INVENTORY SECURITY AGREEMENT

AND POWER OF ATTORNEY

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TO: 21st MORTGAGE CORPORATION (“Secured Party”), which has its principal place
of business at 620 Market Street, Suite 100, Knoxville, Tennessee 37902, as of
the date set forth in the final paragraph of this Agreement.

The undersigned entity or person (“Debtor”) intends to engage or is engaged in
the business of buying, selling and generally dealing in goods of various types
of retail and, from time to time, may desire Secured Party to finance the
acquisition of such goods from manufacturers or other suppliers acceptable to
Secured Party.

Therefore, the parties agree as follows:

1. DEFINITION OF COLLATERAL. The term “Collateral,” as used herein, shall have
the same meaning as the following terms, as

those definitions under applicable law may be amended from time to time:

1.1 Inventory. All Inventory or goods financed by Secured Party of whatever
description held for sale, rent or lease by Debtor, now or hereafter owned, or
now or hereafter in the possession, custody or control of Debtor, wherever
located, together with all attachments, accessories, additions and
substitutions, including all returns and repossessions (hereinafter called
“Inventory”).

1.2 Other Items. All of Debtor’s rights related to or arising out of the
transfer or sale of any of the Inventory listed in 1.1, and specifically to any
(a) accounts including but not limited to, rebates, discounts, credits, factory
holdbacks and incentive payments which may become due to Debtor by the
manufacturer or distributor with respect to any of the Inventory, (b) chattel
paper, (c) instruments, and (d) money, whether now owned or hereafter acquired.

1.3 Proceeds. All proceeds from the above-described Collateral, including, but
not limited to, insurance proceeds payable by reason of loss or damage to any of
the Collateral.

2. APPLICATION FOR CREDIT.

2.1 Request. Secured Party will provide financing during the first 12 months of
this Agreement as provided in the Terms Schedule, thereafter, Debtor may request
financing from Secured Party for the purchase of goods from any supplier and, if
Secured Party elects; in its sole discretion, to make such financing available,
it shall be made under the terms of the attached Terms Schedule and this
Inventory Security Agreement. Debtor agrees that Secured Party may, at any time
and without notice, elect not to finance Inventory if Debtor if Debtor is in
default under this or any other agreement with Secured Party. Further, Debtor
agrees that Secured Party may, at any time and without notice, elect not to
finance Inventory if the supplier of said inventory is in default of any of its
obligations to Secured Party or Secured Party is otherwise reasonably insecure.

2.2 Execution of Documents. As part of an application for such financing, Debtor
shall execute and deliver to Secured Party any and all additional writings that
Secured Party deems necessary or desirable to accomplish the purposes of this
Agreement, including, but not limited to Financing Statements and any amendments
thereto.

2.3 General Terms. Debtor and Secured Party agree that the financial terms of
any advance by Secured Party hereunder, such as finance charge rates, other
fees, maturities and curtailments, are not fully set forth

 

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because such terms depend, in part, upon supplier incentives or discounts,
general economic conditions, governmental and quasi-governmental actions,
Debtor’s volume and outstanding indebtedness with Secured Party and other market
factors. This Agreement provides the general terms only of Secured Party’s
financing program with Debtor, specific terms are set forth in the Terms
Schedule which are locked in for a period of 12 months. Debtor shall be deemed
to have accepted the specific terms of each financing transaction hereunder
unless Debtor notifies Secured Party in writing of any objection within fifteen
(15) days of receipt of Secured Party’s confirmation. If Debtor timely objects
to the terms of any extension of credit (other than the initial credit
transaction which cannot be protested), and mutually agreeable terms cannot be
negotiated, Debtor agrees to pay Secured Party for such Financing on the same
terms and conditions as the immediately preceding extension of credit for like
Inventory from the same supplier, to which Debtor has not objected. In this
event, Debtor acknowledges that Secured Party may then elect to suspend or
terminate this Agreement. Termination for this reason alone will not be deemed a
default of this Agreement, and prior extensions of credit shall not be
accelerated, unless Debtor is, otherwise in default under this Agreement,
Without limiting the generality of the remainder of this Section 2.3, the
parties acknowledge that the interest

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rate applicable to all notes funded under this Agreement has been determined
based upon a number of factors, including, without limitation, market
conditions, usage of the available credit facility and credit quality of Debtor.
After the initial 12 month period, Debtor expressly agrees that if Secured Party
determines that any of these factors has changed, Secured Party may, in the
exercise of its discretion, adjust the interest rate, either upwards or
downwards, for all future notes upon the delivery of written notice to Debtor.
This interest rate adjustment shall be effective thirty (30) days subsequent to
the date of such written notice.

