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                                                                    Exhibit 10.4

                               SECURITY AGREEMENT
                               ------------------

DATED AS OF:      February 20, 2002

DEBTOR:           Genesis Financial, Inc.
                  200 North Mullan Road, Suite 217
                  Spokane, WA 99206, and

SECURED PARTY:    Temporary Financial Services, Inc.
                  200 North Mullan Road, Suite 213
                  Spokane, Washington 99206

1.       GRANT OF SECURITY  INTEREST.  Debtor  hereby  grants to Secured Party a
         continuing  security  interest in the following  described  property of
         Debtor,  and any additions,  attachments and accessions thereto and all
         products and proceeds thereof, together with all guarantees,  liens and
         securities in connection therewith (collectively, the "Collateral"):

                  All  assets,  including:  All  inventory,  accounts,  accounts
                  receivable,  chattel paper, documents,  instruments,  contract
                  rights, real estate loans held for resale, insurance proceeds,
                  trademarks,   tradenames   and  other   general   intangibles,
                  furniture,  fixtures, equipment, and all proceeds thereof, now
                  owned and hereafter acquired.

2.       OBLIGATIONS SECURED
         2.1      The security interest granted hereby is to secure payment of a
                  Warehousing  Line of Credit  Promissory  Note dated  February,
                  2002 (the  "Note")  and  performance  of all  liabilities  and
                  obligations  of  Debtor  to  Secured  Party of every  kind and
                  description,  direct or indirect,  absolute or contingent, due
                  or to become due, now existing or hereafter arising, including
                  but not limited to indebtedness  and obligations  with respect
                  to LENDER  agreements,  notes,  advances,  letters  of credit,
                  acceptances,   foreign   exchange   contracts,    suretyships,
                  guaranties, endorsements, and checks drawn with non-sufficient
                  funds,  together  with any and all  extensions,  renewals  and
                  modifications  thereof  (collectively,   "Obligations"),   and
                  whether  or  not  any  Obligation  is  related  to  any  other
                  Obligation by class or kind or is  contemplated by the parties
                  at the time this Security Agreement is executed.
         2.2      In addition to the provisions of Section 2.1, the  Obligations
                  secured  hereunder shall include all amounts payable by Debtor
                  to Secured Party under this Security Agreement and all amounts
                  paid or  liabilities  incurred by Secured  Party in connection
                  with  protecting  or enforcing  its rights under this Security
                  Agreement,  including but not limited to amounts  described in
                  Sections 12, 13, 16 and 20.8, and interest on any such amounts
                  at the interest rate established in the Note.

3.       PURCHASE  MONEY SECURITY  INTEREST.  If Debtor at any time acquires any
         Collateral with the proceeds of any advance from Secured Party,  Debtor
         authorizes  Secured  Party to  disburse  proceeds  in the amount of the
         purchase  price of such  Collateral  directly to, or Debtor shall remit
         such proceeds directly to, the seller of such Collateral. Secured Party
         shall have both a purchase money  security  interest and a non-purchase
         money  security  interest  under the  Uniform  Commercial  Code in such
         Collateral.

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4.       TITLE;  ADVERSE LIENS.  Debtor warrants that Debtor is and shall be the
         lawful owner of the Collateral, free of all adverse liens, encumbrances
         and security  interests  except as  previously  disclosed in writing to
         Secured Party, with the right to sell, assign,  pledge,  transfer,  and
         grant a  security  interest  therein.  Except  as  expressly  permitted
         hereunder, or under the Agreement dated as of January 25, 2002, between
         Debtor and Secured Party  (hereinafter  referred to as the  "Investment
         Agreement") Debtor shall not sell, assign, pledge,  transfer or grant a
         security  interest in any of the  Collateral  to any person  other than
         Secured Party.  Debtor shall defend all  Collateral  against the claims
         and demands of all persons.

5.       CORPORATE  STATUS  AND  AUTHORITY.  (i)  Debtor is duly  organized  and
         existing under the laws of Washington and is duly qualified and in good
         standing  in every  other  state or  jurisdiction  in which it is doing
         business; and (ii) the execution,  delivery, and performance hereof are
         within Debtor's corporate powers and have been duly authorized, and are
         not in contravention of law or the terms of Debtor's charter, bylaws or
         other  incorporation   papers,  or  of  any  indenture,   agreement  or
         undertaking to which Debtor is a party or by which it is bound.

6.       PERMITS AND LICENSES.  Debtor has and shall keep in force all licenses,
         permits  and  authorizations  necessary  to the  proper  conduct of its
         business  in  any  state  or  jurisdiction  in  which  Debtor  conducts
         business,  and shall  promptly  obtain  all such  additional  licenses,
         permits and  authorizations  as hereafter may become necessary for such
         purposes.

7.       PLACES OF  BUSINESS  AND  CERTAIN  LOCATIONS.  The  street  address  of
         Debtor's chief executive office from which Debtor manages the main part
         of its  operation,  keeps all  Collateral,  and all records  concerning
         accounts,  contract rights, and chattel paper is shown above. If Debtor
         (i) has one or more places of business at any  location  other than its
         chief executive office or (ii) keeps  Collateral or records  concerning
         accounts,  contract rights and chattel paper at any location other than
         its chief executive office, such other locations, including the address
         of the  servicing  agent,  will be provided to Secured Party by written
         notice  within  seven  days  of the  date  use of such  other  location
         commences.

