EXHIBIT 1(D)
SECURITY AGREEMENT
THIS SECURITY AGREEMENT is dated March 30, 1996. FORWARD INDUSTRIES, INC.,
with the principal office (or residence address in the case of individuals)
located at 275 HEMPSTEAD TURNPIKE, WEST HEMPSTEAD, NEW YORK 11552, jointly and
severally ("Borrower(s)") hereby
GRANTS A CONTINUING SECURITY INTEREST TO 1ST SOURCE BANK
a financial institution with principal offices located at 100 North Michigan
Street, South Bend, Indiana 46601, its successors and assigns ("1st Source"), in
and to:
all accounts, contract rights, general intangibles, instruments, chattel paper,
invoices, contracts, claims, leases, agreements, books and records, policies or
certificates of insurance, deposits, deposit accounts, documents, documents of
title, and choses in action, whether now owned or existing or hereafter acquired
or arising, and all inventory, whether now owned or existing or hereafter
acquired or arising;
all equipment, machinery, motor vehicles, furniture and all other goods and
personal property and interests in goods and personal property, and all
fixtures, whether now owned or existing or hereafter acquired or arising; and
together with all additions, accessions and accessories to, substitutions for,
and replacements, products and proceeds of, all of the foregoing, including,
without limitation, proceeds of insurance (all called the "Collateral").
This Security Agreement is given to secure payment and performance of all
indebtedness and obligations of Borrower now or hereafter owing to 1st Source,
including, but not limited to, future advances, obligations of Borrower under
this Security Agreement and under all notes, mortgages, security agreements,
assignments, leases, guaranties and any other agreements or documents heretofore
or hereafter executed by Borrower including all interest, late charges,
prepayment penalties and other amounts set forth in any such documents, whether
such indebtedness or obligations be direct or indirect, absolute or contingent,
primary or secondary, or related or unrelated to the Collateral or Borrower's
financing thereof, and all partial or full extensions, renewals and
modifications of the indebtedness and obligations (collectively called the
"Indebtedness"). The Indebtedness includes but is not limited to the notes and
guaranties indicated herein:
NOTES GUARANTIES
Date of Note Original Principal Amount Date of Guaranty Name of Primary
Obligor
MARCH 30, 1996 $350,000.00
MARCH 20, 1996 $750,000.00
Borrower hereby authorizes 1st Source to execute and file any financing or
fixture filing statements signed only by 1st Source as deemed advisable by 1st
Source in the appropriate state or local offices on behalf of the Borrower in
connection herewith.
Borrower further represents, warrants, covenants and agrees as follows:
1. That all terms used in this Security Agreement that are defined in the
Indiana Uniform Commercial Code shall have the meanings given to those
terms in the Indiana Uniform Commercial Code; and
that in this Security Agreement, "Prime Rate" shall mean the Prime Rate as
published in the The Wall Street Journal, and which is described as the
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base rate on corporate loans at large U.S. money center commercial banks,
as such rate may vary from time to time, provided, if such base rate is
expressed in a range in said publication, the higher rate of the Reported
range will apply, and provided further, in the event The Wall Street
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Journal ceases to publish a Prime Rate, 1st Source shall use a similar
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source to determine said Prime Rate, and provided further, the interest
rate will be adjusted with each published change of the Prime Rate.
2. To perform and pay the Indebtedness, including interest, in accordance with
the terms of the documents evidencing the Indebtedness.
3. That Borrower acquired the Collateral in the ordinary course of business
and is the sole owner of the Collateral and has good and marketable title
to the Collateral free and clear of all liens and encumbrances except liens
and encumbrances granted to 1st Source and those liens and encumbrances set
forth below:
Permitted encumbrances: NONE
That Borrower will warrant and defend the Collateral against any person
claiming an interest in the Collateral adverse to the interest of 1st Source;
that the Collateral will be used solely for business purposes and uses; that if
any portion of the Collateral is or is to be attached to real estate, a complete
and accurate legal description of the real estate is set forth on Exhibit A
attached hereto and incorporated herein, and that Borrower is the record owner
of such real estate unless the name of the record owner is set forth on Exhibit
A, and if Collateral is attached to the real estate prior to the perfection of
the security interest granted hereby, Borrower,on demand of 1st Source, shall
furnish 1st Source with a disclaimer, signed by all persons having an interest
in the real estate, of any interest in the Collateral which is superior to 1st
Source's interest; that Borrower will not remove any Collateral that is a
fixture without the prior written consent of 1st Source; that the Collateral has
not been moved into this state from another state in the past six months; that,
except as set forth herein, the Collateral will be kept at the address of
Borrower set out above, which, except as disclosed herein, is Borrower's chief
executive office, mailing address and sole place of business (or residence
address in the case of individuals); that Borrower has not changed the location
of its chief executive office or principal place of business in the last six
months; that Borrower will give immediate notice to 1st Source of any change in
its name or the location of its chief executive office or places where it
conducts business (or residence address in the case of individuals); that all
records relating to Collateral will be kept at Borrower's chief executive
office; and that Borrower will not move any Collateral from one state to another
without giving 1st Source thirty days' prior written notice.
