COMMERCIAL SECURITY AGREEMENT
 
Principal
   
Loan Date
   
Maturity
   
Loan No
   
Call / Coll
 
Account
 
Officer
 
Initials
                                      $ 750,000.00       12-29-2011      
12-31-2012       74902426       3010         118    

 
References in the boxes above are for Lender’s use only and do not limit the
applicability of this document to any particular loan or item.
 
Any item above containing “***” has been omitted due to text length limitations.
 
Borrower:
ISECUREtrac Corp.,
Lender:
Access Bank
 
Martin J. Halbur, Roger J.
 
210 North 78th Street
 
Kanne and Dennis L. Anderson
 
Omaha, NE  68114
 
5078 South 111th Street
 
(402) 763-6000
 
Omaha, NE  68137
           
Grantor:
ISECUREtrac Corp.
     
5078 South 111th Street
     
Omaha, NE  68137
   

 
THIS COMMERCIAL SECURITY AGREEMENT dated December 29, 2011 is made and executed
among ISECURETRAC CORP. (“Grantor”); ISECURETRAC CORP., MARTIN J. HALBUR,
ROGER J. KANNE and DENNIS L. ANDERSON (“Borrower”); and Access Bank (“Lender”).
 
GRANT OF SECURITY INTEREST.  For valuable consideration, Grantor grants to
Lender a security interest in the Collateral to secure the Indebtedness and
agrees that Lender shall have the rights stated in this Agreement with respect
to the Collateral, in addition to all other rights which Lender may have by law.
 
COLLATERAL DESCRIPTION.  The word “Collateral” as used in this Agreement means
the following-described property, whether now owned or hereafter acquired,
whether now existing or hereafter arising, and wherever located, in which
Grantor is giving to Lender a security interest for the payment of the
Indebtedness and performance of all other obligations under the Note and this
Agreement:
 
All inventory, equipment, accounts (including, but not limited to, all
health-care-insurance receivables), chattel paper, instruments (including, but
not limited to, all promissory notes), letter-of-credit rights, letters of
credit, documents, deposit accounts, investment property, money, other rights to
payment and performance, and general intangibles (including, but not limited to,
all software and all payment intangibles); all Patents, Trademarks, Copyrights,
and IP Licenses; all oil, gas and other minerals before extraction; all oil,
gas, other minerals and accounts constituting as-extracted collateral; all
fixtures; all timber to be cut; all attachments, accessions, accessories,
fittings, increases, tools, parts, repairs, supplies, and commingled goods
relating to the foregoing property and all additions, replacements of and
substitutions for all or any part of the foregoing property; all insurance
refunds relating to the foregoing property; all goodwill relating to the
foregoing property; all records and data and embedded software relating to the
foregoing property and all equipment, inventory and software to utilize, create,
maintain and process any such records and data on electronic media; and all
supporting obligations relating to the foregoing property, all whether now
existing or hereafter arising, whether now owned or hereafter acquired or
whether now or hereafter subject to any rights in the foregoing property; and
all products and proceeds (including, but not limited to, all insurance
payments) of or relating to the foregoing property.

 
 

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In addition, the word “Collateral” also includes all the following, whether now
owned or hereafter acquired, whether now existing or hereafter arising, and
wherever located:
 
(A)           All accessions, attachments, accessories, tools, parts, supplies,
replacements of and additions to any of the collateral described herein, whether
added now or later.
 
(B)           All products and produce of any of the property described in this
Collateral section.
 
(C)           All accounts, general intangibles, instruments, rents, moneys,
payments and all other rights, arising out of a sale, lease, consignment or
other disposition of any of the property described in this Collateral section.
 
(D)           All proceeds (including insurance proceeds) from the sale,
destruction, loss or other disposition of any of the property described in this
Collateral section and sums due from a third party who has damaged or destroyed
the Collateral or from that party’s insurer, whether due to judgment, settlement
or other process.
 
(E)           All records and data relating to any of the property described in
this Collateral section, whether in the form of a writing, photograph,
microfilm, microfiche or electronic media, together with all of Grantor’s right,
title and interest in and to all computer software required to utilize, create,
maintain and process any such records or data on electronic media.
 
BORROWER’S WAIVERS AND RESPONSIBILITIES.  Except as otherwise required under
this Agreement or by applicable law, (a) Borrower agrees that Lender need not
tell Borrower about any action or inaction Lender takes in connection with this
Agreement; (b) Borrower assumes the responsibility for being and keeping
informed about the Collateral; and (c) Borrower waives any defenses that may
arise because of any action or inaction of Lender, including, without
limitation, any failure of Lender to realize upon the Collateral or any delay by
Lender in realizing upon the Collateral; and Borrower agrees to remain liable
under the Note no matter what action Lender takes or fails to take under this
Agreement.
 
GRANTOR’S REPRESENTATIONS AND WARRANTIES.  Grantor warrants that: (a) this
Agreement is executed at Borrower’s request and not at the request of Lender;
(b) Grantor has the full right, power and authority to enter into this Agreement
and to pledge the Collateral to Lender; (c) Grantor has established adequate
means of obtaining from Borrower on a continuing basis information about
Borrower’s financial condition; and (d) Lender has made no representation to
Grantor about Borrower or Borrower’s creditworthiness.
 
