EXHIBIT 99.3] [LINE OF CREDIT AGREEMENT WITH SOUTHTRUST BANK, N.A.] PROMISSORY NOTE

[EXHIBIT 99.3]

[LINE OF CREDIT AGREEMENT WITH SOUTHTRUST BANK, N.A.]

PROMISSORY NOTE

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Principal Loan Date Maturity Loan No. Call/Coll Account Officer Initials

$1,000,000.00 07-22-2002 07-22-2003 0000050483 0001/780 0955232160 LH4
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References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item
containing "***" has been omitted due to text length limitations.
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Borrower: PETMED EXPRESS, INC. Lender: SouthTrust Bank
(SSN:65-0000000) West Palm Beach (Metro Lending)
0000 XX 00xx Xxx. Xxx Xxxx Xxxxxxx Xxxx (0xx Xxxxx)
XXXXXXX XXXXX, XX 00000 Ft. Xxxxxxxxxx, XX 00000
(000) 000-0000
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Principal Initial Date of
Amount: $1,000,000.00 Rate: 4.750% Note: July 22, 2002

PROMISE TO PAY. PET MED EXPRESS, INC. ("Borrower") promises to pay to
SouthTrust Bank ("Lender"), or order, in lawful money of the United
States of America, the principal amount of One Million & 00/100 Dollars
($1,000,000.00) or so much as may be outstanding, together with
interest on the unpaid outstanding principal balance of each advance.
Interest shall be calculated from the date of each advance until
repayment of each advance.

PAYMENT. Borrower will pay this loan in one payment of all outstanding
principal plus all accrued unpaid interest on July 22, 2003. In addition,
Borrower will pay regular monthly payments of all accrued unpaid interest
due as of each payment date, beginning August 13, 2002, with all
subsequent interest payments to be due on the same day of each month
after that. Unless otherwise agreed or required by applicable law,
payments will be applied first to accrued unpaid interest, then to
principal, and any remaining amount to any unpaid collection costs and
late charges. The annual interest rate for this Note is computed on a
365/360 basis; that is, by applying the ratio of the annual interest rate
over a year of 360 days, multiplied by the outstanding principal balance,
multiplied by the actual number of days the principal balance is
outstanding. Borrower will pay Lender at Lender's address shown above or
at such other place as Lender may designate in writing.

VARIABLE INTEREST RATE. The interest rate on this Note is subject to
change from time to time based on changes in an index which is the "base
rate." The term "base rate" means the rate of interest designated by the
Lender periodically as its Base Rate (the "Index"). Tile Index is not
necessarily the lowest rate charged by Lender on its loans and is set by
Lender in its sole discretion. If the Index becomes unavailable during
the term of this loan, Lender may designate a substitute index after
notifying Borrower. Lender will tell Borrower the current Index rate
upon Borrower's request. The interest rate change will not occur more
often than each day. The frequency of the rate change is further defined
below in paragraph titled "VARIABLE RATE CHANGE FREQUENCY." Borrower
understands that Lender may make loans based on other rates as well. The
Index currently is 4.750% per annum. The interest rate to be applied to
the unpaid principal balance of this Note will be at a rate equal to
the Index, resulting in an initial rate of 4.750% per annum.
NOTICE: Under no circumstances will the effective rate of interest on
this Note be more than the maximum rate allowed by applicable law.

PREPAYMENT. Borrower may pay without penalty all or a portion of the
amount owed earlier than it is due. Early payments will not, unless
agreed to by Lender in writing, relieve Borrower of Borrower's obligation
to continue to make payments of accrued unpaid interest. Rather, early
payments will reduce the principal balance due. Borrower agrees not to
send Lender payments marked "paid in full," "without recourse," or
similar language. If Borrower sends such a payment, Lender may accept it
without losing any of Lender's rights under this Note, and Borrower will
remain obligated to pay any further amount owed to Lender. All written
communications concerning disputed amounts, including any check or other
payment instrument that indicates that the payment constitutes "payment
in full" of the amount owed or that is tendered with other conditions or
limitations or as full satisfaction of a disputed amount must be mailed
or delivered to: SouthTrust Bank, West Palm Beach (Metro Lending), Xxx
Xxxx Xxxxxxx Xxxx (0xx Xxxxx), Xx. Xxxxxxxxxx, XX 00000.

LATE CHARGE. If a payment is 10 days or more late, Borrower will be
charged 5.000% of the unpaid portion of the regularly scheduled payment
or $10.00, whichever is greater.

INTEREST AFTER DEFAULT. Upon default, including failure to pay upon
final maturity, at Lender's option, and if permitted by applicable law,
Lender may add any unpaid accrued interest to principal and such sum will
bear interest therefrom until paid at the rate provided in this Note.
Upon default, the total sum due under this Note will bear interest from
the date of acceleration or maturity at the variable interest rate on
this Note.

DEFAULT. Each of the following shall constitute an event of default
("Event of Default") under this Note:

Payment Default. Borrower fails to make any payment when due under
this Note.

Other Defaults. Borrower fails to comply with or to perform any
other term, obligation, covenant or condition contained in this Note or
in any of the related documents or to comply with or to perform any term,
obligation, covenant or condition contained in any other agreement
between Lender and Borrower.

Default in Favor of Third Parties. Borrower or any Grantor defaults
under any loan, extension of credit, security agreement, purchase or
sales agreement, or any other agreement, in favor of any other creditor
or person that may materially affect any of Borrower's property or
Borrower's ability to repay this Note or perform Borrower's obligations
under this Note or any of the related documents.

False Statements. Any warranty, representation or statement made or
furnished to Lender by Borrower or on Borrower's behalf under this Note
or the related documents is false or misleading in any material respect,
either now or at the time made or furnished or becomes false or
misleading at any time thereafter.

Insolvency. The dissolution or termination of Borrower's existence
as a going business, the insolvency of Borrower, the appointment of a
receiver for any part of Borrower's property, any assignment for the
benefit of creditors, any type of creditor workout, or the commencement
of any proceeding under any bankruptcy or insolvency laws by or against
Borrower.

Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by any
governmental agency against any collateral securing the loan. This
includes a garnishment of any of Borrower's accounts, including deposit
accounts, with Lender. However, this Event of Default shall not apply if
there is a good faith dispute by Borrower as to the validity or
reasonableness of the claim which is the basis of the creditor or
forfeiture proceeding and if Borrower gives Lender written notice of the
creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount
determined by Lender, in its sole discretion, as being an adequate
reserve or bond for the dispute.

Events Affecting Guarantor. Any of the preceding events occurs with
respect to any Guarantor of any of the indebtedness or any Guarantor dies
or becomes incompetent, or revokes or disputes the validity of, or
liability under, any guaranty of the indebtedness evidenced by this Note.
In the event of a death, Lender, at its option, may, but shall not be
required to, permit the Guarantor's estate to assume unconditionally the
obligations arising under the guaranty in a manner satisfactory to
Lender, and, in doing so, cure any Event of Default.

Change In Ownership. Any change in ownership of twenty-five percent
(25%) or more of the common stock of Borrower.

Adverse Change. A material adverse change occurs in Borrower's
financial condition, or Lender believes the prospect of payment or
performance of this Note is impaired.

Insecurity. Lender in good faith believes itself insecure.

Cure Provisions. If any default, other than a default in payment is
curable and if Borrower has not been given a notice of a breach of the
same provision of this Note within the preceding twelve (12) months, it
may be cured (and no event of default will have occurred) if Borrower,
after receiving written notice from Lender demanding cure of such
default: (1) cures the default within fifteen (15) days; or (2) if the
cure requires more than fifteen (15) days, immediately initiates steps
which Lender deems in Lender's sole discretion to be sufficient to cure
the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonably
practical.

LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid
principal balance on this Note and all accrued unpaid interest
immediately due, and then Borrower will pay that amount.

ATTORNEYS' FEES; EXPENSES. Lender may hire or pay someone else to help
collect this Note if Borrower does not pay. Borrower will pay Lender the
amount of these costs and expenses, which includes, subject to any limits
under applicable law, Lender's reasonable attorneys' fees

Exhibit 99.3 - Pg. 1

PROMISSORY NOTE
Loan No: 0000050483 (Continued) Page 2
______________________________________________________________________

and Lender's legal expenses whether or not there is a lawsuit, including
reasonable attorneys' fees and legal expenses for bankruptcy proceedings
(including efforts to modify or vacate any automatic stay or injunction),
and appeals. If not prohibited by applicable law, Borrower also will
pay any court costs, in addition to all other sums provided by law.

