Agricultural Loan Agreement (Crop/Livestock Collateral)

AGRICULTURAL LOAN AGREEMENT (CROP / LIVESTOCK COLLATERAL)

TABLE OF CONTENTS

1. Parties; Loan Summary
2. The Loan; Advances; Interest; Repayment
3. Collateral and Security Interest
4. FSA Guaranty / Programs (if applicable)
5. Representations and Warranties of Borrower
6. Affirmative Covenants
7. Negative Covenants
8. Financial Reporting
9. Insurance Requirements
10. Events of Default; Remedies
11. Food Security Act Notice / EFS Filing
12. Miscellaneous
13. Signature Blocks
14. Schedule A — Collateral Description
15. Schedule B — FSA Farm Information
16. Sources and References

1. PARTIES; LOAN SUMMARY

This Agricultural Loan Agreement (the "Agreement") is entered into as of [__/__/____] between:

Lender: [LENDER NAME], a [STATE] [BANK / FARM CREDIT SYSTEM INSTITUTION / OTHER], at [ADDRESS] ("Lender");

Borrower: [BORROWER NAME], a [STATE] [SOLE PROPRIETORSHIP / LLC / CORPORATION / GENERAL PARTNERSHIP], at [ADDRESS], FSA Farm Number [____] ("Borrower").

2. THE LOAN; ADVANCES; INTEREST; REPAYMENT

2.1. Commitment. Lender shall lend Borrower the Principal Amount on the terms herein, subject to satisfaction of conditions precedent in Section 2.4.

2.2. Advances (Operating Line). If this is an operating line of credit, Borrower may request advances up to the Commitment for:

• ☐ Seed, fertilizer, chemicals
• ☐ Fuel, repairs, labor
• ☐ Feeder livestock, feed
• ☐ Cash rent / custom operations
• ☐ Crop insurance premiums
• ☐ Other ordinary-course farm operating expenses

2.3. Interest. Interest accrues on outstanding principal at the rate stated above, computed on an [actual/365 / 30/360] basis. Default rate: [____] % over contract rate.

2.4. Conditions Precedent. Lender shall have received:

• ☐ Executed note, security agreement, UCC-1
• ☐ Current balance sheet, 3-year operating history, cash-flow projection
• ☐ Crop insurance binder / MPCI schedule
• ☐ Landlord waiver / tenant subordination (if leased ground)
• ☐ FSA guarantee commitment (if applicable)
• ☐ Environmental questionnaire
• ☐ Lien searches / EFS searches (clear except for permitted exceptions)

2.5. Repayment.

• Operating loans: repaid annually from marketing-year crop or livestock sales proceeds.
• Term loans: amortized in [____] installments of $[____] on [DUE DATES].
• Balloon: balance due on Maturity Date.

2.6. Prepayment. ☐ Permitted without penalty; ☐ Permitted with prepayment premium per Schedule.

3. COLLATERAL AND SECURITY INTEREST

3.1. Grant. Borrower grants Lender a continuing security interest in the following (the "Collateral"), as further described in Schedule A:

• Crops: all crops growing or to be grown on the Farm Property for crop years [____] through [____], including harvested and stored grain;
• Livestock: all livestock now owned or hereafter acquired, including offspring, and all feed;
• Equipment: all farm machinery, equipment, and implements;
• Proceeds: insurance proceeds, government program payments (ARC/PLC/ELAP/LFP/LIP/CRP/marketing assistance/disaster), crop-insurance indemnities, deficiency payments, contract rights, accounts;
• General Intangibles: FSA farm numbers, base acres, payment yields, allotments.

3.2. Perfection. Lender shall file UCC-1 financing statements in the applicable central filing office(s) and, if required, effective-financing statements (EFS) under the state's central filing system per 7 U.S.C. § 1631.

3.3. Cross-Collateralization. The Collateral secures all present and future obligations of Borrower to Lender.

3.4. Crop Insurance Assignment. Borrower irrevocably assigns to Lender all rights to multi-peril crop insurance ("MPCI") indemnity proceeds and executes an AD-1068 (or equivalent) assignment.

4. FSA GUARANTY / PROGRAMS (IF APPLICABLE)

4.1. FSA Guarantee. If marked in Section 1, this Loan is guaranteed by the USDA Farm Service Agency pursuant to 7 U.S.C. § 1925 and 7 C.F.R. Part 762, at a guarantee percentage of [____] %.

4.2. Compliance. Borrower and Lender shall comply with all FSA regulations, including (a) lender servicing and loss-claim procedures under 7 C.F.R. § 762.140 et seq.; (b) borrower progress reports; (c) environmental requirements (NEPA); (d) highly erodible land / wetland conservation compliance (HEL/WC) certification on Form AD-1026.

4.3. FSA-Related Conditions. No modification impairing the guarantee may be made without FSA consent.

5. REPRESENTATIONS AND WARRANTIES OF BORROWER

5.1. Borrower is duly organized and authorized to enter this Agreement.

5.2. Borrower is the sole owner of the Collateral except for permitted liens.

5.3. Borrower's principal residence and place of business is in [STATE]; all Collateral is located in [STATE(S) / COUNTIES].

5.4. Financial information provided is accurate and complete.

5.5. No environmental violations; no pending administrative actions.

5.6. Borrower is current on all FSA, state, and federal farm program obligations.

6. AFFIRMATIVE COVENANTS

Borrower shall:

6.1. Plant, cultivate, and harvest all crops in a good and husbandlike manner.

6.2. Maintain livestock consistent with sound animal-husbandry practices; preserve brands, identification, and health records.

