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EXHIBIT 10.20
LOCKBOX AGREEMENT
This LOCKBOX AGREEMENT (this "AGREEMENT"), dated as of November
12, 1997, is entered into by and among FWT, INC., a Texas corporation
("Company"), BT COMMERCIAL CORPORATION, as agent ("AGENT"), and BANK ONE TEXAS,
NA ("BANK").
PRELIMINARY STATEMENTS
A. Agent and certain financial institutions acting as Lenders
("LENDERS") have entered into that certain Credit Agreement, dated as of
November 12, 1997 (said Credit Agreement, as it may hereafter be amended,
supplemented or otherwise modified from time to time, being the "CREDIT
AGREEMENT") with Company, wherein the Company has granted the Lenders a
security interest in its present and future accounts receivable, and all
proceeds thereof and Company has agreed that all collections and proceeds of
such accounts receivable shall be remitted in kind to the Agent; and
B. In order to provide for a more efficient and faster
collection and deposit of said collection and proceeds the Agent and Company
desire to use the lockbox service of Bank; and
C. Bank is willing to provide said service for Company and
the Agent commencing as of November 12, 1997; and
WHEREAS, Schedule I to that certain Security Agreement, dated
as of November 12, 1997, by and between Company and Agent, sets forth all of
the Company's deposit accounts.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Post Office Box. The Bank will rent X.X. Xxx 00000 (the
"LOCKBOX") of the post office located at Xxxx Xxxxx, XX 00000-0000 in the name
of Company. Customers of Company have been, or will be, instructed to mail
their remittances to the Lockbox.
2. Access to Mail. The Bank will have exclusive and
unrestricted access to the Lockbox and will have complete and exclusive
authority to receive, pick up and open all regular, registered, certified or
insured mail addressed to the Lockbox. On written demand of the Agent, Bank
shall cease its processing of said mail, and shall release some, in kind, to
the Agent, without the prior consent of
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Company, and the Agent shall thereafter process said mail promptly in
accordance with this Agreement. Bank shall not inquire into the Agent's right
to make such a demand under any agreement among the Agent, the Lenders and
Company, and shall be forever released of all obligations with respect to said
remittances upon release to the Agent. Company shall have no control whatsoever
over any mail, checks, money orders, collections or other forms of remittances
received in the Lockbox. Appropriate instructions have been, or will be, given
by the Bank to the post office where the Lockbox is maintained, and such
instructions shall not be revoked without the prior written consent of the
Agent. Any instruction given to the Bank by Company without the prior or
concurrent written agreement of the Agent shall be void and of no force or
effect. All mail addressed to the Lockbox will be picked up by the Bank
according to its regular collection schedule.
3. Remittance Collection. On the day received the Bank will
open all mail addressed to the Lockbox and remove and inspect the enclosures.
All checks, money orders and other forms or orders for the payment of money and
other collection remittances (hereinafter collectively referred to as "checks")
shall be processed by the Bank as follows:
(1) Missing Date. Undated checks will not be reviewed,
and will be processed as hereafter provided.
(2) Postdated. Postdated checks will not be reviewed,
and will be processed as hereafter provided.
(3) Stale Date. Bank will not review for stale checks,
and will process stale checks as hereafter provided.
(4) Different Amount. Where written and numeric amounts
differ, a check will be processed by the Bank if the correct amount can be
determined from the accompanying documents, otherwise the check will processed
based on the written amount shown on the check.
(5) Signature Missing. The Bank will deposit and process
the check by affixing a stamped impression requesting the drawer bank to
contact the drawer for authority to pay.
(6) Alterations and Restrictions. Checks with alterations
and checks bearing restrictive notations such as "Payment in Full" will be
processed as if no such alterations or restrictions exist, as hereafter
provided.
(7) Foreign Banks and Currency. Checks drawn in foreign
currency will be processed in accordance with the Bank's normal procedure for
such checks and the Agent will be notified by advice of any such checks in the
detail provided to the Company and Agent daily.
