4.14.308    USE OF FINANCIAL AND SECURITY DOCUMENTS

(1)  The financial institution should use its own forms of financial statements and security documents which it may feel necessary and appropriate under particular loan circumstances.   These items should be referenced in an exhibit to the bond or loan agreement and their provisions incorporated therein.   Any additional requirements not specifically provided for in the bond or loan agreement, such as insurance coverage and amounts, should be added by means of an exhibit to the bond or loan agreement and their provisions incorporated therein.

(2)  Any security documents or guarantees required to be delivered in connection with a loan should clearly state that they are given as additional security for the indebtedness evidenced by the promissory note, the loan agreement, the authority's bond and to further secure the agreements, covenants and obligations of the beginning farmer/rancher contained therein.   The security documents and any guarantees should run directly between the beginning farmer/rancher and the financial institution.   The financial institution may also wish to add a "cross-default" provision to these documents, making an event of default under the security documents or guarantee and vice versa.

History: 80-12-103, MCA; IMP, 80-12-103 and 80-12-201, MCA; NEW, 1984 MAR p. 363, Eff. 3/1/84; AMD, 2001 MAR p. 1723, Eff. 9/7/01.