JURY WAIVER. Lender and Borrower hereby waive the right to any jury
trial in any action, proceeding or counterclaim brought by either Lender
or Borrower against the other. (Initial Here /s/ B.S.R.)

GOVERNING LAW. This Note will be governed by, construed and enforced in
accordance with federal law and the laws of the State of Florida. This
Note has been accepted by Lender in the State of Florida.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender
reserves a right of setoff in all Borrower's accounts with Lender
(whether checking, savings, or some other account). This includes all
accounts Borrower holds jointly with someone else and all accounts
Borrower may open in the future. However, this does not include any XXX
or Xxxxx accounts, or any trust accounts for which setoff would be
prohibited by law. Borrower authorizes Lender, to the extent permitted
by applicable law, to charge or setoff all sums owing on the indebtedness
against any and all such accounts, and, at Lender's option, to
administratively freeze all such accounts to allow Lender to protect
Lender's charge and setoff rights provided in this paragraph.

COLLATERAL. Borrower acknowledges this Note is secured by BLANKET LIEN
ON ALL BUSINESS ASSETS.

LINE OF CREDIT. This Note evidences a revolving line of credit.
Advances under this Note, as well as directions for payment from
Borrower's accounts, may be requested orally or in writing by Borrower or
by an authorized person. Lender may, but need not, require that all oral
requests be confirmed in writing. Borrower agrees to be liable for all
sums either: (A) advanced in accordance with the instructions of an
authorized person; or (B) credited to any of Borrower's accounts with
Lender. The unpaid principal balance owing on this Note at any time may
be evidenced by endorsements on this Note or by Lender's internal
records, including daily computer print-outs. Lender will have no
obligation to advance funds under this Note if: (A) Borrower or any
guarantor is in default under the terms of this Note or any agreement
that Borrower or any guarantor has with Lender, including any agreement
made in connection with the signing of this Note; (B) Borrower or any
guarantor ceases doing business or is insolvent; (C) any guarantor seeks,
claims or otherwise attempts to limit, modify or revoke such guarantor's
guarantee of this Note or any other loan with Lender; (D) Borrower has
applied funds provided pursuant to this Note for purposes other than
those authorized by Lender; or (E) Lender in good faith believes itself
insecure.

FINANCIAL STATEMENTS. Until this loan is paid in full, Borrower will
furnish to Lender, as soon as available but in any event within 120 days
after the end of each fiscal year, Borrower's audited balance sheet and
statements of income, cash flows and changes in capital for the fiscal
year just ended, setting forth in comparative form the corresponding
figures for the prior year, together with accompanying schedules and
footnotes. If the financial statements were compiled or certified by a
public accountant, Borrower will also furnish Lender the accountant's
letter accompanying the financial statements. Borrower will furnish to
Lender, as soon as available but in any event within 45 days after the
end of the first three quarters of Borrower's fiscal year, Borrower's
balance sheet and profit and loss statement for the quarter just ended.
All financial reports provided to Lender will be certified in writing by
the chief executive officer, chief financial officer, managing partner or
comparable financial officer of Borrower to be true and complete to the
best of his or her knowledge and belief and to have been prepared in
accordance with generally accepted accounting principles applied on a
basis consistent with the financial statements previously furnished to
Lender or, if not so prepared, setting forth the manner in which the
financial statements depart therefrom. Borrower will furnish Lender,
within 30 days after Lender's request therefore, a copy of the federal
income tax return most recently filed by Borrower. Borrower will cause
each guarantor or endorser of this loan to furnish to Lender, within 30
days after Lender's request therefore, a current financial statement of
such guarantor or endorser in form acceptable to Lender and a copy of the
federal income tax return most recently filed by such guarantor or
endorser. Borrower shall provide to Lender, in form and substance
acceptable to Lender, Borrowing Base certificates quarterly, due within
45 days of each quarter end. Borrower shall provide to Lender, in form
and substanace acceptable to Lender, an Inventory Detail report
quarterly, due within 45 days of each quarter end..

OBLIGATION TO DEVELOP BUSINESS PLAN. Before approving this loan, Lender
required Borrower to furnish Lender with financial statements and other
information concerning the financial history and future prospects of
Borrower's business. Lender requested and reviewed that information
solely to enable it to make a decision whether to extend credit. Borrower
understands that Lender has not necessarily approved Borrower's business
plan and has not undertaken any duty or obligation to advise Borrower on
business matters now or in the future. Lender is not a financial or
business advisor, and Borrower will not look to Lender for business
advice. Lender's role is solely that of a Lender, and Borrower's
relationship with Lender is that of debtor and creditor. Lender
expressly disclaims any fiduciary or other duties or obligations to
Borrower except those expressly provided in the written loan documents
signed by Lender.

NO ORAL AGREEMENTS. Lender's agreement to lend, Borrower's obligation to
repay the loan, and all other agreements between Lender and Borrower have
been reduced to writing. This instrument and the other documents signed
concurrently with it contain the entire agreement between Lender and
Borrower. Any prior conversations and discussions that Lender or
Borrower may have had concerning the transaction are not binding unless
reflected in the written loan documents. Borrower acknowledges that the
loan documents reflect everything the Lender has agreed to do or not to
do in connection with this transaction.

COMMERCIAL PURPOSES. Borrower intends to use the loan proceeds solely
for business or commercial related purposes and under no circumstances
will such proceeds be used for personal, family or household purposes.

VARIABLE RATE FREQUENCY. The interest rate change will occur each day
the Index Rate changes. This change will not occur more often than
once each day.

CROSS DEFAULT CLAUSE. IT IS UNDERSTOOD AND AGREED THAT IN THE EVENT A
DEFAULT EXISTS UNDER THE LOANS HELD BY THE LENDER IN WHICH PET MED
EXPRESS, INC. IS BORROWER THEREUNDER, THEN THE LENDER MAY, AT ITS OPTION,
DECLARE THE ENTIRE INDEBTEDNESS EVIDENCED HEREBY IMMEDIATELY DUE AND
PAYABLE.

ADDITIONAL CROSS COLLATERALIZATION. In additon to the Note, this
Agreement secures all obligations, debts and liabilities, plus interest
thereon, of Borrower or Grantor to Lender, or any one or more of them,
as well as all claims by Lender against Borrower or Grantor or any one
or more of them, whether now existing or hereunder arising, whether
related or unrelated to the purpose of the Note, whether voluntary or
otherwise, whether due or note due, direct or indirect, determined or
undetermined, absolute or contingent, liquidated or unliquidated
whether Borrower or Grantor may be liable individually or jointly with
others, whether obligated as guarantor, surety, accommodation party or
otherwise, and whether recovery upon such amounts may be or hereafter
may become barred by any statute of limitations, and whether the
oglibation to repay such amounts may be or hereafter may become
otherwise unenforceable.

FINANCIAL COVENANTS. BORROWER SHALL MAINTAIN A MINIMUM TANGIBLE NET
WORTH (TOTAL NET WORTH MINUS INTANGIBLE AND RELATED PARTY RECEIVABLES)
OF $1,500,000.00 TESTED QUARTERLY. BORROWER SHALL MAINTAIN A MINIMUM
FIXED CHARGE COVERAGE (AFTER TAX INCOME + DEPRECIATION + AMORTIZATION
+ LEASE EXPENSE DIVIDED BY LEASE EXPENSE + INTEREST EXPENXE + CURRENT
MATURITIES OF LONG TERM DEBT) OF 1.50 TO 1.00 TESTED QUARTERLY.
BORROWER SHALL MAINTAIN A MAXIMUM SENIOR LIABILITY TO ADJUSTED NET
WORTH OF 3.00 TO 1.00 TESTED QUARTERLY..

AFFIRMATIVE COVENANTS. BORROWER SHALL MAINTAIN HAZARD, FLOOD AND
LIABILITY INSURANCE SUFFICIENT ENOUGH TO PROTECT THE LENDER.
BORROWER SHALL MAINTAIN ITS PRINCIPAL ACCOUNTS WITH THE LENDER.