 
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GRANTOR’S WAIVERS.  Grantor waives all requirements of presentment, protest,
demand and notice of dishonor or nonpayment to Borrower or Grantor or any other
party to the Indebtedness or the Collateral.  Lender may do any of the following
with respect to any obligation of any Borrower without first obtaining the
consent of Grantor: (a) grant any extension of time for any payment, (b) grant
any renewal, (c) permit any modification of payment terms or other terms, or
(d) exchange or release any Collateral or other security.  No such act or
failure to act shall affect Lender’s rights against Grantor or the Collateral.
 
RIGHT OF SETOFF.  To the extent permitted by applicable law, Lender reserves a
right of setoff in all Grantor’s accounts with Lender (whether checking, savings
or some other account).  This includes all accounts Grantor holds jointly with
someone else and all accounts Grantor may open in the future.  However, this
does not include any IRA or Keogh accounts or any trust accounts for which
setoff would be prohibited by law.  Grantor authorizes Lender, to the extent
permitted by applicable law, to charge or setoff all sums owing on the
Indebtedness against any and all such accounts and, at Lender’s option, to
administratively freeze all such accounts to allow Lender to protect Lender’s
charge and setoff rights provided in this paragraph.
 
GRANTOR’S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL.  With
respect to the Collateral, Grantor represents and promises to Lender that:
 
Perfection of Security Interest.  Grantor agrees to take whatever actions are
requested by Lender to perfect and continue Lender’s security interest in the
Collateral.  Upon request of Lender, Grantor will deliver to Lender any and all
of the documents evidencing or constituting the Collateral, and Grantor will
note Lender’s interest upon any and all chattel paper and instruments if not
delivered to Lender for possession by Lender.  This is a continuing Security
Agreement and will continue in effect even though all or any part of the
Indebtedness is paid in full and even though for a period of time Borrower may
not be indebted to Lender.
 
Notices to Lender.  Grantor will promptly notify Lender in writing at Lender’s
address shown above (or such other addresses as Lender may designate from time
to time) prior to any (a) change in Grantor’s name; (b) change in Grantor’s
assumed business name(s); (c) change in the management of the Corporation
Grantor; (d) change in the authorized signer(s); (e) change in Grantor’s
principal office address; (f) change in Grantor’s state of organization;
(g) conversion of Grantor to a new or different type of business entity; or
(h) change in any other aspect of Grantor that directly or indirectly relates to
any agreements between Grantor and Lender.  No change in Grantor’s name or state
of organization will take effect until after Lender has received notice.
 
No Violation.  The execution and delivery of this Agreement will not violate any
law or agreement governing Grantor or to which Grantor is a party, and its
certificate or articles of incorporation and bylaws do not prohibit any term or
condition of this Agreement.

 
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Enforceability of Collateral.  To the extent the Collateral consists of
accounts, chattel paper, or general intangibles, as defined by the Uniform
Commercial Code, the Collateral is enforceable in accordance with its terms, is
genuine, and fully complies with all applicable laws and regulations concerning
form, content and manner of preparation and execution, and all persons appearing
to be obligated on the Collateral have authority and capacity to contract and
are in fact obligated as they appear to be on the Collateral.  At the time any
account becomes subject to a security interest in favor of Lender, the account
shall be a good and valid account representing an undisputed, bona fide
indebtedness incurred by the account debtor, for merchandise held subject to
delivery instructions or previously shipped or delivered pursuant to a contract
of sale, or for services previously performed by Grantor with or for the account
debtor.  So long as this Agreement remains in effect, Grantor shall not, without
Lender’s prior written consent, compromise, settle, adjust, or extend payment
under or with regard to any such Accounts, except in the ordinary course of
business.  There shall be no setoffs or counterclaims against any of the
Collateral, and no agreement shall have been made under which any deductions or
discounts may be claimed concerning the Collateral except those disclosed to
Lender in writing.
 
Location of the Collateral.  Except in the ordinary course of Grantor’s
business, Grantor agrees to keep the Collateral (or to the extent the Collateral
consists of intangible property such as accounts or general intangibles, the
records concerning the Collateral) at Grantor’s address shown above or at such
other locations as are acceptable to Lender.  Upon Lender’s request, Grantor
will deliver to Lender in form satisfactory to Lender a schedule of real
properties and Collateral locations relating to Grantor’s operations, including,
without limitation, the following: (a) all real property Grantor owns or is
purchasing; (b) all real property Grantor is renting or leasing; (c) all storage
facilities Grantor owns, rents, leases, or uses; and (d) all other properties
where Collateral is or may be located.
 
Removal of the Collateral.  Except in the ordinary course of Grantor’s business,
including the sales of inventory, Grantor shall not remove the Collateral from
its existing location without Lender’s prior written consent.  To the extent
that the Collateral consists of vehicles, or other titled property, Grantor
shall not take or permit any action which would require application for
certificates of title for the vehicles outside the State of Delaware, without
Lender’s prior written consent.  Grantor shall, whenever requested, advise
Lender of the exact location of the Collateral.
 