8.       CHANGE OF NAME,  STRUCTURE  AND  LOCATION.  Without  the prior  written
         consent of Secured  Party,  Debtor  shall not (i) merge or  consolidate
         with or into  any  person,  or (ii)  remove  any  Collateral  from  the
         state(s)  or  jurisdiction(s)  indicated  in this  Security  Agreement.
         Without  limiting the  foregoing,  Debtor  shall give Secured  Party at
         least 30 days  prior  written  notice of any change of  Debtor's  name,
         identity or  corporate  structure  and any  addition  to,  change in or
         discontinuance of its mailing address, its business locations,  and any
         locations  concerning  the  Collateral  as indicated  in this  Security
         Agreement.

9.       IDENTIFICATION AND DELIVERY OF COLLATERAL;  COLLATERAL REPORTS.  Debtor
         shall  mark and  identify  all  Collateral  and all books  and  records
         pertaining to the Collateral as required by Secured Party. Debtor shall
         deliver  to Secured  Party at Secured  Party's  request,  all  original
         instruments,   documents  and  title  documents,   leases,   contracts,
         securities,  licenses,  records, and other chattel paper (together with
         any related  certificates of title)  included in the  Collateral,  each
         assigned or endorsed as Secured Party may require, and all original and
         duplicate  invoices   representing  sales  and  delivery  of  goods  or
         performance of services (each of which shall bear and assignment  stamp
         acceptable to Secured Party)  together with evidence of delivery as may
         be required by Secured Party.  Debtor shall deliver to Secured Party at
         Secured Party's request such reports  concerning the Collateral on such
         dates  and in such  detail  as  Secured

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         Party  from  time to time  may  require.  The  value  of all  inventory
         reflected on the reports shall be the lesser of cost or market value.

10.      FINANCIAL AND OTHER INFORMATION.  Debtor shall furnish to Secured Party
         from time to time such financial statements and other financial data as
         Secured  Party  may  require,  each in form and  detail  acceptable  to
         Secured  Party.  Debtor  warrants that all  information  concerning the
         Collateral,   all  financial  statements,   balance  sheets  and  other
         financial  data,  and all  other  information  furnished  by  Debtor to
         Secured  Party are, or at the time  furnished  shall be,  accurate  and
         correct in all  material  respects and as complete as necessary to give
         Secured Party true and accurate  knowledge of the subject  matter.  All
         financial  information  furnished  by Debtor to Secured  Party shall be
         prepared in accordance with generally  accepted  accounting  principles
         consistently applied.

11.      INSPECTIONS.  Debtor shall at all reasonable  times allow Secured Party
         by or through its nominees  (i) to examine and inspect the  Collateral;
         (ii) to verify the Collateral  directly with  applicable  third parties
         such as account debtors or by any other methods;  and (iii) to examine,
         inspect and take extracts from Debtor's books and records.

12.      USE AND ADVERSE LIENS. Debtor shall not use or permit the Collateral to
         be used in  violation  of any law or  regulation,  waste or destroy the
         Collateral,  or permit anything to be done that may impair the value of
         the  Collateral.  Debtor  shall  promptly  pay when due all  taxes  and
         assessments on the Collateral,  or for its use or operation,  and shall
         keep the Collateral  free from any adverse lien,  security  interest or
         encumbrance.  At its option,  Secured Party may discharge taxes, liens,
         security  interests or encumbrances at any time levied or placed on the
         Collateral  and may pay for the  maintenance  and  preservation  of the
         Collateral,  and Debtor  shall pay to Secured  Party on demand all such
         amounts.

13.      INSURANCE.  Unless  expressly  waived by Secured  Party,  Debtor  shall
         provide,  maintain and deliver to Secured Party  policies  insuring the
         Collateral  against  loss or  damage  by such  risks,  in such form and
         amount,  for such periods and by such companies as may be  satisfactory
         to Secured  Party.  All policies of insurance  shall include a standard
         loss payable  endorsement and such other  endorsements as Secured Party
         may request.  If Debtor fails to obtain such  insurance,  Secured Party
         shall have the right, but not the obligation,  to obtain such insurance
         and  Debtor  shall pay to  Secured  Party on demand  the cost  thereof.
         Secured Party is hereby appointed Debtor's  attorney-in-fact to obtain,
         adjust,  settle and cancel  such  insurance  in  Secured  Party's  sole
         discretion.  Debtor  hereby  assigns  to  Secured  Party all  rights to
         receive  proceeds of  insurance to the full extent of the amount of all
         Obligations secured hereunder,  directs any insurer to pay all proceeds
         directly to Secured Party, and authorizes  Secured Party to endorse any
         check for proceeds.

