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Secured Party:
[Secured Party’s Name], a [business entity type] organized and existing under the laws of the state of [State], with its principal place of business located at [Secured Party’s Address]. -
Debtor:
[Debtor’s Name], a [business entity type] organized and existing under the laws of the state of [State], with its principal place of business located at [Debtor’s Address].
Both parties, having the legal capacity to enter into this Agreement, agree as follows:
1. Grant of Security Interest
1.1. The Debtor hereby grants the Secured Party a security interest in the following ownership interest or assets (“Collateral”):
- Type of Ownership Interest: [Specify, e.g., Shares, Membership Interest, Equity, Business Ownership]
- Company/Entity Name: [Company Name]
- Percentage of Ownership Interest: [XX%]
- Stock Certificate/Ownership Document Number: [If applicable]
1.2. This security interest is granted to secure payment and performance of the following obligations (“Secured Obligations”):
- [Specify the debt, loan, or obligations secured by this ownership interest]
- [Repayment or performance terms]
1.3. The Secured Party shall have a lien and security interest in the ownership rights of the Debtor, including but not limited to voting rights, dividends, and any distributions, until the Secured Obligations are fully satisfied.
2. Representations and Warranties of Debtor
2.1. The Debtor represents and warrants that:
- The Debtor legally owns the ownership interest and has full rights to grant this security interest.
- The ownership interest is free of liens, claims, or encumbrances, except as disclosed in this Agreement.
- The execution and performance of this Agreement do not violate any governing agreements, contracts, or legal obligations.
3. Covenants of Debtor
3.1. The Debtor agrees to:
- Maintain the ownership interest in good standing and comply with all applicable corporate governance and regulatory requirements.
- Not sell, transfer, pledge, or otherwise dispose of the ownership interest without prior written consent from the Secured Party.
- Provide the Secured Party with access to relevant business records, financial statements, and other materials necessary to monitor the ownership interest.
- Execute any additional documents necessary to perfect and maintain the Secured Party’s security interest.
4. Default
4.1. The following events shall constitute Default under this Agreement:
- Failure to pay any secured obligation when due.
- Breach of any term or covenant in this Agreement.
- Unauthorized sale, transfer, or encumbrance of the ownership interest.
- Bankruptcy, insolvency, or assignment for the benefit of creditors by the Debtor.
5. Remedies Upon Default
5.1. Upon default, the Secured Party may:
- Declare all Secured Obligations immediately due and payable.
- Take control of the ownership interest, including voting rights and dividend distributions.
- Sell, transfer, or liquidate the ownership interest in accordance with applicable laws and governing documents.
- Pursue any other remedies available under the Uniform Commercial Code (UCC) or applicable law.
5.2. In the event of a forced sale, the proceeds shall be applied to satisfy the outstanding debt, with any surplus returned to the Debtor.
6. Governing Law
6.1. This Agreement shall be governed by and construed under the laws of the state of [State].
7. Miscellaneous Provisions
7.1. Amendments – Any modifications to this Agreement must be in writing and signed by both parties.
7.2. Severability – If any provision of this Agreement is deemed invalid, the remaining provisions shall continue in full force and effect.
7.3. Waiver – Failure to enforce any provision shall not constitute a waiver of the right to enforce that provision in the future.
7.4. Entire Agreement – This Agreement constitutes the entire understanding between the parties regarding the subject matter herein.
8. Notices
All notices required under this Agreement shall be in writing and delivered via certified mail, email, or in person to the addresses listed below:
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Secured Party:
[Secured Party’s Name]
[Secured Party’s Address]
[Email Address] -
Debtor:
[Debtor’s Name]
[Debtor’s Address]
[Email Address]
9. Signatures
IN WITNESS WHEREOF, the parties have executed this Ownership Security Agreement as of the date first written above.
Secured Party:
By: ___________________________
Title: __________________________
Date: __________________________
Debtor:
By: ___________________________
Title: __________________________
Date: __________________________