Transactions Involving Collateral.  Except for inventory sold or accounts
collected in the ordinary course of Grantor’s business, or as otherwise provided
for in this Agreement, Grantor shall not sell, offer to sell, or otherwise
transfer or dispose of the Collateral.  While Grantor is not in default under
this Agreement, Grantor may sell inventory, but only in the ordinary course of
its business and only to buyers who qualify as buyers in the ordinary course of
business.  A sale in the ordinary course of Grantor’s business does not include
a transfer in partial or total satisfaction of a debt or any bulk sale.  Grantor
shall not pledge, mortgage, encumber or otherwise permit the Collateral to be
subject to any lien, security interest, encumbrance, or charge, other than the
security interest provided for in this Agreement, without the prior written
consent of Lender, it being understood that Lender has been advised of, and
consents to, the existing security interest of Crestpark L.P., Inc. (which shall
be junior hereto) and AHK Leasing, LLC.  This includes security interests even
if junior in right to the security interests granted under this
Agreement.  Unless waived by Lender, all proceeds from any disposition of the
Collateral (for whatever reason) shall be held in trust for Lender and shall not
be commingled with any other funds; provided, however, this requirement shall
not constitute consent by Lender to any sale or other disposition.  Upon
receipt, Grantor shall immediately deliver any such proceeds to Lender.

 
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Title.  Grantor represents and warrants to Lender that Grantor holds good and
marketable title to the Collateral, free and clear of all liens and encumbrances
except for the lien of this Agreement, and except as disclosed by Borrower to
Lender.  No financing statement covering any of the Collateral is on file in any
public office other than those which reflect the security interest created by
this Agreement or to which Lender has specifically consented.  Grantor shall
defend Lender’s rights in the Collateral against the claims and demands of all
other persons.
 
Repairs and Maintenance.  Grantor agrees to keep and maintain, and to cause
others to keep and maintain, the Collateral in good order, repair and condition
at all times while this Agreement remains in effect.  Grantor further agrees to
pay when due all claims for work done on, or services rendered or material
furnished in connection with, the Collateral so that no lien or encumbrance may
ever attach to or be filed against the Collateral.
 
Inspection of Collateral.  Lender and Lender’s designated representatives and
agents shall have the right at all reasonable times to examine and inspect the
Collateral wherever located.
 
Taxes, Assessments and Liens.  Grantor will pay when due all taxes, assessments
and liens upon the Collateral, its use or operation, upon this Agreement, upon
any promissory note or notes evidencing the Indebtedness, or upon any of the
other Related Documents.  Grantor may withhold any such payment or may elect to
contest any lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender’s interest in
the Collateral is not jeopardized in Lender’s sole opinion.  If the Collateral
is subjected to a lien which is not discharged within 15 days, Grantor shall
deposit with Lender cash, a sufficient corporate surety bond or other security
satisfactory to Lender in an amount adequate to provide for the discharge of the
lien plus any interest, costs, reasonable attorneys’ fees or other charges that
could accrue as a result of foreclosure or sale of the Collateral.  In any
contest Grantor shall defend itself and Lender and shall satisfy any final
adverse judgment before enforcement against the Collateral.  Grantor shall name
Lender as an additional obligee under any surety bond furnished in the contest
proceedings.  Grantor further agrees to furnish Lender with evidence that such
taxes, assessments, and governmental and other charges have been paid in full
and in a timely manner.  Grantor may withhold any such payment or may elect to
contest any lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender’s interest in
the Collateral is not jeopardized.

 
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Compliance With Governmental Requirements.  Grantor shall comply promptly with
all laws, ordinances, rules and regulations of all governmental authorities, now
or hereafter in effect, applicable to the ownership, production, disposition or
use of the Collateral, including all laws or regulations relating to the undue
erosion of highly erodible land or relating to the conversion of wetlands for
the production of an agricultural product or commodity.  Grantor may contest in
good faith any such law, ordinance or regulation and withhold compliance during
any proceeding, including appropriate appeals, so long as Lender’s interest in
the Collateral, in Lender’s opinion, is not jeopardized.
 
Hazardous Substances.  Grantor represents and warrants that the Collateral never
has been, and never will be so long as this Agreement remains a lien on the
Collateral, used in violation of any Environmental Laws or for the generation,
manufacture, storage, transportation, treatment, disposal, release or threatened
release of any Hazardous Substance.  The representations and warranties
contained herein are based on Grantor’s due diligence in investigating the
Collateral for Hazardous Substances.  Grantor hereby (a) releases and waives any
future claims against Lender for indemnity or contribution in the event Grantor
becomes liable for cleanup or other costs under any Environmental Laws, and
(b) agrees to indemnify, defend and hold harmless Lender against any and all
claims and losses resulting from a breach of this provision of this
Agreement.  This obligation to indemnify and defend shall survive the payment of
the Indebtedness and the satisfaction of this Agreement.
 