Location of chief executive office (if different from that set forth in the
first paragraph):
Principal place of business (if other than chief executive office):
Locations (other than chief executive office) where Borrower conducts
business (indicate by check mark the locations at which Collateral will be
kept):
702 S. CHAPIN STREET, SOUTH BEND, INDIANA 46624
2626 STATE ROAD 39, LAPORTE, INDIANA 46350
4. That all information concerning Borrower, the Collateral, and any guarantor
of the Indebtedness furnished to 1st Source in connection with this
transaction is true and correct in all material respects and no omission or
misrepresentation of material fact renders said information misleading;
that the execution, delivery, and performance of this Security Agreement by
Borrower does not violate any law or requirement binding upon Borrower or
require the approval of any third party; that this Security Agreement
constitutes the valid and binding obligation of Borrower, enforceable in
accordance with its terms; and that there are no pending or threatened
proceedings or arbitrations before any court, agency, or other person or
body which may adversely affect the Borrower or the Collateral.
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5. If Borrower is a corporation or partnership, Borrower is duly organized,
validly existing and in good standing and existence in the state where it
was organized and in such states where it is required to be registered to
do business; that Borrower has full power and authority to carry on its
business as presently conducted and to enter into and perform its
obligations under this Security Agreement; that the execution, delivery,
and performance of this Security Agreement by Borrower have been duly
authorized by appropriate corporate or partnership action and will not
violate Borrower's articles of incorporation, by-laws, or partnership
agreement, or require the approval of its shareholders; that Borrower,
except as previously disclosed in writing to 1st Source by Borrower, does
not transact business and has not transacted business in any name other
than the name set forth in the first paragraph of this Security Agreement,
and has not changed its legal name in the past six months; and that
Borrower will not change its legal name or any trade name or assumed name
without giving at least thirty days' prior written notice to 1st Source.
6. To do such reasonable acts and things and deliver or cause to be delivered
such other papers as 1st Source may deem necessary to establish, protect or
maintain a valid security interest in the Collateral to secure the
Indebtedness, including without limitation, delivery of certificates of
title with appropriate assignments or notations thereon; and that 1st
Source, and any persons 1st Source permits, shall have the right to examine
and inspect Collateral at reasonable times.
7. That Borrower will from time to time, as 1st Source requests, deliver to
1st Source in a form acceptable to 1st Source such schedules, certificates
and reports relative to all or any of the Collateral and the items or
amounts received by Borrower as proceeds of any of the Collateral, each
signed by Borrower's duly authorized officer. Borrower shall at all times
allow 1st Source and any persons 1st Source permits to examine, inspect or
make abstracts from the Borrower's books and records and to verify returned
and repossessed goods, if any, and to arrange for verification of accounts,
under reasonable procedures, directly with the account debtors or by other
methods.
8. That Borrower may, in the ordinary course of business and until 1st Source
notifies Borrower of the revocation of such power and authority respecting
any inventory which constitutes Collateral, at its own expense, sell, lease
or furnish under contracts of service, any of the inventory held by the
Borrower for such purpose in the ordinary course of business (a sale in the
ordinary course of business does not include a transfer in total or partial
satisfaction of a debt), and use and consume, in the ordinary course of
business, any raw materials, work in process or materials used or consumed
in the ordinary course of business; that Borrower will, at its own expense,
endeavor to collect, as and when due, all amounts due with respect to any
Collateral including the taking of such action with respect to such
collection as 1st Source may reasonably request; that Borrower may grant,
in the ordinary course of business and until 1st Source notifies Borrower
of the revocation of such power and authority respecting any accounts which
constitute Collateral, to any account debtor, any rebate, refund or
adjustment to which such account debtor may be lawfully entitled and may
accept and in connection therewith, accept the return of goods the sale or
lease of which shall have given rise to the obligation of the account
debtor.
