SUBORDINATION AGREEMENT (By UCC Category)
THIS AGREEMENT, by and between SPECTRUM Commercial Services, 0000 Xxxxxxxxxxxxx
Xxxxx, Xxxxxxxxxxx, XX 00000, a Minnesota corporation ("SPECTRUM" or "you"), and
the undersigned "Creditor", relates to the following described "Borrower":
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Borrower's Full Name: Infinite Graphics Incorporated
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Borrower's Full Address: 0000 Xxxx Xxxx Xxxxxx, Xxxxxxxxxxx, XX 00000
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For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and to induce SPECTRUM from time to time at its discretion
to factor invoices with or make loans or extend credit to Borrower, the
undersigned hereby agrees that, regardless of any priority otherwise available
to the undersigned by law or by agreement, any security interest which the
undersigned may now hold or may at anytime hereafter acquire in the Collateral
(defined below) is, shall be and shall remain fully subordinate for all purposes
to any security interest now held or at any time hereafter granted to or
acquired by you in any or all of the Collateral. "Collateral" as used herein
refers to all property of Borrower whatsoever, including, without limitation:
(a) All of Debtor's inventory, whether now owned or hereafter acquired and
wherever located, including but not limited to raw materials, goods and work in
process, finished goods, and all merchandise returned by or reclaimed from
customers; (b) All of Debtor's chattel paper, purchase orders, purchase order
contracts, accounts and accounts receivable, whether now existing or hereafter
arising, and all other rights to payment of every type and description, whether
now existing or hereafter arising, including, but not limited to, any reserve or
reserve account, all rights to payment arising out of a loan or out of the
overpayment of taxes or other liabilities, whether such right to payment is
earned or not, and howsoever such right to payment may be evidenced, together
with all security interests, mortgages, mechanic's lien rights, and other rights
and interests Debtor may at any time have against any account debtor or other
obligor obligated to make such payment or against any property of any account
debtor or such obligor; (c) All of Debtor's general intangibles, whether now
owned or existing or hereafter acquired or arising, including, but not limited
to, purchase orders, purchase order contracts, applications for patents,
patents, copyrights, trademarks, service marks, trade secrets, tradenames,
goodwill, customer lists, permits, franchises, and the right to use Debtor's
name; (d) Proceeds (including insurance proceeds), products and accessions of
all of the above. The undersigned Creditor further agrees that:
1. Creditor will not exercise collection rights as to any
Collateral, will not take possession of, collect, sell or dispose of any
Collateral, and will not exercise or enforce any other right or remedy available
to the undersigned upon default, without your prior written consent which will
not be unreasonably withheld.
2. SPECTRUM may exercise collection rights, may take possession
of, and may sell, collect or dispose of Collateral, and/or may exercise and
enforce any other right or remedy available to you with respect to Collateral,
whether available prior to or after the occurrence of any default, all without
notice to or consent by anyone, except that notice will be provided to the
undersigned within a reasonable time after commencement of any material
collection effort or as otherwise specifically required by law. You may apply
the proceeds of Collateral to any indebtedness secured by your security
interest, in any order of application, and shall remit any excess proceeds or
any other sums or amounts to the undersigned without being obligated to assure
that any such proceeds or sums are applied to the satisfaction of the
undersigned's subordinated security interest in any Collateral, except as
specifically required by law.
3. SPECTRUM may make loans, factor invoices and/or purchase
orders, or extend other financial accommodations to Borrower in any amount and
at any time or from time to time, and you may otherwise create, or agree,
consent to or suffer the creation of, indebtedness secured by a security
interest in any Collateral, without notice to or consent by the undersigned and
without affecting or impairing the subordination effected hereby.
4. Neither the undersigned nor you (i) makes any representation or
warranty concerning the Collateral or the validity, perfection or (except as to
the subordination effected hereby) priority of any security interest therein; or
(ii) shall have any duty to preserve, protect, care for, insure, take possession
of, collect, dispose of or otherwise realize upon any Collateral.
5. The undersigned warrants that any purchaser or transferee of,
or successor to, any security interest of the undersigned in any or all of the
Collateral will be given written notice of the subordination effected hereby,
prior to the time of purchase, transfer or succession, and that any such
purchaser, transferee or successor will be in all respects subject to and bound
by this Agreement.
6. The undersigned waives any priority available to the
undersigned by law with respect to any security interest in the Collateral, but
the priority or parity of the rights and claims of the undersigned and of you as
general creditors of Borrower (rather than as secured parties) shall not be
affected or impaired by this Agreement. This Agreement is made under and shall
be interpreted under the laws of the State of Minnesota. It cannot be waived or
changed or ended, except by a writing signed by the party to be bound thereby.
This Agreement shall be binding upon the undersigned and the heirs,
representatives, successors and assigns of the undersigned and shall inure
solely to the benefit of and shall be enforceable by, you and your participants,
successors and assigns and otherwise neither Borrower nor any other secured
party nor any other person shall be entitled to rely on or enforce this
Agreement. The undersigned waives notice of your acceptance hereof. A
telecopied/facsimile signature hereon shall be as effective as an original.
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print name] Xxxxxx X. Xxxx "Creditor" Date signed:
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By: [signature] Address:
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Its: [title]
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