2.4 Credit Verification. Debtor agrees Secured Party may verify credit
information provided by Debtor with Debtor’s references, other third parties and
through credit reporting agencies, and Debtor agrees that Secured party may
provide such information to such parties for the purpose of verifying such
information..

3. SELECTION OF INVENTORY; DISCLAIMER OF WARRANTY. Debtor, in its sole
discretion, has selected both the Inventory and the supplier from whom Debtor
acquired said Inventory and Debtor assumes all responsibility and risk for the
existence, character, quality, condition and value of the Inventory. This is an
agreement regarding the extension of credit and not the provision of goods and
services. Debtor irrevocably waives any claims against Secured Party with
respect to the Inventory whether for breach of warranty or otherwise and shall
not assert against Secured Party any claim or defense Debtor may have against
any supplier of Inventory to Debtor. Any such claims shall not alter, diminish
or otherwise impair Debtor’s liabilities or obligations to Secured Party under
this or any other Agreement.

4. GRANT OF SECURITY INTEREST. Debtor grants to Secured Party a security
interest in all Collateral of Debtor that is financed by Secured Party, whether
presently owned or after-acquired. The security interest granted under this
Agreement or under any other present or future agreement between Debtor and
Secured Party or any of Secured Party’s affiliates or subsidiaries, shall secure
the payment and performance of all debts, liabilities and obligations of Debtor
to Secured Party, its affiliates and subsidiaries, whether presently existing or
hereafter arising or created. The security interest granted by Debtor will
secure all present and future advances made under this Agreement. In granting
the security interest, Debtor authorizes Secured Party to perfect its interest
by filing a financing statement or by taking any other steps to perfect as
authorized by law.

5. PAYMENT OF DEBTS DUE FROM SUPPLIERS. Debtor assigns to Secured Party and
agrees to pay the amounts described in Paragraph 1.2 to Secured Party, as soon
as the same are received, for application to Debtor’s obligations hereunder.
Upon the occurrence of any default of this or any other agreement with Secured
Party, Debtor authorizes Secured Party to collect any such amounts directly from
the manufacturer, supplier or distributor, and, upon request of Secured Party,
to so instruct the manufacturer or distributor to make payments directly to
Secured Party.

6. DOCUMENTS OF TITLE. Debtor shall promptly deliver to Secured Party any
Certificate of Title, Certificate of Origin, or Manufacturer’s Statement of
Origin issued for each item of Inventory, or cause any manufacturer or supplier
of Inventory or other third party which may hold such Certificate or Statement
to deliver same to Secured Party. Secured Party shall have the right to hold
such documents until such items of Inventory are sold and Secured Party has been
paid the balance owing on such Inventory. Secured Party shall the right to have
its lien or security interest noted thereon.

7. OBLIGATIONS OF DEBTOR. Debtor shall have the following obligations to Secured
Party:

7.1 Use and Location. Debtor will only display and sell Inventory to buyers in
the ordinary course of business. Debtor shall not use (except for incidental
demonstration for sale), rent, lease, transfer or dispose of Inventory except as
provided herein, nor permit, without the written consent of Secured Party, the
Collateral to be subject to any lien encumbrance or security interest except
that granted herein. All Inventory shall be located at the address(es) listed in
Paragraph 19. Secured Party may examine the Inventory and Debtor’s books and
records regarding the Inventory, wherever located, at any time during normal
business hours.

 

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7.2 Documents. Debtor will execute all documents Secured Party requests to
evidence a credit extension, and to perfect Secured Party’s Inventory purchase
money security interest, or otherwise assist Secured Party to obtain any
necessary subordination agreements, waivers, releases, or amendments to this
Agreement to ensure Secured Party has the first priority purchase money security
interest in the Inventory.

7.3 Condition. Debtor shall keep all Inventory in good order, repair and
operating condition, and shall immediately notify Secured Party of any loss,
theft or damage to the Inventory.

