Legal Commercial Security Agreement

LEGAL COMMERCIAL SECURITY AGREEMENT

This Commercial Security Agreement (this Agreement) is made as of the day of , , by and between Grantor: (entity type: Individual Corporation LLC) and Secured Party: (entity type: Individual Corporation LLC).

RECITALS

WHEREAS, Grantor is indebted to Secured Party and has executed or will execute one or more instruments, agreements or obligations described in this Agreement and in the schedules attached hereto (collectively, the Obligations); and

WHEREAS, to secure prompt payment and performance of the Obligations, Grantor desires to grant to Secured Party a security interest in certain property of Grantor described below (the Collateral); and

WHEREAS, Secured Party is willing to accept a security interest in the Collateral on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

1.1 "Obligations" means all debts, liabilities, obligations, covenants and indemnities of Grantor to Secured Party, whether now existing or hereafter arising, direct or indirect, absolute or contingent, matured or unmatured, including principal, interest, fees, charges, expenses and attorneys' fees owed under any agreement between the parties.

1.2 "Collateral" means all accounts, chattel paper, goods, inventory, instruments, documents, general intangibles, payment intangibles, contract rights, proceeds and all other personal property of Grantor described in Section 3 and any schedules hereto, together with all accessions, additions, substitutions and replacements thereto and proceeds thereof.

2. GRANT OF SECURITY INTEREST

2.1 Grant. Grantor hereby grants to Secured Party a continuing first-priority security interest in, lien on and right of set-off against all Collateral to secure payment and performance of the Obligations.

2.2 Scope. The security interest granted hereby extends to all present and after-acquired Collateral of Grantor and to any and all amendments, renewals, extensions and modifications of the Obligations.

3. COLLATERAL DESCRIPTION

3.1 Collateral Description. The Collateral shall include, without limitation, the following:

3.2 Proceeds. Collateral also includes all proceeds of the Collateral, whether cash or noncash, and all rights to receive the same.

4. OBLIGATIONS SECURED; LIMITATIONS

4.1 Obligations Secured. This Agreement secures the payment and performance of all Obligations whether now existing or hereafter arising. Secured Party may, at its election, apply payments and proceeds in such order and manner as Secured Party determines in its sole discretion.

4.2 Maximum Liability. The aggregate liability secured by this Agreement shall not exceed the maximum principal amount set forth here:

5. PERFECTION; FURTHER ASSURANCES

5.1 Filings. Grantor shall execute and deliver to Secured Party such financing statements, continuation statements and other instruments and shall take such actions as Secured Party reasonably requests to create, perfect and maintain the security interest and priority herein, including perfection by filing, possession, control or other means permitted by law.

5.2 No Authorization to Grant. Grantor represents and warrants that the Collateral is not subject to any security interest, lien, encumbrance or claim other than those expressly permitted by Secured Party in writing.

6. WARRANTIES AND REPRESENTATIONS

Grantor represents and warrants that (a) Grantor is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization; (b) Grantor has full power and authority to grant the security interest and to perform its obligations hereunder; (c) the execution, delivery and performance of this Agreement do not conflict with any law, contract, order, decree or other instrument to which Grantor is subject; and (d) all Collateral is and will be owned by Grantor, free and clear of any adverse lien, security interest, title defect or encumbrance, except for those disclosed in writing to Secured Party.

7. COVENANTS

7.1 Maintenance of Collateral. Grantor shall maintain, preserve and protect the Collateral, keep proper books and records with respect to the Collateral, and permit Secured Party or its agents to inspect the Collateral and such books and records upon reasonable notice.

7.2 Insurance; Taxes. Grantor shall keep the Collateral insured against loss and casualty in such amounts and with such insurers as Secured Party may reasonably require and shall pay when due all taxes, assessments and governmental charges levied or assessed against the Collateral or any interest therein.

8. DEFAULT

8.1 Events of Default. Each of the following shall constitute an Event of Default: (a) failure by Grantor to pay any Obligation when due; (b) breach by Grantor of any term, covenant or warranty in this Agreement; (c) insolvency, bankruptcy or commencement of any proceeding under any bankruptcy or insolvency law by or against Grantor; or (d) any material adverse change in Grantor's financial condition.

9. REMEDIES

9.1 Remedies Upon Default. Upon the occurrence of an Event of Default, Secured Party may, at its option and without notice except as required by applicable law, declare all Obligations immediately due and payable and exercise any or all rights and remedies available under applicable law, including repossession and disposition of the Collateral, collection of accounts, foreclosure and set-off. Secured Party may sell, lease or otherwise dispose of the Collateral at private or public sale and apply the proceeds to the Obligations after satisfying commercially reasonable expenses of collection and disposition.

9.2 Cumulative Remedies. The rights and remedies of Secured Party are cumulative and in addition to any other rights and remedies provided by law or equity.

10. NOTICES

10.1 Methods. All notices, demands and communications required or permitted under this Agreement shall be in writing and shall be deemed given when personally delivered, or on the date of receipt when sent by certified mail, return receipt requested, or by overnight courier to the addresses set forth above or to such other address as a party may designate by written notice to the other.

11. ATTORNEYS' FEES AND COLLECTION COSTS

If suit or other proceeding is instituted to enforce any obligation under this Agreement, the prevailing party shall be entitled to recover reasonable attorneys' fees, court costs and other expenses incurred in addition to any other relief granted.

12. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the state specified below without regard to its conflict of law principles.

13. ENTIRE AGREEMENT; AMENDMENTS; SEVERABILITY

13.1 Entire Agreement. This Agreement, together with any schedules or security agreements executed contemporaneously herewith, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral or written.

13.2 Amendments. No amendment or modification of this Agreement shall be effective unless in writing and signed by the party to be charged.

13.3 Severability. If any provision of this Agreement is held invalid or unenforceable, the remaining provisions shall continue in full force and effect and the invalid or unenforceable provision shall be reformed only to the minimum extent necessary to make it enforceable.

14. WAIVER; COUNTERPARTS

14.1 Waiver. No delay or omission by Secured Party in exercising any right hereunder 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 to or waiver of any right on any other occasion.

14.2 Counterparts. This Agreement may be executed in counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. Signatures delivered by electronic means shall be effective as original signatures.

15. ADDITIONAL PROVISIONS

15.1 Costs of Perfection. Grantor shall pay all costs and expenses of Secured Party in connection with the preparation, filing, recording or continuation of financing statements and other documents to perfect or maintain the security interest.

15.2 Assignment. Secured Party may assign, transfer or sell any or all of the Obligations and the security interests granted hereunder. Grantor acknowledges that Secured Party may disclose Grantor's information to prospective assignees.

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