Maintenance of Casualty Insurance.  Grantor shall procure and maintain all risks
insurance, including, without limitation, fire, theft and liability coverage,
together with such other insurance as Lender may require with respect to the
Collateral, in form, amounts, coverages and bases reasonably acceptable to
Lender and issued by a company or companies reasonably acceptable to
Lender.  Grantor, upon request of Lender, will deliver to Lender from time to
time the policies or certificates of insurance in form satisfactory to Lender,
including stipulations that coverages will not be cancelled or diminished
without at least 15 days’ prior written notice to Lender and not including any
disclaimer of the insurer’s liability for failure to give such notice.  Each
insurance policy also shall include an endorsement providing that coverage in
favor of Lender will not be impaired in any way by any act, omission or default
of Grantor or any other person.  In connection with all policies covering assets
in which Lender holds or is offered a security interest, Grantor will provide
Lender with such loss payable or other endorsements as Lender may require.  If
Grantor at any time fails to obtain or maintain any insurance as required under
this Agreement, Lender may (but shall not be obligated to) obtain such insurance
as Lender deems appropriate, including if Lender so chooses “single interest
insurance,” which will cover only Lender’s interest in the Collateral.

 
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Application of Insurance Proceeds.  Grantor shall promptly notify Lender of any
loss or damage to the Collateral if the estimated cost of repair or replacement
exceeds $2,500, whether or not such casualty or loss is covered by
insurance.  Lender may make proof of loss if Grantor fails to do so within
15 days of the casualty.  All proceeds of any insurance on the Collateral,
including accrued proceeds thereon, shall be held by Lender as part of the
Collateral.  If Lender consents to repair or replacement of the damaged or
destroyed Collateral, Lender shall, upon satisfactory proof of expenditure, pay
or reimburse Grantor from the proceeds for the reasonable cost of repair or
restoration.  If Lender does not consent to repair or replacement of the
Collateral, Lender shall retain a sufficient amount of the proceeds to pay all
of the Indebtedness and shall pay the balance to Grantor.  Any proceeds which
have not been disbursed within six months after their receipt and which Grantor
has not committed to the repair or restoration of the Collateral shall be used
to prepay the Indebtedness.
 
Insurance Reserves.  Lender may require Grantor to maintain with Lender reserves
for payment of insurance premiums, which reserves shall be created by monthly
payments from Grantor of a sum estimated by Lender to be sufficient to produce,
at least 15 days before the premium due date, amounts at least equal to the
insurance premiums to be paid.  If 15 days before payment is due, the reserve
funds are insufficient, Grantor shall upon demand pay any deficiency to
Lender.  The reserve funds shall be held by Lender as a general deposit and
shall constitute a non-interest-bearing account which Lender may satisfy by
payment of the insurance premiums required to be paid by Grantor as they become
due.  Lender does not hold the reserve funds in trust for Grantor, and Lender is
not the agent of Grantor for payment of the insurance premiums required to be
paid by Grantor.  The responsibility for the payment of premiums shall remain
Grantor’s sole responsibility.
 
Insurance Reports.  Grantor, upon request of Lender, shall furnish to Lender
reports on each existing policy of insurance showing such information as Lender
may reasonably request, including the following: (a) the name of the insurer;
(b) the risks insured; (c) the amount of the policy; (d) the property insured;
(f) the then current value on the basis of which insurance has been obtained and
the manner of determining that value; and (g) the expiration date of the
policy.  In addition, Grantor shall, upon request by Lender (however not more
often than annually), have an independent appraiser satisfactory to Lender
determine, as applicable, the cash value or replacement cost of the Collateral.
 
Financing Statements.  Grantor authorizes Lender to file a UCC financing
statement or, alternatively, a copy of this Agreement to perfect Lender’s
security interest.  At Lender’s request, Grantor additionally agrees to sign all
other documents that are necessary to perfect, protect and continue Lender’s
security interest in the Property.  Grantor will pay all filing fees, title
transfer fees and other fees and costs involved unless prohibited by law or
unless Lender is required by law to pay such fees and costs.  Grantor
irrevocably appoints Lender to execute documents necessary to transfer title if
there is a default.  Lender may file a copy of this Agreement as a financing
statement.  If Grantor changes Grantor’s name or address, or the name or address
of any person granting a security interest under this Agreement changes, Grantor
will promptly notify Lender of such change.

 
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GRANTOR’S RIGHT TO POSSESSION AND TO COLLECT ACCOUNTS.  Until default and except
as otherwise provided below with respect to accounts, Grantor may have
possession of the tangible personal property and beneficial use of all the
Collateral and may use it in any lawful manner not inconsistent with this
Agreement or the Related Documents, provided that Grantor’s right to possession
and beneficial use shall not apply to any Collateral where possession of the
Collateral by Lender is required by law to perfect Lender’s security interest in
such Collateral.  Until otherwise notified by Lender, Grantor may collect any of
the Collateral consisting of accounts.  At any time and even though no Event of
Default exists, Lender may exercise its rights to collect the accounts and to
notify account debtors to make payments directly to Lender for application to
the Indebtedness.  If Lender at any time has possession of any Collateral,
whether before or after an Event of Default, Lender shall be deemed to have
exercised reasonable care in the custody and preservation of the Collateral if
Lender takes such action for that purpose as Grantor shall request or as Lender,
in Lender’s sole discretion, shall deem appropriate under the circumstances, but
failure to honor any request by Grantor shall not of itself be deemed to be a
failure to exercise reasonable care.  Lender shall not be required to take any
steps necessary to preserve any rights in the Collateral against prior parties
or protect, preserve or maintain any security interest given to secure the
Indebtedness.
 