7.4 Taxes. Debtor shall pay immediately all taxes, expenses, assessments and
charges that may now or hereafter be levied or assessed against the Collateral.
If Debtor fails to pay such taxes, fees or charges, Secured Party may, but shall
not be obligated to do so on Debtor’s behalf and demand from Debtor repayment of
all such amounts plus interest at the highest contract rate allowed by law.

7.5 Payment. Time is of the essence with respect to Debtor’s performance of
obligations hereunder notwithstanding any course of dealings or custom on the
part of Secured Party to grant extensions of time. Any extension of time shall
be a nonbinding

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accommodation to Debtor and shall not prejudice Secured Party’s right to demand
immediate performance. Debtor’s payments are due upon receipt of its monthly
billing statement. Payment of the Late Fee will not waive the default caused by
the failure to make such payment. Debtor shall pay Secured Party promptly when
due the amount of any extension of credit according to the terms of any
floorplan note or any other writing evidencing such extension of credit,
including, but not limited to, all accrued and unpaid interest, any required
curtailments, maturities and additional charges and fees as required in any
Addendum, Terms Schedule or other written supplement to this Agreement, all
without regard to any manufacturer or distributor rebates, credits, holdbacks or
discounts. Notwithstanding the foregoing, Debtor agrees to pay Secured Party the
amount of any extension of credit on each item of inventory financed hereunder
immediately upon the sale thereof or removal from the location listed in
Paragraph 19 except for the purposes of incidental demonstration. Debtor
recognizes that it has a fiduciary obligation to treat any funds received by
Debtor from any party intended as full or partial payment for any item of
inventory financed hereunder as funds belonging to Secured Party which are held
in trust by Debtor until such time as they are tender to Secured Party.

Secured Party may apply payments received from Debtor toward the payment of any
obligations of Debtor in such order of application as Secured Party may
determine. Secured Party may apply payments to finance charges first, then to
principal, regardless of Debtor’s instructions and it may apply payments to
oldest (earliest) Inventory floorplan notes. All principal payments will be
applied first to such Inventory that is sold, stolen, lost, damaged, rented,
leased or otherwise missing. Any payment by the Debtor shall be deemed credited
3 Business Days after received by the Secured Party at the place for payment
provided for in the Agreement, or if paid to the Secured Party at any other
place, 3 Business Days after deposited by the Secured Party. Should any check
received by Secured Party from Debtor be returned to Secured Party due to
insufficient funds, Secured Party may, in its sole discretion, chose to
inactivate Debtor for a period of thirty (30) days and/or refuse to accept
checks from Debtor or any agent/representative of Debtor from that point
forward.

If Secured Party determines that the aggregate outstanding credit owed by Debtor
exceeds the aggregate wholesale invoice price of the Inventory in Debtor’s
possession, Debtor shall immediately upon demand pay Secured Party the
difference between the two amounts. Acceptance by Secured Party of past due
amounts shall not be construed as a waiver of default or an amendment to the
terms of this Agreement. Any supplier or third party discount rebate, bonus, or
credit paid to Secured Party will not reduce Debtor’s obligations to Secured
Party until such payment becomes Secured Party’s cash.

7.6 Finance Charge Calculation. All payments are due upon Debtor’s receipt of
Secured Party’s monthly or other billing statement. Debtor agrees to pay Secured
Party finance charges on the outstanding principal indebtedness owing for each
item of Inventory at the rate(s) provided in the Terms Schedule in effect at the
time that particular unit of Inventory is financed by Secured Party for Debtor,
unless Debtor objects thereto as provided in Section 2.3. Finance charges at the
stated rate shall be computed based on a 360 day year and calculated by
multiplying the Daily Charge (defined below) by the actual number of days in the
applicable billing period, Such finance charges shall accrue from the floorplan
note date for the Inventory until Secured Party receives the entire principal
amount. The “Daily Charge” is the product of the Daily Rate (defined below)
multiplied by the Average Daily Balance (defined below). The “Daily Rate” is the
quotient of the annual rate provided in the Terms Schedule divided by 360. The
“Average Daily Balance” is the quotient of (i) the sum of the outstanding
principal debt owed Secured Party on each day of a billing period for each item
of Collateral, divided by (ii) The actual number of days in such billing period.