NEGATIVE COVENANTS. BORROWER SHALL NOT CREATE OR INCUR INDEBTEDNESS
EXCEPT FROM SOUTHTRUST BANK, BORROWER SHALL NOT MERGE, CONSOLIDATE
OR TRANSFER ASSETS. BORROWER SHALL NOT GUARANTEE OR BECOME
CONTINGENTLY LIABLE FOR ANY FURTHER DEBT. BORROWER SHALL NOT MAKE
ANY FURTHER LOANS.

BORROWING BASE. ADVANCES ARE LIMITED TO 35% OF INVENTORY..

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon
Borrower, and upon Borrower's heirs, personal representatives, successors
and assigns, and shall inure to the benefit of Lender and its successors
and assigns.

NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING
AGENCIES. Please notify us if we report any inaccurate information about
your account(s) to a consumer reporting agency. Your written notice
describing the specific inaccuracy(ies) should be sent to us at the
following address: SouthTrust Bank, West Palm Beach (Metro Lending), Xxx
Xxxx Xxxxxxx Xxxx (0xx Xxxxx), Xx. Xxxxxxxxxx, XX 00000.

GENERAL PROVISIONS. If any part of this Note cannot be enforced, this
fact will not affect the rest of the Note. Borrower does not agree or
intend to pay, and Lender does not agree or intend to contract for,
charge, collect, take, reserve or receive (collectively referred to
herein as "charge or collect"), any amount in the nature of interest or
in the nature of a fee for this loan, which would in any way or event
(including demand, prepayment, or acceleration) cause Lender to charge or
collect more for this loan than the maximum Lender would be permitted to
charge or collect by federal law or the law of the State of Florida (as
applicable). Any such excess interest or unauthorized fee shall, instead of

Exhibit 99.3 - Pg. 2

PROMISSORY NOTE
Loan No: 0000050483 (Continued) Page 3
______________________________________________________________________

anything stated to the contrary, be applied first to reduce the
principal balance of this loan, and when the principal has been paid in
full, be refunded to Borrower. Lender may delay or forgo enforcing any
of its rights or remedies under this Note without losing them. Borrower
and any other person who signs, guarantees or endorses this Note, to the
extent allowed by law, waive presentment, demand for payment, and notice
of dishonor. Upon any change in the terms of this Note, and unless
otherwise expressly stated in writing, no party who signs this Note,
whether as maker, guarantor, accommodation maker or endorser, shall be
released from liability. All such parties agree that Lender may renew or
extend (repeatedly and for any length of time) this loan or release any
party or guarantor or collateral; or impair, fail to realize upon or
perfect Lender's security interest in the collateral; and take any other
action deemed necessary by Lender without the consent of or notice to
anyone. All such parties also agree that Lender may modify this loan
without the consent of or notice to anyone other than the party with whom
the modification is made. The obligations under this Note are joint and
several.

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE
PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS.
BORROWER AGREES TO THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY
NOTE.

BORROWER:

PETMED EXPRESS, INC.

By: /s/________Bruce S. Rosenbloom______________
XXXXX XXXXXXXXXX, C.F.O. of PETMED EXPRESS, INC.

Exhibit 99.3 - Pg. 3

COMMERCIAL SECURITY AGREEMENT

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Principal Loan Date Maturity Loan No. Call/Coll Account Officer Initials

THIS COMMERCIAL SECURITY AGREEMENT dated July 22, 2002, is made and
executed between PET MED EXPRESS, INC. ("Grantor") and SouthTrust Bank
("Lender").

GRANT OF SECURITY INTEREST. For valuable consideration, Grantor grants
to Lender a security interest in the Collateral to secure the
Indebtedness and agrees that Lender shall have the rights stated in this
Agreement with respect to the Collateral, in addition to all other rights
which Lender may have by law.

COLLATERAL DESCRIPTION. The word "Collateral" as used in this Agreement
means the following described property, whether now owned or hereafter
acquired, whether now existing or hereafter arising, and wherever
located, in which Grantor is giving to Lender a security interest for the
payment of the Indebtedness and performance of all other obligations
under the Note and this Agreement:

All Inventory, Chattel Paper, Accounts, Equipment, Furniture,
Fixtures and General Intangibles

In addition, the word "Collateral" also includes all the following,
whether now owned or hereafter acquired, whether now existing or
hereafter arising, and wherever located:

(A) All accessions, attachments, accessories, tools, parts,
supplies, replacements of and additions to any of the collateral
described herein, whether added now or later.

(B) All products and produce of any of the property described in
this Collateral section.

(C) All accounts, general intangibles, instruments, rents, monies,
payments, and all other rights, arising out of a sale, lease, or
other disposition of any of the property described in this
Collateral section.

(D) All proceeds (including insurance proceeds) from the sale,
destruction, loss, or other disposition of any of the property
described in this Collateral section, and sums due from a third
party who has damaged or destroyed the Collateral or from that
party's insurer, whether due to judgment, settlement or other
process.

(E) All records and data relating to any of the property described
in this Collateral section, whether in the form of a writing,
photograph, microfilm, microfiche, or electronic media, together
with all of Grantor's right, title, and interest in and to all
computer software required to utilize, create, maintain, and process
any such records or data on electronic media.

Despite any other provision of this Agreement, Lender is not granted, and
will not have, a nonpurchase money security interest in household goods,
to the extent such a security interest would be prohibited by applicable
law. In addition, if because of the type of any Property, Lender is
required to give a notice of the right to cancel under Truth in Lending
for the Indebtedness, then Lender will not have a security interest in
such Collateral unless and until such a notice is given.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender
reserves a right of setoff in all Grantor's accounts with Lender (whether
checking, savings, or some other account). This includes all accounts
Grantor holds jointly with someone else and all accounts Grantor may open
in the future. However, this does not include any XXX or Xxxxx accounts,
or any trust accounts for which setoff would be prohibited by law.
Grantor authorizes Lender, to the extent permitted by applicable law, to
charge or setoff all sums owing on the Indebtedness against any and all
such accounts, and, at Lender's option, to administratively freeze all
such accounts to allow Lender to protect Lender's charge and setoff
rights provided in this paragraph.

GRANTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL.
With respect to the Collateral, Grantor represents and promises to
Lender that:

Perfection of Security Interest. Grantor agrees to execute
financing statements and to take whatever other actions are
requested by Lender to perfect and continue Lender's security
interest in the Collateral. Upon request of Lender, Grantor will
deliver to Lender any and all of the documents evidencing or
constituting the Collateral, and Grantor will note Lender's interest
upon any and all chattel paper if not delivered to Lender for
possession by Lender. This is a continuing Security Agreement and
will continue in effect even though all or any part of tile
Indebtedness is paid in full and even though for a period of time
Grantor may not be indebted to Lender.

Notices to Lender. Grantor will promptly notify Lender in writing
at Lender's address shown above (or such other addresses as Lender
may designate from time to time) prior to any (1) change in
Grantor's name; (2) change in Grantor's assumed business name(s);
(3) change in the management of the Corporation Grantor; (4) change
in the authorized signer(s); (5) change in Grantor's principal
office address; (6) change in Grantor's state of organization; (7)
conversion of Grantor to a new or different type of business entity;
or (8) change in any other aspect of Grantor that directly or
indirectly relates to any agreements between Grantor and Lender. No
change in Grantor's name or state of organization will take effect
until after Lender has received notice.

No Violation. The execution and delivery of this Agreement will not
violate any law or agreement governing Grantor or to which Grantor
is a party, and its certificate or articles of incorporation and
bylaws do not prohibit any term or condition of this Agreement.

