Premier Certified Lenders Program Security Agreement - U. S. Small Business Administration
PREMIER CERTIFIED LENDERS PROGRAM
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (the “Agreement”) is made this
day of
, 20
, by and between
________ [Exact legal name of
Premier CDC as it appears on its articles of incorporation or organization]
, and the U.S.
Small Business Administration (“SBA”).
1.
AGREEMENT:
For value received, Premier CDC hereby grants to SBA a security interest (the
“Security Interest”) in the collateral described below to secure the payment and
performance of the obligations herein specified. Premier CDC also authorizes SBA,
without further notice to or consent by Premier CDC, to file any records necessary to
perfect, continue, amend, or terminate the Security Interest.
2.
OBLIGATION:
The obligation consists of Premier CDC’s agreement to reimburse SBA for 10%
of any loss (including attorney’s fees and litigation costs and expenses) sustained by SBA
as a result of a default in the payment of principal or interest on a Debenture issued by
Premier CDC under the Premier Certified Lenders Program (“PCLP”) (the “Obligation”).
The Obligation extends to reimbursement for any loss to SBA on a loan funded by the
issuance of such a Debenture.
3.
LOAN LOSS RESERVE FUND:
In accordance with the Small Business Investment Act of 1958, 15 U.S.C. § 697e,
as amended, and SBA regulations promulgated thereunder, Premier CDC must establish a
loss reserve (the Loan Loss Reserve Fund or “LLRF”) to provide funds to pay the
Obligation. The LLRF shall be comprised of segregated funds in a deposit account or
accounts at one or more federally insured depository institutions selected by Premier
CDC. The LLRF must total one percent of the original principal amount of the
Debentures which Premier CDC issues under the PCLP.
4.
COLLATERAL:
The collateral is Premier CDC’s LLRF (the “Collateral”).
5.
PREMIER CDC’S REPRESENTATIONS AND WARRANTIES:
Premier CDC represents and warrants that:
(a) Premier CDC is the legal and beneficial owner of the Collateral;
SBA Form 2229 (4/03)
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