14.      POSSESSION,  USE AND SALE OF  COLLATERAL.  Until  default,  Debtor  may
         retain possession of all Collateral  composed of equipment and fixtures
         and may use them in any lawful manner not  inconsistent  with the terms
         and  conditions  of this  Security  Agreement.  Debtor  shall not sell,
         lease,  transfer  or  otherwise  dispose  of any  interest  in any such
         Collateral  without the prior written  consent of Secured Party.  Until
         default,  Debtor may use any  Collateral  composed of  inventory in any
         lawful manner not  inconsistent  with the terms and  conditions of this
         Security  Agreement and the Investment  Agreement,  and may consume any
         raw  materials  and  supplies  comprising  such  Collateral  as  may be
         necessary  to carry on  Debtor's  business.  Debtor  may also sell such
         Collateral but only in the ordinary  course of business.  A sale in the
         ordinary  course of

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         business  does not include a transfer in bulk or as security  for or in
         total or partial satisfaction of a money debt.

15.      COLLECTION OF ACCOUNTS. Subject to the following sentence, Debtor shall
         make collections from the account debtors on all Collateral composed of
         accounts,  chattel paper and general intangibles as directed by Secured
         Party.  Secured Party may before or after any default hereunder without
         prior notice to Debtor, and Debtor shall at Secured Party's request and
         in such form as Secured Party may require,  notify the account  debtors
         that the Collateral  has been assigned to and payment  thereon shall be
         made directly to Secured Party.

16.      FINANCING  STATEMENTS;  FURTHER ASSURANCE.  At Secured Party's request,
         Debtor shall execute and pay the costs of filing one or more  financing
         statements and any other documents  required by the Uniform  Commercial
         Code or other applicable laws or regulations. A carbon, photographic or
         other  reproduction  of  this  Security  Agreement  or of  any  related
         financing  statement shall be sufficient as a financing  statement.  At
         the  request of Secured  Party,  Debtor  shall do,  make,  execute  and
         deliver all such  additional  and further acts,  deeds,  assurances and
         instruments  as  Secured  Party  from time to time may  require to more
         completely vest in and assure to Secured Party its rights hereunder and
         in or to the Collateral,  all at Debtor's expense. Secured Party hereby
         is appointed  Debtor's  attorney-in-fact  with power to do all acts and
         things which Secured  Party may deem  necessary to perfect and continue
         perfected its security  interest in the Collateral,  and to protect the
         Collateral.  Without the prior written consent of Secured Party, Debtor
         shall not grant a security  interest  in the  Collateral  to any person
         other than Secured Party,  and shall not allow any financing  statement
         or other security  instrument covering Collateral or its proceeds to be
         on file in any public office.

17.      EVENTS OF DEFAULT.  Time is of the essence of this Security  Agreement.
         The  occurrence of any of the  following  shall,  at the  discretion of
         Secured Party,  be an Event of Default  hereunder:
         17.1     Default in the payment or  performance of any  Obligation,  in
                  any covenant or liability  contained or referred to herein, in
                  the Agreement and/or Addenda  thereto,  in any note, or in any
                  other agreement between Debtor and Secured Party;
         17.2     Any warranty,  representation or statement  (including but not
                  limited to financial  statements) made or furnished to Secured
                  Party by or on behalf of Debtor or any guarantor of any of the
                  Obligations  ("Guarantor")  proves to have  been  false in any
                  material respect when made or furnished;
         17.3     Any   indebtedness  of  Debtor  under  any  note,   indenture,
                  agreement,  undertaking  or  obligation  of  any  kind  to any
                  person,  including Secured Party,  becomes due by acceleration
                  or otherwise and is not paid;
         17.4     Default by Debtor under any lease or other arrangement whereby
                  Debtor occupies,  or stores  Collateral in, any premises owned
                  by any person other than Debtor;
         17.5     Any default under any security  agreement or other  instrument
                  executed by any person which secures any of the Obligations or
                  under any guaranty of any Guarantor;
         17.6     Any guaranty of any  Guarantor  shall cease to be, or shall be
                  asserted by any person not to be, in full force and effect;
         17.7     Loss, theft,  damage,  destruction,  sale (except as expressly
                  permitted under this Security  Agreement) or encumbrance to or
                  of any of the Collateral,  or the making of any levy,  seizure
                  or attachment thereof or thereon;
         17.8     Death,  dissolution,  termination  of  existence,  insolvency,
                  business  failure,  appointment  of a receiver for any part of
                  the property of,  assignment  for the benefit of creditors by,
                  entry

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                  of any judgment  against or the commencement of any proceeding
                  under any bankruptcy or insolvency laws by or against, Debtor,
                  and Guarantor or any surety for Debtor,  or failure of Debtor,
                  any Guarantor or any such surety to provide Secured Party with
                  financial information promptly when requested;
         17.9     Sale,  transfer,  or other disposition of all or a substantial
                  part of the  assets of Debtor or any  Guarantor  other than in
                  the ordinary course of business;
         17.10    Interruption  or cessation  of a material  portion of Debtor's
                  ordinary business operations;
         17.11    Secured   Party  in  good  faith   believes   the   Collateral
                  inadequate, unsafe, or in danger of misuse;
         17.12    Secured Party deems itself  insecure with respect to repayment
                  of any of the Obligations.

