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Text Box: ineffective if the underlying security agreement is not also amended. In this instance, Minnesota Power should have amended its security agreement when it filed the second financing statement. Alternately, it could also have amended its general security agreement, granting a security interest in all equipment and inventory wherever located, either of which would have been sufficient to avoid the loss of a security interest in property housed in multiple locations. The case is cited as Allete, Inc., d/b/a Minnesota Power v. GEC Engineering, Inc., et al., 726 N.W. 2d 520 (Ct. App. Minn. 2007). Terms of Lease Enforceable Even Though Provisions Are Unreasonable The Court of Appeals of Iowa has determined that a “hell or high water” clause is enforceable against a lessee despite the apparent unreasonableness of his lease. In C and J Leasing Corp. v. Hendren Golf Management, Inc., Brett Hendren, owner of Hendren Golf Management and Wolf Creek Golf Course, agreed to lease beverage carts from C and J. The deal was brokered through Royal Links, who arranged for advertising to be placed on the beverage carts. The deal was structured so that the profits from the advertising would cover the lease payments on the carts, which were valued at $19,000. The contract gave C and J a security interest in the carts and contained a “hell or high water” clause in which Hendren agreed to pay C and J all amounts due under the contract regardless of the condition or even the existence of the carts. However, when Royal Links stopped paying advertising profits to Hendren, Hendren stopped making lease payments to C and J. The carts were ultimately repossessed, and only one was re-sold – for $600.00. Litigation ensued, and the District Court concluded the contract was unconscionable due to the disparity between the lease price of the carts and their apparent market value. The Court of Appeals disagreed with the lower court that the contract was unconscionable because there was no unfair surprise or disparity of bargaining power among the parties. In other words, no matter how unreasonable the commercial contract appeared to be in light of the situation, the terms of the lease were clear and unambiguous. Accordingly, the Court determined that the “hell or high water” clause was enforceable. This case reminds us of the importance of clearly identifying and understanding all terms of an agreement, because once it is signed, it may well be strictly enforced against the parties. This case is cited as C and J Leasing Corp. v. Hendren Golf Management, Inc., 728 N.W.2d 852. Corporate Borrower Can’t Use Usury as Defense to Late Charge The United States District Court for the District of New Jersey has recently ruled that if applicable state law prohibits a corporate borrower from using a usury defense, the corporation cannot claim that a promissory note’s late fee is usurious. Tabatchnick Realty Group LLC and Tabatchnick Fine Foods Inc. were New Jersey corporations that entered into a loan with PNC Bank, N.A., successor in interest to United Trust