CONTINUING SECURITY AGREEMENT
NAME OF DEBTOR: MADE2MANAGE SYSTEMS, INC. ("the Debtor")
TAXPAYER I.D. NO.: 00-0000000
DEBTOR'S ADDRESS: (Chief executive office): 0000 Xxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxxxx, XX 00000
GRANT OF SECURITY INTEREST: The Debtor grants to NBD Bank, N.A, a national
banking association (the "Bank"),whose address is Xxx Xxxxxxx Xxxxxx,
Xxxxxxxxxxxx, XX 00000, a continuing security interest in the Collateral listed
below, to secure the payment and performance of all of Debtor's debt to the
Bank.
Debt shall include each and every debt, liability and obligation of every type
and description now owed or arising at a later time, whether they are direct or
indirect, joint, several, or joint and several and whether or not of the same
type or class as presently outstanding, which shall collectively be referred to
as "Liabilities". Liabilities shall also include all interest, costs, expenses
and reasonable attorney's fees accruing to or incurred by the Bank in collecting
the Liabilities or in the protection, maintenance or liquidation of the
Collateral.
DESCRIPTION OF COLLATERAL: The Collateral covered by this agreement is all of
the Debtor's property defined below, present and future, including, but not
limited to any items listed on any schedule or list attached. Also included are
all proceeds, including but not limited to stock rights, subscription rights,
dividends, stock dividends, stock splits, or liquidating dividends, and all
cash, accounts, chattel paper and general intangibles arising from the sale,
rent, lease, casualty loss or other disposition of the Collateral, and any
Collateral returned to, repossessed by or stopped in transit by Debtor. Where
the Collateral is in the possession of the Bank, the Debtor agrees to deliver to
the Bank any property which represents an increase in the Collateral or profits
or proceeds of the Collateral.
(1) "Accounts Receivable" shall consist of accounts, chattel paper and general
intangibles as those terms are defined in the Indiana Uniform Commercial
Code ("UCC"). Also included is any right to a refund of taxes paid at any
time to any governmental entity. Also included are letters of credit, and
drafts under them, given in support of Accounts Receivable. Debtor
warrants that its chief executive office is at the address shown above.
(2) "Inventory" shall consist of all property held at any location by or for
Debtor for sale, rent, or lease, or furnished or to be furnished by Debtor
under any contract of service, or raw materials or work in process and
their products, or materials used or consumed in its business, and shall
include containers and shelving useful for storing. Without limiting the
security interest granted, Inventory is presently located at 0000 Xxxxxx
Xxxx, Xxxxx 000, Xxxxxxxxxxxx, XX 00000.
(3) "Equipment" shall consist of any goods at any time acquired, owned or held
by Debtor at any location primarily for use in its business, including, but
not limited to, machinery, fixtures, furniture, furnishings and vehicles,
and any accessions, parts, attachments, accessories, tools, dies,
additions, substitutions, replacements and appurtenances to them or
intended for use with them. Without limiting the security interest
granted, Equipment is presently located at 0000 Xxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxxxx, XX 00000.
(4) "Instruments" shall consist of Debtor's interest of any kind in any
negotiable instrument or security as those terms are defined in the UCC, or
any other writing which evidences a right to payment of money and is of a
type which is, in the ordinary course of business, transferred by delivery
alone or by delivery with any necessary endorsement or assignment.
WARRANTIES & COVENANTS: The Debtor warrants and covenants to the Bank that:
(1) It will pay all Liabilities to the Bank secured by this agreement;
(2) It is or will become the owner of the Collateral free from any liens,
encumbrances or security interests, except for this security interest and,
existing liens disclosed to and accepted by the Bank in writing, and will
defend the Collateral against all claims and demands of all persons at any
time claiming any interest in it;
(3) It will keep the Collateral free of liens, encumbrances and other security
interests except for this security interest, maintain it in good repair,
not use it illegally and exhibit it to Bank on demand;
(4) At its own expense, the Debtor will maintain comprehensive casualty
insurance on the Collateral against such risks, in such amounts, with such
deductibles and with such companies as may be satisfactory to the Bank.
