04 04 FLOOR PLAN SECURITY AGREEMENT

• Jurisdiction: Arkansas
• Library: Arkansas Form Book - Complete (2023 Ed.)

04-04 FLOOR PLAN SECURITY AGREEMENT

FLOOR PLAN SECURITY AGREEMENT

RE: [location]

THIS AGREEMENT is made to be effective as of [date], by and [between/among] [lender name/s] ("Bank"), [borrower name/s] (referred to herein as "Borrower"), and [guarantor name/s], collectively referred to herein as "Guarantors").

Borrower and Guarantors have requested that Bank provide a revolving line of credit in the amount not to exceed $[line of credit amount] for the purpose of [line of credit purpose] (collectively referred to as "Inventory" with individual pieces of Inventory sometimes referred to as a "Vehicle") to be sold from Borrower's facility in [city, state]; Bank is willing to make available such credit to Borrower and lend such sums, or such lesser amounts as may be desired by Borrower, to Borrower, and to otherwise provide the accommodations provided for herein, subject to the terms and conditions hereinafter set forth, as follows:

I. TERMS OF CREDIT

1.01. Floor Plan Line of Credit.

a. Bank agrees, subject to the terms and conditions set forth herein, to advance funds, not exceeding $[advance amount] in total, to Borrower through [expiration date] (the "Expiration Date") for the sole purpose of purchasing and financing [type of inventory] inventories (the "Floor Plan Credit").

b. No advance shall exceed the invoice price of the Inventory to be purchased with the proceeds of such advance.

c. Each advance will be funded by Bank upon delivery to Bank of the Vehicle invoice (or equivalent document), Borrower's draft in the amount of the advance (if applicable), the Vehicle's manufacturer's certificate of origin, and other documents acceptable to Bank as evidence of purchase. Waiver of any required documentation as to a particular advance shall not be deemed to constitute a waiver of the right to require any and all documentation described herein as a condition to any future advance.

d. The principal amount of each advance shall be repaid in full upon sale of the Vehicle purchased with the proceeds of such advance.

e. Borrower's obligations under this Floor Plan Credit shall be evidenced by, bear interest, and be payable as set forth in that certain Note of even date in the original principal amount of $[note amount] (the "Floor Plan Note").

f. All obligations of Borrower to Bank as a result of the Floor Plan Credit and any extensions, modifications and renewals thereof shall be secured by a purchase money security interest in the Vehicles so pledged, as well as a general security interest in any and all other tangible and intangible personal property of Borrower, including but not limited to accounts, automobiles, fixtures, accessions and deposit accounts, with Bank and otherwise, general intangibles, goodwill and contract rights, which security interest is granted hereby and which shall be perfected by appropriate UCC filings. Advances under the Floor Plan Note are also secured by the guaranties of Guarantors dated as of [date], which guaranties Guarantors affirm are fully applicable to the Floor Plan Note and this Floor Plan Credit. [The Floor Plan Note is also cross-collateralized and cross-defaulted with Borrower's Note[s] numbered [a, b, c, etc.].

1.02. Availability of Proceeds. The proceeds of the Floor Plan Credit (hereinafter sometimes also referred to as the "Credit") shall be available to Borrower, at such times as Borrower may request, so long as no Event of Default as hereinafter defined shall have occurred, subject to the limitations set forth herein. However, it is understood that Borrower may not re-borrow funds re-paid under the Floor Plan Credit. As a condition precedent to the making of any advance hereunder under any credit, Borrower shall deliver to Bank its Floor Plan Note in accordance with the provisions of this Agreement, and such other documents and instruments evidencing and securing the Floor Plan Credit as Bank shall reasonably require.

1.03. Note. The Floor Plan Note provided for hereinabove may hereinafter sometimes be referred to as the "Note." The Note shall be dated as of the date hereof and shall be payable in full on the Expiration Date. Borrower's and Guarantors' liability under any Note shall not be diminished or extinguished by (i) the renewal, extension or modification of the Note (including any change in the interest rate or method of calculation thereof) to which Borrower has agreed, (ii) failure of Borrower to be given any notice, (iii) waiver by Lender of any Event of Default, (iv) release of part or all of any collateral security for any Note, or (v) any other acts or omissions which, in the absence of this sentence, would operate so as to impair, diminish or extinguish Borrower's liability under any Note.

1.04. Interest. The Note shall bear interest from the date or dates of disbursement of advances made under and against the Note on the outstanding balance thereof at the rate set forth herein and therein:

a. From and after the effective date hereof sums actually advanced under the Floor Plan Credit will accrue interest at the rate set forth in the Note.

b. After default, all borrowings shall bear interest, payable on demand, at the highest rate permitted by law to be charged for past due principal and interest, but no more than [interest ceiling rate]%.

c. All interest shall accrue daily at a per diem rate computed on the basis of a 360-day year for the actual number of days elapsed. All interest shall be payable monthly commencing on [date] and on the same day of each month thereafter, at maturity, and after maturity, on demand.

1.05. Customer Financing.

a. Borrower receives from its customers applications for financing ("Customer Paper") from Bank which

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