Enforceability of Collateral. To the extent the Collateral consists
of accounts, chattel paper, or general intangibles, as defined by
the Uniform Commercial Code, the Collateral is enforceable in
accordance with its terms, is genuine, and fully complies with all
applicable laws and regulations concerning form, content and manner
of preparation and execution, and all persons appearing to be
obligated on the Collateral have authority and capacity to contract
and are in fact obligated as they appear to be on the Collateral.
At the time any Account becomes subject to a security interest in
favor of Lender, the Account shall be a good and valid account
representing an undisputed, bona fide indebtedness incurred by the
account debtor, for merchandise held subject to delivery
instructions or previously shipped or delivered pursuant to a
contract of sale, or for services previously performed by Grantor
with or for the account debtor. So long as this Agreement remains
in effect, Grantor shall not, without Lender's prior written
consent, compromise, settle, adjust, or extend payment under or with
regard to any such Accounts. There shall be no setoffs or
counterclaims against any of the Collateral, and no agreement shall
have been made under which any deductions or discounts may be
claimed concerning the Collateral except those disclosed to Lender
in writing.

Location of the Collateral. Except in the ordinary course of
Grantor's business, Grantor agrees to keep the Collateral (or to the
extent the Collateral consists of intangible property such as
accounts or general intangibles, the records concerning the
Collateral) at Grantor's address shown above or at such other
locations as are acceptable to Lender. Upon Lender's request,
Grantor will deliver to Lender in form satisfactory to Lender a
schedule of real properties and Collateral locations relating to
Grantor's operations, including without limitation the following:
(1) all real property Grantor owns or is purchasing; (2) all real
property Grantor is renting or leasing; (3) all storage facilities
Grantor owns, rents, leases, or uses; and (4) all other properties
where Collateral is or may be located.

Removal of the Collateral. Except in the ordinary course of
Grantor's business, including the sales of inventory, Grantor shall
riot remove the Collateral from its existing location without
Lender's prior written consent. To the extent that the Collateral
consists of vehicles, or other titled property, Grantor shall not
take or permit any action which would require application for
certificates of title for the vehicles outside the State of Florida,
without Lender's prior written consent. Grantor shall, whenever
requested, advise Lender of the exact location of the Collateral.

Transactions Involving Collateral. Except for inventory sold or
accounts collected in the ordinary course of Grantor's business, or
as otherwise provided for in this Agreement, Grantor shall not sell,
offer to sell, or otherwise transfer or dispose of the Collateral.
While Grantor is not in default under this Agreement, Grantor may
sell inventory, but only in the ordinary course of its business and
only to buyers who qualify as a buyer in the ordinary course of
business. A sale in the ordinary course of Grantor's business does
not include a transfer in partial or total satisfaction of a debt or
any bulk sale. Grantor shall not pledge, mortgage, encumber or
otherwise permit the Collateral to he Subject to any lien, security
interest, encumbrance, or charge, other than the security interest
provided for in this Agreement, without the prior written consent of
Lender. This includes security interests even if junior in right to
the security interests granted under this

Exhibit 99.3 - Pg. 4

COMMERCIAL SECURITY AGREEMENT
Loan No: 0000050483 (Continued) Page 2
______________________________________________________________________

Agreement. Unless waived by Lender, all proceeds from any
disposition of the Collateral (for whatever reason) shall be held
in trust for Lender and shall not be commingled with any other
funds; provided however, this requirement shall not constitute
consent by Lender to any sale or other disposition. Upon receipt,
Grantor shall immediately deliver any such proceeds to Lender.

Title. Grantor represents and warrants to Lender that Grantor holds
good and marketable title to the Collateral, free and clear of all
liens and encumbrances except for the lien of this Agreement. No
financing statement covering any of the Collateral is on file in any
public office other than those which reflect the security interest
created by this Agreement or to which Lender has specifically
consented. Grantor shall defend Lender's rights in the Collateral
against the claims and demands of all other persons.

Repairs and Maintenance. Grantor agrees to keep and maintain, and
to cause others to keep and maintain, the Collateral in good order,
repair and condition at all times while this Agreement remains in
effect. Grantor further agrees to pay when due all claims for work
done on, or services rendered or material furnished in connection
with the Collateral so that no lien or encumbrance may ever attach
to or be filed against the Collateral.

Inspection of Collateral. Lender and Lender's designated
representatives and agents shall have the right at all reasonable
times to examine and inspect the Collateral wherever located.

Taxes, Assessments and Liens. Grantor will pay when due all taxes,
assessments and liens upon the Collateral, its use or operation,
upon this Agreement, upon any promissory note or notes evidencing
the Indebtedness, or upon any of the other Related Documents,
Grantor may withhold any such payment or may elect to contest any
lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender's
interest in the Collateral is not jeopardized in Lender's sole
opinion. If the Collateral is subjected to a lien which is not
discharged within fifteen (15) days, Grantor shall deposit with
Lender cash, a sufficient corporate surety bond or other security
satisfactory to Lender in an amount adequate to provide for the
discharge of the lien plus any interest, costs, reasonable
attorneys' fees or other charges that could accrue as a result of
foreclosure or sale of the Collateral. In any contest Grantor shall
defend itself and Lender and shall satisfy any final adverse
judgment before enforcement against the Collateral. Grantor shall
name Lender as an additional obligee under any surety bond furnished
in the contest proceedings. Grantor further agrees to furnish
Lender with evidence that such taxes, assessments, and governmental
and other charges have been paid in full and in a timely manner.
Grantor may withhold any such payment or may elect to contest any
lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender's
interest in the Collateral is not jeopardized.

Compliance with Governmental Requirements. Grantor shall comply
promptly with all laws, ordinances, rules and regulations of all
governmental authorities, now or hereafter in effect, applicable to
the ownership, production, disposition, or use of the Collateral.
Grantor may contest in good faith any such law, ordinance or
regulation and withhold compliance during any proceeding, including
appropriate appeals, so long as Lender's interest in the Collateral,
in Lender's opinion, is not jeopardized.

Hazardous Substances. Grantor represents and warrants that the
Collateral never has been, and never will be so long as this
Agreement remains a lien on the Collateral, used in violation of any
Environmental Laws or for the generation, manufacture, storage,
transportation, treatment, disposal, release or threatened release
of any Hazardous Substance. The representations and warranties
contained herein are based on Grantor's due diligence in
investigating the Collateral for Hazardous Substances. Grantor
hereby (1) releases and waives any future claims against Lender for
indemnity or contribution in the event Grantor becomes liable for
cleanup or other costs under any Environmental Laws, and (2) agrees
to indemnify and hold harmless Lender against any and all claims and
losses resulting from a breach of this provision of this Agreement.
This obligation to indemnify shall survive the payment of the
Indebtedness and the satisfaction of this Agreement.

Maintenance of Casualty Insurance. Grantor shall procure and
maintain all risks insurance, including without limitation fire,
theft and liability coverage together with such other insurance as
Lender may require with respect to the Collateral, in form, amounts,
coverages and basis reasonably acceptable to Lender and issued by a
company or companies reasonably acceptable to Lender. Grantor, upon
request of Lender, will deliver to Lender from time to time the
policies or certificates of insurance in form satisfactory to
Lender, including stipulations that coverages will not be cancelled
or diminished without at least ten (10) days' prior written notice
to Lender and not including any disclaimer of the insurer's
liability for failure to give such a notice. Each insurance policy
aIso shall include an endorsement providing that coverage in favor
of Lender will not be impaired in any way by any act, omission or
default of Grantor or any other person. In connection with all
policies covering assets in which Lender holds or is offered a
security interest, Grantor will provide Lender with such loss
payable or other endorsements as Lender may require. If Grantor at
any time fails to obtain or maintain any insurance as required under
this Agreement, Lender may (but shall not be obligated to) obtain
such insurance as Lender deems appropriate, including if Lender so
chooses "single interest insurance," which will cover only Lender's
interest in the Collateral.

Application of Insurance Proceeds. Grantor shall promptly notify
Lender of any loss or damage to the Collateral. Lender may make
proof of loss it Grantor fails to do so within fifteen (15) days of
the casualty. All proceeds of any insurance on the Collateral,
including accrued proceeds thereon, shall be held by Lender as part
of the Collateral. If Lender consents to repair or replacement of
the damaged or destroyed Collateral, Lender shall, upon satisfactory
proof of expenditure, pay or reimburse Grantor from the proceeds for
the reasonable cost of repair or restoration. If Lender does not
consent to repair or replacement of the Collateral, Lender shall
retain a sufficient amount of the proceeds to pay all of the
Indebtedness, and shall pay the balance to Grantor. Any proceeds
which have not been disbursed within six (6) months after their
receipt and which Grantor has not committed to the repair or
restoration of the Collateral shall be used to prepay the
Indebtedness.