LENDER’S EXPENDITURES.  If any action or proceeding is commenced that would
materially affect Lender’s interest in the Collateral or if Grantor fails to
comply with any provision of this Agreement or any Related Documents, including,
but not limited to, Grantor’s failure to discharge or pay when due any amounts
Grantor is required to discharge or pay under this Agreement or any Related
Documents, Lender on Grantor’s behalf may (but shall not be obligated to) take
any action that Lender deems appropriate, including, but not limited to,
discharging or paying all taxes, liens, security interests, encumbrances and
other claims, at any time levied or placed on the Collateral and paying all
costs for insuring, maintaining and preserving the Collateral.  All such
expenditures incurred or paid by Lender for such purposes will then bear
interest at the rate charged under the Note from the date incurred or paid by
Lender to the date of repayment by Grantor.  All such expenses will become a
part of the Indebtedness and, at Lender’s option, will (a) be payable on demand;
(b) be added to the balance of the Note and be apportioned among and be payable
with any installment payments to become due during either (i) the term of any
applicable insurance policy; or (ii) the remaining term of the Note; or (c) be
treated as a balloon payment which will be due and payable at the Note’s
maturity.  The Agreement also will secure payment of these amounts.  Such right
shall be in addition to all other rights and remedies to which Lender may be
entitled upon Default.
 
DEFAULT.  Each of the following shall constitute an Event of Default under this
Agreement:
 
Payment Default.  Borrower fails to make any payment when due under the
Indebtedness.
 
Other Defaults.  Borrower or Grantor fails to comply with or to perform any
other term, obligation, covenant or condition contained in this Agreement or in
any of the Related Documents or to comply with or to perform any term,
obligation, covenant or condition contained in any other agreement between
Lender and Borrower or Grantor.
 
Default in Favor of Third Parties.  Borrower or Grantor defaults under any loan,
extension of credit, security agreement, purchase or sales agreement, or any
other agreement, in favor of any other creditor or person that may materially
affect any of Borrower’s or Grantor’s property or ability to perform their
respective obligations under this Agreement or any of the Related Documents.

 
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False Statements.  Any warranty, representation or statement made or furnished
to Lender by Borrower or Grantor or on Borrower’s or Grantor’s behalf under this
Agreement or the Related Documents is false or misleading in any material
respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.
 
Defective Collateralization.  This Agreement or any of the Related Documents
ceases to be in full force and effect (including failure of any collateral
document to create a valid and perfected security interest or lien) at any time
and for any reason, except that, if the Lender elects to not perfect its
security interest in any patents, trademarks, copyrights and IP licenses, such
defect in the perfection of its Security Interest shall not be considered an
Event of Default.
 
Death or Insolvency.  The death of Borrower or Grantor or the dissolution or
termination of Borrower’s or Grantor’s existence as a going business, the
insolvency of Borrower or Grantor, the appointment of a receiver for any part of
Borrower’s or Grantor’s property, any assignment for the benefit of creditors,
any type of creditor workout (other than a conversion of all or a portion of
Borrower’s $2,000,000.00 debt to Crestpark LP, Inc. into stock or any
forgiveness thereof) or the commencement of any proceeding under any bankruptcy
or insolvency laws by or against Borrower or Grantor.
 
Creditor or Forfeiture Proceedings.  Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Borrower or Grantor or by any governmental
agency against any collateral securing the Indebtedness.  This includes a
garnishment of any of Borrower’s or Grantor’s accounts, including deposit
accounts, with Lender.  However, this Event of Default shall not apply if there
is a good-faith dispute by Borrower or Grantor as to the validity or
reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower or Grantor gives Lender written notice of the
creditor or forfeiture proceeding and deposits with Lender moneys or a surety
bond for the creditor or forfeiture proceeding, in an amount determined by
Lender, in its sole discretion, as being an adequate reserve or bond for the
dispute.
 
Adverse Change.  Lender in good faith determines that a material adverse change
has occurred in Borrower’s or Grantor’s financial condition, that Lender is
adversely affected by a change in control of iSecuretrac Corp. or the prospect
of payment or performance of the Indebtedness is impaired.
 
Insecurity.  Lender in good faith believes itself insecure.
 
Cure Provisions.  If any default, other than a default in payment is curable and
if Grantor has not been given a notice of a breach of the same provision of this
Agreement within the preceding one month, it may be cured if Grantor, after
Lender sends written notice to Borrower demanding cure of such default:
(a) cures the default within 30 days; or (b) if the cure requires more than
30 days, immediately initiates steps which Lender deems in Lender’s sole
discretion to be sufficient to cure the default and thereafter continues and
completes all reasonable and necessary steps sufficient to produce compliance as
soon as reasonably practical.

 
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Events Affecting Borrower.  Any of the preceding events occurs with respect to
any Borrower of any of the indebtedness or any Borrower dies or becomes
incompetent, or revokes or disputes the validity of, or liability under, any
note or Indebtedness.
 
RIGHTS AND REMEDIES ON DEFAULT.  If an Event of Default occurs under this
Agreement, at any time thereafter, Lender shall have all the rights of a secured
party under the Delaware Uniform Commercial Code.  In addition and without
limitation, Lender may exercise any one or more of the following rights and
remedies:
 
Accelerate Indebtedness.  Lender may declare the entire Indebtedness, including
any prepayment penalty which Borrower would be required to pay, immediately due
and payable, without notice of any kind to Borrower or Grantor.
 
