EXHIBIT 10.7
ACCOUNT PURCHASE AGREEMENT
This Agreement dated as of November 2, 2001 between Xxxxx Fargo Business Credit,
Inc., ("WFBCI") and SSP Solutions, Inc., a Delaware corporation ("Customer").
The Customer and WFBCI agree as follows:
1. PURPOSE OF AGREEMENT. The Customer desires to sell and assign to WFBCI
acceptable accounts receivable. The purpose of this agreement is commercial in
nature and not for household, family and/or personal use.
2. DEFINITIONS.
"ACCOUNT" means any right of payment of the net amount for goods sold, or
leased and delivered or services rendered in the ordinary course of Customer's
business which is not evidenced by an instrument or chattel paper.
"ACCEPTABLE ACCOUNT" means an Account, in an amount not to be less than
$100, which conforms to the warranties and terms set forth herein or at WFBCI's
sole discretion, net of any credits or allowances of any nature, except the
following shall not in any event be deemed Acceptable Accounts:
(i) That portion of Accounts unpaid 90 days or more after the
invoice date or, if WFBCI in its discretion has determined that a
particular dated Account may be acceptable, that portion of such Account
which is unpaid more than 30 days past the stated due date or more than
90 days past the invoice date;
(ii) That portion of Accounts that is disputed or subject to a
claim of offset or a contra account;
(iii) That portion of Accounts not yet earned by the final
delivery of goods or rendition of services, as applicable, by the
Customer to the Account Debtor;
(iv) Accounts owed by any unit of government, whether foreign or
domestic (provided, however, that there shall be included in Acceptable
Accounts that portion of Accounts owed by such units of government for
which the Customer has provided evidence satisfactory to WFBCI that (A)
WFBCI has a first priority perfected security interest and (B) such
Accounts may be enforced by WFBCI directly against such unit of
government under all applicable laws);
(v) Accounts owed by an Account Debtor located outside the United
States which are not (A) backed by a bank letter of credit naming WFBCI
as beneficiary or assigned to WFBCI, in WFBCI's possession and acceptable
to WFBCI in all respects, in its sole discretion, (B) covered by a
foreign receivables insurance policy acceptable to WFBCI in its sole
discretion;
(vi) Accounts owed by an Account Debtor that is insolvent, the
subject of bankruptcy proceedings or has gone out of business;
(vii) Accounts owed by a shareholder, subsidiary, affiliate,
officer or employee of the Customer;
(viii) Accounts not subject to a duly perfected security interest
in WFBCI's favor or which are subject to any lien, security interest or
claim in favor of any Person other than WFBCI including without
limitation any payment or performance bond;
(ix) That portion of Accounts that has been restructured,
extended, amended or modified;
(x) That portion of Accounts that constitutes advertising, finance
charges, service charges or sales or excise taxes;
(xi) Accounts owed by an Account Debtor, regardless of whether
otherwise acceptable, if 10% or more of the total amount due under
Accounts from such Account Debtor is unacceptable under clauses above;
and
(xii) Accounts, or portions thereof, otherwise deemed unacceptable
by WFBCI in its sole discretion.
"ACCOUNT DEBTOR" means Customer's customer or the person or entity owing
money to the Customer.
"ACCOUNT DEBTOR DISPUTE" means a claim by Account Debtor against
Customer, of any kind whatsoever, that reduces or may reduce the amount
collectible from Account Debtor by WFBCI which arises at anytime, both before or
after signing of this Agreement or the purchase of an Account.
"COLLATERAL" means the intangible or tangible property given as security
to WFBCI by Customer for any obligations and liabilities of Customer to WFBCI
under this Agreement.
"CUSTOMER" means the seller and assignor of the Accounts.
"CREDIT PROBLEM" means, as established by the Customer, that an Account
Debtor is unable to pay its debts because the Account Debtor is the subject of a
bankruptcy, insolvency, or receivership proceeding within 75 days of the date of
the invoice.
"EVENT OF DEFAULT" shall mean the existence of a default pursuant to
paragraph 7 hereunder, or a default under any documents given to WFBCI in
connection with this Agreement.