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' (8) Other Items. Any items which the Agent has
specifically instructed the Bank in writing not to process will not be
deposited and shall be sent to the Company, with a copy to the Agent.
Notwithstanding anything to the contrary contained in
this Agreement, Bank shall have no obligation to perform services on a basis
any different than it performs lockbox services in the normal course of
business, except with respect to receiving instructions from the Agent rather
than Company.
4. Processing Acceptable Checks. All checks, except those
not acceptable for deposit under the terms of this Agreement, shall be
deposited on the day of receipt by the Bank to Account No. 1561678150 (the
"LENDER ACCOUNT"), which is an account owned and controlled exclusively by the
Agent, and all such checks shall be endorsed as follows:
credited to account number 1561678150; absence of
endorsement hereby supplied and guarantied by Bank One
Texas, NA;
Until a Notice of Redirection substantially in the form
of Exhibit A hereto (a "Notice") is delivered by Agent to Bank, all available
balances in the Lender Account will be transferred on a daily basis via the
automated clearing house system or wire transfer with the following
instructions:
Bankers Trust Company
New York, New York
ABA No. 021 001 033
Account No. 00000000
Account Name: BT Commercial Corporation-LA
Ref.: FWT, Inc.
Attn: X. Xxxxxx
Upon the delivery of a Notice by Agent to Bank, Bank shall transfer such funds
only as provided in such Notice.
All remittance advices, envelopes, and written matter (except as expressly
provided herein) received in the Lockbox together with photocopies of all
checks shall be sent to Company and, if requested by the Agent, copies of same
shall be sent to the Agent. Bank shall mail both a deposit advice for all
deposits to the Lender Account, on a daily basis, and a statement of account,
on a monthly basis, to both the Agent and Company. In addition, Bank shall
facsimile to Agent on each business day by 2:30 p.m., New York City time the
amount of each day's deposit total. Facsimiles shall be sent to BT Commercial
Corporation; attention: Bhartai Baliga, at (000) 000-0000.
5. Returned Checks. Checks deposited in the Lender Account
which are returned unpaid because of "Insufficient Funds," "Uncollected Funds,"
etc. will be redeposited by the Bank only once, except that if a returned check
exceeds,
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$ 1,000 the Bank shall not redeposit such check but shall telephone the Agent
for further instructions on the day such check is received. If redeposit is not
warranted for reasons such as "account closed" or "payment stopped" or if a
check is returned a second time, the Bank will charge the Lender Account and
send a debit advice with the item to Company with copies of same to Agent.
6. Remittance Received by Company. Remittances which are
sent directly to or received by Company shall be forwarded to the Lockbox on
the day received.
7. Record Maintenance . All deposit checks will be scanned
into digital format (on front and back) by the Bank and retained for five years
by the bank prior to destruction. CD-Roms of digital data will be provided to
the Agent or Company on request, within the five-year period.
8. Bank Charges. All charges of Bank for services rendered
pursuant to this agreement shall be billed to and paid directly by Company.
Said charges shall not be charged against remittances nor shall they be debited
to the Lender Account.
9. No Offset. Bank hereby agrees that it will treat all
remittances received in the Lockbox in accordance with the terms of this
agreement and it will not offset or assert any claim against the Lockbox or the
Lender Account or divert such remittances on account of any obligations owed to
the Bank by Company or by the party making the remittance, except as provided in
paragraph 5 hereof.
10. Bank Liability. In acting under this agreement Bank shall
not be liable to the Agent, the Lenders or Company for any error of judgment,
or for any act done or step taken or omitted by it in good faith, except for
gross negligence or willful misconduct.
11. Term. This agreement shall continue in full force and
effect until termination by the Bank on 60 days' prior written notice to all
other parties. The Agent may terminate this Agreement at any time which
termination shall be effective on receipt of written notice by Bank and in the
event of such termination, the Agent shall at its option, have the sole right
to remove mail from the Lockbox. Company shall have no right to unilaterally
terminate this Agreement.