Assemble Collateral.  Lender may require Grantor to deliver to Lender all or any
portion of the Collateral and any and all certificates of title and other
documents relating to the Collateral.  Lender may require Grantor to assemble
the Collateral and make it available to Lender at a place to be designated by
Lender.  Lender also shall have full power to enter upon the property of Grantor
to take possession of and remove the Collateral.  If the Collateral contains
other goods not covered by this Agreement at the time of repossession, Grantor
agrees Lender may take such other goods, provided that Lender makes reasonable
efforts to return them to Grantor after repossession.
 
Sell the Collateral.  Lender shall have full power to sell, lease, transfer or
otherwise deal with the Collateral or proceeds thereof in Lender’s own name or
that of Grantor.  Lender may sell the Collateral at public auction or private
sale.  Unless the Collateral threatens to decline speedily in value or is of a
type customarily sold on a recognized market, Lender will give Grantor, and
other persons as required by law, reasonable notice of the time and place of any
public sale, or the time after which any private sale or any other disposition
of the Collateral is to be made.  However, no notice need be provided to any
person who, after Event of Default occurs, enters into and authenticates an
agreement waiving that person’s right to notification of sale.  The requirements
of reasonable notice shall be met if such notice is given at least 10 days
before the time of the sale or disposition.  All expenses relating to the
disposition of the Collateral, including, without limitation, the expenses of
retaking, holding, insuring, preparing for sale and selling the Collateral,
shall become a part of the Indebtedness secured by this Agreement and shall be
payable on demand, with interest at the Note rate from date of expenditure until
repaid.
 
Appoint Receiver.  Lender shall have the right to have a receiver appointed to
take possession of all or any part of the Collateral, with the power to protect
and preserve the Collateral, to operate the Collateral preceding foreclosure or
sale and to collect the Rents from the Collateral and apply the proceeds, over
and above the cost of the receivership, against the Indebtedness.  The receiver
may serve without bond if permitted by law.  Lender’s right to the appointment
of a receiver shall exist whether or not the apparent value of the Collateral
exceeds the Indebtedness by a substantial amount.  Employment by Lender shall
not disqualify a person from serving as a receiver.

 
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Collect Revenues, Apply Accounts.  Lender, either itself or through a receiver,
may collect the payments, rents, income and revenues from the
Collateral.  Lender may at any time in Lender’s discretion transfer any
Collateral into Lender’s own name or that of Lender’s nominee and receive the
payments, rents, income and revenues therefrom and hold the same as security for
the Indebtedness or apply it to payment of the Indebtedness in such order of
preference as Lender may determine.  Insofar as the Collateral consists of
accounts, general intangibles, insurance policies, instruments, chattel paper,
choses in action or similar property, Lender may demand, collect, receipt for,
settle, compromise, adjust, sue for, foreclose or realize on the Collateral as
Lender may determine, whether or not Indebtedness or Collateral is then
due.  For these purposes, Lender may, on behalf of and in the name of Grantor,
receive, open and dispose of mail addressed to Grantor; change any address to
which mail and payments are to be sent; and endorse notes, checks, drafts, money
orders, documents of title, instruments and items pertaining to payment,
shipment or storage of any Collateral.  To facilitate collection, Lender may
notify account debtors and obligors on any Collateral to make payments directly
to Lender.
 
Obtain Deficiency.  If Lender chooses to sell any or all of the Collateral,
Lender may obtain a judgment against Borrower for any deficiency remaining on
the Indebtedness due to Lender after application of all amounts received from
the exercise of the rights provided in this Agreement.  Borrower shall be liable
for a deficiency even if the transaction described in this section is a sale of
accounts or chattel paper.
 
Other Rights and Remedies.  Lender shall have all the rights and remedies of a
secured creditor under the provisions of the Uniform Commercial Code, as may be
amended from time to time.  In addition, Lender shall have and may exercise any
or all other rights and remedies it may have available at law, in equity or
otherwise.
 
Election of Remedies.  Except as may be prohibited by applicable law, all of
Lender’s rights and remedies, whether evidenced by this Agreement, the Related
Documents or by any other writing, shall be cumulative and may be exercised
singularly or concurrently.  Election by Lender to pursue any remedy shall not
exclude pursuit of any other remedy, and an election to make expenditures or to
take action to perform an obligation of Grantor under this Agreement, after
Grantor’s failure to perform, shall not affect Lender’s right to declare a
default and exercise its remedies.
 
MISCELLANEOUS PROVISIONS.  The following miscellaneous provisions are a part of
this Agreement:
 
Amendments.  This Agreement, together with any Related Documents, constitutes
the entire understanding and agreement of the parties as to the matters set
forth in this Agreement.  No alteration of or amendment to this Agreement shall
be effective unless given in writing and signed by the party or parties sought
to be charged or bound by the alteration or amendment.