18.      RIGHTS AND REMEDIES. Upon the occurrence of any Event of Default and at
         any time  thereafter,  Secured Party at its option and not withstanding
         any time or credit allowed by any instrument  evidencing any Obligation
         or related thereto,  may without notice declare any and all Obligations
         immediately  due and payable and  terminate  any  commitment  to extend
         credit to  Debtor.  In such  event,  Secured  Party  shall have all the
         rights and remedies  provided  herein and in all other  instruments  or
         writings, executed by Debtor or any other person in connection with the
         Obligations,  and as otherwise  provided by law.  Without  limiting the
         foregoing,  Secured Party may do any one or more of the following:  (i)
         enter upon any premises  where the Collateral may be located and remove
         therefrom the Collateral,  and with respect to accounts, may remove any
         records  which Secured Party deems  necessary for  collection  thereof;
         (ii) require Debtor to assemble the Collateral and make it available to
         Secured  Party  at a place  designated  by  Secured  Party;  and  (iii)
         establish  a field  warehouse  under the  control of  Secured  Party on
         Debtor's  premises and place the Collateral  therein.  Secured Party in
         its sole  discretion,  without notice and without  bringing suit on the
         Obligations,  may  apply  for and  secure  appointment  of a  receiver,
         receiver-manager,   or  receiver  and  manager   ("receiver")  for  the
         undersigned to take possession of Debtor's business and the Collateral,
         and the incomes,  rents and proceeds  thereof.  Debtor hereby expressly
         waives any  requirement  that Secured Party or the receiver post a bond
         upon such appointment.  Any receiver appointed by Secured Party, so far
         as concerns  responsibility  for its acts, shall be deemed the agent of
         the  undersigned  and not of Secured Party.  All Secured Party's rights
         and  remedies,  whether  evidenced  hereby or by any  other  agreement,
         instrument  or  writing  shall  be  cumulative  and  may  be  exercised
         singularly or concurrently.

19.      ADDITIONAL  SECURITY AND COLLATERAL  AGREEMENT.  As additional security
         and  collateral  for the  Obligations,  Debtor hereby grants to Secured
         Party a security interest in all instruments,  documents,  notes, bills
         of exchange,  title or documents of title, policies and certificates of
         insurance,  securities,  stock  certificates,  bonds,  goods,  accounts
         receivable,  deposits,  choses in action, chattel paper, cash, property
         and the  proceeds  thereof  (whether  or not the  same  are  Collateral
         hereunder)  owned by Debtor or in which Debtor has an  interest,  which
         now or  hereafter  are at any  time in the  possession  or  control  of
         Secured Party at any of its offices or in transit by mail or carrier to
         or from Secured Party or in the possession of any third party acting in
         Secured  Party's  behalf,  without  regard  to  whether  Secured  Party
         received the same in pledge,  for safekeeping,  as agent for collection
         or transmission or otherwise or whether Secured Party has conditionally
         released the same, shall constitute  additional security and collateral
         for the Obligations and may at any time be collected, negotiated, sold,
         assigned, set off or applied against any Obligations which are then due
         whether by acceleration or otherwise.

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20.      GENERAL
         20.1     Nothing   contained  in  this  Security   Agreement  shall  be
                  construed  to  obligate  Secured  Party to  extend  credit  to
                  Debtor, or enter into any foreign exchange  contracts or other
                  contracts of any nature with Debtor.
         20.2     Without notice to Debtor and without  diminishing or affecting
                  Secured  Party's  rights or  Debtor's  obligations  hereunder,
                  Secured  Party may deal in any  manner  with any person who at
                  any time is  liable  for,  or  provides  any real or  personal
                  property  collateral for (i) any of the  Obligations;  or (ii)
                  any obligations constituting Collateral.  Without limiting the
                  foregoing,  Secured  Party may,  in its sole  discretion:  (a)
                  provide  secured or unsecured  credit to Debtor;  (b) agree to
                  any number of waivers, modifications,  extensions and renewals
                  of any  length  of  any  Obligations  and  of any  obligations
                  constituting Collateral;  (c) impair, release (with or without
                  substitution of new collateral) and fail to perfect a security
                  interest in, any  collateral  provided by any person,  whether
                  with   respect   to  the   Obligations   or  any   obligations
                  constituting  Collateral;  (d) sue, fail to sue,  agree not to
                  sue, release, and settle or compromise with, any person.
         20.3     This  Security   Agreement  and  all  rights  and  liabilities
                  hereunder and in and to any and all Obligations and Collateral
                  or other  security shall inure to the benefit of Secured Party
                  and its  successors  and  assigns,  and shall be binding  upon
                  Debtor and its successors and assigns.
         20.4     If at any time or times by  assignment  or  otherwise  Secured
                  Party  transfers  any  Obligations  and  Collateral  or  other
                  security  therefor,  the  transferee  shall become vested with
                  Secured  Party's  rights and powers  hereunder with respect to
                  the  Obligations,  Collateral and other security  transferred,
                  whether or not  specifically  referred to in the transfer.  To
                  the extent that  Secured  Party  retains any  Obligations  and
                  Collateral or other security therefor,  Secured Party's rights
                  and powers hereunder shall continue with respect thereto.
         20.5     Secured  Party  shall  not be  deemed  to have  waived  any of
                  Secured Party's rights hereunder or under any other agreement,
                  instrument  or writing  signed by Debtor unless such waiver be
                  in writing and signed by Secured  Party.  No delay or omission
                  on the part of Secured  Party in  exercising  any right  shall
                  operate as a waiver of such right or any other right. A waiver
                  on any one occasion  shall not be construed as a bar or waiver
                  of any right or remedy on any future occasion.
         20.6     Any demand  upon or notice to Debtor  that  Secured  Party may
                  give shall be effective when served personally or deposited in
                  the mails or by facsimile or courier  addressed to the address
                  shown  above,  such  other  address  as may be  designated  in
                  writing to Secured  Party from time to time, or to any address
                  at which Secured Party customarily communicates with Debtor.
         20.7     If there is more than one Debtor hereunder,  all references to
                  "Debtor" shall mean all or any one or more of them.
         20.8     Whether or not litigation or arbitration is commenced,  Debtor
                  shall pay to  Secured  Party on  demand  any and all costs and
                  expenses  reasonably  incurred or expended by Secured Party in
                  the  repossession,   protection,   storage,  maintenance,  and
                  liquidation  of any  Collateral  and  other  security,  in the
                  collection or attempted  collection of the  Collateral  and in
                  protecting   and   enforcing   the  rights  of  Secured  Party
                  hereunder,  including  such  additional  sums as any  court or
                  arbitrator(s)  shall  adjudge  reasonable  as  attorney  fees,
                  including  but not limited to costs and attorney fees incurred
                  in any appellate  proceeding,  proceeding under the bankruptcy
                  code or receivership.
         20.9     This  Security  Agreement  shall be  effective  when signed by
                  Debtor and delivered to Secured Party.