Each insurance policy shall contain a lender's loss payable endorsement
satisfactory to the Bank and a prohibition against cancellation or
amendment of the policy or removal of the Bank as loss payee without at
least 30 days prior written notice to the Bank. In all events, the amounts
of such insurance coverages shall conform to prudent business practices and
shall be in such minimum amounts that the Debtor will not be deemed a
co-insurer.
(5) It will not sell or offer to sell or otherwise transfer the Collateral, nor
change the location of the Collateral, without the written consent of the
Bank, except in the ordinary course of business;
(6) It will pay promptly when due all taxes and assessments upon the
Collateral, or for its use or operation;
(7) No financing statement covering all or any part of the Collateral or any
proceeds is on file in any public office, unless the Bank has approved that
filing. At Bank's request, Debtor will execute one or more financing
statements in form satisfactory to Bank and will pay the cost of filing
them in all public offices wherever filing is deemed by Bank to be
desirable;
(8) It will immediately notify Bank in writing of any name change or any change
in business organization;
(9) It will provide any information that Bank may reasonably request, and will
permit Bank upon prior notice, to inspect and copy its books and records
during normal business hours.
ACCOUNTS RECEIVABLE: The Debtor acknowledges that if the Collateral includes
"Accounts Receivable" then until the Bank gives notice to Debtor to the
contrary, Debtor will, in the usual course of its business and at its own cost
and expense, on the Bank's behalf but not as the Bank's agent, demand and
receive and use its best efforts to collect all moneys due or to become due on
the Accounts Receivable. Until the Bank gives notice to Debtor to the contrary
or until Debtor is in default, it may use the funds collected in its business.
Upon notice from the Bank or upon default, the Debtor agrees that all sums of
money it receives on account of or in payment of settlement of the Accounts
Receivable shall be held by it as trustee for the Bank without commingling with
any of its funds, and shall immediately be delivered to the Bank with
endorsement to the Bank's order of any check or similar instrument. It is
agreed that, at any time Bank so elects, it shall be entitled, in its own name
or in the name of the Debtor or otherwise, but at the expense and cost of the
Debtor, to collect, demand, receive, xxx for or compromise any and all Accounts
Receivable, and to give good and sufficient releases, to endorse any checks,
drafts or other orders for the payment of money payable to the Debtor in payment
and, in its discretion, to file any claims or take any action or proceeding
which the Bank may deem necessary or advisable. It is expressly understood and
agreed, however, that the Bank shall not be required or obligated in any manner
to make any demand or to make any inquiry as to the nature or sufficiency of any
payment received by it or to present or file any claim or take any other action
to collect or enforce the payment of any amounts which may have been assigned to
it or to which it may be entitled at any time or times. All notices required in
this paragraph will be immediately effective when sent. Such notices need not
be given prior to the Bank taking action.
REPRESENTATIONS BY DEBTOR: Each Debtor represents: (a) that the execution and
delivery of this agreement and the performance of the obligations it imposes
does not violate any law, conflict with any agreement by which it is bound, or
require the consent or approval of any governmental authority or other third
party; (b) that this agreement is valid and binding, enforceable according to
its terms; and (c) that all balance sheets, profit and loss statements, and
other financial statements furnished to the Bank are accurate and fairly reflect
the financial condition of the organizations and persons to which they apply on
their effective dates, including contingent liabilities of every type, which
financial condition has not changed materially and adversely since those dates.
Each Debtor, other than a natural person, further represents: (a) that it is
duly organized, existing and in good standing pursuant to the laws under which
it is organized; and (b) the execution and delivery of this agreement and the
performance of the obligations it imposes (i) are within its powers and have
been duly authorized by all necessary action of its governing body, and (ii) do
not contravene the terms of its articles of incorporation or organization, its
by-laws, or any partnership, operating or other agreement governing its affairs.
