MEN BY THESE PRESENTS, That Borrower’s Name(s) , (“Grantor”), for consideration paid, grants to XXX CU (“Grantee”), with MORTGAGE COVENANTS, to secure of Fifty thousand and no/100 Dollars ($50,000) as provided in the terms of a Promissory Note of even date from Borrower or any renewals or extensions thereof, as well as to secure the payment of all future advances made to (Borrower) at the option of Grantee, its successors and assigns, to the Grantor, Grantor’s successors and assigns, in accordance with the terms and conditions of said future advances, all of which advances may be evidenced by notes, endorsements, guarantees, and any form of indebtedness, direct or indirect, written or oral. TOGETHER WITH all machinery, equipment, apparatus, heating, plumbing and light fixtures, and other fixtures now or hereafter attached to or used in connection with said premises. TOGETHER WITH all rights, easements, privileges and appurtenances belonging to the premises herein above described including, but not limited to, all leases, rents, issues and profits thereof and all awards and payments, and the rights to receive the same, which may be made with respect to the premises as a result of the exercise of the right or eminent domain, or the alteration of the grade of any street. The Grantor agrees to execute and deliver, from time to time, such further instruments as may be requested by Grantee to confirm any and all such assignments to the Grantee to of any such rents, issues, profits, awards, and payments. 1.The Grantor further covenants and agrees that this instrument shall constitute a security agreement with respect to any and all machinery, equipment , chattels, articles of personal property, and fixtures now owned by Grantor hereinafter acquired and all additions, accessions, substitutions and replacements thereto and therefore, any and all of which are hereinafter referred to as the “Collateral” and Grantor hereby grants and conveys to the Grantee, its successors and assigns, a security interest therein. Upon default of any term, condition or covenant of this mortgage and acceleration of any indebtedness hereby secured, the Grantee may, at its discretion, require the Grantor to assemble the collateral and make it available to the Grantee at a place reasonably convenient to both parties to be designated by the Grantee. The Grantee shall give the Grantor notice, by registered mail, postage prepaid, of the time and place of any public sale of any of the Collateral or of the time of any private sale or other intended disposition thereof is to be made by sending notice to the Grantor at least five (5) 4-5 days before the time of the sale or other disposition, which provisions for notice the Grantor and Grantee agree are reasonable; provided, however, that nothing herein shall preclude the Grantee from proceeding as to both real and personal property in accordance with Grantee’s rights and remedies in respect of the real property. Grantor agrees that all rights of the Grantee as to said collateral and as to said real estate, rights and interest appurtenant thereto, the Grantee may sell the Collateral or any part thereof, either separately from or together with the said real estate, rights and interest appurtenant thereto, may be exercised together or separately and further agrees that in exercising this power of sale as to the Collateral and as to said real estate, and rights and interest appurtenant thereto, or any part thereof, either separately from or together with the said real estate, rights and interest appurtenant thereto, or any part thereof, all as the Grantee may in its discretion elect. 2. It is an additional condition of the Grantor herein for breach of which foreclosure may be claimed and for breach of which all indebtedness secured hereby may be declared due and payable at once, that title to the within described mortgaged premises shall not pass from Grantor by deed, mortgage, or operation of law, or from any subsequent title holder, either voluntarily or involuntarily and that Grantor shall not assign, transfer or convey any interest in the premises or suffer or permit any encumbrance thereof. This condition shall continue until all indebtedness and obligations secured hereby are satisfied, and permission given, or election not to foreclose or accelerate said indebtedness by Grantee, its successors or assigns, as to any one such transfer, shall not constitute a waiver of any rights of Grantee, its successors and assigns, as to any subsequent such transfer of title as to which this condition shall remain in full force and effect. The term title as used herein shall mean the estate of the Grantor subject to the lien of the Mortgage. 