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Collateral Surrender Agreement

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Collateral Surrender Agreement Powered By Docstoc
					A Collateral Surrender Agreement is an agreement between a secured lender (Secured
Party) and a debtor. This agreement is used to enforce a security agreement when the
debtor is in default of their obligations to the Secured Party. Using this agreement, a
loan secured against property is cancelled and the property is surrendered to the lender.
This form should be used by secured lenders for defaulted loans. This document can
be customized to fit the needs of the drafting parties.
              COLLATERAL SURRENDER AGREEMENT
       THIS COLLATERAL SURRENDER AGREEMENT (the “Collateral Agreement”),
entered into this _____ day of _____________ [MONTH], _____ [YEAR] (the “Effective
Date”), by and between _________________ (the “Secured Party”) and _______________ (the
“Debtor”).

      WHEREAS the Secured Party and the Debtor entered into a ____________________
agreement (the “Agreement”) dated the _____ day of _____________ [MONTH], _____
[YEAR];

        AND WHEREAS as of the Effective Date, the Debtor is indebted to the Secured Party in
the principal amount of ____________ [AMOUNT IN WORDS] dollars ($_______) [AMOUNT
IN NUMERALS] (the “Indebtedness”) Dollars, plus any and all accrued interest up to and
including the Effective Date;

       AND WHEREAS the Indebtedness owing to the Secured Party by the Debtor is now due
and delinquent by the Debtor, and the Secured Party has provided notice to the Debtor that
foreclosure on the Indebtedness is imminent;

       AND WHEREAS the Indebtedness owing by the Debtor to the Secured Party is secured
by way of a security agreement (the “Security Agreement”) dated the _____ day of
_____________ [MONTH], _____ [YEAR], which secures and encumbers all of the personal
property and assets of the Debtor (the “Collateral”);

       AND WHEREAS the Debtor has given notice to the Secured Party that it is desirous to
have the Secured Party foreclose on the Collateral of the Debtor and the Secured Party has
agreed to exercise all of its right to do so as payment of the Indebtedness owing to the Secured
Party by the Debtor.

       NOW THEREFORE, in consideration of the mutual covenants and agreement set forth in
this Collateral Agreement, and the forbearance by the Secured Party to exercise its rights to
foreclose on the Collateral of the Debtor for the payment of the Indebtedness due and owing to
the Secured Party, the Secured Party and the Debtor hereby acknowledge and agree as follows:

1.00   DEBTOR ACKNOWLEDGMENT OF DEFAULT

1.01 The Debtor hereby acknowledges that it is in default of payments to the Secured Party for
the Indebtedness in the principal amount of ____________ [AMOUNT IN WORDS] dollars
($_______) [AMOUNT IN NUMERALS] together with all accrued interest up to and including
the Effective Date, pursuant to the terms and the conditions of the Agreement between the
Secured Party and the Debtor.
1.02 The Debtor hereby acknowledges and agrees with the Secured Party that the Debtor
granted to the Secured Party a security interest in the Collateral of the Debtor and that the
Secured Party has all right to enforce and foreclose upon the Collateral of the Debtor pursuant to
the terms and conditions of the Agreement entered into between the Secured Party and the
Debtor.

2.00     FORECLOSURE BY SECURED PARTY

2.01 Pursuant to the terms and conditions of this Collateral Agreement and the terms and
conditions of the Agreement entered into between the Secured Party and the Debtor, the Secured
Party hereby acknowledges and agrees that it will exercise its rights to enforce its security
against the Collateral of the Debtor for payment of the Indebtedness owing to it by the Debtor.

3.00     REPRESENTATIONS AND WARRANTIES OF DEBTOR

3.01     The Debtor hereby represents and warrants to the Secured Party as follows:

         (i)      that at the Effective Date all documents or instruments which secure the
                  Indebtedness due and owing to the Secured Party has been executed by the Debtor
                  and delivered to the Secured Party or its attorneys;

         (ii)     that the amount of the Indebtedness due and owing to the Secured Party at the
                  Effective Date is ____________ [AMOUNT IN WORDS] dollars ($_______)
                  [AMOUNT IN NUMERALS] together with all accrued interest up to and
                  including the Effective Date;

         (iii)    that at the Effective Date, the Debtor will surrender the Collateral to the Secured
                  Party as payment of the Indebtedness due and owing to the Secured Party;

         (iv)     that at the Effective Date there are no liens, charges or claims which would
                  otherwise encumber the Collateral of the Debtor;

         (v)      that at the Effective Date the Collateral of the Debtor is in a good state of repair
                  and condition; and

         (vi)     that the Debtor shall not remove any of the Collateral from its principal premises
                  or from such other location where the Collateral may reside.

4.00     MUTUAL RELEASES

4.01 The Secured Party hereby acknowledges and agrees that the timely performance of this
Agreement by the Debtor shall constitute full and final satisfaction of all of the obligations of the
Debtor to the Secured Party.




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4.02 Upon completion of the terms and conditions of this Collateral Agreement, the Secured
Party shall deliver a release to the Debtor releasing the Debtor, its heirs, successors, and assigns
from any and all claims, debts, liabilities, agreements and causes of action with the Secured Party
may have for, up
				
DOCUMENT INFO
Description: A Collateral Surrender Agreement is an agreement between a secured lender (Secured Party) and a debtor. This agreement is used to enforce a security agreement when the debtor is in default of their obligations to the Secured Party. Using this agreement, a loan secured against property is cancelled and the property is surrendered to the lender. This form should be used by secured lenders for defaulted loans. This document can be customized to fit the needs of the drafting parties.