DEFAULT/REMEDIES: if the Debtor fails to pay any of the Liabilities when due, or
otherwise defaults under the terms of any agreement related to any of the
Liabilities, or if the Debtor fails to
observe or perform any term of this agreement, or if any representation or
warranty of the Debtor contained in this agreement is untrue in any material
respect, then the Bank shall have the rights and remedies provided by law or
this agreement, including but not limited to the right to require the Debtor to
assemble the Collateral and make it available to the Bank at a place to be
designated by Bank which is reasonably convenient to both parties, the right to
take possession of the Collateral with or without demand and with or without
process of law, and the right to sell and dispose of it and distribute the
proceeds according to law. In connection with the right of Bank to take
possession of the Collateral, the Bank may take possession of any other items of
property in or on the Collateral at the time of taking possession, and hold them
for the Debtor without liability on the part of Bank. If there is any statutory
requirement for notice, that requirement shall be met if Bank sends notice to
the Debtor at least seven (7) days prior to the date of sale, disposition or
other event giving rise to the required notice. The Debtor shall be liable for
any deficiency remaining after disposition of the Collateral, and waives all
valuation and appraisement laws.
MISCELLANEOUS:
(1) At its option the Bank may, but shall be under no duty or obligation to,
discharge taxes, liens, security interests or other encumbrances at any
time levied or placed on the Collateral, pay for insurance on the
Collateral, and pay for the maintenance and preservation of the Collateral,
and the Debtor agrees to reimburse the Bank on demand for any payment made
or expense incurred by the Bank, with interest at the maximum legal rate.
(2) No delay on the part of Bank in the exercise of any right or remedy shall
operate as a waiver, no single or partial exercise by Bank of any right or
remedy shall preclude any other exercise of it or the exercise of any other
right or remedy, and no waiver or indulgence by the Bank of any default
shall be effective unless in writing and signed by Bank, nor shall a waiver
on one occasion be construed as a waiver of that right on any future
occasion.
(3) If any provision of this agreement is invalid, it shall be ineffective only
to the extent of its invalidity, and the remaining provisions shall be
valid and effective.
(4) Except as provided in the Accounts Receivable paragraph above, notice from
one party to another relating to this agreement shall be deemed effective
if made in writing (including telecommunications) and delivered to the
recipient's address, telex number or facsimile number set forth above by
any of the following means: (a) hand delivery, (b) registered or certified
mail, postage prepaid, with return receipt requested, (c) first class or
express mail, postage prepaid, (d) Federal Express, Purolator Courier or
like overnight courier service or (e) facsimile, telex or other wire
transmission with request for assurance of receipt in a manner typical with
respect to communications of that type. Notice made in accordance with
this section shall be deemed delivered on receipt if delivered by hand or
wire transmission, on the third business day after mailing if mailed by
first class, registered or certified mail, or on the next business day
after mailing or deposit with an overnight courier service if delivered by
express mail or overnight courier.
(5) All rights of Bank shall inure to the benefit of the Bank's successors and
assigns; and all
obligations of the Debtor shall bind the Debtor's heirs, executors,
administrators, successors and assigns. If there is more than one
Debtor, their obligations are joint and several.
(6) A carbon, photographic or other reproduction of this agreement is
sufficient, and can be filed as a financing statement. The Bank is
irrevocably appointed the Debtor's attorney-in-fact to execute any
financing statement on Debtor's behalf covering the Collateral.
(7) The terms and provisions of this security agreement shall be governed by
Indiana law.
WAIVER OF JURY TRIAL BY BANK AND DEBTOR: The Bank and the Debtor, after
consulting or having had the opportunity to consult with counsel, knowingly,
voluntarily and intentionally waive any right either of them may have to a trial
by jury in any litigation based upon or arising out of this agreement or any
related instrument or agreement, or any of the transactions contemplated by this
agreement, or any course of conduct, dealing, statements (whether oral or
written), or actions of either of them. Neither the Bank nor the Debtor shall
seek to consolidate, by counterclaim or otherwise, any action in which a jury
trial has been waived with any other action in which a jury trial cannot be or
has not been waived. These provisions shall not be deemed to have been modified
in any respect or relinquished by either the Bank or the Debtor except by a
written instrument executed by both of them.
Debtor:
TEKSYN, INC. k/n/a MADE2MANAGE
SYSTEMS, INC.
Dated: March 20, 1995
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx President
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Printed Name Title