9. To pay, when due, all taxes, assessments, insurance premiums and other
charges (all called the "Charges") relating to the Collateral before the
same become delinquent and will deliver to 1st Source satisfactory evidence
of payment.
10. To cause the Collateral to be insured at all times against loss or damage
by fire, windstorm and such other hazards as 1st Source from time to time
may require, in such amounts and with such insurers as are acceptable to
1st Source, and Borrower will cause all premiums on such insurance to be
paid when due; that each insurance policy shall provide that loss shall be
payable to 1st Source and shall be in form acceptable to 1st Source; that
Borrower shall, promptly upon 1st Source's request, deliver to 1st Source
copies of all insurance policies or other evidence of insurance as is
acceptable to 1st Source; that each such policy shall provide that at least
twenty (20) days' prior written notice of any modification or cancellation
shall be given to 1st
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Source by the insurer; that each renewal of each such policy shall be
delivered to 1st Source at least fifteen (15) days prior to its expiration;
and that upon transfer of the Collateral in full satisfaction of the
Indebtedness, all right, title and interest of Borrower in and to any
insurance policies then in force, including the right to any premium refund
thereon, shall vest in the purchaser or grantee.
In the event of any loss of or damage to the Collateral, Borrower will give
immediate notice to 1st Source and 1st Source shall have the right to make
proof of such loss or damage, if Borrower does not promptly do so. All
proceeds payable under any insurance policy, whether or not endorsed
payable to 1st Source, shall be payable directly to 1st Source. 1st Source
is authorized to settle, adjust, or compromise any claims for loss or
damage under any such policy.
11. To maintain the Collateral which is inventory or goods in good condition
and repair; to not commit or suffer any waste; and to comply with all laws
and regulations of any authority applicable to the Collateral.
12. If Borrower defaults in any of its covenants in Sections 9, 10 or 11 above,
1st Source shall have the right to pay the Charges, procure and maintain
insurance, or cause such other covenant to be performed, and all sums
expended by 1st Source in connection therewith shall become part of the
Indebtedness and a lien upon the Collateral, payable by Borrower to 1st
Source upon demand, with interest per annum at three percent (3%) in excess
of the Prime Rate. No such action by 1st Source shall be deemed to relieve
Borrower from any default hereunder or impair any right or remedy of 1st
Source, and the right of 1st Source to take such action shall be optional
and not obligatory. Borrower's failure to pay the Charges when due, or to
procure and maintain insurance, or to cause such other covenants to be
performed, shall constitute waste and shall entitle 1st Source to the
appointment by a court of competent jurisdiction of a receiver of the
Collateral for the purpose of preventing such waste, which receiver,
subject to the order of the court, may collect the rents, income and
profits from the Collateral and exercise such control over the Collateral
as the court shall order.
13. If all or any part of the Collateral is taken, whether temporarily or
permanently, under power of eminent domain or by condemnation, the entire
proceeds of the award or other payment in relief therefor shall be paid
directly to 1st Source, which shall render any surplus, after payment in
full of the Indebtedness and all expenses, including attorneys' fees, legal
assistants' fees and all legal expenses, to Borrower.
14. Upon the occurrence of any of the following events of default by Borrower,
the Indebtedness shall, at the option of 1st Source, become immediately due
and payable without notice or demand:
(a) Borrower defaults in the payment of all or part of any installment of
interest, principal, or premium (if any) on the Indebtedness when the
same shall become due (whether by acceleration or otherwise), or
defaults in the payment of any other obligation to 1st Source whether
now existing or hereafter incurred.
(b) Borrower without the written consent of 1st Source, except as
expressly allowed by this Security Agreement, sells, conveys, or
transfers the Collateral, or any portion of the Collateral, or any
interest in the Collateral, or any rents, income or profits from the
Collateral, or creates or suffers to exist any lien or other
encumbrance or any writ of attachment, garnishment, execution, or
other legal process to be placed upon the Collateral, or any portion
of the Collateral, or any interest in the Collateral, or any rents,
income or profits from the Collateral, except in favor of 1st Source,
or if any part of the Collateral shall be transferred by operation of
law.
