CHATTEL MORTGAGE
INSTRUCTIONS TO SOLICITORS

Note that this is the form for direct loan obligations “Chattel Mortgage West.doc”. We also
have a form for use in support of guarantee “Chattel Mortgage in support of Guarantee
West.doc” - please ensure you have the right form.

On Page 1 strike out “jointly and severally with _____” if the Borrower set out at the top is
the only obligant of the loan.
DISCARD THIS PAGE
Amendments July 2002 – Section 18 “Saskatchewan Law”
Chattel Mortgage - Western
Rev. April 11, 2005
PREFACE
CHATTEL MORTGAGE
THIS AGREEMENT dated _____.
BETWEEN:
_____
(the "Borrower")
AND:
BUSINESS DEVELOPMENT BANK OF CANADA, incorporated by Special Act of
the Parliament of Canada, and having its head office in Montreal, Quebec, with a
business centre at _____
("BDC")
WHEREAS pursuant to a Letter of Offer of Loan dated _____ (the “Loan Agreement”), BDC agreed to make a
loan of $_____ to the Borrower jointly and severally with _____ on the terms and conditions set out therein; AND
WHEREAS the Borrower accepted the said loan and covenants to comply with the terms of the Loan Agreement;
NOW THIS CHATTEL MORTGAGE WITNESSES that in consideration of the premises and to secure the
indebtedness and liability of the Borrower to BDC relating to or arising out of the Loan Agreement (the
"Indebtedness") the Borrower does hereby assign and mortgage to BDC, and grant to BDC a security interest in,
all the right, title and interest of the Borrower in and to:
(a)
the goods and chattels described in Schedule A hereto which are now owned by the Borrower, and
all attachments, accessories and accessions thereto which are now owned or hereafter acquired by
the Borrower,
(b)
all goods and chattels, and all attachments, accessories and accessions thereto, hereafter acquired
by the Borrower in replacement of or in substitution for the goods and chattels described in
Schedule A, and
(c)
all proceeds of and from any or all of the foregoing,
(all of which is hereinafter collectively called the "Collateral").
TO HAVE AND TO HOLD the Collateral unto BDC forever;
PROVIDED that this assignment, mortgage and security interest will be void upon:
(a)
payment of the Indebtedness and all other monies to which BDC may be entitled by virtue of this
Chattel Mortgage; and;
(b)
observance and performance of the covenants, terms and conditions herein contained.
THE BORROWER AGREES with BDC that:
1.
The Borrower will pay to BDC the Indebtedness in accordance with the terms thereof agreed upon by BDC
and the Borrower.
Chattel Mortgage - Western
Rev. April 11, 2005
Page 1
2.
The Borrower represents that the Borrower is the sole owner of the Collateral and that there are no liens
or encumbrances thereon, or security interests therein, except those, if any, consented to in writing by
BDC.
3.
The Borrower acknowledges that the security interest hereby created attaches upon the execution of this
Chattel Mortgage (or in the case of any after acquired property, upon the date of acquisition thereof), that
value has been given, and that the Borrower has (or in the case of after acquired property, will have upon
the date of acquisition thereof) rights in the Collateral.
4.
The Borrower covenants and agrees that:
(a)
if the Collateral is or becomes subject to any lien, encumbrance or security interest (whether or not
consented to in writing by BDC) in favour of any person other than BDC, BDC may pay such lien,
encumbrance or security;
(b)
BDC and its employees and agents may, when and so often as BDC may deem advisable, enter
upon the premises where the Collateral may be, for the purpose of inspecting the state of repair and
the condition thereof;
(c)
the Borrower will keep the Collateral in good repair and will replace all broken, damaged or worn
parts thereof;
(d)
if the Borrower fails to effect such repair or replacement, BDC may do so;
(e)
the Borrower will insure and keep insured the Collateral for the full insurable value thereof against
loss or damage by fire or theft and hereby assigns to BDC all policies evidencing such insurance
and all amounts payable thereunder and will forthwith deliver to BDC all such documents as may be
necessary to perfect such insurance and assignment;
(f)
if the Borrower fails to effect or maintain such insurance or such assignment, BDC may effect and
maintain such insurance in the name of BDC.
5.
Monies paid by BDC pursuant to Clause 4, together with interest thereon at the rate then applicable to the
Indebtedness (or if more than one such rate, the highest rate) from the date when paid by BDC shall be
secured by the security interest in the Collateral created by this Chattel Mortgage, and the Borrower shall
forthwith pay such monies and interest to BDC.
6.
The Borrower will not sell or dispose of or part with possession of the Collateral and will not, without first
obtaining the written consent of BDC, remove or allow to be removed either temporarily or permanently,
any Collateral from the premises where it is now located.
7.
It shall be an event of default if at any time:
8.
(a)
the Borrower fails to pay any part of the Indebtedness or any other monies payable pursuant to this
Chattel Mortgage when due; or
(b)
the Borrower fails to observe or perform any of the covenants contained herein; or
(c)
the Borrower institutes, or does anything which would permit to be instituted, any proceedings
leading to the Borrower being declared a bankrupt; or
(d)
the Borrower, if an individual, dies; or
(e)
BDC in good faith believes that the prospect of payment of the Indebtedness or performance of the
Borrower's obligations hereunder is or is about to be impaired, or that the Collateral is or is about to
be placed in jeopardy.
Upon the occurrence of an event of default, subject to any rights of redemption and reinstatement given to
the Borrower by applicable legislation:
Chattel Mortgage - Western
Rev. April 11, 2005
Page 2
9.