3. This Mortgage is upon the statutory condition, for any breach of which and for any breach of any term, condition, or provision of the Mortgage or any instrument that it secures, the Grantee shall have the remedies provided by law. The Grantee shall have all statutory powers of sale with respect to this Mortgage, to the extent permitted by law. 4. This Mortgage is subject to a prior mortgage and to a prior Security Interest in given to and recorded or to be recorded in the county registry of deeds, securing the principal amount of $ XXX plus interest. The Grantor hereby agrees that a breach of the conditions of the prior mortgage to Bank of Texas or of any mortgage securing an interest in Grantor’s residence shall constitute a breach of the conditions of this Mortgage and that any default by Grantor under any mortgage by virtue of which grantee thereunder shall have the right to claim a foreclosure thereof and to accelerate the time for payment of the indebtedness secured thereby shall constitute a breach of 4-5 the condition of this Mortgage and all indebtedness secured hereby may be declared due and payable at once. The Grantor herein hereby transfers and assigns to the Grantee herein, its heirs and assigns, the Grantor’s equity of redemption or said prior mortgage; it’s right to receive any surplus resulting from a foreclosure sale on account of any prior mortgage; the right to demand assignment of said mortgage and the note secured by same. A copy of any notice received by the Grantor relating to any default or notice thereof under said prior mortgage shall be promptly furnished to the Grantee. Any payment made by the Grantee, his heirs and assigns, on the prior mortgage shall at the option of the Grantee, be deemed to be an advance necessary to protect the Grantee’s security, and shall thereupon become a part of the indebtedness secured by this Mortgage. Grantor shall make the payments and observe all of the conditions called for by the prior mortgage in a prompt manner, and if Grantor does not do so, Grantee shall have the right (but not the obligation) to make any such payment directly to the holder of such prior mortgage, or otherwise cure such default, and any sums so advanced by Grantee together with all costs and expenses incurred in connection therewith, including reasonable attorneys’ fees, (1) shall bear interest at the rate of 5% over the rate applicable to the note secured hereby from the date of the advancement until paid, (2) shall be immediately due and payable by Grantor to Grantee, and (3) shall be and become a part of the indebtedness secured hereby, as aforesaid. The right of the Grantee to make such payments or otherwise cure defaults on such prior mortgage is solely for the protection of the Grantee herein, and may not be relied upon by any such prior mortgage or any other third party. To the extent that any such payments or advances are made and used directly or indirectly, to pay off, discharge or satisfy in whole or in part, any such prior mortgage then the Grantee shall be subrogated to such prior mortgage lien and to any additional security held by the holder thereof, and shall have the benefit of the priority of all of the same. The rights and remedies of the Grantee under this paragraph shall be cumulative of all of the other rights and remedies of the Grantee under law and under this Mortgage and any other documents evidencing, securing or governing the loan secured hereby. The occurrence of any modification, renewal, extension, restructuring or refinancing of the indebtedness secured by said prior mortgage without the prior written consent of the Grantee shall constitute an event by default hereunder, and shall entitle the Grantee to declare the entire indebtedness secured hereby to be immediately due and payable without notice to Grantor. 5. Grantor shall well and truly perform, or cause to be performed, in punctual manner, all the terms, conditions and agreements that are the obligation of Grantor contained in a Loan Agreement of even date herewith between Grantor and Grantee and any default thereunder shall constitute a default under this Mortgage and Security Agreement and shall entitle Grantee to demand immediate to demand immediate payment of the entire indebtedness secured hereby. 6. This Mortgage is not assumable by or transferable to any third party. This mortgage and debt hereby secured shall remain the liability of the Grantor 4-5 until full payment of all indebtedness secured hereby is made to Grantee in accordance with the terms and conditions hereof. This Mortgage shall also serve as a financing statement with respect to any and all fixtures of the Grantor (Debtors), whether now owned or hereafter acquired, which are or may become affixed to the above described premises. Information concerning this security interest in fixtures may be obtained from the Grantee (Secured Party) at 245 Millers Lane, Fremont TX 89776; the mailing address of the Grantor (Debtors) is Proceeds of Collateral (including insurance proceeds) are also covered, although no disposition of Collateral by Grantor (Debtor) is thereby authorized. 