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(c) All or any material part of the Collateral is damaged or destroyed by
fire or other casualty, regardless of insurance coverage therefor, or
is taken by condemnation or power of eminent domain.
(d) Borrower does not pay principal or interest on any other indebtedness
for borrowed money when due.
(e) Any representation or warranty made in any document, agreement, or
instrument, or any amendment or supplement thereto, delivered to or
for the benefit of 1st Source by any person relating to the
Indebtedness, including without limitation this Security Agreement
(the "Loan Documents") or otherwise in writing furnished in connection
therewith shall be false or inaccurate in any material respect when
made.
(f) Any one or more of the covenants or agreements contained in any of the
Loan Documents is violated, or any other default occurs under any of
the Loan Documents.
(g) Any judgments are rendered against Borrower or Borrower agrees to
settle any claim asserted in any litigation or proceeding, except as
covered by insurance.
(h) Borrower or any guarantor of the obligations of Borrower to 1st Source
dies, dissolves, becomes insolvent, makes an assignment for the
benefit of creditors, applies to any court for the appointment of a
trustee or receiver of any substantial part of its assets or commences
any proceedings relating to itself under any bankruptcy, receivership,
reorganization, arrangement, insolvency, readjustment of debt,
dissolution or other liquidation law of any jurisdiction, or any
application is filed or proceedings are commenced as described above
against Borrower or any such guarantor or Borrower or any such
guarantor indicates its approval, consent or acquiescence thereto, or
an order is entered appointing such a trustee or receiver or
adjudicating Borrower or any such guarantor as a bankrupt or an
insolvent or approving the petition in any such proceedings and such
order remains in effect for thirty (30) days.
(i) Any order is entered in any proceedings against Borrower or any such
guarantor to create a dissolution or split-up thereof and such order
remains in effect for thirty (30) days.
(j) Any enforcement action or other proceeding is commenced or threatened
or notice is received by a Borrower in any way relating to the
environment or discharges into the environment, or any claim is
instituted against Borrower in the nature of toxic tort, fear of
illness or other health related claim or claim relating to potentially
responsible party status at any disposal, storage, recycling or
reclamation site to which soils or other materials were taken during
or after operations conducted on the property which constitutes
Collateral, or any order in any way relating to the environment or
discharges into the environment is entered against the Borrower or
any of its property by any administrative agency or court.
(k) There occurs any material change in the nature of Borrower's business
as carried on as of the date of this Security Agreement or in the
financial condition or prospects of Borrower, which change would have
a material adverse effect on the position of 1st Source.
15. 1st Source shall have all rights and remedies provided for in this Security
Agreement or otherwise permitted by law or in equity, including without
limitation all of the rights and remedies of a secured party under the
applicable Uniform Commercial Code statutes. In addition, without limiting
the foregoing, upon the occurrence of an event of default defined above,
1st Source shall have the right, and is hereby authorized:
(a) To the extent permitted by law, to act as a receiver or have a
receiver appointed for 1st Source's benefit with such powers as the
court shall confer, to collect and receive all rents,
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income and profits,and other amounts that are due or shall hereafter
become due under the terms of any leases, or other agreements, now or
hereafter in effect, by which Borrower is, or shall be, leasing or
selling the Collateral or any portion thereof or any interest therein,
and to exercise any other right or remedy of Borrower under any such
lease, or other agreement, provided, that 1st Source shall have no
obligation to make any demand or inquiry as to the nature or
sufficiency of any payment received, or to present or file any claim,
or take any other action to collect or enforce the payment of any
amounts to which 1st Source may become entitled hereunder, nor shall
1st Source be liable for any of the Borrower's obligations under any
such lease or other agreement.
(b) To cause the lien searches, tax histories, and federal tax lien and
bankruptcy and judgment searches with respect to the Collateral to be
certified to current date, or to procure new searches in case none was
furnished to 1st Source, and all sums expended therefor shall be part
of the Indebtedness and shall bear interest per annum at three percent
(3%) in excess of the Prime Rate.