"INITIAL PAYMENT" shall mean the amount paid to the Customer at the time
of purchase of the Account which is equal to the gross face amount of the
Account less stated trade discounts offered by the Customer to the Account
Debtor less 15 percent.
"MINIMUM FEE" shall mean the minimum fee paid per month by the Customer
as stated in paragraph 5(m) below.
"WFBCI DISCOUNT" means the amount to be paid by the Customer according to
the following schedule:
(i) Days Rate
(for payment
of account)
----------
1-30 1.25% of the gross face amount of each Account purchased
by WFBCI.
45+ .0625 of 1% additionally per day until the account is paid
in full. Upon request from customer, WFBCI may in its sole
discretion, Purchase Accounts or specific invoices that
are less than $100.00.
If any Event of Default exists, as defined below, this discount may
increase in an amount to be determined by WFBCI at its sole discretion.
WFBCI may, upon prior written notice to Customer, change the amount of
any fee or charge at its sole discretion or if WFBCI's cost of funds
increases for any reason. Such change shall be effective upon delivery of
the notice.
plus,
(ii) Each Account purchased by WFBCI that is less than $500.00 shall be
assessed an additional $3.00 charge.
"NET PURCHASE PRICE" means the purchase price of each Account sold to
WFBCI which shall be equal to the gross face amount of each Account less WFBCI's
Discount and other charges and less any amount of any trade discounts, credits
or allowances, or any other reductions or adjustments to such Accounts taken by
the Account Debtor.
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"PART PAYMENT" means a payment/payments made by WFBCI to the Customer
which is/are less than the full Net Purchase Price as more fully described in
Section 3 below.
"REPURCHASE PRICE" for any Account means the Net Purchase Price less any
amounts collected from the Account Debtor on the Account plus all fees, costs or
expenses associated with the repurchase or collection of such Account.
3. PURCHASE OF ACCOUNTS.
a. Pursuant to the terms herein, Customer hereby sells, transfers and
assigns to WFBCI, its successors and assigns, as absolute owner, and WFBCI
hereby purchases and accepts from the Customer all of the Customer's right,
title and interest in and to:
(i) the Customer's Acceptable Accounts receivables due from the Account
Debtor together with all rights of action accrued or to accrue thereon,
including, without limitation, full power to collect, xxx for,
compromise, assign, in whole or in part, or in any other manner enforce
collection thereof in Customer's name or otherwise, as identified and
accepted by WFBCI; and
(ii) all right, title and interest of the Customer in and to the books
and records evidencing or relating to the Acceptable Account, all
deposits, or other security for the obligation of any person under or
relating to the Acceptable Account, all goods relating to, or which by
sale have resulted in, the Account, including goods returned by any
Account Debtor, debtor or obligor in any way obligated on or in
connection with the Acceptable Account including, without limitation,
the Account Debtor, all rights of stoppage in transit, replevin,
repossession and reclamation and all other rights of action of an unpaid
vendor or lienor; and
(iii) proceeds of the foregoing in any form.
b. Approval: WFBCI shall not purchase an Account unless such Account is
first submitted to WFBCI by Customer for approval. WFBCI is not obligated to buy
any Account from Customer which WFBCI does not deem acceptable.
c. Purchase: Upon approval and acceptance by WFBCI of an Account for the
assignment and sale of an Account to WFBCI, Customer shall be entitled to an
Initial Payment.
d. Purchase Price: As consideration for the assignment and sale of an
Account to WFBCI, WFBCI shall pay the to the Customer the Net Purchase Price on
the terms and conditions as stated herein.
e. Payment of Purchase Price: If no Default exists hereunder, WFBCI shall
pay the Net Purchase Price to the Customer at the Customer's request or at
WFBCI's discretion as follows:
(i) First, WFBCI shall pay to the Customer an Initial Payment upon
assignment or sale of an Account to WFBCI, and receipt of all documents and
forms described in paragraph 3(g) below and upon fulfillment of all terms
precedent to such sale or assignment as more fully described below.