 
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Attorneys’ Fees; Expenses.  Grantor agrees to pay upon demand all of Lender’s
costs and expenses, including Lender’s reasonable attorneys’ fees and Lender’s
legal expenses, incurred in connection with the enforcement of this
Agreement.  Lender may hire or pay someone else to help enforce this Agreement,
and Grantor shall pay the costs and expenses of such enforcement.  Costs and
expenses include Lender’s reasonable attorneys’ fees and legal expenses, whether
or not there is a lawsuit, including reasonable attorneys’ fees and legal
expenses for bankruptcy proceedings (including efforts to modify or vacate any
automatic stay or injunction), appeals and any anticipated post-judgment
collection services.  Lender may also recover from Grantor all court,
alternative dispute resolution or other collection costs (including, without
limitation, fees and charges of collection agencies) actually incurred by
Lender.
 
Caption Headings.  Caption headings in this Agreement are for convenience
purposes only and are not to be used to interpret or define the provisions of
this Agreement.
 
Governing Law.  With respect to procedural matters related to the perfection and
enforcement of Lender’s rights against the Collateral, this Agreement will be
governed by federal law applicable to Lender and, to the extent not preempted by
federal law, the laws of the State of Delaware.  In all other respects, this
Agreement will be governed by federal law applicable to Lender and, to the
extent not preempted by federal law, the laws of the State of Nebraska without
regard to its conflicts of law provisions.  However, if there ever is a question
about whether any provision of this Agreement is valid or enforceable, the
provision that is questioned will be governed by whichever state or federal law
would find the provision to be valid and enforceable.  The loan transaction that
is evidenced by the Note and this Agreement has been applied for, considered,
approved and made, and all necessary loan documents have been accepted by Lender
in the State of Nebraska.
 
Choice of Venue.  If there is a lawsuit, Grantor agrees upon Lender’s request to
submit to the jurisdiction of the courts of Douglas County, State of Nebraska.
 
Joint and Several Liability.  All obligations of Borrower and Grantor under this
Agreement shall be joint and several, and all references to Grantor shall mean
each and every Grantor, and all references to Borrower shall mean each and every
Borrower.  This means that each Borrower and Grantor signing below is
responsible for all obligations in this Agreement.  Where any one or more of the
parties is a corporation, partnership, limited liability company or similar
entity, it is not necessary for Lender to inquire into the powers of any of the
officers, directors, partners, members or other agents acting or purporting to
act on the entity’s behalf, and any obligations made or created in reliance upon
the professed exercise of such powers shall be guaranteed under this Agreement.

 
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No Waiver by Lender.  Lender shall not be deemed to have waived any rights under
this Agreement unless such waiver is given in writing and signed by Lender.  No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right.  A waiver by Lender of a provision of
this Agreement shall not prejudice or constitute a waiver of Lender’s right
otherwise to demand strict compliance with that provision or any other provision
of this Agreement.  No prior waiver by Lender, nor any course of dealing between
Lender and Grantor, shall constitute a waiver of any of Lender’s rights or of
any of Grantor’s obligations as to any future transactions.  Whenever the
consent of Lender is required under this Agreement, the granting of such consent
by Lender in any instance shall not constitute continuing consent to subsequent
instances where such consent is required, and in all cases such consent may be
granted or withheld in the sole discretion of Lender.
 
Notices.  Any notice required to be given under this Agreement shall be given in
writing, and shall be effective when actually delivered, when actually received
by telefacsimile (unless otherwise required by law), when deposited with a
nationally recognized overnight courier or, if mailed, when deposited in the
United States mail, as first-class, certified or registered mail, postage
prepaid, directed to the addresses shown near the beginning of this
Agreement.  Any party may change its address for notices under this Agreement by
giving formal written notice to the other parties, specifying that the purpose
of the notice is to change the party’s address.  For notice purposes, Grantor
agrees to keep Lender informed at all times of Grantor’s current
address.  Unless otherwise provided or required by law, if there is more than
one Grantor, any notice given by Lender to any Grantor is deemed to be notice
given to all Grantors.
 
Power of Attorney.  Grantor hereby appoints Lender as Grantor’s irrevocable
attorney-in-fact for the purpose of executing any documents necessary to
perfect, amend or to continue the security interest granted in this Agreement or
to demand termination of filings of other secured parties.  Lender may at any
time, and without further authorization from Grantor, file a carbon,
photographic or other reproduction of any financing statement or of this
Agreement for use as a financing statement.  Grantor will reimburse Lender for
all expenses for the perfection and the continuation of the perfection of
Lender’s security interest in the Collateral.
 
Severability.  If a court of competent jurisdiction finds any provision of this
Agreement to be illegal, invalid or unenforceable as to any circumstance, that
finding shall not make the offending provision illegal, invalid or unenforceable
as to any other circumstance.  If feasible, the offending provision shall be
considered modified so that it becomes legal, valid and enforceable.  If the
offending provision cannot be so modified, it shall be considered deleted from
this Agreement.  Unless otherwise required by law, the illegality, invalidity or
unenforceability of any provision of this Agreement shall not affect the
legality, validity or enforceability of any other provision of this Agreement.
 
Successors and Assigns.  Subject to any limitations stated in this Agreement on
transfer of Grantor’s interest, this Agreement shall be binding upon and inure
to the benefit of the parties, their successors and assigns.  If ownership of
the Collateral becomes vested in a person other than Grantor, Lender, without
notice to Grantor, may deal with Grantor’s successors with reference to this
Agreement and the Indebtedness by way of forbearance or extension without
releasing Grantor from the obligations of this Agreement or liability under the
Indebtedness.