7. Grantor shall well and truly performed, in a punctual manner, all terms conditions and agreements that are the obligations of Grantor contained in a Loan Agreement dated between Grantor and Grantee and any default thereunder shall constitute a default under this Mortgage and Security Agreement and shall entitle Grantee to demand immediate payment of the entire indebtedness hereby. IN WITNESS WHEREOF, instrument this of have executed this . WITNESS: Borrower Borrower STATE OF Texas COUNTY OF SS. Then personally appeared the above-named acknowledged the foregoing instrument to be their free act and deed. and Before me, Notary Public/Attorney-at-Law Print Name: My commission expires: 4-5 DFTC Inc provides this sample document solely to illustrate policies and documents employed by other financial institutions, and neither DFTC Inc nor any of the organizations that have provided these documents can be held responsible for their use or any claims arising from their use. Your legal counsel, your accountant, and other professionals should be consulted in all relevant matters. PROMISSORY NOTE FOR VALUE RECEIVED, the undersigned promises to pay to the order of XXX CU, the sum of and no/11 Dollars ($0,000.00), with interest from date hereof until paid on the outstanding principal balance hereof, computed at the rate of percent (.0%) per annum (Interest will be calculated using a 365 year). Principal and interest, amortized over fifteen ( ) years, shall be payable as follows: (a) on the XX day of each month hereafter commencing XX , continuing on the same day of each month thereafter continuing through XX , consecutive monthly payments of principal and interest in the amount of ($ ) shall be due and payable, and (b) a final payment of all remaining principal shall be due and payable on the XX day of XX. Any payment of principal and interest which is not paid when due shall thereafter until paid bear interest at the rate herein above set forth, and in addition, time of payment being of the essence, the holder of this note may collect a late charge not to exceed five cents for each dollar of each payment more than fifteen (15) days in arrears. Failure by the holder to collect one such late charge shall not be deemed a waiver by the holder of its rights to collect late charges for any other instance of late payment. All payments due hereunder shall be made to the XXX CU, 245 Millers Lane, Fairmont TX, 07885, or to such other parties or addresses as the holder hereof may from time to time designate in writing to the maker or other parties liable therefore. This note evidences a loan for business and commercial purposes and not personal, family, household or agricultural purposes. Provided that at least thirty (30) days prior notice is given in writing to holder, maker shall have the right to prepay all or any part of the unpaid principal balance hereof without premium or penalty. This note is subject to the condition that at no time shall the maker hereof be obligated or required to pay interest at a rate which could subject the holder hereof to either civil or criminal liability, forfeiture or loss of principal, interest or other sums as a result of being in excess of the maximum interest rate which maker is permitted by law to contract or agree to pay or which the holder hereof is permitted to receive. If by the terms of this Note, maker is at any time required or obligated to pay interest at a rate in excess of such maximum rate, the rate of interest under the Note shall be deemed to be simultaneously reduced to such maximum rate for so long as such maximum rate shall be in effect and shall thereafter be payable at the rate herein provided. In the case of default in the payment of any payment due herein including default in the payment of any applicable late charge or in the case of any default under the terms 4-4 of the Commitment Letter and Loan Agreement executed by the Maker in connection with the loan evidence by this Note, and such default continues for a period of fifteen days or in a case of a default in any term or condition of the Security Agreements of even date herewith given as security herefor or in the case of default in any term or condition of any document given or which may from time to time be given a security for this Note, the holder thereof, at its option, at any time thereafter, may declare due and payable at once the entire principal balance hereof, accrued interest and late charges, as applicable. If the Holder of this Note has not received the full amount of any monthly payment by the end of fifteen calendar days after the date that it is due or the Holder has not received financial reports, tax returns, insurance verification, employment verification, or such other reports or information that maker is required to furnish to the Holder under the terms of the Commitment Letter and Loan Agreement executed by Maker in connection with the loan evidenced by this Note within fifteen (15) calendar days that the same may be due under the terms of the Commitment Letter and Loan Agreement, the Maker shall pay a late charge to Holder in the amount of 5% of the monthly payment of principal and interest for each month that the payment or other required materials remain overdue. The maker and all other parties liable hereafter, whether principal, guarantor, endorser or otherwise, hereby severally