Premier Certified Lenders Program Security Agreement - U. S. Small Business Administration
has and maintains a valid and perfected first priority security interest in the
Collateral.
7.
DEFAULT AND SBA’S RIGHT TO PROTECT THE COLLATERAL:
(a) It shall be considered a default if Premier CDC fails 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 any Debenture issued by Premier CDC or any loss to SBA on a
loan funded by the issuance of such a Debenture under the PCLP after (i) a
determination (including the expiration of any time period for appeal to the
SBA Assistant Administrator for Financial Assistance) of the loss sustained
by SBA, (ii) demand by SBA to Premier CDC for reimbursement for 10% of
such loss, and (iii) the expiration of any time period within which Premier
CDC must make such reimbursement.
(b) SBA also shall have the right to protect the Collateral and the priority of its
Security Interest in the Collateral in the event of:
(i) the making of any levy, seizure or attachment of or on the Collateral by a
party other than SBA; or
(ii) the appointment of a receiver for any part of the property of Premier
CDC, assignment for the benefit of creditors, or the commencement of any
proceedings under any bankruptcy or insolvency laws against Premier
CDC, which proceeding is not dismissed within ninety (90) days.
8. RIGHTS
OF
SBA:
(a)
Upon default or at any time thereafter until such default is cured, and upon the
occurrence of any of the events in Paragraph 7(b), SBA shall:
(i)
have the rights of a secured party pursuant to the Uniform Commercial
Code (“UCC”);
(ii)
have the sole right to transfer or withdraw funds from the Collateral by
check, withdrawal slip, wire transfer instructions or any other means,
without further consent by Premier CDC, in order to apply such funds
to pay the Obligation and cure the default, or to protect the Collateral
and SBA’s Security Interest therein;
(iii)
hold as additional security any proceeds arising from the Collateral,
including but not limited to, any insurance rights;
(iv)
have the right to issue instructions to the bank under any control
agreement entered into by Premier CDC, SBA and such bank,
SBA Form 2229 (4/03)
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