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1 <br />EL185\79\955723.v2 <br />SECURITY AGREEMENT <br />(Microloan) <br /> <br /> <br /> This SECURITY AGREEMENT (“Agreement”) is made to be effective as of November <br />__, 2024, by MFS FOODS, INC., a Minnesota corporation (“Grantor”) and the ECONOMIC <br />DEVELOPMENT AUTHORITY OF THE CITY OF ELK RIVER (the “Secured Party”). <br /> <br />AGREEMENT <br /> <br />In consideration of the above recitals, and the promises set forth in this Agreement, the <br />parties agree as follows: <br /> <br />1. OBLIGATIONS. “Obligations” means collectively each debt, liability and obligation of <br />every type and nature which the Grantor and Modern Construction of Minnesota, Inc. <br />(the “Borrower”) may now or at any time hereafter owe to Secured Party (including <br />without limitation the obligations of the Borrower created under the loan agreement (the <br />“Loan Agreement”) and the Promissory Note of the Borrower to Secured Party of even <br />date herewith, in the amount of $51,499.00 and all amendments, replacements, <br />restatements, and substitutions therefor) together with Grantor’s obligations to Secured <br />Party pursuant to the Corporate Guaranty of even date herewith, whether now existing or <br />hereafter created or arising, and whether direct or indirect, due or to become due, <br />absolute or contingent, and the repayment or performance of any of the foregoing if any <br />such payment or performance is at any time avoided, rescinded, set aside, or recovered <br />from or repaid by Secured Party, in whole or in part, in any bankruptcy, insolvency, or <br />similar proceeding instituted by or against the Grantor, the Borrower or any other <br />guarantor of any Obligation, or otherwise, including but not limited to all principal, <br />interest, fees, expenses and other charges. <br /> <br />2. COLLATERAL. “Collateral” means collectively all of the personal property and <br />equipment of the Grantor or the Borrower and personal property and equipment in <br />which the Grantor or the Borrower has rights, now owned or hereafter acquired, and <br />located at or arising out of that certain real property located in Elk River, Minnesota <br />legally described in Exhibit A attached hereto, including, but not limited to: <br />Accounts; Chattel Paper; Inventory; Machinery; Equipment; Instruments, including <br />Promissory Notes; Investment Property; Documents; Deposit Accounts; Letter-of- <br />Credit Rights; General Intangibles; Supporting Obligations; and to the extent not <br />included in the foregoing as original collateral, the proceeds and products of the <br />foregoing. The terms Collateral shall also include (a) accessions, additions and <br />improvements to, replacements of, and substitutions for any of the foregoing; (b) all <br />products and proceeds of any of the foregoing; and (c) books, records and data in any <br />form relating to any of the foregoing. <br /> <br />3. SECURITY INTEREST. The Grantor grants to Secured Party a security interest <br />(“Security Interest”) in the Collateral to secure the payment and performance of the <br />Obligations. The Security Interest continues in effect until this Agreement is terminated <br />Page 84 of 124