waive demand, notice and protest, and waive all recourse to suretyship and guarantor ship defenses generally, including, but not limited to, any extension of time for payment or performance which may be granted to the makers or to any other reliable party, any modifications or amendments to this to this promissory note or on any other documents securing payment performance hereof, and act or omission to act by or on behalf of the holder hereof, any release of security, any release of liable party or parties, and all other indulges of any type which may be granted by the holder hereof to the maker or any other party liable hereof, and do also agree to pay all costs of collection of the indebtedness evidenced hereby , including reasonable attorney’s fees which may be incurred in connection therewith. If any obligation or portion of the promissory note is determined to be invalid or unenforceable under law, it shall not affect the validity or enforcement of the remaining obligations or portions hereof. The terms and provision hereof shall be constructed pursuant to the laws of the State of Ohio. All of the obligations and promises herein are the joint and several obligations and promises of the undersigned. 4-4 This promissory note is secured by Mortgage and Security Agreements given on date herewith by the undersigned to XXX CU. WITNESS: By: Borrower’s Name Title 4-4 Definitions: UCC – Article 9 (1) "Accession" means goods that are physically united with other goods in such a manner that the identity of the original goods is not lost. (2) "Account", except as used in "account for", means a right to payment of a monetary obligation, whether or not earned by performance, (i) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (ii) for services rendered or to be rendered, (iii) for a policy of insurance issued or to be issued, (iv) for a secondary obligation incurred or to be incurred, (v) for energy provided or to be provided, (vi) for the use or hire of a vessel under a charter or other contract, (vii) arising out of the use of a credit or charge card or information contained on or for use with the card, or (viii) as winnings in a lottery or other game of chance operated or sponsored by a State, governmental unit of a State, or person licensed or authorized to operate the game by a State or governmental unit of a State. The term includes health-care-insurance receivables. The term does not include (i) rights to payment evidenced by chattel paper or an instrument, (ii) commercial tort claims, (iii) deposit accounts, (iv) investment property, (v) letter-of-credit rights or letters of credit, or (vi) rights to payment for money or funds advanced or sold, other than rights arising out of the use of a credit or charge card or information contained on or for use with the card. (3) "Account debtor" means a person obligated on an account, chattel paper, or general intangible. The term does not include persons obligated to pay a negotiable instrument, even if the instrument constitutes part of chattel paper. (4) "Accounting", except as used in "accounting for", means a record: (A) authenticated by a secured party; (B) indicating the aggregate unpaid secured obligations as of a date not more than 35 days earlier or 35 days later than the date of the record; and (C) identifying the components of the obligations in reasonable detail. (5) "Agricultural lien" means an interest, other than a security interest, in farm products: (A) which secures payment or performance of an obligation for: (i) goods or services furnished in connection with a debtor's farming operation; or (ii) rent on real property leased by a debtor in connection with its farming operation; (B) which is created by statute in favor of a person that: (i) in the ordinary course of its business furnished goods or services to a debtor in connection with a debtor's farming operation; or (ii) leased real property to a debtor in connection with the debtor's farming operation; and (C) whose effectiveness does not depend on the person's possession of the personal property. (6) "As-extracted collateral" means: (A) oil, gas, or other minerals that are subject to a security interest that: (i) is created by a debtor having an interest in the minerals before extraction; and (ii) attaches to the minerals as extracted; or (B) accounts arising out of the sale at the wellhead or minehead of oil, gas, or other minerals in which the debtor had an interest before extraction. (7) "Authenticate" means: (A) to sign; or (B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record. (8) "Bank" means an organization that is engaged in the business of banking. The term includes savings banks, savings and loan associations, credit unions, and trust companies. (9) "Cash proceeds" means proceeds that are money, checks, deposit accounts, or the like. (10) "Certificate of title" means a certificate of title with respect to which a statute provides for the security interest in question to be indicated on the certificate as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the