(ii) After collection of an Account in full by WFBCI, WFBCI shall pay to
the Customer the amount collected on the Account less: (a) the Initial Payment,
(b) Part Payment(s), and (c) any fees, expenses or charges owed to WFBCI as more
fully described herein. This payment shall be made on the Wednesday of the week
following the calendar week in which the full collection of Account is received
by WFBCI.
f. Reporting and Statement of Account: On a weekly basis, or as otherwise
determined by WFBCI in its sole discretion, WFBCI shall prepare, and have
available for the Customer, an accounting of the purchases, collections, fees
and charges related to this Agreement which have occurred during that week.
Should such a statement of account indicate a deficit balance, the Customer
shall immediately pay to WFBCI, the amount of such deficit plus accrued
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interest on such deficit balance. Interest shall accrue on any deficit balance
at the annual rate of eighteen percent (18%), calculated on a daily basis, not
to exceed the applicable legal limit, until such deficit is paid in full.
g. Required Forms: When Customer offers Accounts to WFBCI for sale, WFBCI
shall receive (i) an assignment of Accounts, in a form satisfactory to WFBCI and
signed by an authorized representative of Customer, (ii) an original invoice or
such other document acceptable to WFBCI in its sole discretion, (iii) a copy of
the Xxxx of Lading, (iv) proof of delivery, (v) contract, purchase order, or
purchase order number which corresponds with such invoice(s), as appropriate to
the business of Customer, (vi) notification of assignment and waiver of offset,
in a form acceptable to WFBCI in its sole discretion and (vii) and any other
document which WFBCI may require.
h. Labels: Customer shall imprint, label, or otherwise xxxx each original
invoice or other such documentation accepted by WFBCI pursuant to paragraph
3(g)(ii) for each Account being sold to WFBCI which indicates that the Account
has been sold to WFBCI with the following language:
This invoice has been assigned to
and is payable to:
XXXXX FARGO BUSINESS CREDIT, INC.
X.X. 00000
Xxxxxx, Xxxxxxxx 00000-0000
For information call 303/000-0000
i. Notification: WFBCI may at any time, and at its sole discretion, notify
any Account Debtor of the assignment of the Account and direct the Account
Debtor to make payments directly to WFBCI.
4. REPRESENTATIONS AND WARRANTIES.
Customer hereby warrants and covenants as follows:
a. Customer is properly licensed, qualified and authorized to operate the
business of Computer Supply Corporation, a Delaware corporation. Customer, and
the persons executing this document, are duly authorized to execute and deliver
this Agreement and all other documents required to be executed and delivered
hereunder.
b. Customer is solvent, is not a Debtor under the United States Bankruptcy
Code or under the direction of a receiver, and Customer has made and shall
continue to make timely payment on deposit of any tax required to be deducted
and withheld by Customer from the wages of any of its employees.
c. Customer is, at the time of purchase of an Account by WFBCI, the lawful
owner of and has good and undisputed title to the Accounts purchased by WFBCI.
The Accounts, at the time of purchase are free from any liens, mortgages,
restrictions or encumbrances. The Account is an Acceptable Account as defined
above.
d. Each Account Debtor's business is solvent to the best of Customer's
information and knowledge.
e. Each Account offered for sale to WFBCI is an accurate and undisputed
statement of indebtedness owed by Account Debtor to Customer for a certain sum
which is due and payable in 30 days or less, or within such time as is agreed to
in writing by WFBCI and Customer for a bona fide sale, delivery and acceptance
of merchandise or performance of services which have been received and finally
accepted by the Account Debtor. Customer has all rights to transfer or sell such
Accounts to WFBCI.
f. Customer does not own, control or exercise dominion over, in any way
whatsoever, the Account Debtor or the business of any Account Debtor for whom
Accounts are to be sold by Customer to WFBCI.