Whenever used in this agreement, in any other document referring to this
agreement, or in the Terms Schedule, the term “Prime Rate” shall mean the higher
of: 1.) The prevailing domestic “Prime Rate” as published in the Wall Street
Journal in its “Money Rates” column on a daily basis or 2.) The Minimum Prime
Rate as defined in the Terms Schedule. In the event that the “Prime Rate” as
published in the Wall Street Journal ceases to exist or the Wall Street Journal
ceases publishing a “Prime Rate”, the Secured Party will substitute a comparable
index, which is outside the control of the Secured Party. In the event of an
error by the Wall Street Journal, the “Prime Rate” will be based upon the “Prime
Rate” as corrected.

 

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Notwithstanding the above, Debtor acknowledges that Secured Party intends to
strictly comply with all applicable usury laws governing this Agreement. Should
such law other than Tennessee apply and the usury rate be less than that billed,
any excess finance charges paid shall be deemed payment on the unpaid principal
on the applicable floorplan note. If an overpayment of principal results, it may
be applied to principal on any other floorplan note, and if none, refunded to
Debtor.

7.7 Additional Charges. If Secured Party does not receive by the 25th day of the
month payment of all amounts listed on the monthly billing statement (including
principal, interest, curtailment and administrative charges), Debtor will to the
maximum extent permitted by applicable law, pay Secured Party a late fee in the
amount equal to the greater of $5.00 or 5% of the amount of such delinquent
payments (the “Late Fee”). To the extent permitted by applicable law, Debtor
agrees to pay Secured Party $100 for each check returned unpaid for insufficient
funds to cover administrative costs.

Debtor further agrees to pay the Secured Party, promptly as billed, the service
charge with respect to each unit of Inventory as specified in the Terms Schedule
attached to this agreement. These charges are intended as an administrative fee
to defray the costs and expenses of managing the financing and/or monitoring and
inspecting of the Inventory.

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7.8 Establishment of Direct Pay Relationship. It is the responsibility of the
Debtor to (i) notify the Secured Party of the proposed sale of any Collateral
prior to such Collateral physically leaving the Debtor’s applicable sales
location, (ii) provide Lender with a copy of the Form 500 or Purchase Agreement
from the proposed sale, and (iii) upon notice from Secured Party, to establish a
contractual direct pay relationship between the Secured Party and the applicable
lender, or the purchaser of the Collateral in the event that a lender is not
involved in the transaction (i.e., purchase for cash). If the debtor cannot
complete (i) and (ii) above then the Collateral becomes immediately due and
payable without notice or demand. Failure to comply with these requirements may,
in Secured Party’s sole discretion, be treated as an Event of Default under
paragraph 11 of the Inventory Security Agreement and Power of Attorney.
Furthermore, this default will subject the Debtor to all Remedies as listed in
paragraph 12 of the Inventory Security Agreement and Power of Attorney or those
provided by applicable law. Failure on behalf of Secured Party to exercise any
of its rights under this section to declare Debtor in default shall not waive
any future rights of Secured Party to declare Debtor in default under this
section.

8. INSURANCE. Debtor shall keep the Inventory insured with an insurance company
acceptable to Secured Party for full value against all insurable risks,
including flood, with Secured Party as the loss payee, and will notify Secured
Party in writing ten (10) days before changing or canceling such insurance.
Debtor shall provide Secured Party with written evidence of such coverage and
loss payee and lender’s clauses. If Debtor should fail to obtain such insurance,
Secured Party may obtain coverage, but shall not be obligated to do so on
Debtor’s behalf. Secured Party can demand from Debtor repayment for all
expenditures together with interest at the highest contract rate allowed by law.

9. DEBTOR’S RECORDS AND FINANCIAL INFORMATION. Debtor shall keep accurate and
complete records of the Collateral that may be examined and copied by Secured
Party upon request. Debtor agrees to provide, within 90 days of the end of
Debtor’s fiscal year, Financial Statements and shall provide management prepared
financial Statements within 45 days of the end of each fiscal quarter of Debtor.
For the purposes of this Section 9, Financial Statements shall include, without
limitation, reasonably detailed balance sheets and reasonably detailed income
statements, all prepared in accordance with generally accepted accounting
principles, consistently applied. Debtor grants Secured Party an irrevocable
license and right to occupy Dealer’s business locations during normal business
hours without notice to verify the Inventory, examine Debtor’s books and records
relating to the Inventory and Collateral, and to verify Debtor’s compliance with
this Agreement. Debtor shall give Secured Party at least 45 days prior written
notice of any change in Debtor’s identity, name, location, form of business
organization, ownership, and additional business locations.