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         20.10    Whenever there is no outstanding  Obligation and no commitment
                  on the part of Secured Party under any  agreement  which might
                  give rise to an Obligation, Debtor may terminate this Security
                  Agreement by notice in writing  delivered to Secured  Party at
                  the office of Secured Party to which this  Security  Agreement
                  was  delivered.  Prior to such  termination,  this  shall be a
                  continuing agreement in every respect.
         20.11    Even if this  Security  Agreement  and any  security  interest
                  granted  herein  has  been  terminated  in  whole  or in  part
                  (pursuant  to Section  20.9 or  otherwise),  if any payment or
                  other   transfer   to   Secured   Party  on   account  of  any
                  Obligation(s)  is  avoided or set aside  under any  applicable
                  bankruptcy, insolvency or fraudulent conveyance law or law for
                  the  relief of debtors  or on any other  basis,  or if Secured
                  Party in its sole  discretion  consents  in good  faith to any
                  such  avoidance  or set  aside,  such  Obligation(s)  and  the
                  security  interest  granted herein shall be deemed to continue
                  or be reinstated to the extent of such payment or transfer.
         20.12    Any disputes claims,  counterclaims,  and defenses,  including
                  those  based on or arising  from any alleged  tort  ("Claims")
                  relating  in any way to this  Security  Agreement,  or  breach
                  thereof,  shall be settled by arbitration  in accordance  with
                  the  rules  of the  American  Arbitration  Association  or any
                  organization which is the successor thereto, and judgment upon
                  the  award  rendered  pursuant  to  such  arbitration  may  be
                  rendered in any court having  jurisdiction  thereof.  The fees
                  and expenses of any  arbitration  shall be borne by the losing
                  party.  The prevailing party shall be entitled to recover from
                  the losing party the expenses of its witnesses and  reasonable
                  attorney  fees.  If  either  party   institutes  any  judicial
                  proceeding  relating to this Security  Agreement,  such action
                  shall  not be a waiver  of the  right to  submit  any Claim to
                  arbitration.  In addition,  each has the right before, during,
                  and  after  any  arbitration  to  exercise  any  number of the
                  following remedies, in any order or concurrently:  (i) setoff;
                  (ii) self-help  repossession;  (iii) judicial or  non-judicial
                  foreclosure against real or personal property collateral;  and
                  (iv) provisional remedies,  including injunction,  appointment
                  of receiver, attachment, claim and delivery and replevin.
         20.13    This Security Agreement shall be governed by and construed and
                  enforced  in  accordance   with  the  laws  of  the  State  of
                  Washington  without regard to conflict of law principles.  Any
                  legal action taken in connection with this Security  Agreement
                  shall be  commenced  in Spokane,  Washington,  and the parties
                  agree that they will be subject  to the  jurisdictions  of the
                  Courts of Spokane County, Washington.
         20.14    If anything in this Security  Agreement is held to be illegal,
                  then only that  portion  is void and not the  entire  Security
                  Agreement.
         20.15    Secured  Party  shall  use  ordinary  reasonable  care  in the
                  physical  preservation  and custody of the  Collateral  in its
                  possession,  but shall have no other obligation to protect the
                  Collateral  or its value,  and in  particular,  Secured  Party
                  shall have no responsibility  for the collection or protection
                  of  any  income  on the  Collateral;  preservation  of  rights
                  against parties thereto or against third persons; ascertaining
                  any  maturities,   calls,  conversions,   exchanges,   offers,
                  tenders, or similar matters relating to any of the Collateral;
                  nor for informing the  undersigned  with respect to any of the
                  above,  whether or not Secured  Party has or is deemed to have
                  knowledge thereof.  The undersigned hereby waives presentment,
                  protest,  demand, or notice of non-payment to the undersigned,
                  or to any maker, endorser,  surety, guarantor, or other person
                  who is a  party  to any of the  Collateral,  and  agrees  that
                  Secured   Party   shall  have  no   obligations   to  commence
                  litigation,  notify debtor or take any other action to prevent
                  the  running  of any  statute  of  limitations.  Further,  the
                  undersigned waives presentment,  protest, demand, or notice of
                  non-payment   to  the   undersigned  of  any  portion  of  the
                  indebtedness  and Secured