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g. All financial records, statements, books or other documents shown to
WFBCI by Customer at anytime, either before or after the signing of this
Agreement are true and accurate.
h. Customer will not under any circumstances or in any manner whatsoever,
interfere with any of WFBCI's rights under this Agreement.
i. Customer will not sell or assign Accounts except to WFBCI for the period
of this Agreement, and/or for as long as any obligation to repurchase or
indebtedness whatsoever remains owing by Customer to WFBCI.
j. Customer has not transferred, pledged or granted a security interest in
Customer's Accounts or other personal property to any other party which Customer
has not fully disclosed in writing to WFBCI. Customer shall not, and shall not
consent to the transfer, pledge or grant a security interest to, placement of
any lien or encumbrance, by any other party on any personal property or accounts
belonging to the Customer for the term of this Agreement and for as long as
Customer may be required to repurchase an Account or is indebted to WFBCI
hereunder without the written consent of WFBCI. Customer shall provide written
notice to WFBCI within five business days of Customer obtaining any knowledge,
from any source, of the assertion, filing, recording or perfection by any means,
of any non-consensual lien, claim or encumbrance against the property of
Customer.
k. Customer will not change or modify the terms of the original invoice or
agreement with the Account Debtor or the order of payment on Accounts sold to
WFBCI unless WFBCI first consents to such change or modification in writing.
l. Customer will maintain such insurance covering Customer's business and/or
the property of the Account Debtors as is customary and adequate for businesses
similar to the business of Customer in an amount as is sufficient to compensate
for reasonably foreseeable loss, and promptly pay all premiums with respect to
the policies covering such insurance. Further, at the request of WFBCI, the
Customer shall have WFBCI named as loss payee for such insurance.
m. Customer will notify WFBCI in writing prior to any change in the location
of Customer's place(s) of business, including the location of the Customer's
inventory or, if Customer has or intends to acquire any additional place(s) of
business, or prior to any change in Customer's chief executive office or the
office or offices where Customer's books and records concerning Accounts are
kept.
n. Customer will immediately notify WFBCI in writing of any proposed change
of Customer's name, identity, legal entity, corporate structure, business
dissolution, use of additional trade name(s), and/or any proposed change in any
of the officers, principals, partners, and/or owners of Customer and will not
effect any such change without WFBCI's written consent.
o. Customer will immediately notify WFBCI in writing of the commencement of
any legal proceeding or service of any legal document affecting the Customer
including, but not limited to, any judgments, liens, attachments, garnishments,
complaints, or the filing of a voluntary or involuntary petition under the
United States Bankruptcy Code.
p. There is no action, suit or proceeding at law or in equity or by or
before any governmental instrumentality or other agency now pending, or to the
knowledge of Customer, threatened against or affecting Customer, which if
adversely determined, would have a material adverse effect on the business,
operations, property, assets or condition, financial or otherwise, of Customer.
q. The execution and performance by Customer of the terms and provisions of
this Agreement and the execution and delivery of any other documents required to
be executed and delivered hereunder have been duly authorized by all
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requisite company action, and neither the execution and performance of this
Agreement or any other documents required to be delivered hereunder, will
violate any provision of law, any order of any court or other agency of
government, the governing documents of any Customer, or any agreement or other
instrument to which Customer is a party, or by which Customer is bound, or be in
conflict with, result in breach of, or constitute (with due notice or lapse of
time or both) a default under, or result in the creation or imposition of any
lien, charge or encumbrance of any nature whatsoever upon any of the property or
assets of Customer, pursuant to any such agreement or instrument, except as
provided hereunder. Customer agrees that it will execute and perform all terms
hereunder.
5. PROMISES.
Customer hereby promises as follows:
a. Security Interest/Collateral: As further inducement for WFBCI to enter
into this Agreement, Customer gives to WFBCI, as collateral for the repayment of
any and all obligations and liabilities whatsoever of Customer to WFBCI, a
security interest, under the Uniform Commercial Code, in the following described
property, as defined under the Uniform Commercial Code, hereinafter collectively
called "Collateral": All presently existing or hereafter arising, now owned or
hereafter acquired property including, but not limited to, accounts, general
intangibles, investment property, insurance proceeds, and all books and records
pertaining to accounts and all proceeds and products of the foregoing property,
now and hereafter owned by Debtor, or in which Debtor now or hereafter may have
any rights, wherever situated and whenever acquired. Customer shall execute all
and deliver to WFBCI any and all documents and instruments as WFBCI may request
from time to time, including, without limitation, UCC financing statements or
amendments.