collateral. (11) "Chattel paper" means a record or records that evidence both a monetary obligation and a security interest in specific goods, a security interest in specific goods and software used in the goods, a security interest in specific goods and license of software used in the goods, a lease of specific goods, or a lease of specific goods and license of software used in the goods. In this paragraph, "monetary obligation" means a monetary obligation secured by the goods or owed under a lease of the goods and includes a monetary obligation with respect to software used in the goods. The term does not include (i) charters or other contracts involving the use or hire of a vessel or (ii) records that evidence a right to payment arising out of the use of a credit or charge card or information contained on or for use with the card. If a transaction is evidenced by records that include an instrument or series of instruments, the group of records taken together constitutes chattel paper. (12) "Collateral" means the property subject to a security interest or agricultural lien. The term includes: (A) proceeds to which a security interest attaches; (B) accounts, chattel paper, payment intangibles, and promissory notes that have been sold; and (C) goods that are the subject of a consignment. (13) "Commercial tort claim" means a claim arising in tort with respect to which: (A) the claimant is an organization; or (B) the claimant is an individual and the claim: (i) arose in the course of the claimant's business or profession; and (ii) does not include damages arising out of personal injury to or the death of an individual. (14) "Commodity account" means an account maintained by a commodity intermediary in which a commodity contract is carried for a commodity customer. (15) "Commodity contract" means a commodity futures contract, an option on a commodity futures contract, a commodity option, or another contract if the contract or option is: (A) traded on or subject to the rules of a board of trade that has been designated as a contract market for such a contract pursuant to federal commodities laws; or (B) traded on a foreign commodity board of trade, exchange, or market, and is carried on the books of a commodity intermediary for a commodity customer. (16) "Commodity customer" means a person for which a commodity intermediary carries a commodity contract on its books. (17) "Commodity intermediary" means a person that: (A) is registered as a futures commission merchant under federal commodities law; or (B) in the ordinary course of its business provides clearance or settlement services for a board of trade that has been designated as a contract market pursuant to federal commodities law. (18) "Communicate" means: (A) to send a written or other tangible record; (B) to transmit a record by any means agreed upon by the persons sending and receiving the record; or (C) in the case of transmission of a record to or by a filing office, to transmit a record by any means prescribed by filing-office rule. (19) "Consignee" means a merchant to which goods are delivered in a consignment. (20) "Consignment" means a transaction, regardless of its form, in which a person delivers goods to a merchant for the purpose of sale and: (A) the merchant: (i) deals in goods of that kind under a name other than the name of the person making delivery; (ii) is not an auctioneer; and (iii) is not generally known by its creditors to be substantially engaged in selling the goods of others; (B) with respect to each delivery, the aggregate value of the goods is $1,000 or more at the time of delivery; (C) the goods are not consumer goods immediately before delivery; and (D) the transaction does not create a security interest that secures an obligation. (21) "Consignor" means a person that delivers goods to a consignee in a consignment. (22) "Consumer debtor" means a debtor in a consumer transaction. (23) "Consumer goods" means goods that are used or bought for use primarily for personal, family, or household purposes. (24) "Consumer-goods transaction" means a consumer transaction in which: (A) an individual incurs an obligation primarily for personal, family, or household purposes; and (B) a security interest in consumer goods secures the obligation. (25) "Consumer obligor" means an obligor who is an individual and who incurred the obligation as part of a transaction entered into primarily for personal, family, or household purposes. (26) "Consumer transaction" means a transaction in which (i) an individual incurs an obligation primarily for personal, family, or household purposes, (ii) a security interest secures the obligation, and (iii) the collateral is held or acquired primarily for personal, family, or household purposes. The term includes consumer-goods transactions. (27) "Continuation statement" means an amendment of a financing statement which: (A) identifies, by its file number, the initial financing statement to which it relates; and (B) indicates that it is a continuation statement for, or that it is filed to continue the effectiveness