10. POWER OF ATTORNEY. Debtor hereby grants a Power of Attorney to Secured Party
(which may be exercised by any agents or employees of Secured Party) under which
Secured Party may endorse checks, money orders, cashiers checks or other forms
of payment and may execute, on behalf of Debtor, any trust receipts, floorplan
notes, chattel paper, financing statements and amendments thereto, or other
writing in connection with this Agreement as attorney-in-fact for Debtor. Debtor
hereby directs Secured Party to sign all floorplan notes on Debtor’s behalf.
Secured Party agrees to promptly furnish Debtor a copy of such notes. Debtor
shall call any errors in such floorplan notes to Secured Party’s attention
within fifteen (15) days of Debtor’s receipt of such note or receipt of Debtor’s
monthly statement. Secured Party will sign a corrected note in replacement of
any incorrect note. Under this Power of Attorney, Secured Party is authorized to
execute any such writings manually or by affixing a mechanical facsimile or
printed signature. Upon Debtor’s request, Secured Party will furnish Debtor with
a copy of each writing executed under the Power of Attorney.

11. EVENTS OF DEFAULT. The occurrence of one or more of the following events
shall constitute a default by Debtor under this Agreement:

11.1 Failure to Pay. Any failure by Debtor to pay any portion of its debts to
Secured Party, when due and payable hereunder.

 

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11.2 Breach. Any breach or failure of Debtor to observe or perform any of its
other terms, obligations, representations, warranties, covenants or undertakings
hereunder not cured within 10 days notice of such breach or failure.

11.3 Misrepresentation. Any misrepresentation by Debtor to Secured Party in
connection with the business and financial condition or organizational structure
of Debtor or any misrepresentation relating to the Collateral.

11.4 Death or Dissolution. Death or dissolution of Debtor or of any guarantor or
surety for Debtor’s obligations hereunder.

11.5 Termination of Guaranty. The termination by any guarantor or surety of a
guaranty or suretyship with respect to Debtor.

11.6 Insolvency Proceedings. Debtor or any guarantor or surety; (a) makes an
assignment for the benefit of creditors; (b) files a petition in bankruptcy or
for the appointment of a receiver; or (c) has filed against it a petition in
bankruptcy or for the appointment of a receiver and such proceeding is not
dismissed within 60 days of filing, so long as Debtor is not otherwise in
default of this or any other agreement with Secured Party.

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11.7 Judgments/Attachment. Any other creditor, customer or tax authority obtains
a judgment or lien against Debtor or any guarantor, or any attachment, sale or
seizure issues or is executed against any assets of Debtor or any guarantor, and
such is not paid, discharged, dismissed or bonded over within 30 days, so long
as Debtor is not otherwise in default of this or any other agreement with
Secured Party.

11.8 Collateral Impairment/Sale Out of Trust. Any material reduction in the
value of the Collateral or any act of Debtor which imperils the prospect of full
performance or satisfaction of Debtor’s obligations hereunder; any sale, lease,
rental, or other transfer of any Inventory by Debtor without informing Secured
Party and promptly paying off the applicable floorplan note and any other
charges.

11.9 Fraudulent Acts. Debtor has concealed, removed, transferred or permitted to
be concealed, removed or transferred, any part of its assets, so as to binder,
delay or defraud any of its creditors or in such manner as would be fraudulent
under any bankruptcy, insolvency, fraudulent conveyance or similar law.

11.10 Loss of Right to Sell. Debtor has voluntarily or involuntarily given up or
lost any franchise, permission, license or right to sell or deal in any product
line of Inventory that represents a significant portion of Debtor’s sales
volume.

11.11 Insecurity. Secured Party shall, in good faith, deem itself insecure with
respect to any material portion of the Collateral or repayment of any of the
amounts described herein.

11.12 Other Agreement with Secured Party. If Secured Party has a Retail
Financing Agreement(s) with Debtor, a default on one agreement may, at Secured
Party’s option, constitute a default on the other agreement(s). Any monies due
Debtor by Secured Party, under any agreement(s) may be applied to other defaults
at the Secured Party’s discretion.