b. Credit Problems: If Customer asserts that nonpayment of an Account is due
to a Credit Problem, then Customer shall provide documentation establishing that
such non payment is due solely to a Credit Problem satisfactory to WFBCI, in its
reasonable discretion, within ten days of receipt of written notice by WFBCI of
the nonpayment. If WFBCI is not satisfied that nonpayment is solely due to a
Credit Problem, then customer shall be obligated to repurchase the Account by
paying the Repurchase Price within ten days of receipt of written demand by
WFBCI.
c. Sole Property: Once WFBCI has purchased an Account, the payment from the
Account Debtor as to that Account is the sole property of WFBCI.
d. Misdirected Payment: Customer shall hold in trust and safekeeping, as the
property of WFBCI, and immediately turn over to WFBCI the original check or
other form of payment received by Customer, whenever any payment on an Account
purchased by WFBCI comes into Customer's possession. Should Customer come into
possession of a check or other form of payment consisting of payments upon
Accounts purchased by WFBCI and Accounts not purchased by WFBCI, Customer shall
turn over said check or other form of payment to WFBCI. After receipt of good
funds therefor, WFBCI shall apply the funds, first to those Accounts purchased
by WFBCI and, second, to any amounts owed to WFBCI. If no Default exists
hereunder, any remaining balance shall be paid to the Customer. Further,
Customer shall hold in trust and safekeeping, as the property of WFBCI, and
immediately turn over to WFBCI, any goods or inventory returned to, reclaimed or
repossessed by the Customer which are covered by an Account purchased by WFBCI.
Customer shall pay a misdirected payment fee in the amount of fifteen percent
(15%) of the amount of any payment on account of a Purchased Account which has
been received by Customer and not delivered in kind to WFBCI on the next
business day following the date of receipt by Customer.
e. Financial Records: Customer will furnish financial statements and
information as requested, including, but not limited to, satisfactory proof of
payment and/or compliance with all Federal, State and/or local tax requirements
to WFBCI, as requested from time to time, at least once per quarter, or once per
month if Customer is in default.
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f. Book Entry: Customer shall, immediately upon sale of Accounts to WFBCI,
make proper entries on its books and records disclosing the absolute sale of
said Accounts to WFBCI, including the proper inclusion of the language stated in
paragraph 3(h) above, on said books and records and other documents as so
directed by WFBCI.
g. Audit: The Customer hereby agrees to pay WFBCI, on demand, audit fees in
connection with any audits or inspections conducted by WFBCI of any Collateral
or the Customer's operations or business at the rates established from time to
time by WFBCI as its audit fees, together with all actual out-of-pocket costs
and expenses incurred in conducting any such audit or inspection.
h. Power of Attorney: In order to carry out this Agreement and avoid
unnecessary notification of Account Debtors, Customer irrevocably appoints
WFBCI, or any person designated by WFBCI, as its special attorney in fact, or
agent, with power to:
i. strike out Customer's address on all Accounts mailed to Account
Debtors and note WFBCI's address on all Accounts.
ii. receive, open and dispose of all mail addressed to Customer, or to
Customer's trade name sent to WFBCI's address.
iii. endorse the name of Customer or Customer's trade name on any checks
or other evidences of payment that may come into the possession of WFBCI on
Accounts purchased by WFBCI or pursuant to default, and on any other documents
relating to any of the Accounts or to Collateral.
iv. in Customer's name, or otherwise, demand, xxx for, collect, and give
releases for any and all monies due to or become due on Accounts.
v. compromise, prosecute, or defend any action, claim or proceeding as to
said Accounts.
vi. from time to time offer a trade discount to Customer's Account Debtor
exclusive of Customer's normal business custom with said Account Debtor.
vii. initiate electronic debit or credit entries through the ACH system
to Customer's account or any other deposit account maintained by Customer
wherever located.
viii. do any and all things necessary and proper to carry out the
purposes intended by this Agreement.