of, the identified financing statement. (28) "Debtor" means: (A) a person having an interest, other than a security interest or other lien, in the collateral, whether or not the person is an obligor; (B) a seller of accounts, chattel paper, payment intangibles, or promissory notes; or (C) a consignee. (29) "Deposit account" means a demand, time, savings, passbook, or similar account maintained with a bank. The term does not include investment property or accounts evidenced by an instrument. (30) "Document" means a document of title or a receipt of the type described in Section 7-201(2). (31) "Electronic chattel paper" means chattel paper evidenced by a record or records consisting of information stored in an electronic medium. (32) "Encumbrance" means a right, other than an ownership interest, in real property. The term includes mortgages and other liens on real property. (33) "Equipment" means goods other than inventory, farm products, or consumer goods. (34) "Farm products" means goods, other than standing timber, with respect to which the debtor is engaged in a farming operation and which are: (A) crops grown, growing, or to be grown, including: (i) crops produced on trees, vines, and bushes; and (ii) aquatic goods produced in aquacultural operations; (B) livestock, born or unborn, including aquatic goods produced in aquacultural operations; (C) supplies used or produced in a farming operation; or (D) products of crops or livestock in their unmanufactured states. (35) "Farming operation" means raising, cultivating, propagating, fattening, grazing, or any other farming, livestock, or aquacultural operation. (36) "File number" means the number assigned to an initial financing statement pursuant to Section 9-519(a). (37) "Filing office" means an office designated in Section 9-501 as the place to file a financing statement. (38) "Filing-office rule" means a rule adopted pursuant to Section 9526. (39) "Financing statement" means a record or records composed of an initial financing statement and any filed record relating to the initial financing statement. (40) "Fixture filing" means the filing of a financing statement covering goods that are or are to become fixtures and satisfying Section 9-502(a) and (b). The term includes the filing of a financing statement covering goods of a transmitting utility which are or are to become fixtures. (41) "Fixtures" means goods that have become so related to particular real property that an interest in them arises under real property law. (42) "General intangible" means any personal property, including things in action, other than accounts, chattel paper, commercial tort claims, deposit accounts, documents, goods, instruments, investment property, letter-of-credit rights, letters of credit, money, and oil, gas, or other minerals before extraction. The term includes payment intangibles and software. (43) "Good faith" means honesty in fact and the observance of reasonable commercial standards of fair dealing. (44) "Goods" means all things that are movable when a security interest attaches. The term includes (i) fixtures, (ii) standing timber that is to be cut and removed under a conveyance or contract for sale, (iii) the unborn young of animals, (iv) crops grown, growing, or to be grown, even if the crops are produced on trees, vines, or bushes, and (v) manufactured homes. The term also includes a computer program embedded in goods and any supporting information provided in connection with a transaction relating to the program if (i) the program is associated with the goods in such a manner that it customarily is considered part of the goods, or (ii) by becoming the owner of the goods, a person acquires a right to use the program in connection with the goods. The term does not include a computer program embedded in goods that consist solely of the medium in which the program is embedded. The term also does not include accounts, chattel paper, commercial tort claims, deposit accounts, documents, general intangibles, instruments, investment property, letter-of-credit rights, letters of credit, money, or oil, gas, or other minerals before extraction. (45) "Governmental unit" means a subdivision, agency, department, county, parish, municipality, or other unit of the government of the United States, a State, or a foreign country. The term includes an organization having a separate corporate existence if the organization is eligible to issue debt on which interest is exempt from income taxation under the laws of the United States. (46) "Health-care-insurance receivable" means an interest in or claim under a policy of insurance which is a right to payment of a monetary obligation for health-care goods or services provided. (47) "Instrument" means a negotiable instrument or any other writing that evidences a right to the payment of a monetary obligation, is not itself a security agreement or lease, and is of a type that in ordinary course of business is transferred by delivery with any necessary indorsement or assignment. The term does not include (i) investment