--------------------------------------------------------------------------------
Warehousing Line of Credit Promissory Note
 Exhibit C - Security Agreement                                      Page 7 of 8

<PAGE>

                  Party  may  grant  an  extension  of  time  to  or  renew  any
                  obligation of the  undersigned  or any one or more of them, or
                  exchange or release any Collateral or other  security  without
                  first obtaining the consent of the undersigned.

21.      AGREEMENT AND ADDENDA.  This Security  Agreement supports and backs the
         Warehousing  Line of Credit  Promissory  Note dated as of February  20,
         2002.

                 Signed and  Delivered  to Secured  Party as of the day and year
first written above.

GENESIS FINANCIAL, INC.

/S/ MICHAEL A. KIRK
-------------------------------
MICHAEL A. KIRK, PRESIDENT

ATTEST:

/S/ DOUGLAS B. DURHAM
-------------------------------
DOUGLAS B. DURHAM, CHAIRMAN

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Warehousing Line of Credit Promissory Note
 Exhibit C - Security Agreement                                      Page 8 of 8

<PAGE><PAGE>

                                                                   Exhibit 10.5

                                    GUARANTY

LENDER:               TEMPORARY FINANCIAL SERVICES, INC.
                      200 North Mullan Road, Suite 213
                      Spokane, Washington 99206

BORROWER:             GENESIS FINANCIAL, INC.
                      200 North Mullan Road, Suite 217
                      Spokane, Washington 99206

GUARANTOR:            MICHAEL A. KIRK, A SINGLE MAN
                      6519 North Sutherlin
                      Spokane, Washington 99208

                      DOUGLAS B. DURHAM AND COLLEEN D. DURHAM, HUSBAND AND WIFE
                      1926 East 38th
                      Spokane, Washington 99223

         This  Guaranty  supports  and  backs  the  Warehousing  Line of  Credit
Promissory Note and the related Security  Agreement between BORROWER and LENDER,
both dated as of February 20, 2002 (collectively the "Credit Facility").

         Executed at: Spokane, Washington, this 20th day of February, 2002.

         For  a  valuable  consideration  the  undersigned  and  each  of  them,
hereinafter   collectively  called   "Guarantor",   jointly  and  severally  and
unconditionally  guarantees  and promises to pay Temporary  Financial  Services,
Inc., a Washington  corporation,  (herein  called  `LENDER'),  its successors or
assigns, on demand in lawful money of the United States of America,  any and all
indebtedness of the above named "BORROWER", to LENDER, as follows:

         1. MAXIMUM  LIABILITY.  The liability of Guarantor  hereunder shall not
exceed  at any one time  the sum of:  (a) The  principal  amount  of the  Credit
Facility;  (b) An amount  equal to  interest,  and fees owed by  BORROWER on the
Credit Facility; and, (c) All costs, expenses and attorneys' fees, including any
on  appeals,  incurred  by  LENDER  in  connection  with the  collection  of the
indebtedness  of BORROWER or with the  collection  or sale of any  collateral in
accordance with the Credit Facility.

         2.  "INDEBTEDNESS"  DEFINED.  The word "indebtedness" is used herein in
its most  comprehensive  sense and includes,  but is not limited to, any and all
advances, debts,  obligations,  and liabilities of BORROWER to LENDER, including
judgments against BORROWER by LENDER, whether currently existing or arising at a
later date, whether voluntarily or involuntarily  created,  and however arising,
and whether due or not due, absolute or contingent,  liquidated or unliquidated,
determined or undetermined.

         3.  NATURE OF  GUARANTOR'S  UNDERTAKING.  The  liability  of  Guarantor
hereunder  shall be open and continuous for as long as this guaranty shall be in
force.  Guarantor  intends  to  guarantee  at all times the  performance  of all
obligations  of BORROWER to LENDER  within the limits set forth above.  Thus, no
payments  made  upon  BORROWER's  indebtedness  shall  be held to  discharge  or
diminish the liability of Guarantor  for any and all  remaining  and  succeeding
indebtedness of BORROWER to LENDER.  The liability of Guarantor  hereunder shall
be joint and several with all other Guarantors hereunder,  shall also be binding
upon Guarantor's  marital  community (if any), and shall be enforceable  against
both the

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Warehousing Line of Credit Exhibit D - Personal Guaranty             Page 1 of 4

<PAGE>

separate and community  property of Guarantor  existing at the date of execution
hereof or hereafter acquired.