6.3. Pay all real-estate and personal-property taxes before delinquency.

6.4. Keep all Collateral at the Farm Property and not move it out of state without Lender's written consent (except in the ordinary course of marketing).

6.5. Maintain required crop insurance (MPCI at [____] % coverage level on insurable crops) and livestock mortality insurance where applicable.

6.6. Allow Lender reasonable inspection of crops, livestock, books, and records upon [____] days' notice.

6.7. Apply all proceeds from sale of Collateral to the Loan unless Lender has released its interest in writing.

6.8. Notify Lender within [____] days of any casualty, theft, governmental action, or material change in operation.

7. NEGATIVE COVENANTS

Borrower shall not, without Lender's prior written consent:

7.1. Sell, transfer, or dispose of Collateral outside the ordinary course.

7.2. Grant additional liens on the Collateral.

7.3. Incur additional indebtedness beyond trade payables in the ordinary course.

7.4. Change the nature of farming operations materially.

7.5. Enroll or withdraw enrolled acres in CRP, WRP, or similar programs.

7.6. Move livestock out of county/state except for ordinary sale.

7.7. Accept prepayment of rent, forward contracts, or custom work without Lender's knowledge.

8. FINANCIAL REPORTING

Borrower shall deliver:

• ☐ Annual balance sheet (cost and fair-value basis) within [____] days of fiscal year end
• ☐ Annual Schedule F and federal tax return within [____] days of filing
• ☐ Interim production reports at planting, harvest, and year-end
• ☐ Cash-flow projection for each crop/marketing year
• ☐ FSA Form 156EZ (farm report) upon material change

9. INSURANCE REQUIREMENTS

Lender shall be named as loss payee and additional insured as its interests appear; crop insurance shall be assigned via AD-1068.

10. EVENTS OF DEFAULT; REMEDIES

10.1. Events of Default.

• ☐ Nonpayment of principal, interest, or fees when due;
• ☐ Material misrepresentation;
• ☐ Breach of covenant uncured after [____] days' notice;
• ☐ Bankruptcy or insolvency;
• ☐ Material adverse change;
• ☐ Sale or loss of Collateral without application to the Loan;
• ☐ Loss of crop insurance coverage;
• ☐ Default under FSA guarantee.

10.2. Remedies. Upon default, Lender may:

• Accelerate the Loan;
• Enter the Farm Property to take possession of crops or livestock;
• Harvest crops at Borrower's expense;
• Sell Collateral via commercially reasonable private or public sale (U.C.C. Article 9);
• Enforce crop-insurance assignments;
• Offset government program payments;
• Obtain appointment of a receiver;
• Pursue all other legal and equitable remedies.

11. FOOD SECURITY ACT NOTICE / EFS FILING

11.1. Clear-Title Protection. The federal Food Security Act of 1985 (7 U.S.C. § 1631) protects buyers of "farm products" in the ordinary course unless the secured party (a) files an effective financing statement in a "central filing" state, or (b) gives direct written notice to the buyer in a "direct notice" state.

11.2. EFS Filing. Lender may, at its option, file an EFS in [STATE] central filing system for crops and livestock.

11.3. Direct Notice. Borrower shall provide Lender a list of buyers, commission merchants, and selling agents to whom Borrower intends to sell farm products. Lender may give notice of its security interest to each.

12. MISCELLANEOUS

12.1. Governing Law. [STATE] law, excluding conflicts principles. If FSA-guaranteed, federal law governs guarantee questions.

12.2. Forum. State and federal courts located in [COUNTY, STATE].

12.3. Jury Waiver. ☐ Included (review state-law enforceability, e.g., Georgia prohibits pre-dispute jury waivers).

12.4. Assignment. Lender may assign; Borrower may not assign.

12.5. Entire Agreement; Severability; Amendments in writing.

12.6. Notices to the addresses above.

13. SIGNATURE BLOCKS

LENDER: [LENDER NAME]

By: [________________________________]

Name: [____] Title: [____] Date: [__/__/____]

BORROWER: [BORROWER NAME]

By: [________________________________]

Name: [____] Title: [____] Date: [__/__/____]

SPOUSE ACKNOWLEDGMENT (if required by state law for homestead or marital-property collateral):

[________________________________]

[SPOUSE NAME]

Date: [__/__/____]

14. SCHEDULE A — COLLATERAL DESCRIPTION

Crops. All crops growing or to be grown in crop years [____]-[____] on:

Livestock.

Equipment. See attached list dated [__/__/____].

15. SCHEDULE B — FSA FARM INFORMATION

16. SOURCES AND REFERENCES

• USDA Farm Service Agency — https://www.fsa.usda.gov/
• 7 C.F.R. Part 762 (FSA Guaranteed Loans) — https://www.ecfr.gov/current/title-7/chapter-VII/subchapter-B/part-762
• 7 C.F.R. Part 764 (FSA Direct Loan Making) — https://www.ecfr.gov/current/title-7/chapter-VII/subchapter-B/part-764
• 7 U.S.C. § 1631 (Food Security Act) — https://www.govinfo.gov/
• Farm Credit Administration — https://www.fca.gov/
• 12 C.F.R. Part 614 (FCA Loan Policies) — https://www.ecfr.gov/current/title-12/chapter-VI/part-614
• USDA Risk Management Agency (Crop Insurance) — https://rma.usda.gov/
• Uniform Commercial Code Article 9

Disclaimer: This template is provided for informational purposes only and does not constitute legal advice. An attorney must review and customize this document before use, with particular attention to state-law superpriority agricultural liens, state central filing / EFS requirements, spousal consent, homestead, and FSA program compliance.