Insurance Reserves. Lender may require Grantor to maintain with
Lender reserves for payment of insurance premiums, which reserves
shall be created by monthly payments from Grantor of a sum estimated
by Lender to be sufficient to produce, at least fifteen (15) days
before the premium due date, amounts at least equal to the insurance
premiums to be paid. If fifteen (15) days before payment is due,
the reserve funds are insufficient, Grantor shall upon demand pay
any deficiency to Lender. The reserve funds shall be held by Lender
as a general deposit and shall constitute a non-interest-bearing
account which Lender may satisfy by payment of the insurance
premiums required to be paid by Grantor as they become due. Lender
does not hold the reserve funds in trust for Grantor, and Lender is
not the agent of Grantor for payment of the insurance premiums
required to be paid by Grantor. The responsibility for the payment
of premiums shall remain Grantor's sole responsibility.

Insurance Reports. Grantor, upon request of Lender, shall furnish
to Lender reports on each existing policy of insurance showing such
information as Lender may reasonably request including the
following: (1) the name of the insurer; (2) the risks insured; (3)
the amount of the policy; (4) the property insured; (5) the then
current value on the basis of which insurance has been obtained and
the manner of determining that value; and (6) the expiration date of
the policy. In addition, Grantor shall upon request by Lender
(however riot more often than annually) have an independent
appraiser satisfactory to Lender determine, as applicable, the cash
value or replacement cost of the Collateral.

Financing Statements. Grantor authorizes Lender to file a UCC-1
financing statement, or alternatively, a copy of this Agreement to
perfect Lender's security interest. At Lender's request, Grantor
additionally agrees to sign all other documents that are necessary
to perfect, protect, and continue Lender's security interest in the
Property. Grantor will pay all filing fees, title transfer fees,
and other fees and costs involved unless prohibited by law or unless
Lender is required by law to pay such fees and costs. Grantor
irrevocably appoints Lender to execute financing statements and
documents of title in Grantor's name and to execute all documents
necessary to transfer title if there is a default. Lender may file
a copy of this Agreement as a financing statement. If Grantor
changes Grantor's name or address, or the name or address of any
person granting a security interest under this Agreement changes,
Grantor will promptly notify the Lender of such change.

GRANTOR'S RIGHT TO POSSESSION AND TO COLLECT ACCOUNTS. Until default and
except as otherwise provided below with respect to accounts, Grantor may
have possession of the tangible personal property and beneficial use of
all the Collateral and may use it in any lawful manner not inconsistent
with this Agreement or the Related Documents, provided that Grantor's
right to possession and beneficial use shall not apply to any Collateral
where possession of the Collateral by Lender is required by law to
perfect Lender's security interest in such Collateral. Until otherwise
notified by Lender, Grantor may collect any of the Collateral consisting
of accounts. At any time and even though no Event of Default exists,
Lender may exercise its rights to collect the accounts and to notify
account debtors to make payments directly to Lender for application to
the Indebtedness. If Lender at any time has possession of any
Collateral, whether before or after an Event of Default, Lender shall be
deemed to have exercised reasonable care in the custody and preservation
of the Collateral if Lender takes such action for that purpose as Grantor
shall request or as Lender, in Lender's sole discretion, shall deem
appropriate under the circumstances, but failure to honor any request by
Grantor shall not of itself be deemed to be a failure to exercise
reasonable care. Lender shall not be required to take any steps
necessary to preserve any rights in the Collateral against prior parties,
nor to protect, preserve or maintain any security interest given to
secure the Indebtedness.

Exhibit 99.3 - Pg. 5

COMMERCIAL SECURITY AGREEMENT
Loan No: 0000050483 (Continued) Page 3
______________________________________________________________________

LENDER'S EXPENDITURES. If any action or proceeding is commenced that
would materially affect Lender's interest in the Collateral or if
Gantor fails to comply with any provision of this Agreement or any
Related Documents, including but not limited to Grantor's failure to
discharge or pay when due any amounts Grantor is required to discharge or
pay under this Agreement or any Related Documents, Lender on Grantor's
behalf may (but shall not be obligated to) take any action that Lender
deems appropriate, including but not limited to discharging or paying all
taxes, liens, security interests, encumbrances and other claims, at any
time levied or placed on the Collateral and paying all costs for
insuring, maintaining and preserving the Collateral. All such
expenditures incurred or paid by Lender for such purposes will then bear
interest at the rate charged under the Note from the date incurred or
paid by Lender to the date of repayment by Grantor. All such expenses
will become a part of the Indebtedness and, at Lender's option, will (A)
be payable on demand; (B) be added to the balance of the Note and be
apportioned among and be payable with any installment payments to become
due during either (1) the term of any applicable insurance policy; or (2)
the remaining term of the Note; or (C) be treated as a balloon payment
which will be due and payable at the Note's maturity. The Agreement also
will secure payment of these amounts. Such right shall be in addition to
all other rights and remedies to which Lender may be entitled upon
Default.

DEFAULT. Each of the following shall constitute an Event of Default
under this Agreement:

Payment Default. Grantor fails to make any payment when due under
the Indebtedness.

Other Defaults. Grantor fails to comply with or to perform any
other term, obligation, covenant or condition contained in this
Agreement or in any of the Related Documents or to comply with or to
perform any term, obligation, covenant or condition contained in any
other agreement between Lender and Grantor.

Default in Favor of Third Parties. Should Borrower or any Grantor
default under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of any
other creditor or person that may materially affect any of Grantor's
property or Grantor's or any Grantor's ability to repay the
Indebtedness or perform their respective obligations under this
Agreement or any of the Related Documents.

False Statements. Any warranty, representation or statement made or
furnished to Lender by Grantor or on Grantor's behalf under this
Agreement or the Related Documents is false or misleading in any
material respect, either now or at the time made or furnished or
becomes false or misleading at any time thereafter.

Defective Collateralization. This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure
of any collateral document to create a valid and perfected security
interest or lien) at any time and for any reason.

Insolvency. The dissolution or termination of Grantor's existence
as a going business, the insolvency of Grantor, the appointment of a
receiver for any part of Grantor's property, any assignment for the
benefit of creditors, any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency
laws by or against Grantor.

Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self help,
repossession or any other method, by any creditor of Grantor or by
any governmental agency against any collateral securing tile
Indebtedness. This includes a garnishment of any of Grantor's
accounts, including deposit accounts, with Lender. However, this
Event of Default shall not apply if there is a good faith dispute by
Grantor as to the validity or reasonableness of the claim which is
the basis of the creditor or forfeiture proceeding and if Grantor
gives Lender written notice of the creditor or forfeiture proceeding
and deposits with Lender monies or a surety bond for the creditor or
forfeiture proceeding, in an amount determined by Lender, in its
sole discretion, as being an adequate reserve or bond for the
dispute.

Events Affecting Guarantor. Any of the preceding events occurs with
respect to Guarantor of any of the Indebtedness or Guarantor dies or
becomes incompetent or revokes or disputes the validity of, or
liability under, any Guaranty of the Indebtedness.

Adverse Change. A material adverse change occurs in Grantor's
financial condition, or Lender believes the prospect of payment or
performance of the Indebtedness is impaired.

Insecurity. Lender in good faith believes itself insecure.

Cure Provisions. If any default, other than a default in payment is
curable and if Grantor has not been given a notice of a breach of
the same provision of this Agreement within the preceding twelve
(12) months, it may be cured (and no event of default will have
occurred) if Grantor, after receiving written notice from Lender
demanding cure of such default: (1) cures the default within
fifteen (15) days; or 2) if the cure requires more than fifteen (15)
days, immediately initiates steps which Lender deems in Lender's
sole discretion to be Sufficient to cure the default and thereafter
continues and completes all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical.

RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this
Agreement, at any time thereafter, Lender shall have all the rights of a
secured party under the Florida Uniform Commercial Code. In addition and
without limitation, Lender may exercise any one or more of the following
rights and remedies:

Accelerate Indebtedness. Lender may declare the entire
Indebtedness, including any prepayment penalty which Grantor would
be required to pay, immediately due and payable, without notice of
any kind to Grantor.