(c) To take possession of the Collateral, and for that purpose 1st Source
may, so far as the Borrower can give authority therefor, enter upon
any premises on which the Collateral may be situated and remove the
same therefrom. 1st Source shall give to Borrower at least ten (10)
days' prior written notice of the time and place of any public sale of
Collateral or of the time after which any private sale or any other
intended disposition is to be made. Any such sale may be held or made
on such terms as 1st Source deems advisable. 1st Source may purchase
all or any part of the Collateral at any sale. 1st Source may at any
time in its discretion transfer any property constituting Collateral
into its own name or that of its nominee and receive the income
thereon and hold the same as security hereunder or apply it pursuant
to this Security Agreement. Insofar as Collateral shall consist of
accounts, contract rights, general intangibles, instruments, chattel
paper, invoices, contracts, claims, leases, agreements, insurance
policies, choses in action or the like, 1st Source may demand,
collect, receive, receipt for, sue for, settle, compromise, adjust,
foreclose or realize upon Collateral as 1st Source may determine, and
1st Source may receive, open and dispose of mail addressed to the
Borrower and endorse notes, checks, drafts, money orders, documents of
title or other evidences of payment, shipment or storage of any form
of Collateral on behalf of and in the name of the Borrower. Except as
otherwise required by law, 1st Source shall have no duty as to the
collection or protection of the Collateral, or any income therefrom,
nor as to the preservation of rights against prior parties nor as to
the preservation of any rights pertaining thereto beyond the safe
custody thereof. 1st Source may exercise its rights with respect to
Collateral without resorting to or regard to other collateral or
sources of payment or reimbursement for Indebtedness.
Upon the occurrence of an event of default defined above, Borrower: will
upon receipt of all checks, drafts, cash and other remittances in payment
of accounts of Borrower deposit same in a special collateral account
("Collateral Account") maintained with 1st Source from which Borrower shall
have no right to make withdrawals, and such proceeds shall be deposited in
the form received except for the endorsement of the Borrower where
required, which endorsement 1st Source is authorized to make on the
Borrower's behalf and 1st Source may at its discretion apply monies held in
the Collateral Account as set forth in Section 20 hereof or hold such
monies as further security for Indebtedness (without waiving its rights to
later apply the same as set forth in Section 20); will prior to the time of
any deposit keep segregated any such checks, drafts, cash or other
remittances in trust for the benefit of 1st Source until deposited in the
Collateral Account with 1st Source; agrees that 1st Source may notify any
account debtor to make payment directly to 1st Source of any amounts due or
to become due and Borrower will upon request of 1st Source provide such
notice to account debtors, and 1st Source may enforce the collection of any
account or contract right by suit or otherwise and surrender, release or
exchange all or any part thereof, or compromise or extend or renew for a
period (whether or not longer than the original period) any indebtedness
thereunder or evidenced thereby; will note the security interest of 1st
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Source on all records relative to the Collateral including, without
limitation, any invoice which evidences an account; will, whenever Borrower
obtains possession (by return, repossession or otherwise) of any goods the
sale or lease of which had given rise to any of the Collateral, segregate,
label and hold such goods subject to the security interest of 1st Source
and will at its own expense dispose of such goods in such manner as 1st
Source from time to time may direct; will assemble the Collateral and make
it available to 1st Source at a place acceptable to 1st Source which is
convenient to 1st Source; and will pay to 1st Source on demand and without
relief from valuation and appraisement laws any deficiency remaining after
disposal of the Collateral, which deficiency shall be Indebtedness secured
hereby.
16. 1st Source, at its option, may extend the time for the payment of the
Indebtedness, or reduce the payment thereon, or accept a renewal note or
notes therefor, without the consent of any endorser, guarantor or junior
lien holder and without the consent of Borrower if Borrower has conveyed
title to the Collateral; and any such extension, reduction or renewal shall
not affect the The liens created by this Security Agreement or impair the
security hereof in any manner, or release, discharge, or affect in any
manner the liability of Borrower, or any endorser or guarantor, to 1st
Source. Any part of the Collateral may be released by 1st Source without
affecting the lien and security interest hereby granted as to the
remainder, and the security of this Security Agreement shall not affect or
be affected by any other security for the Indebtedness nor shall the taking
of additional security release or impair the security hereof or the
liability of Borrower, or any endorser or guarantor, for the Indebtedness.
17. Borrower waives any and all right to have the property and estates
comprising the Collateral marshalled, and agrees that Collateral may be
sold as an entirety or in parts or parcels.