 
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Survival of Representations and Warranties.  All representations, warranties and
agreements made by Grantor in this Agreement shall survive the execution and
delivery of this Agreement, shall be continuing in nature and shall remain in
full force and effect until such time as Borrower’s Indebtedness shall be paid
in full.
 
Time Is of the Essence.  Time is of the essence in the performance of this
Agreement.
 
Waive Jury.  All parties to this Agreement hereby waive the right to any jury
trial in any action, proceeding or counterclaim brought by any party against any
other party.
 
DEFINITIONS.  The following capitalized words and terms shall have the following
meanings when used in this Agreement.  Unless specifically stated to the
contrary, all references to dollar amounts shall mean amounts in lawful money of
the United States of America.  Words and terms used in the singular shall
include the plural, and the plural shall include the singular, as the context
may require.  Words and terms not otherwise defined in this Agreement shall have
the meanings attributed to such terms in the Uniform Commercial Code:
 
Agreement.  The word “Agreement” means this Commercial Security Agreement, as
this Commercial Security Agreement may be amended or modified from time to time,
together with all exhibits and schedules attached to this Commercial Security
Agreement from time to time.
 
Borrower.  The word “Borrower” means ISECURETRAC CORP., MARTIN J. HALBUR, ROGER
J. KANNE and DENNIS L. ANDERSON and includes all co-signers and co-makers
signing the Note and all their successors and assigns.
 
Collateral.  The word “Collateral” means all of Grantor’s right, title and
interest in and to all the Collateral as described in the “COLLATERAL
DESCRIPTION” section of this Agreement.
 
Default.  The word “Default” means the Default set forth in this Agreement in
the section titled “DEFAULT.”
 
Environmental Laws.  The words “Environmental Laws” mean any and all state,
federal and local statutes, regulations and ordinances relating to the
protection of human health or the environment, including, without limitation,
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended, 42 U.S.C. Section 9601, et seq. (“CERCLA”), the Superfund
Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499 (“SARA”), the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or
other applicable state or federal laws, rules or regulations adopted pursuant
thereto.
 
Event of Default.  The words “Event of Default” mean any of the events of
default set forth in this Agreement in the “DEFAULT” section of this Agreement.
 
Grantor.  The word “Grantor” means ISECURETRAC CORP.

 
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Hazardous Substances.  The words “Hazardous Substances” mean materials that,
because of their quantity, concentration or physical, chemical or infectious
characteristics, may cause or pose a present or potential hazard to human health
or the environment when improperly used, treated, stored, disposed of,
generated, manufactured, transported or otherwise handled.  The words “Hazardous
Substances” are used in their very broadest sense and include, without
limitation, any and all hazardous or toxic substances, materials or waste as
defined by or listed under the Environmental Laws.  The term “Hazardous
Substances” also includes, without limitation, petroleum and petroleum
byproducts or any fraction thereof and asbestos.
 
Indebtedness.  The word “Indebtedness” means the indebtedness evidenced by the
Note or Related Documents, including all principal and interest, together with
all other indebtedness and costs and expenses for which Borrower is responsible
under this Agreement or under any of the Related Documents.
 
Lender.  The word “Lender” means Access Bank, its successors and assigns.
 
Note.  The word “Note” means the Note executed by ISECURETRAC CORP., MARTIN J.
HALBUR, ROGER J. KANNE and DENNIS L. ANDERSON in the principal amount of
$750,000.00 dated December 29, 2011, together with all renewals of, extensions
of, modifications of, refinancings of, consolidations of and substitutions for
the Note or Credit Agreement.
 
Property.  The word “Property” means all of Grantor’s right, title and interest
in and to all the Property as described in the “COLLATERAL DESCRIPTION” section
of this Agreement.
 
Related Documents.  The words “Related Documents” mean all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages and all other instruments, agreements and documents, whether now or
hereafter existing, executed in connection with the Indebtedness.
 
BORROWER AND GRANTOR HAVE READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS
COMMERCIAL SECURITY AGREEMENT AND AGREE TO ITS TERMS.  THIS AGREEMENT IS DATED
DECEMBER 29, 2011.
 
THIS AGREEMENT IS DELIVERED UNDER SEAL AND IT IS INTENDED THAT THIS AGREEMENT IS
AND SHALL CONSTITUTE AND HAVE THE EFFECT OF A SEALED INSTRUMENT ACCORDING TO
LAW.

 
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GRANTOR:
     
ISECURETRAC CORP.
     
[SEAL]
By
/s/ Lincoln Zehr
   
LINCOLN ZEHR, CFO of ISECURETRAC CORP.

 

 
BORROWER:
     
ISECURETRAC CORP.
   
[SEAL]
By
/s/ Lincoln Zehr
   
Lincoln Zehr, CFO of ISECUREtrac CORP.

[SEAL]
/s/ Martin J. Halbur
 
Martin J. Halbur, Individually
   
[SEAL]
/s/ Roger J. Kanne
 
Roger J. Kanne, Individually
   
[SEAL]
/s/ Dennis L. Anderson
 
Dennis L. Anderson, Individually

 
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