Assemble Collateral. Lender may require Grantor to deliver to
Lender all or any portion of the Collateral and any and all
certificates of title and other documents relating to the
Collateral. Lender may require Grantor to assemble the Collateral
and make it available to Lender at a place to be designated by
Lender. Lender also shall have full power to enter upon the
property of Grantor to take possession of arid remove the
Collateral. If the Collateral contains other goods not covered by
this Agreement at the time of repossession, Grantor agrees Lender
may take such other goods, provided that Lender makes reasonable
efforts to return them to Grantor after repossession.

Sell the Collateral. Lender shall have full power to sell, lease,
transfer, or otherwise deal with the Collateral or proceeds thereof
in Lender's own name or that of Grantor. Lender may sell the
Collateral at public auction or private sale. Unless the Collateral
threatens to decline speedily in value or is of a type customarily
sold on a recognized market, Lender will give Grantor, and other
persons as required by law, reasonable notice of the time and place
of any public sale, or the time after which any private sale or any
other disposition of the Collateral is to be made. However, no
notice need be provided to any person who, after Event of Default
occurs, enters into and authenticates an agreement waiving that
person's right to notification of sale. The requirements of
reasonable notice shall be met if such notice is given at least ten
(10) days before the time of the sale or disposition. All expenses
relating to the disposition of the Collateral, including without
limitation the expenses of retaking, holding, insuring, preparing
for sale and selling the Collateral, shall become a part of the
Indebtedness secured by this Agreement and shall be payable on
demand, with interest at the Note rate from date of expenditure
until repaid.

Appoint Receiver. In the event of a suit being instituted to
foreclose this Agreement, Lender shall be entitled to apply at any
time pending such foreclosure suit to the court having jurisdiction
thereof for the appointment of a receiver of any or all of the
Collateral, and of all rents, incomes, profits, issues and revenues
thereof, from whatsoever source. The parties agree that the court
shall forthwith appoint such receiver with the usual powers and
duties of receivers in like cases. Such appointment shall be made
by the court as a matter of strict right to Lender and without
notice to Grantor, and without reference to the adequacy or
inadequacy of the value of the Collateral, or to Grantor's solvency
or any other party defendant to such suit. Grantor hereby
specifically waives the right to object to the appointment of a
receiver and agrees that such appointment shall be made as an
admitted equity and as a matter of absolute right to Lender, and
consents to the appointment of any officer or employee of Lender as
receiver. Lender shall have the right to have a receiver appointed
to take possession of all or any part of the Collateral, with the
power to protect and preserve the Collateral, to operate the
Collateral preceding foreclosure or sale, and to collect the Rents
from the Collateral and apply the proceeds, over and above the cost
of the receivership, against the Indebtedness. The receiver may
serve without bond if permitted by law. Lender's right to the
appointment of a receiver shall exist whether or not the apparent
value of the Collateral exceeds the Indebtedness by a substantial
amount. Employment by Lender shall not disqualify a person from
serving as a receiver.

Collect Revenues, Apply Accounts. Lender, either itself or through
a receiver, may collect the payments, rents, income, and revenues
from the Collateral. Lender may at any time in Lender's discretion
transfer any Collateral into Lender's own name or that of Lender's
nominee and receive the payments, rents, income, and revenues
therefrom and hold the same as security for the Indebtedness in such
order of preference as Lender may determine. Insofar as the
Collateral consists of accounts, general intangibles, insurance
policies, instruments, chattel paper, choses in action, or similar
property, Lender may demand, collect, receipt for, settle,
compromise, adjust, xxx for, foreclose, or realize on the Collateral
as Lender may determine, whether or not Indebtedness or Collateral
is then due. For these purposes, Lender may, on behalf of and in
the name of Grantor, receive, open and dispose of mail addressed to
Grantor; change any address to which mail and payments are to be
sent; and endorse notes, checks, drafts, money orders,

Exhibit 99.3 - Pg. 6

COMMERCIAL SECURITY AGREEMENT
Loan No: 0000050483 (Continued) Page 4
______________________________________________________________________

documents of title, instruments and items pertaining to payment,
shipment, or storage of any Collateral. To facilitate collection,
Lender may notify account debtors and obligors on any Collateral to
make payments directly to Lender.

Obtain Deficiency. If Lender chooses to sell any or all of the
Collateral, Lender may obtain a judgment against Grantor for any
deficiency remaining on the Indebtedness due to Lender after
application of all amounts received from the exercise of the rights
provided in this Agreement. Grantor shall be liable for a
deficiency even if the transaction described in this subsection is a
sale of accounts or chattel paper.

Other Rights and Remedies. Lender shall have all the rights and
remedies of a secured creditor under the provisions of the Uniform
Commercial Code, as may be amended from time to time. In addition,
Lender shall have and may exercise any or all other rights and
remedies it may have available at law, in equity, or otherwise.

Election of Remedies. Except as may be prohibited by applicable
law, all of Lender's rights and remedies, whether evidenced by this
Agreement, the Related Documents, or by any other writing, shall be
cumulative and may be exercised singularly or concurrently.
Election by Lender to pursue any remedy shall not exclude pursuit of
any other remedy, and an election to make expenditures or to take
action to perform an obligation of Grantor under this Agreement,
after Grantor's failure to perform, shall not affect Lender's right
to declare a default and exercise its remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a
part of this Agreement:

Amendments. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as
to the matters set forth in this Agreement. No alteration of or
amendment to this Agreement shall be effective unless given in
writing and signed by the party or parties sought to be charged or
bound by the alteration or amendment.

Attorneys' Fees; Expenses. Grantor agrees to pay upon demand all of
Lender's costs and expenses, including Lender's reasonable
attorneys' fees and Lender's legal expenses, incurred in connection
with the enforcement of this Agreement. Lender may hire or pay
someone else to help enforce this Agreement, and Grantor shall pay
the costs and expenses of such enforcement. Costs and expenses
include Lender's reasonable attorneys' fees and legal expenses
whether or not there is a lawsuit, including reasonable attorneys'
fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction),
appeals, and any anticipated post-judgment collection services.
Grantor also shall pay all court costs and such additional fees as
may be directed by the court.

Caption Headings. Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret or
define the provisions of this Agreement.

Governing Law. This Agreement will be governed by, construed and
enforced in accordance with federal law and the laws of the State of
Florida. This Agreement has been accepted by Lender in the State of
Florida.

No Waiver by Lender. Lender shall not be deemed to have waived any
rights under this Agreement unless such waiver is given in writing
and signed by Lender. No delay or omission on the part of Lender in
exercising any right shall operate as a waiver of such right or any
other right. A waiver by Lender of a provision of this Agreement
shall not prejudice or constitute a waiver of Lender's right
otherwise to demand strict compliance with that provision or any
other provision of this Agreement. No prior waiver by Lender, nor
any course of dealing between Lender and Grantor, shall constitute a
waiver of any of Lender's rights or of any of Grantor's obligations
as to any future transactions. Whenever the consent of Lender is
required under this Agreement, the granting of such consent by
Lender in any instance shall not constitute continuing consent to
subsequent instances where such consent is required and in all cases
such consent may be granted or withheld in the sole discretion of
Lender.

Notices. Any notice required to be given under this Agreement shall
be given in writing, and shall be effective when actually delivered,
when actually received by telefacsimile (unless otherwise required
by law), when deposited with a nationally recognized overnight
courier, or, if mailed, when deposited in the United States mail, as
first class, certified or registered mail postage prepaid, directed
to the addresses shown near the beginning of this Agreement. Any
party may change its address for notices under this Agreement by
giving written notice to the other parties, specifying that the
purpose of the notice is to change the party's address. For notice
purposes, Grantor agrees to keep Lender informed at all times of
Grantor's current address. Unless otherwise provided or required by
law, if there is more than one Grantor, any notice given by Lender
to any Grantor is deemed to be notice given to all Grantors.

Power of Attorney. Grantor hereby appoints Lender as Grantor's
irrevocable attorney-in-fact for the purpose of executing any
documents necessary to perfect, amend, or to continue the security
interest granted in this Agreement or to demand termination of
filings of other secured parties. Lender may at any time, and
without further authorization from Grantor, file a carbon,
photographic or other reproduction of any financing statement or of
this Agreement for use as a financing statement, Grantor will
reimburse Lender for all expenses for the perfection and the
continuation of the perfection of Lender's security interest in the
Collateral.

