Exhibit 10.21
[Logo] CONTINUING SECURITY AGREEMENT
NAME OF DEBTOR: MADE2MANAGE SYSTEMS, INC. ("the Debtor")
TAXPAYER I.D. NO.: ▇▇-▇▇▇▇▇▇▇
DEBTOR'S ADDRESS (Chief executive office): ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
GRANT OF SECURITY INTEREST: The Debtor grants to NBD Bank, N.A., a national
banking association the secured party, (referred to as the "Bank"), whose
address is ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, 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 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 attorneys' 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 the
Debtor. Also included are the Debtor's books and records which reflect the
Collateral. 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; Chattel Paper; General Intangibles" consists of accounts,
chattel paper, general intangibles, instruments and documents, as those terms
are defined in the 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. The Debtor warrants that its chief executive office is
at the address shown above.
2. "Inventory" consists of all property held at any location by or for the
Debtor for sale, rent, or lease, or furnished or to be furnished by the
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 includes
containers and shelving useful for storing. Without limiting the security
interest granted, the Debtor's Inventory is presently located at ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
3. "Equipment" consists 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 ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
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. The
policies, or certificates evidencing them, shall, if the Bank so request, be
deposited with the Bank;
5. It will not sell or offer to sell or otherwise transfer the Collateral,
or 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, and at the Bank's request, the Debtor will execute one or more
financing statements in form satisfactory to the Bank and will pay the cost
of filing them in all public offices where filing is deemed by the Bank to
be necessary or desirable;
8. It will immediately notify the Bank in writing of any change in its name,
in its business organization, or its chief executive office, and of any
additional places of business;
9. It will provide any information that the Bank may reasonably request and
will permit the Bank, upon prior notice, to inspect and copy its books and
records during normal business hours.
ACCOUNTS; CHATTEL PAPER; GENERAL INTANGIBLES: The Debtor acknowledges that if
the Collateral includes "Accounts, Chattel Paper, and General Intangibles"
and until the Bank gives notice to the Debtor to the contrary, the Debtor
will, in the usual course of its business and at its own 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. Until the Bank gives
notice to Debtor to the contrary or until the 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 or settlement of the Accounts, Chattel Paper and General
Intangibles 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 the 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, ▇▇▇ for or compromise any and all
Accounts, Chattel Paper and General Intangibles, and to give good and
sufficient releases, to endorse any checks, drafts or other orders for the
payment of money payable to the Debtor 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's taking action. The Debtor appoints the Bank or the
Bank's designee as the Debtor's as the Debtor's attorney-in-fact to do all
things with reference to the Collateral as provided for in this section
including without limitation (1) to notify the post office authorities to
change the Debtor's mailing address to one designated by the Bank, (2) to
receive, open and dispose of mail addressed to the Debtor (3) to sign the
Debtor's name on any invoice or ▇▇▇▇ of lading relating to any Collateral on
assignments and verifications of account and on notices to the Debtor's
customers, and (4) to do all things necessary to carry out this agreement.
The Debtor ratifies and approves all acts of the Bank as attorney-in-fact.
The Bank shall not be liable for any act or omission, nor any error of
judgment or mistake of fact or law, but only for its gross negligence or
willful misconduct. This power being coupled with an interest is irrevocable
until the Liabilities have been fully satisfied.
The Bank shall have the right now, and at any time in the future in its sole
and absolute discretion, without notice to the Debtor, to (a) prepare, file
and sign the Debtor's name on any proof of claim in bankruptcy or similar
document against any owner of the Collateral and (b) prepare, file and sign
the Debtor's name on any notice of lien, assignment or satisfaction of lien
or similar document in connection with the Collateral.
Immediately upon the Debtor's receipt of any Collateral evidenced by an
agreement, instrument, chattel paper or document ("Special Collateral"), the
Debtor shall ▇▇▇▇ the Special Collateral the show that it is subject to the
Bank's security interest and shall deliver the original to the Bank together
with appropriate endorsements and other specific evidence of assignment in
form and substance satisfactory to the Bank.