(a)
BDC and its employees and agents may exercise all of the rights and remedies of a secured party
under applicable legislation and in particular may take possession of the Collateral and for this
purpose may enter into or upon any and all premises, lands and buildings where the Collateral may
be and use such force as may be necessary to take possession of and recover the Collateral, and
may, without limiting the generality of the foregoing, break and force open any doors, locks, bars,
bolts and gates; and
(b)
unless waived by BDC, the Indebtedness and all other monies payable pursuant to this Chattel
Mortgage shall forthwith become due and payable.
If BDC takes possession of the Collateral BDC may sell the Collateral or any part thereof at public auction
or private sale, upon such notice to the Borrower as may be required by applicable legislation, and the
proceeds of any such sale shall be applied as follows:
(a)
in payment of all costs and charges and expenses of and incidental to taking possession of, keeping
and selling such Collateral;
(b)
in or toward payment of the Indebtedness and all other monies payable pursuant to this Chattel
Mortgage;
(c)
in or toward payment of all other costs and expenses incurred by BDC in connection with this
Chattel Mortgage or as a result of the failure of the Borrower to observe or perform any of the
covenants herein contained; and
(d)
any surplus shall be paid to the Borrower.
10.
If the aggregate of the amounts set out in paragraphs (a), (b) and (c) of Clause 9 exceeds the proceeds of
sale of the Collateral made pursuant to Clause 9, the Borrower will forthwith pay to BDC the amount of
such excess unless such obligation to pay is extinguished by applicable legislation.
11.
Unless prohibited by applicable legislation, BDC may, in order to recover any amount owing to it
hereunder, pursue either singly or concurrently the remedy of action and the remedy of taking possession
and selling given to it hereby and shall not be precluded by the exercise of either remedy from proceeding
to exercise the other remedy or any other remedy available to it.
12.
The taking of a judgment or judgments on any of the covenants herein contained shall not operate as a
merger thereof or affect BDC's rights herein provided and any such judgment may provide that interest
thereon be computed at the same rate or rates and in the same manner then applicable to the
Indebtedness until the said judgment shall have been fully paid and satisfied.
13.
Any demand or notice herein referred to may be effectively given by BDC by personal delivery thereof or
by mailing such demand or notice by prepaid post to the Borrower at the address set out above, or at such
other address as may have been given in writing by the Borrower to BDC.
14.
If the provisions of any Clause or part of any Clause of this Chattel Mortgage shall be held to be
unenforceable or invalid, such holding shall not in any way affect the enforceability or validity of the
remaining Clauses or the remainder of such Clause of this Chattel Mortgage.
15.
A waiver by BDC of any right at any time whatsoever shall not be effective unless it is in writing and shall
not extend to or be taken in any manner whatsoever to effect a waiver of that right at any subsequent time
or of any other right at any time.
16.
Whenever the singular or masculine is used in this Chattel Mortgage the same shall be deemed to include
the plural or the feminine or the body corporate as the context may require and the obligations of the
Borrower, if there be more than one Borrower, shall be joint and several.
17.
The Borrower hereby:
(a)
acknowledges receiving a copy of this Chattel Mortgage, and
Chattel Mortgage - Western
Rev. April 11, 2005
Page 3
(b)
18.
waives all rights to receive from BDC a copy of any financing statement or financing change statement
filed, or any verification statement issued, at any time in respect of this Chattel Mortgage.
Saskatchewan Law
If the Borrower is a corporation now or in the future operating or registered in Saskatchewan, the Borrower
agrees as follows:
(a)
that the Land Contracts (Actions) Act of Saskatchewan shall have no application to any action, as
defined in the Land Contracts (Actions) Act of Saskatchewan, respecting this Security Agreement, any
mortgage, charge or other security for the payment of money made, given or created by this Security
Agreement, any agreement or instrument which renews or extends or is collateral to this Security
Agreement, or the rights, powers or remedies of BDC under this Security Agreement or any mortgage
or charge created by this Security Agreement as BDC is specifically exempted from the operation of
that Act;
(b)
that the Limitation of Civil Rights Act of Saskatchewan shall have no application to this Security
Agreement, any mortgage, charge or other security for the payment of money made, given or created
by this Security Agreement, any agreement or instrument which renews or extends or is collateral to
this Security Agreement, or the rights, powers or remedies of BDC under this Security Agreement or
any mortgage or charge created by this Security Agreement; and
(c)
that if it is an agricultural corporation, as defined in the Saskatchewan Farm Security Act, it has
received independent legal advice prior to the execution of this Security Agreement, and agrees that
the provisions of Part IV of the Saskatchewan Farm Security Act, other than Section 46, shall not
apply to the Borrower.
THIS CHATTEL MORTGAGE shall enure to the benefit of and be binding upon the parties hereto and their
respective heirs, executors, administrators, successors and assigns.
IN WITNESS WHEREOF the Borrower has executed this Chattel Mortgage.
Executed and Delivered by _____
in the presence of:
___________________________
Name
___________________________
Address
___________________________
_____
Principal Residence of Borrower:
___________________________
Occupation
________________________________________
_____
by its authorized signatories:
___________________________
Authorized signatory
Chief Executive Office of Borrower:
___________________________
Authorized signatory
Chattel Mortgage - Western
Rev. April 11, 2005
________________________________________
Page 4
SCHEDULE “A”
1.
General Collateral, other than Serial Numbered Goods (insert description by item or kind)
_____
2.
Serial Numbered Goods
Type Serial No. / Dept. of Transport No.
Year
_____
Chattel Mortgage - Western
Rev. April 11, 2005
Page 5
Make and Model