         4. LENDER'S RIGHTS AND OBLIGATIONS IN DEALING WITH BORROWER.  Guarantor
authorizes LENDER to deal with BORROWER and BORROWER's sureties,  endorsers, and
other guarantors,  in any manner in which LENDER sees fit in connection with any
indebtedness  of  BORROWER  to LENDER,  now or  hereafter  created,  without any
further consent or authorization  from Guarantor being necessary.  Specifically,
but without  limiting  the powers of LENDER,  LENDER may make  various  types of
secured or unsecured financing arrangements for BORROWER;  LENDER may extend the
time for  payment  of any  indebtedness  of  BORROWER,  LENDER may  release  any
collateral given to LENDER by BORROWER,  with or without the substitution of new
collateral;  LENDER  may  release  or  agree  not  to sue  BORROWER's  sureties,
endorsers,  or other guarantors on any terms it chooses;  LENDER may sue or fail
to sue  BORROWER  upon any  overdue  indebtedness  or may  realize or neglect to
realize upon any collateral held in connection  therewith;  all of the foregoing
without the necessity of any notice to or consent from Guarantor and all without
affecting Guarantor's liability hereunder.

         5. DURATION OF GUARANTY.  This guaranty shall take effect when received
by LENDER, without the necessity of any acceptance by LENDER, and shall continue
in full force until such time as Guarantor  shall notify  LENDER in writing,  at
the  office of LENDER to which this  guaranty  shall be  delivered  in the first
instance,  of  Guarantor's  election to terminate the same. Any such election to
terminate  shall be effective  only as to  indebtedness  incurred by BORROWER to
LENDER after receipt of such written notice;  provided, that this guaranty shall
be effective even as to indebtedness  incurred by BORROWER after receipt of such
written  notice  if  LENDER  committed  itself  to  BORROWER  in  regard to such
indebtedness  prior to  receipt of such  notice.  This  guaranty  shall bind the
Guarantor for renewals and extensions granted after the termination hereof which
pertain to debts guaranteed hereby whether or not the renewals or extensions are
longer than the original period of the debts guaranteed hereunder. This guaranty
shall bind the estate of  Guarantor as to  indebtedness  created both before and
after the death or incapacity of Guarantor;  provided, that Guarantor's executor
or  administrator or other legal  representative  may terminate this guaranty in
the same manner in which  Guarantor  might have  terminated it and with the same
effect.  Termination of this guaranty by one of the undersigned shall not affect
the liability hereunder of the remaining of the undersigned.

         6. LENDER'S  RIGHTS  AGAINST AND  OBLIGATIONS  TO GUARANTOR.  Guarantor
hereby expressly waives  presentment,  protest,  demand,  or notice of any kind,
including  notice of  nonpayment  of any of  BORROWER's  indebtedness  or of any
collateral  thereto  and  notice  of any  action  or  nonaction  on the  part of
BORROWER,  LENDER, or any surety, endorser, or other guarantor. Upon any default
of BORROWER on any  obligation  to LENDER,  LENDER may, at its option,  then and
there demand and be entitled to payment from Guarantor of the full amount or any
part of the amount of BORROWER's  indebtedness to LENDER, within the limitations
set forth  above,  and if  Guarantor  shall not pay the sum  demanded to LENDER,
LENDER may proceed  directly and at once  against  Guarantor to collect such sum
without first proceeding  against BORROWER,  or any surety,  endorser,  or other
guarantor and without  foreclosing upon or selling or otherwise disposing of any
collateral it may have as security for any of BORROWER's  indebtedness.  Failure
to make such demand at such time or so to proceed shall not relieve Guarantor of
its obligations hereunder or in any sense constitute a waiver. LENDER shall have
the right to demand and collect from  Guarantor all or any portion of BORROWER's
indebtedness  and failure of LENDER at any time to demand from  Guarantor  or to
proceed to collect from  Guarantor  the full amount of  BORROWER's  indebtedness
from Guarantor  shall not preclude  LENDER from later demanding or proceeding to
collect from Guarantor any remaining  indebtedness of BORROWER to LENDER covered
by this  guaranty.  In any action or suit  against  Guarantor  to  enforce  this
guaranty,

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Warehousing Line of Credit Exhibit D - Personal Guaranty             Page 2 of 4

<PAGE>

LENDER  shall be entitled to recover  from  Guarantor,  in addition to costs and
disbursements  allowed by law, a reasonable amount for LENDER's  attorney's fees
in such  action or suit or appeal  therefrom.  In any action or suit  brought by
LENDER against Guarantor,  Guarantor will not assert as a defense any statute of
limitations if at the time the action or suit is commenced  there is outstanding
any  indebtedness  of BORROWER  to LENDER  which is not barred by the statute of
limitations of the State of Washington. If payment is made by BORROWER on a debt
guaranteed  hereby and  thereafter  LENDER is forced to remit the amount of that
payment to the  BORROWER's  trustee in  bankruptcy  or similar  person under any
federal or state bankruptcy law or law for the relief of debtors, the BORROWER's
debt shall be considered unpaid for the purpose of enforcement of this Guaranty.