18. Time is of the essence of this Security Agreement and all rights and
remedies of 1st Source under this Security Agreement, whether or not
exercisable only on default, shall be cumulative and in addition to those
other rights provided by law and may be exercised from time to time, and no
delay or omission by 1st Source in the exercise of any right or remedy
shall waive that right or remedy, and no single or partial exercise of any
right or remedy shall preclude other or further exercise of any right or
remedy under this Security Agreement or the exercise of any other right or
remedy. No waiver by 1st Source under this Security Agreement shall be
effective unless in writing.
19. Borrower shall pay to 1st Source, on demand, any and all expenses,
including attorneys' fees, legal assistants' fees and legal expenses, paid
or incurred by 1st Source in collecting or attempting to collect the
Indebtedness, or in protecting and enforcing the rights of and obligations
to 1st Source under any provision of this Security Agreement, including,
without limitation, taking any action in any bankruptcy, insolvency, or
reorganization proceedings concerning Borrower, and all such expenses shall
be part of the Indebtedness and shall bear interest per annum, from the
date paid or incurred by 1st Source, at three percent (3%) in excess of the
Prime Rate.
20. In the event of the payment to 1st Source, of any rents, income, profits,
proceeds of insurance, condemnation or eminent domain awards, or from sale,
lease, or other disposition of the Collateral, or otherwise coming to 1st
Source under the provisions of this Security Agreement, 1st Source shall
have the right to apply such payment in such amounts and proportions as 1st
Source shall in its sole discretion determine, to the costs and expenses
paid or incurred by 1st Source, including without limitation the reasonable
expenses of retaking, holding, preparing for sale or lease, selling,
leasing and the like, and reasonable attorneys' and legal assistants' fees
and legal expenses, and to full or partial satisfaction of any or all of
the Indebtedness, including any contingent or secondary obligations,
whether or not the same shall then be due and payable by the primary
obligor. In lieu of such application to the Indebtedness, 1st Source shall
have the right, but not the obligation, to require all or part of the
proceeds of insurance or condemnation or eminent domain award to be used to
repair, restore or rebuild any part of the Collateral damaged or destroyed
by reasons of the occurrence which gave rise to such payment.
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21. All notices to Borrower and 1st Source shall be deemed given when mailed by
first class mail, postage prepaid, to the respective addresses of Borrower
and 1st Source (Attn: Commercial Loan Services) as shown above or such
other address as is provided by such notice, or if and when delivered
personally.
22. Any provisions of this Security Agreement prohibited or unenforceable under
any applicable law shall be ineffective only to the extent of such
prohibition or unenforceability without invalidating the remaining
provisions of this Security Agreement. All reference herein to this
Security Agreement shall include all amendments and modifications of the
same.
23. The person executing this Security Agreement on behalf of any Borrower
hereby personally represents and warrants to 1st Source that he or she is
authorized to do so and that this Security Agreement is fully enforceable
against the Borrower. For breach of this warranty, such persons shall be
liable to 1st Source for all losses, damages and costs of collection of the
same, including but not limited to attorneys' and legal assistants' fees
and legal expenses.
24. This Security Agreement shall inure to the benefit and bind 1st Source and
Borrower, their successors, assigns, heirs, and personal representatives.
The terms of this Security Agreement shall be interpreted, construed and
governed by the laws of the State of Indiana.
25. DUE TO THE HIGH COST AND TIME INVOLVED IN COMMERCIAL LITIGATION BEFORE A
JURY, BORROWER WAIVES ALL RIGHT TO A JURY TRIAL ON ALL ISSUES IN ANY ACTION
OR PROCEEDING RELATED HERETO OR TO THE TRANSACTIONS EVIDENCED HEREBY OR TO
ANY DOCUMENTS EXECUTED IN CONNECTION HEREWITH, AND NO ATTEMPT SHALL BE MADE
TO CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH ACTION OR PROCEEDING
WITH ANY OTHER ACTION OR PROCEEDING IN WHICH THERE IS A TRIAL BY JURY OR IN
WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED.
26. Additional Provisions: (attach separate sheets if necessary).
IN WITNESS WHEREOF, Borrower(s) has executed this Security Agreement as of
the day and year first above written.
BORROWER(S): FORWARD INDUSTRIES, INC.
BY: s/ Michael Schiffman
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Its Executive Vice President
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