12. Modification. This agreement may only be modified by a
writing signed by all of the parties hereto.
13. Addresses .
(1) All notices, including phone notice, daily deposit
advices, monthly statements of account and copies of all checks and the
documents which are
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to be given or sent to the Agent shall be sent to the following address, and,
where applicable, given at the following phone number:
BT Commercial Corporation
00 Xxxx Xxxxxx, 0xx Xxxxx
Mail Stop #4032
Xxx Xxxx, XX 00000
Attn: Bhartai Baliga
Fax: (000) 000-0000
(2) All notices to Bank shall be sent to:
Bank One Texas, NA
X.X. Xxx 0000
Xxxx Xxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
Fax: (000) 000-0000
(3) All notices and items which are to be sent to
Company shall be sent to:
FWT, Inc.
0000 Xxxx Xxxx 000 Xxxxx
Xxxx Xxxxx, XX 00000
Attn: Chief Executive Officer
Fax: (000) 000-0000
14. Agent Agreement . The Agent agrees that it will indemnify
and hold Bank harmless from any and all loss, liability, expense or damage that
Bank may incur in processing lockbox items in accordance with this Agreement,
including, without limitation any loss that Bank experiences as a result of
returned items to the extent the balances in the Lender Account referenced in
paragraph 5 are insufficient to cover such losses or in the event the balances
in such Lender Account are insufficient to cover Bank charges referenced in
paragraph 8.
15. Limitation on Liability The Agent and Company acknowledge
that the bank undertakes to perform only such duties as are expressly set forth
in this Agreement and those which are normally undertaken by Bank in connection
with lockbox processing. Notwithstanding any other provision of this Agreement,
it is agreed by the parties that Bank shall not be liable for any action taken
by Bank or any of its directors, officers, agents or employees in accordance
with this Agreement, except for Bank's or such natural person's gross
negligence or wilful misconduct. In no event shall Bank be liable for losses or
delays resulting from force majeure, computer malfunction, interruption of
communication facilities, labor difficulties or other causes beyond its
reasonable control or for any indirect, special or consequential damages.
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16. Governing Law. This Agreement shall be governed in
accordance with the laws of Texas, without giving effect to the conflict of law
principles thereof.
17. Effectiveness . This Agreement shall become effective
upon its receipt by the Agent, properly executed by all of the parties hereto.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement by their duly authorized officers as of the day and year first above
written.
BT COMMERCIAL CORPORATION, as Agent
By: /s/ XXXXXX SUN
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Name: Xxxxxx Sun
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Title: Vice President
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BANK ONE TEXAS, NA
By: /s/ XXXXX XXXXXXXX
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Name: Xxxxx Xxxxxxxx
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Title: Vice President
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FWT, INC., as Company
By: [ILLEGIBLE]
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Name: [ILLEGIBLE]
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Title: C.E.O.
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EXHIBIT A (to Exhibit 10.20)
Bank One Texas, NA
X.X. Xxx 0000
Xxxxx Xxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
Re: Lockbox Account for FWT, Inc.
Account No. 1561678150
Ladies and Gentlemen:
Reference is made to that certain Lockbox Agreement, dated as of
November 12, 1997 (the "AGREEMENT") among you, us, as Agent, and FWT, Inc.
pursuant to which we, for our benefit and for the benefit of the Lenders (as
defined in the Agreement), were given exclusive interest and control of the
Account. This notice is given in accordance with the terms of the Agreement.
Effective immediately and continuing until we shall authorize you
in writing to do otherwise, we hereby direct you to transfer on a daily basis
all funds deposited into the Account with the instructions attached hereto.
Very truly yours,
BT COMMERCIAL CORPORATION, as
Agent
By:
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Name:
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Title:
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Exhibit A-1
