As part of this Application Form, you agree to the terms of the Security Agreement below.
1. The undersigned (the "Customer"), for valuable consideration, the receipt and sufficiency of which is hereby acknowledged, grants to to Central Ontario Dairy Distributing Inc. and CJR Wholesale Grocers Ltd. (collectively, the "Secured Party"), a security interest to which the Personal Property Security Act, R.S.O. 1990, as amended or re enacted from time to time (the "PPSA"), applies in the following property (the "Collateral"):
(a) all goods, inventory, equipment, and accounts, now or hereafter used or intended to be used in any business of the Customer (and which are not inventory or consumer goods as defined in the PPSA), including but not limited to fixtures, Collateral, machinery, vehicles, and other tangible personal property; and
(b) all accounts, debts, demands, choses in action and claims which are now due, owing or accruing due or which may hereafter become due, owing or accruing due to the Customer, and all claims of any kind which the Customer now has or may hereafter have including but not limited to claims against the Crown and claims under insurance policies.
(collectively, the “Collateral”)
2. The security interest granted hereby secures payment to the Secured Party of all debts and liabilities owing by the Customer between the Customer and the Secured Party relating to the Collateral, together with applicable interest thereon, and including expenses under paragraph 6 of this Agreement and all interest, commissions, legal and other costs, charges and expenses payable to or incurred by or on behalf of the Secured Party in connection with the foregoing (the "Obligations").
3. The Customer has, or will have when the Collateral is acquired, the right to create a security interest in the Collateral in favour of the Secured Party and to register such interest under the PPSA.
4. Upon failure by the Customer to perform any of the agreements or covenants described in the Application, the Secured Party is authorized and has the option to take possession of the Collateral and to perform any of the agreements in any manner deemed proper by the Secured Party, without waiving any rights to enforce this Agreement. The reasonable expenses (including the cost of any insurance and payment of taxes or other charges and solicitor's costs and legal expenses on a solicitor and his client basis) paid by the Secured Party in respect of the custody, preservation, use or operation of the Collateral in its possession and/or in connection with the enforcement of this Agreement or the realization of the Collateral shall be deemed advanced to the Customer by the Secured Party, and shall be secured by this Agreement and payable on demand.
5. Upon the happening of any of the following events, the Customer shall be in default hereunder, the security granted hereunder shall become enforceable, and, at the option of the Secured Party, the Obligations secured by this Agreement shall immediately become due and payable in full;
(a) If the Customer shall fail to pay when due any payment of any of the Obligations secured by this Agreement;
(b) If the Customer shall be in default or fail to perform or observe any provisions or obligations under this application or of any other agreement to which the Customer and the Secured Party are parties;
(c) If the Customer ceases or threatens to cease to carry on its business, commits an act of bankruptcy, becomes insolvent, makes an authorized assignment or bulk sale of its assets, or proposes a compromise or arrangement to its creditors;
(d) If any proceeding is taken with respect to a compromise or arrangement, or to have the Customer declared bankrupt or wound up, or to have a receiver appointed of any part of the Collateral, or if any encumbrancer takes possession of any part thereof;
(e) if the Secured Party in good faith and on commercially reasonable grounds believes that the prospect of payment or performance is or is about to be impaired or that the Collateral is or is about to be placed in jeopardy.
6. If the security granted hereunder becomes enforceable, the Customer and the Secured Party shall have, in addition to any other rights and remedies provided by law, the rights and remedies of a Customer and a secured party respectively under the PPSA and those provided by this Agreement, the Secured Party may enforce any rights of the Customer in respect of the Collateral by any manner permitted by law and may require the Customer to assemble the Collateral and deliver or make the Collateral available to the Secured Party at a reasonably convenient place designated by the Secured Party, and without limiting the generality of the foregoing, the Secured Party shall having the following rights, powers and remedies:
(a) to appoint any person to be its agent or any person to be a receiver, manager, or receiver and manager;
(b) to make payments to parties having prior charges or encumbrances on properties on which the Secured Party may hold charges or encumbrances;
(c) to enter onto any premises where the Collateral may be located;
(d) to take possession of all or any part of the Collateral with power to exclude the Customer, its agents, and its servants therefrom;
(e) to preserve, protect, and maintain the Collateral and make such replacements thereof and additions thereto as the Secured Party shall deem advisable;
(f) to enjoy and exercise all powers necessary or incidental to the performance of all functions provided for in this Agreement;
(g) to sell, lease, or dispose of all or any part of the Collateral, whether by public or private sale, lease, or otherwise, and on any terms, so long as every aspect of the disposition is commercially reasonable; provided that
(h) to enjoy and exercise all of the rights and remedies of a secured party under the PPSA;
7. All amounts received by the Secured Party on the collection, disposition, realization, or enforcement of the Collateral, after all costs, charges, and expenses incurred by the Secured Party in connection therewith have been deducted therefrom, shall be applied against the Obligations and shall be considered as part payment thereof.
8. Any breach by the Customer of any of the provisions contained in this Agreement or any default by the Customer in the observance or performance of any covenant or condition required to be observed or performed by the Customer hereunder, may only be waived the Secured Party in writing, provided that no such waiver by the Secured Party shall extend to or be taken in any manner to affect any subsequent breach or default or the rights resulting therefrom.
9. This Agreement shall be governed in all respects by the laws of the Province of Ontario
10. Customer hereby acknowledges receipt of a copy of this Agreement.