REPRESENTATIONS: Each Debtor represents that: (a) the execution and delivery
of this agreement and the performance of the obligations it imposes do not
violate any law, do not conflict with any agreement by which it is bound, and
do not require the consent or approval of any governmental authority or any
third party; (b) this agreement is a valid and binding agreement, enforceable
according to its terms; and (c) 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) it is duly organized, existing and in good
standing under the laws where 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 agreement
governing its affairs.
PLEDGE: If the Debtor is not liable for all or any part of the Borrower's
obligations to the Bank (the "Debt"), then it agrees that: (a) If any
monies become available to the Bank that it can apply to any Debt, the Bank
may apply them to Debt not secured by this agreement. (b) Without notice to
or the consent of the Debtor, the Bank may (i) take any action it chooses
against any Borrower, against any collateral for the Debt, or against any
other person liable for the Debt; (ii) release any Borrower or any other
person liable for the Debt; release any collateral for the Debt, and neglect
to perfect any interest in any such collateral; (iii) forbear or agree to
forbear from exercising any rights or remedies, including any right of
setoff, that it has against the Borrower, any other person liable for the
Debt, or any other collateral for the Debt; (iv) renew, extend, modify or
amend any Liability, and deal with any Borrower or any other person liable
for the Debt as it chooses. (c) None of the Debtor's obligations under this
agreement shall be affected by (i) any act or omission of the Bank; (ii) the
voluntary or involuntary liquidation, sale or other disposition of all or
substantially all of the assets of any Borrower; (iii) any receivership,
insolvency, bankruptcy, reorganization or other similar proceedings affecting
any Borrower or any of its assets; or (iv) any change in the composition or
structure of any Borrower or any Debtor, including a merger or consolidation
with any other entity. (d) The Bank's rights under this section and this
agreement are unconditional and absolute, regardless of the unenforceability
of any provision of any agreement between any Borrower and the Bank, or the
existence of any defense, setoff or counterclaim that a Borrower may be able
to assert against the Bank. (e) It waives all rights of subrogation,
contribution, reimbursement, indemnity, exoneration, implied contract,
recourse to security, and any other claim (as that term is defined in the
federal Bankruptcy Code, as amended from time to time) that it may have or
acquire in the future against any Borrower, any other person liable for the
Debt, or any collateral for the Debt, because of the existence of this
agreement, the Debtor's performance under this agreement, or the Bank's
availing itself of any rights or remedies under this agreement. (f) If any
payment to the Bank on any of the Liabilities are wholly or partially
invalidated, set aside, declared fraudulent or required to be repaid to the
Borrower or anyone representing the Borrower or the Borrower's creditors
under any bankruptcy or insolvency act or code, under any state or federal
law, or under common law or equitable principles, then this agreement shall
remain in full force and effect or be reinstated, as the case may be, until
payment in full to the Bank of the repaid amounts, and of the Liabilities. If
this agreement must be reinstated, the Debtor agrees to execute and deliver
to the Bank new agreements and financing statements, if necessary, in form
and substance acceptable to the Bank, covering the Collateral.
DEFAULT/REMEDIES: If the Debtor fails to pay any of the Liabilities when due,
or if a default by anyone occurs under the terms of any agreement related to
any of the Liabilities, or if the Debtor dies or fails to observe or perform
any term of this agreement, or if any representation or warranty contained in
this agreement is untrue, or if there is a material change in the financial
condition of the Debtor which the Bank in good faith determines to be
materially adverse, 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 designated by the 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 the 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 is liable for any deficiency
remaining after disposition of the Collateral.
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 highest rate permitted under any
of the instruments evidencing the Liabilities.
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 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: 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.
Dated: JUNE 25, 1996 Debtor:
MADE2MANAGE SYSTEMS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
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