property, (ii) letters of credit, or (iii) writings that evidence a right to payment arising out of the use of a credit or charge card or information contained on or for use with the card. (48) "Inventory" means goods, other than farm products, which: (A) are leased by a person as lessor; (B) are held by a person for sale or lease or to be furnished under a contract of service; (C) are furnished by a person under a contract of service; or (D) consist of raw materials, work in process, or materials used or consumed in a business. (49) "Investment property" means a security, whether certificated or uncertificated, security entitlement, securities account, commodity contract, or commodity account. (50) "Jurisdiction of organization", with respect to a registered organization, means the jurisdiction under whose law the organization is organized. (51) "Letter-of-credit right" means a right to payment or performance under a letter of credit, whether or not the beneficiary has demanded or is at the time entitled to demand payment or performance. The term does not include the right of a beneficiary to demand payment or performance under a letter of credit. (52) "Lien creditor" means: (A) a creditor that has acquired a lien on the property involved by attachment, levy, or the like; (B) an assignee for benefit of creditors from the time of assignment; (C) a trustee in bankruptcy from the date of the filing of the petition; or (D) a receiver in equity from the time of appointment. (53) "Manufactured home" means a structure, transportable in one or more sections, which, in the traveling mode, is eight body feet or more in width or 40 body feet or more in length, or, when erected on site, is 320 or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air-conditioning, and electrical systems contained therein. The term includes any structure that meets all of the requirements of this paragraph except the size requirements and with respect to which the manufacturer voluntarily files a certification required by the United States Secretary of Housing and Urban Development and complies with the standards established under Title 42 of the United States Code. (54) "Manufactured-home transaction" means a secured transaction: (A) that creates a purchase-money security interest in a manufactured home, other than a manufactured home held as inventory; or (B) in which a manufactured home, other than a manufactured home held as inventory, is the primary collateral. (55) "Mortgage" means a consensual interest in real property, including fixtures, which secures payment or performance of an obligation. (56) "New debtor" means a person that becomes bound as debtor under Section 9-203(d) by a security agreement previously entered into by another person. (57) "New value" means (i) money, (ii) money's worth in property, services, or new credit, or (iii) release by a transferee of an interest in property previously transferred to the transferee. The term does not include an obligation substituted for another obligation. (58) "Noncash proceeds" means proceeds other than cash proceeds. (59) "Obligor" means a person that, with respect to an obligation secured by a security interest in or an agricultural lien on the collateral, (i) owes payment or other performance of the obligation, (ii) has provided property other than the collateral to secure payment or other performance of the obligation, or (iii) is otherwise accountable in whole or in part for payment or other performance of the obligation. The term does not include issuers or nominated persons under a letter of credit. (60) "Original debtor", except as used in Section 9-310(c), means a person that, as debtor, entered into a security agreement to which a new debtor has become bound under Section 9-203(d). (61) "Payment intangible" means a general intangible under which the account debtor's principal obligation is a monetary obligation. (62) "Person related to", with respect to an individual, means: (A) the spouse of the individual; (B) a brother, brother-in-law, sister, or sister-in-law of the individual; (C) an ancestor or lineal descendant of the individual or the individual's spouse; or (D) any other relative, by blood or marriage, of the individual or the individual's spouse who shares the same home with the individual. (63) "Person related to", with respect to an organization, means: (A) a person directly or indirectly controlling, controlled by, or under common control with the organization; (B) an officer or director of, or a person performing similar functions with respect to, the organization; (C) an officer or director of, or a person performing similar functions with respect to, a person described in subparagraph (A); (D) the spouse of an individual described in subparagraph (A), (B), or (C); or (E) an individual who is related by blood or marriage to an individual described in subparagraph (A), (B), (C), or (D) and shares the same home with the individual. (64) "Proceeds", except as used in Section 9-609(b), means the following property: (A) whatever is acquired upon the