Ornak Furniture Inc Had an Operating Line of Credit with the Bank

question 38

True/False

Ornak Furniture Inc had an operating line of credit with the Bank of Brandon. Ornak had given the Bank a security interest in all its present and future assets to secure its obligations under the line of credit. The Bank had perfected its interest by registration in 2008. Cronin carried on business as a supplier of wicker furniture. In 2009, Cronin delivered 20 wicker chairs to Ornak. Ornak put the chairs on display in its showroom. Under the agreement that Ornak had with Cronin, Ornak was not obliged to buy the chairs, but the act of selling a chair to a customer constituted the agreement by Ornak to buy the chair from Cronin. For every chair sold, Ornak paid Cronin whatever it sold the chair for less 50 percent. In December 2009, Ornak defaulted on its obligations to the Bank and the Bank seized its assets including the chairs supplied by Cronin. The Bank is entitled to the chairs.

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Definitions:

Local Monopoly

A situation where a single company or entity exclusively supplies a product or service in a specific geographic area, facing no competition.

CEO Pay

The compensation awarded to the Chief Executive Officer of a company, which may include salary, bonuses, shares, and other benefits.

Ratio

A quantitative relationship between two numbers showing how many times the first number contains the second.

Japan

An island country located in East Asia, known for its rich cultural heritage, advanced technology, and economic influence.