12. REMEDIES. In the event of a default, as defined in Paragraph 11:

12.1 Acceleration. Secured Party shall have, in addition to any and all rights
under the Uniform Commercial Code, the option to terminate this Agreement
immediately and to declare any and all indebtedness or liabilities of Debtor to
Secured Party immediately due and payable without notice or demand.

12.2 Default Finance Charge. Secured Party may impose a default finance charge
to all of Debtor’s outstanding principal indebtedness equal to that default
rate, if any, specified in the Terms Schedule, or, if there is none specified,
at the lesser of 16% per annum on each outstanding floorplan note, or the
highest lawful contract rate of interest permitted under applicable law.

12.3 Assembly of Collateral. Debtor shall, if Secured Party so requests,
assemble the Inventory and deliver it to Secured Party, in good order and repair
at Debtor’s expense, at a place designated by Secured Party.

12.4 Repossession and Sale. Secured Party shall also have the right to take
immediate and exclusive possession of all Collateral or any part thereof,
wherever it may be found, and also may enter any of the premises of Debtor with
or without process of law, without force, wherever the said Collateral may be or
supposed to be and take possession of, and remove, sell, and dispose of, said
Collateral, or any part thereof, at public auction or private sale. Secured
Party reserves the right to bid and become the purchaser at any such sale.
Debtor acknowledges that a manufacturer’s repurchase agreement may exist as to
the Collateral, and Debtor hereby agrees that, without limiting other methods of
disposition, disposition of the Collateral pursuant to such an agreement is a
commercially reasonable foreclosure sale under the Uniform Commercial Code.
Debtor hereby specifically waives any right to judicial proceedings prior to
Secured Party’s exercise of this right of “self-help” repossession.

12.5 Commercial Sale. Dealer agrees that Secured Party may, at its option,
either (i) conduct a private sale of any or all of the Collateral,
(ii) liquidate the Collateral to any supplier of Inventory or (iii) liquidate
the Collateral at a public sale. Without limiting the methodology of disposing
of the Collateral and without excluding other methods of conducting a private
sale, Debtor agrees that a private sale is a commercially reasonable sale under
the Uniform Commercial Code if Secured Party requests bids from at least three

 

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(3) dealers, distributors or suppliers of Inventory of that type and any sale
occurs in whole or in parcels within 180 days after Secured Party obtained
possession and authority (if needed) to sell the Inventory and the sale is made
to the highest bidder making a written cash offer. Debtor agrees that any resale
of Inventory to the supplier of inventory (commonly called a Manufacturer’s
Repurchase) under any agreement between the supplier and Secured Party is a
commercially reasonable private sale of inventory under the Uniform Commercial
Code and no requests for bids shall be required.

12.6 Costs and Expenses. Debtor shall pay all costs incurred by Secured Party in
the collection of any indebtedness or liabilities owed Secured Party by Debtor
and the enforcement of any obligations of Debtor to Secured Party, including the
costs of repossession, reasonable attorney’s fees and other legal expenses, and
reasonable costs of maintenance, possession and sale of the Collateral.

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12.7 Notice. Any notification of collateral disposition shall be deemed
reasonably and properly given if mailed at least ten (10) days before such
disposition, postage prepaid, addressed to Debtor.

12.8 Application of Proceeds. Any proceeds of the Collateral may be applied by
Secured Party to the payment of the reasonable expenses of retaking, holding,
preparing for sale, selling and the like, including reasonable attorney’s fees
and legal expenses, and any balance of such proceeds may be applied by Secured
Party toward the satisfaction of Debtor’s indebtedness or liabilities in such
order of application as Secured Party may in its sole discretion determine. Any
surplus shall be paid to Debtor, and Debtor agrees to pay any deficiency
immediately upon demand.

12.9 Prepayment Penalty. Debtor agrees to keep flooring with Secured Party for a
minimum of 12 months from the date of this agreement. If Secured Party is
bought-out within this time frame then Secured Party may, at its sole
discretion, apply a prepayment penalty of up to 5% of the outstanding inventory
balance.

12.10 Access to Premises. Debtor grants Secured Party an irrevocable license and
right to occupy Dealer’s business locations twenty- four (24) hours a day, seven
(7) days a week. Secured Party may at its sole discretion prohibit the removal
of any Collateral from the premises without payment in full.