sale, lease, license, exchange, or other disposition of collateral; (B) whatever is collected on, or distributed on account of, collateral; (C) rights arising out of collateral; (D) to the extent of the value of collateral, claims arising out of the loss, nonconformity, or interference with the use of, defects or infringement of rights in, or damage to, the collateral; or (E) to the extent of the value of collateral and to the extent payable to the debtor or the secured party, insurance payable by reason of the loss or nonconformity of, defects or infringement of rights in, or damage to, the collateral. (65) "Promissory note" means an instrument that evidences a promise to pay a monetary obligation, does not evidence an order to pay, and does not contain an acknowledgment by a bank that the bank has received for deposit a sum of money or funds. (66) "Proposal" means a record authenticated by a secured party which includes the terms on which the secured party is willing to accept collateral in full or partial satisfaction of the obligation it secures pursuant to Sections 9-620, 9-621, and 9-622. (67) "Public-finance transaction" means a secured transaction in connection with which: (A) debt securities are issued; (B) all or a portion of the securities issued have an initial stated maturity of at least 20 years; and (C) the debtor, obligor, secured party, account debtor or other person obligated on collateral, assignor or assignee of a secured obligation, or assignor or assignee of a security interest is a State or a governmental unit of a State. (68) "Pursuant to commitment", with respect to an advance made or other value given by a secured party, means pursuant to the secured party's obligation, whether or not a subsequent event of default or other event not within the secured party's control has relieved or may relieve the secured party from its obligation. (69) "Record", except as used in "for record", "of record", "record or legal title", and "record owner", means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. (70) "Registered organization" means an organization organized solely under the law of a single State or the United States and as to which the State or the United States must maintain a public record showing the organization to have been organized. (71) "Secondary obligor" means an obligor to the extent that: (A) the obligor's obligation is secondary; or (B) the obligor has a right of recourse with respect to an obligation secured by collateral against the debtor, another obligor, or property of either. (72) "Secured party" means: (A) a person in whose favor a security interest is created or provided for under a security agreement, whether or not any obligation to be secured is outstanding; (B) a person that holds an agricultural lien; (C) a consignor; (D) a person to which accounts, chattel paper, payment intangibles, or promissory notes have been sold; (E) a trustee, indenture trustee, agent, collateral agent, or other representative in whose favor a security interest or agricultural lien is created or provided for; or (F) a person that holds a security interest arising under Section 2-401, 2-505, 2-711(3), 2A-508(5), 4-210, or 5-118. (73) "Security agreement" means an agreement that creates or provides for a security interest. (74) "Send", in connection with a record or notification, means: (A) to deposit in the mail, deliver for transmission, or transmit by any other usual means of communication, with postage or cost of transmission provided for, addressed to any address reasonable under the circumstances; or (B) to cause the record or notification to be received within the time that it would have been received if properly sent under subparagraph (A). (75) "Software" means a computer program and any supporting information provided in connection with a transaction relating to the program. The term does not include a computer program that is included in the definition of goods. (76) "State" means a State of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. (77) "Supporting obligation" means a letter-of-credit right or secondary obligation that supports the payment or performance of an account, chattel paper, a document, a general intangible, an instrument, or investment property. (78) "Tangible chattel paper" means chattel paper evidenced by a record or records consisting of information that is inscribed on a tangible medium. (79) "Termination statement" means an amendment of a financing statement which: (A) identifies, by its file number, the initial financing statement to which it relates; and (B) indicates either that it is a termination statement or that the identified financing statement is no longer effective. (80) "Transmitting utility" means a person primarily engaged in the business of: (A) operating a railroad, subway, street railway, or trolley bus; (B) transmitting communications electrically, electromagnetically, or by light; (C) transmitting goods by pipeline or sewer; or (D) transmitting or producing and transmitting electricity, steam, gas, or water.
© Copyright 2021