Severability. If a court of competent jurisdiction finds any
provision of this Agreement to be illegal, invalid, or unenforceable
as to any circumstance, that finding shall not make the offending
provision illegal, invalid, or unenforceable as to any other
circumstance. If feasible, the offending provision shall be
considered modified so that it becomes legal, valid and enforceable.
If the offending provision cannot be so modified, it shall be
considered deleted from this Agreement. Unless otherwise required
by law, the illegality, invalidity, or unenforceability of any
provision of this Agreement shall not affect the legality, validity
or enforceability of any other provision of this Agreement.

Successors and Assigns. Subject to any limitations stated in this
Agreement on transfer of Grantor's interest, this Agreement shall be
binding upon and inure to the benefit of the parties, their
successors and assigns. If ownership of the Collateral becomes
vested in a person other than Grantor, Lender, without notice to
Grantor, may deal with Grantor's successors with reference to this
Agreement and the Indebtedness by way of forbearance or extension
without releasing Grantor from the obligations of this Agreement or
liability under the Indebtedness.

Survival of Representations and Warranties. All representations,
warranties, and agreements made by Grantor in this Agreement shall
survive the execution and delivery of this Agreement, shall be
continuing in nature, and shall remain in full force and effect
until such time as Grantor's Indebtedness shall be paid in full.

Time is of the Essence. Time is of the essence in the performance
of this Agreement.

Waive Jury. All parties to this Agreement hereby waive the right to
any jury trial in any action, proceeding, or counterclaim brought by
any party against any other party. (Initial Here /s/ B.S.R.)

DEFINITIONS. The following capitalized words and terms shall have the
following meanings when used in this Agreement. Unless specifically
stated to the contrary, all references to dollar amounts shall mean
amounts in lawful money of the United States of America. Words and terms
used in the singular shall include the plural, and the plural shall
include the singular, as the context may require. Words and terms not
otherwise defined in this Agreement shall have the meanings attributed to
such terms in the Uniform Commercial Code:

Account. The word "Account" means a trade account, account
receivable, other receivable, or other right to payment for goods
sold or services rendered owing to Grantor (or to a third party
grantor acceptable to Lender).

Agreement. The word "Agreement" means this Commercial Security
Agreement, as this Commercial Security Agreement may be amended or
modified from time to time, together with all exhibits and schedules
attached to this Commercial Security Agreement from time to time.

Borrower. The word "Borrower" means PET MED EXPRESS, INC., and all
other persons and entities signing the Note in whatever capacity.

Collateral. The word "Collateral" means all of Grantor's right,
title and interest in and to all the Collateral as described in the
Collateral Description section of this Agreement.

Default. The word "Default" means the Default set forth in this
Agreement in the section titled "Default."

Environmental Laws. The words "Environmental Laws" mean any and all
state, federal and local statutes, regulations and ordinances
relating to the protection of human health or the environment,
including without limitation the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, 42
U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund Amendments
and Recovery Act of 1986, Pub. L, No. 99-499 ("XXXX"), the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et
seq., or other applicable state or federal laws, rules, or
regulations adopted pursuant thereto.

Exhibit 99.3 - Pg. 7

COMMERCIAL SECURITY AGREEMENT
Loan No: 0000050483 (Continued) Page 5
______________________________________________________________________

Event of Default. The words "Event of Default" mean any of the
events of default set forth in this Agreement in the default section
of this Agreement.

Grantor. The word "Grantor" means PET MED EXPRESS, INC.

Guarantor. The word "Guarantor" means any guarantor, surety, or
accommodation party of any or all of the Indebtedness.

Guaranty. The word "Guaranty" means the guaranty from Guarantor to
Lender, including without limitation a guaranty of all or part of
the Note.

Hazardous Substances. The words "Hazardous Substances" mean
materials that, because, of their quantity, concentration or
physical, chemical or infectious characteristics, may cause or pose
a present or potential hazard to human health or the environment
when improperly used, treated, stored, disposed of, generated,
manufactured, transported or otherwise handled. The words
"Hazardous Substances" are used in their very broadest sense and
include without limitation any and all hazardous or toxic
substances, materials or waste as defined by or listed under the
Environmental Laws. The term "Hazardous Substances" also includes,
without limitation, petroleum and petroleum by-products or any
fraction thereof and asbestos.

Indebtedness. The word "Indebtedness" means the indebtedness
evidenced by the Note or Related Documents, including all principal
and interest together with all other indebtedness and costs and
expenses for which Grantor is responsible under this Agreement or
under any of the Related Documents.

Lender. The word "Lender" means SouthTrust Bank, its successors and
assigns.

Note. The word "Note" means the Note executed by PET MED EXPRESS,
INC. in the principal amount of $150,000.00 dated March 12, 2002,
together with all renewals of, extensions of, modifications of,
refinancings of, consolidations of, and substitutions for the note
or credit agreement.

Property. The word "Property" means all of Grantor's right, title
and interest in and to all the Property as described in the
"Collateral Description" section of this Agreement.

Related Documents. The words "Related Documents" mean all
promissory notes, credit agreements, loan agreements, environmental
agreements, guaranties, security agreements, mortgages, deeds of
trust, security deeds, collateral mortgages, and all other
instruments, agreements and documents, whether now or hereafter
existing, executed in connection with the Indebtedness.

GRANTOR HAS READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS COMMERCIAL
SECURITY AGREEMENT AND AGREES TO ITS TERMS. THIS AGREEMENT IS DATED
JULY 22, 2002.

GRANTOR:

PETMED EXPRESS, INC.
By:/s/__________Bruce S. Rosenbloom________________
XXXXX XXXXXXXXXX, C.F.O. of PETMED EXPRESS, INC.

Exhibit 99.3 - Pg. 8

DISBURSEMENT REQUEST AND AUTHORIZATION

---------------------------------------------------------------------------------------------------
Principal Loan Date Maturity Loan No. Call/Coll Account Officer Initials

LOAN TYPE. This is a Variable Rate Nondisclosable Revolving Line of
Credit Loan to a Corporation for $1,000,000.00 due on July 22, 2003.
The reference rate ("base rate." The term "base rate" means the rate
of interest designated by the Lender periodically as its Base Rate,
currently 4.750%) is added to the margin of 1.000%, resulting in an
initial rate of 4.750. This is an unsecured renewal loan.

PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for (please
initial):

[ ] _____ Personal, Family, or Household Purposes or Personal
Investment.

[X] _____ Business (including Real Estate Investment).

SPECIFIC PURPOSE. The specific purpose of this loan is: WORKING CAPITAL.

DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds
will be disbursed until all of Lender's conditions for making the loan
have been satisfied. Please disburse the loan proceeds of $1,000,000.00
as follows:

Undisbursed Funds: $ 858,785.52
Other Disbursements: $ 141,214.48
$141,214.48 OUTSTANDING
PRINCIPAL BALANCE
-------------
Note Principal: $1,000,000.00

CHARGES PAID IN CASH. Borrower has paid or will pay in cash as agreed the
following charges:

Prepaid Finance Charges Paid in Cash $ 0.00
Other Charges Paid in Cash: $ 6,375.00
$6,375.00 LOAN FEE
-------------
Total Charges Paid in Cash: $ 6,375.00

AUTOMATIC PAYMENTS. Borrower hereby authorizes Lender automatically to
deduct from Borrower's Checking account numbered 00000000, ABA numbered
the amount of any loan payment. If the funds in the account are
insufficient to cover any payment, Lender shall not be obligated to
advance funds to cover the payment. At any time and for any reason,
Borrower or Lender may voluntarily terminate Automatic Payments.

FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS
AND WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND
CORRECT AND THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S
FINANCIAL CONDITION AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL
STATEMENT TO LENDER. THIS AUTHORIZATION IS DATED JULY 22, 2002.

BORROWER:

PETMED EXPRESS, INC.
By:/s/__________Bruce S. Rosenbloom________________
XXXXX XXXXXXXXXX, C.F.O. of PETMED EXPRESS, INC.