13. PRIOR ACTS NOT A WAIVER. Secured Party shall have the right at all times to
enforce the terms and provisions of this Agreement in strict accordance with the
terms thereof, notwithstanding the prior failure of Secured Party to take such
action.

14. ASSIGNMENT. Secured Party may assign this Agreement but Debtor may not
assign this Agreement without the prior written consent of Secured Party.

15. AMENDMENT. During the first 12 months of this Agreement, the Agreement and
the Terms Schedule attached hereto may not be amended except through a written
instrument signed by Debtor and Secured Party. Thereafter, Debtor agrees that
Secured Party may amend this agreement by providing written notice to Debtor of
the amendments to this Agreement. These amendments shall apply to any
transactions financed by Secured Party 60 days after the date notice of the
amendment is provided by Secured Party, without the execution of the amendment
by Debtor, but such amendments shall not apply to transactions financed by
Secured Party prior to the date of such amendment without Debtor executing and
delivering such amendment. Debtor agrees that in addition to the remedies
described in Section 12, upon the occurrence of an Event of Default, Secured
Party shall have the right to adjust the interest rate for all transactions,
including those entered into prior to the date of the adjustment. If Debtor
previously signed any Inventory Security Agreement regarding the Collateral with
Secured Party, this Agreement will amend and supplement such prior agreement. If
this Agreement conflicts with the terms of any prior agreement, the terms of
this Agreement shall govern.

16. CHOICE OF LAW. This Agreement is deemed to have been entered into and to be
performed at Secured Party’s office in Knoxville, Tennessee. The validity,
enforceability and interpretation of this Agreement and any promissory notes
taken, charges made and sums paid in connection herewith shall be governed by
the laws of the State of Tennessee. If any provision of this Agreement or its
application is deemed invalid or unenforceable, the remainder of this Agreement
will not be affected and will remain binding and enforceable.

17. TERMINATION. This Agreement shall continue in full force and effect for a
term of one (1) year from the date hereof (“Initial Term”). At the end of the
Initial Term, the Agreement shall continue until such time that Secured Party or
Debtor terminates the Agreement by sending thirty (30) days written notice of
termination by certified mail to the other, however termination of this
Agreement does not end Debtor’s obligations to Secured Party for those
obligations which accrued prior to the effective date of the termination;
provided, however, no notice of termination to Debtor will be required if Debtor
is in default of this Agreement.

18. WAIVER OF RIGHT TO JURY TRIAL. Any legal proceeding with respect to any
Dispute will be tried in a court of competent jurisdiction by a judge without a
jury. Debtor and Secured Party waive any right to a jury trial in any such
proceeding, to the extent permitted by applicable law.

 

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THIS CONTRACT CONTAINS JURY WAIVER PROVISIONS.

19. LOCATION. Debtor Business Addresses:

 

 

 

 

 

Attention:

 

Karen J. Dearing

 

 

 

 

27777 Franklin Rd., Suite 200

 

 

 

 

 

Southfield, MI 48034

 

 

 

 

 

 

 

To include any and all locations.

 

 

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Secured Party Business Address:

21ST MORTGAGE CORPORATION

Attention: President

620 Market Street, Suite 100

Knoxville, Tennessee 37902

20. NOTIFICATION. The Parties will be deemed to have received notification if
delivered by certified mail to the address indicated in Section 19.

IN WITNESS WHEREOF, the parties hereto have caused their names to be signed by
their proper officers/agents as of the           day of March, 2009.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sun Home Services, Inc.

 

 

 

 

 

 

 

 

 

 

 

(Debtor)

 

 

 

 

 

 

 

 

 

 

 

 

 

ATTEST:

 

 

 

 

 

BY:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(or Witness)

 

(Secretary or Witness)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PRINT NAME:

 

Karen J. Dearing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Corporate Seal, if applicable)

 

 

 

TITLE:

 

CFO, Secretary, Treasurer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BY:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PRINT NAME:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TITLE:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ACCEPTED:

 

21ST MORTGAGE

 

 

 

 

CORPORATION

 

 

 

 

(Secured Party)

 

 

 

 

 

 

 

BY:

 

 

 

 

 

 

 

 

 

PRINT NAME:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TITLE:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Initials _____

7