         7.  SUBORDINATION  OF GUARANTOR'S  RIGHTS AGAINST  BORROWER.  Guarantor
agrees that the  indebtedness  of BORROWER  to LENDER,  whether now  existing or
hereafter  created,  shall be and the same hereby is declared to be prior to any
claim that Guarantor may now have or hereafter acquire against BORROWER, whether
or not  BORROWER  becomes  insolvent,  and  Guarantor  shall and does  expressly
subordinate  such claim  Guarantor may have against  BORROWER,  upon any account
whatsoever, to any claim that LENDER may now or hereafter have against BORROWER.
In the event of insolvency and consequent liquidation of the assets of BORROWER,
through Bankruptcy,  by an assignment for the benefit of creditors, by voluntary
liquidation,  or otherwise,  the assets of BORROWER applicable to the payment of
the  claims of both  LENDER and  Guarantor  shall be paid to LENDER and shall be
first  applied by LENDER to the  indebtedness  of BORROWER to LENDER.  Guarantor
does  hereby  assign to LENDER all claims  which it may have or acquire  against
BORROWER or any assignee or trustee in  bankruptcy of BORROWER;  provided,  that
such  assignment  shall be effective  only for the purpose of assuring to LENDER
full payment of all indebtedness of BORROWER to LENDER.

         8.  ASSIGNMENT OF GUARANTY.  Assignment by LENDER of all or part of the
indebtedness  shall transfer to the assignee all benefits of this Guaranty as to
the portion of the indebtedness  assigned.  This Guaranty shall remain in effect
in favor of LENDER as to the portion of the indebtedness not assigned.

         9. RELEASES AND WAIVERS.  Guarantor  hereby  expressly and  irrevocably
releases and waives any and all  "claims"  (as now or  hereafter  defined in the
United States  Bankruptcy  Code,  11 USC 101 et.seq.) of any nature  whatsoever,
whether known or unknown and whether now existing or hereafter acquired, against
any debtor or the estate in any existing or future  bankruptcy case in which the
debtors include  BORROWER or any person or entity with respect to whom Guarantor
is an "insider" (as now or hereafter  defined in such  Bankruptcy  Code), to the
extent such claims in any manner  relate to or arise out of this Guaranty or any
indebtedness guaranteed hereby (including but not limited to fixed or contingent
claims  based  on  subrogation,   indemnity,   reimbursement,   contribution  or
contract).  Guarantor authorizes and empowers LENDER to at any time exercise, in
its sole  discretion,  any right or remedy or any combination  thereof which may
then be available to LENDER;  Guarantor  agrees that  nothing  contained  herein
shall  prevent  LENDER  from  suing  on  any  indebtedness  instrument  or  from
exercising  any right or remedy  available to LENDER  thereunder,  and Guarantor
further  agrees  that the  exercise  of any such  rights or  remedies  shall not
constitute a legal or equitable discharge of Guarantor. It is Guarantor's intent
and purpose that the obligation  hereunder shall be absolute,  independent,  and
unconditional under any and all circumstances.

         Notwithstanding  any  foreclosure  of any  lien  on  real  or  personal
property securing any indebtedness guaranteed hereby, whether by the exercise of
a power of sale,  by an action for judicial  foreclosure  or by  acceptance of a
deed in lieu of foreclosure, Guarantor shall remain bound under this Guaranty.

--------------------------------------------------------------------------------
Warehousing Line of Credit Exhibit D - Personal Guaranty             Page 3 of 4

<PAGE>

         Guarantor  acknowledges  that  LENDER's  financing  for  BORROWER is of
substantial and material benefit to Guarantor,  that Guarantor has been informed
and believes  that LENDER would not provide  financing for BORROWER but for this
Guaranty  and  the  representations,   acknowledgments,  releases,  waivers  and
agreements   contained   herein,   and  that   LENDER  will  rely  on  all  such
representations,  acknowledgments, releases, waivers and agreements in providing
financing for BORROWER.

         10.  INDEBTEDNESS  CONTINUED.  The term  "indebtedness"  as  defined in
paragraph  2 above  includes,  but is not limited  to, all  existing  and future
obligations  and  liabilities  of  BORROWER  under the Credit  Facility  between
BORROWER  and  LENDER  referenced  above,  a copy of which is  attached  to this
Guaranty.

         11.  DISPUTES.  This  Guaranty  shall be governed by and  construed and
enforced in accordance  with  Washington  Law.  Notwithstanding  any arbitration
under the  Credit  Facility,  any legal  action  taken in  connection  with this
Guaranty shall be commenced in Spokane,  Washington,  and the parties agree that
they will be  subject  to the  jurisdiction  of the  Courts of  Spokane  County,
Washington.

/S/ MICHAEL A. KIRK
-------------------------------
MICHAEL A. KIRK, GUARANTOR

/s/ Douglas B. Durham
-------------------------------
DOUGLAS B. DURHAM, GUARANTOR

/s/ Colleen D. Durham
-------------------------------
COLLEEN D. DURHAM, GUARANTOR

--------------------------------------------------------------------------------
Warehousing Line of Credit Exhibit D - Personal Guaranty             Page 4 of 4

<PAGE>

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