Exhibit 99.3 - Pg. 9

CORPORATE RESOLUTION TO BORROW/GRANT COLLATERAL

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Principal Loan Date Maturity Loan No. Call/Coll Account Officer Initials

Corporation: PETMED EXPRESS, INC. Lender: SouthTrust Bank
(SSN:65-0680967) West Palm Beach
0000 XX 00xx Xxx. (Xxxxx Xxxxxxx)
XXXXXXX XXXXX, XX 00000 Xxx Xxxx Xxxxxxx Xxxx.
(0xx Xxxxx)
Ft. Xxxxxxxxxx, XX 00000
(000) 000-0000
==============================================================================

I, THE UNDERSIGNED, DO HEREBY CERTIFY THAT:

THE CORPORATION'S EXISTENCE. The complete and correct name of the
Corporation is PET MED EXPRESS, INC. ("Corporation"). The Corporation
is a corporation for profit which is, and at all times shall be, duly
organized, validity existing, and in good standing under and by virtue
of the laws of the State of Florida. The Corporation is duly
authorized to transact business in all other states in which the
Corporation is doing business. Specifically, the Corporation is, and
at all times shall be, duly qualified as a foreign corporation in all
states in which the failure to do so qualify would have a material
adverse effect on its business or financial condition. The Corporation
has the full power and authority to own its properties and to transact
the business in which it is presently engaged or presently proposes to
engage. The Corporation maintains an office at 0000 XX 00XX XXX,
XXXXXXX XXXXX, XX 00000. Unless the Corporation has designated
otherwise in writing, the principal office is the office at which the
Corporation keeps its books and records. The Corporation will notify
Lender prior to any change in the location of the Corporation's state
of organization or any change in the Corporation's name. The
Corporation shall do all things necessary to preserve and to keep in
full force and effect its existence, rights and privileges, and shall
comply with all regulations, rules, ordinances, statues, orders and
decrees of any governmental or quasi-governmental authority or court
applicable to the Corporation and the Corporation's business
activities.

RESOLUTIONS ADOPTED. At a meeting of the Directors of the Corporation,
or if the Corporation is a close corporation having no Board of
Directors then at a meeting of the Corporation's shareholders, duly
called and held on ________________, at which a quorum was present and
voting, or by other duly authorized action in lieu of a meeting, the
resolutions set forth in this Resolution were adopted.

OFFICER. The following named person is an officer of PET MED EXPRESS,
IN.:

NAMES TITLES AUTHORIZED ACTUAL SIGNATURES
----- ------ ---------- -----------------

XXXXX XXXXXXXXXX C.F.O. Y /S/__Bruce S. Rosenbloom__

ACTIONS AUTHORIZED. The authorized person listed above may enter into
any agreements of any nature with Lender, and those agreements will
bind the Corporation. Specifically, but without limitation, the
authorized person is authorized, empowered, and directed to do the
following for and on behalf of the Corporation:

Borrow Money. To borrow, as a cosigner or other, from time to
time from Lender, on such terms as may be agreed upon between the
Corporation and Lender, such sum or sums of money as in his or
her judgment should be borrowed, without limitation.

Execute Notes. To execute and deliver to Lender the promissory
note or notes, or other evidence of the Corporation's credit
accommodations, on Lender's forms, at such rates of interest and
on such terms as may be agreed upon, evidencing the sums of money
so borrowed or any of the Corporation's indebtedness to Lender,
and also to execute and deliver to Lender one or more renewals,
extensions, modifications, refinancing, consolidations, or
substitutions for one or more of the notes, or any other evidence
of credit accommodations.

Grant Security. To mortgage, pledge, transfer, endorse,
hypothecate, or otherwise encumber and deliver to Lender any
property now or hereafter belonging to the Corporation or in
which the Corporation now or hereafter may have an interest,
including without limitation all real property and all personal
property (tangible or intangible) of the Corporation, as security
for the payment of any loans or credit accommodations so
obtained, any promissory notes so executed (including any
amendments to or modifications, renewals, and extensions of such
promissory notes), or any other further indebtedness of the
Corporation to Lender at any time owing, however the same may be
evidenced. Such property may be mortgaged, pledged, transferred,
endorsed, hypothecated or encumbered at the time such loans are
obtained or such indebtedness is incurred, or at any time or
times, and may be either in addition to or in lieu of any
property theretofore mortgaged, pledged, transferred, endorsed,
hypothecated or encumbered.

Execute Security Documents. To execute and deliver to Lender the
forms of mortgage, deed of trust, pledge agreement, hypothecation
agreement, and other security agreements and financing statements
which Lender may require and which shall evidence the terms and
conditions under the pursuant to which such liens and
encumbrances, or any of them, are given; and also to execute and
deliver to Lender any other written instruments, and chattel
paper, or any other collateral, or any kind or nature, which
Lender may deem necessary or proper in connection with or
pertaining to the giving of the liens and encumbrances.

Negotiate Items. To draw, endorse, and discount with Lender all
drafts, trade acceptances, promissory notes, or other evidences
of indebtedness payable to or belonging to the Corporation or in
which the Corporation may have an interest, and either to receive
cash for the same or to cause such proceeds to be credited to the
Corporation's account with Lender, or to cause such other
disposition of the proceeds derived therefrom as he or she may
deem advisable.

Further Acts. In the case of lines of credit, to designate
additional or alternate individuals as being authorized to
request advances under such lines, and in all cases, to do and
perform such other acts and things, to pay any and all fees and
costs, and to execute and deliver such other documents and
agreements, including agreements waiving the right to a trial by
jury, as the officer may in his or her discretion deem reasonably
necessary or proper in order to carry into effect the provisions
of this Resolution.

ASSUMED BUSINESS NAMES. The Corporation has filed or recorded all
documents or filings required by law relating to all assumed business
names used by the Corporation. Excluding the name of the Corporation,
the following is a complete list of all assumed business names under
which the Corporation does business: None.

NOTICES TO LENDER. The Corporation will promptly notify Lender in
writing at Lender's address shown above (or such other addresses as
Lender may designate from time to time) prior to any (A) change the
Corporation's name; (B) change in the Corporation's assumed business
name(s); (C) change in the management of the Corporation; (D) change
in the authorized signer(s); (E) change in the Corporation's principal
office address; (F) change in the Corporation's state of organization;
(G) conversion of the Corporation to a new or different type of
business entity; or (H) change in any other aspect of the Corporation
that directly or indirectly relates to any agreements between the
Corporation and Lender. No change in the Corporation's name or state
of organization will take effect until after Lender has received
notice.

CERTIFICATION CONCERNING OFFICERS AND RESOLUTIONS. The officer named
above is duly elected, appointed, or employed by or for the
Corporation, as the case may be, and occupies the position set
opposite his or her respective name. This Resolution now stands of
record on the books of the Corporation, is in full force and effect,
and has not been modified or revoked in any manner whatsoever.

NO CORPORATE SEAL. The Corporation has no corporate seal, and
therefore, no seal is affixed to this Resolution.

CONTINUING VALIDITY. Any and all acts authorized pursuant to this
Resolution and performed prior to the passage of this Resolu6tion are
hereby ratified and approved. This Resolution shall be continuing,
shall remain in full force and effect and Lender may rely on it until
written notice of its revocation shall have been delivered to and
received by Lender at Lender's address shown above (or such addresses
as Lender may designate from time to time). Any such notice shall not
affect any of the Corporation's agreements or commitments in effect at
the time notice is given.

IN TESTIMONY WHEREOF, I have hereunto set my hand and attest that the
signature set opposite the name listed above is his or her genuine
signature.

I have read all the provisions in this Resolution, and I personally
and on behalf of the Corporation certify that all statements and
representations made this Resolution are true and correct. This
Corporate Resolution to Borrow / Grant Collateral is
dated_________________.

Exhibit 99.3 - Pg. 10

CORPORATE RESOLUTION TO BORROW / GRANT COLLETERAL
Loan No: 0000050483 (Continued) Page 2
______________________________________________________________________

CERTIFIED TO AND ATTESTED BY:

/S/___Bruce S. Rosenbloom___________
XXXXX XXXXXXXXXX, C.F.O.

Exhibit 99.3 - Pg. 11

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EXHIBIT 99.3] [LINE OF CREDIT AGREEMENT WITH SOUTHTRUST BANK, N.A.] PROMISSORY NOTE

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