Fill and Sign the Subordination Agreement Form

Subordination Agreement to Include Future Indebtedness to Secured Party Subordination agreement (this Agreement ) made this __________________ (date) , between ________________________ (Name of Debtor) of _____________________________________________ (street address, city, county, state, zip code) , hereinafter called the Borrower , ________________________ (Name of Secured Party) , of _____________________________________________ (street address, city, county, state, zip code) , hereinafter called the Secured Party, and ________________________ (Name of Preferred Creditor) , a corporation organized under the laws of ________________________ (name of state) , having its principal place of business at _____________________________________________ (street address, city, county, state, zip code) , hereinafter called the Preferred Creditor. Whereas, Borrower is indebted to Secured Party for $ __________________ , on open account, as evidenced by a promissory note, dated __________________ (date) , payable ________________________ (terms of payment) , and bearing _______ % interest on the unpaid balance; and Whereas, the note is secured by collateral described as follows: _______________________________________________________________ ( description of collateral) ; and Whereas, Borrower and Secured Party have requested Preferred Creditor to grant to Borrower a loan of $ __________________ , for which Preferred Creditor requires collateral now subject to the perfected security interest of Secured Party; Now, therefore, for and in consideration of the mutual covenants contained in this agreement, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: I. Subordination of Security Interest. Secured Party shall subordinate Secured Party's security interest in the above-described collateral to the interest of Preferred Creditor in such collateral on account of such loan, and Secured Party will not demand, accept, or receive from Borrower any payment of principal or interest on account of, or any collateral for, any indebtedness of Borrower to Secured Party until the entire indebtedness of $ __________________ of Borrower to Preferred Creditor has been paid in full. II. Bankruptcy; Assignments to Preferred Creditor. If any petition in bankruptcy is brought by or against the Borrower, or if any other proceeding for the liquidation of Borrower's assets is instituted, either by voluntary action or otherwise, Secured Party will assign and pay over to Preferred Creditor, to the extent necessary to satisfy the indebtedness of Borrower to Preferred Creditor in full with interest to the date of the receipt of such payments, any and all dividends and payments with respect to the indebtedness now subordinated to which Secured Party would be entitled in any such proceedings. III. Bankruptcy; Subordination of Rights. In the event of any proceeding affecting Borrower under any bankruptcy or insolvency laws or any laws relating to the relief of debtors, readjustment, composition or extension of indebtedness or reorganization of corporations or other debtors, any payment to which Secured Party would be entitled under any plan of reorganization approved by any court shall be paid to Preferred Creditor and be applied on Borrower's indebtedness to Preferred Creditor. Any securities or other property issued or issuable to Secured Party under any such proceedings shall be assigned and delivered to preferred creditor, to be held by Preferred Creditor subject to the same terms of subordination to the claim of Preferred Creditor as are created by this instrument with respect to the present indebtedness of Borrower to Secured Party. IV. Execution of Further Instruments; Assignment of Claim. To carry out the terms and intent of this undertaking more effectively, Secured Party will do all acts necessary or convenient to preserve for Preferred Creditor the benefits of this Subordination Agreement and will execute all agreements necessary for that purpose. Secured Party assigns, transfers and sets over to Preferred Creditor any claim against Borrower, whether evidenced by the instruments or chattel paper described in this Agreement or by notes, book entries or otherwise, and without imposing on Preferred Creditor any duty to preserve, protect or enforce such claim, or any note or notes evidencing the same. V. Power of Attorney. Secured Party constitutes and appoints Preferred Creditor as Secured Party's true and lawful attorney-in-fact for the following purposes: A. To collect any dividends or payments that would otherwise be payable to Secured Party on any liquidation of Borrower or in any proceedings affecting Borrower under any bankruptcy or insolvency laws or any laws relating to the relief of debtors, readjustment, composition or extension of indebtedness, or reorganization of corporations or other debtors; B. To prove Secured Party's claim against Borrower in any such proceedings; C. To accept or reject, to the extent to which Secured Party would be entitled to accept or reject, any plan of reorganization in any such proceedings; D. To accept any new securities or other property to which Secured Party would otherwise be entitled under any such plan or reorganization or proceedings; and E. In general to do any act in connection with any of such proceedings that Secured Party might otherwise do, it being understood that Preferred Creditor shall account to Secured Party for any dividends or payments received by Preferred Creditor in excess of the amount necessary to satisfy the claim of Preferred Creditor in full with interest. VI. Deposit of Note and Collateral. Secured Party now deposits with Preferred Creditor the note evidencing Borrower's indebtedness to Secured Party, together with all collateral securing payment of the same and in the possession of Secured Party, to be held by Preferred Creditor until all of the indebtedness of Borrower to Preferred Creditor has been paid in full. VII. Survival of Agreement. No action that Preferred Creditor or Borrower, with the consent of Preferred Creditor, may take or refrain from taking with respect to any indebtedness of Borrower to Preferred Creditor, any note or notes representing the same, any collateral for the same, or any agreement or agreements, including guaranties in connection with the same, shall affect this Agreement or the obligations of Secured Party under this Agreement. VIII. Applicability to Future Indebtedness. I f and when all indebtedness of Borrower to Preferred Creditor is paid in full and, subsequently, Borrower again becomes indebted to Preferred Creditor, the provisions of this Agreement shall apply to such new indebtedness unless, before the same is incurred, Secured Party, after written notice of such new indebtedness, notifies Preferred Creditor in writing within ______________ (number) days of the termination of the Agreement. WITNESS our signatures as of the day and date first above stated. _____________________________ (Signature of Debtor) ________________________ (Printed Name of Debtor) ______________________________ (Signature of Secured Party) ________________________ (Printed Name of Secured Party) ________________________ (Name of Preferred Creditor) By: __________________________________ (Signature of Officer of Preferred Creditor) ________________________ (Printed Name and Title of Officer)