The authority granted to WFBCI under this provision shall remain in full force
and effect until all assigned Accounts are paid in full and any indebtedness of
Customer to WFBCI is discharged.
i. Double Payments: Should WFBCI receive a double payment on an Account or
other payment which is not identified, WFBCI shall carry these sums as open
items in its accounting and shall return any double payment to the payor or
apply such unidentified payment pursuant to the terms hereunder upon proper
identification and documentation.
j. Hold Harmless: Customer shall hold WFBCI harmless against any Account
Debtor ill will arising from WFBCI's collecting or attempting to collect on any
Accounts.
k. Taxes: Should any excise, sale, use or other tax be imposed by any
federal, state or local authority requiring a deduction or withholding from the
proceeds of sale of Accounts, or if the Account Debtor is authorized to withhold
and
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deduct such tax or levy, then the Customer shall immediately pay WFBCI the
amount of the tax or levy so withheld, and the Customer shall indemnify and hold
WFBCI harmless from any loss or expense on account of such tax.
l. Costs and Expenses: Except as is prohibited by law, the Customer agrees
to pay on demand all costs and expenses, including (without limitation)
attorneys' fees, incurred by WFBCI in connection with this Agreement and any
other related document or agreement, and the transactions contemplated hereby,
including without limitation all such costs, expenses and fees incurred in
connection with the negotiation, due diligence, preparation, execution,
amendment, administration, performance, collection and enforcement of the
obligations and all such documents and agreements and the creation, perfection,
protection, satisfaction, foreclosure or enforcement of any security interest
granted hereunder, the collection of any Account or any obligation owed by
Customer to WFBCI.
m. Minimum Fee: Customer shall pay a Minimum Fee per quarter in the amount
of $63,000.00 which shall be due on the 15th day of the subsequent month after
the quarter for 12 months from the date hereof and for 12 months from any
extension agreement.
6. FURTHER PROMISES. WFBCI and Customer hereby promise the following:
a. Customer will immediately notify WFBCI of any disputes between Account
Debtor and Customer or the return of any product by Account Debtor to Customer.
b. Customer will repurchase any Account subject to an Account Debtor Dispute
of any kind whatsoever or as required herein.
c. WFBCI may settle any dispute regarding an Account with an Account Debtor.
Such settlement does not relieve Customer of final and full responsibility for
such Accounts.
d. If Customer does not fully settle the dispute with immediacy, the
Customer shall repurchase the disputed Account from WFBCI for the Repurchase
Price. WFBCI need not tender any invoice or document, besides the statement
described in 6(j) below, for such repurchase.
e. Customer shall not breach any warranties or promises in this Agreement
with regard to the unpaid Account or Account Debtor from whom payment on the
Account is due.
f. Customer shall not intentionally contribute to, or aggravate any Credit
Problem of an Account Debtor.
g. Customer and Account Debtor shall not be involved in a dispute of any
kind, regardless of validity during any time period covered by this Agreement.
h. Account Debtor shall not assert a claim or loss or offset of any kind
against Customer or WFBCI during any time period covered by this Agreement.
i. If documents submitted by Customer to WFBCI for the purchase of an
Account are mistaken, fraudulent, incorrect and/or erroneous, or if the Customer
fails to submit any document required by WFBCI under this Agreement for the
purchase of that Account, then said Account may be deemed an Account Debtor
Dispute and the Customer shall repurchase said Account and pay the Repurchase
Price as stated herein.
j. WFBCI shall identify in writing all repurchases and provide to Customer a
written statement of the Accounts subject to repurchase. The Customer shall pay
the Repurchase Price for such Accounts within 10 days of the date of the written
statement.
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k. Upon the occurrence of any Account Debtor Dispute, Customer shall
immediately pay to WFBCI the Repurchase Price for any and all Accounts so
disputed.
7. DEFAULTS. Any one or more of the following shall be an Event of Default
hereunder:
a. Customer shall fail to pay any indebtedness to WFBCI when due or
repurchase any Account when required hereunder.
b. Customer shall breach any term, provision, promise, warranty or
representation under this Agreement, or under any other agreements, contracts,
between Customer and WFBCI or obligation to WFBCI.
c. The appointment of any receiver or trustee of all or a substantial
portion of the assets of Customer.
d. Customer shall become insolvent or unable to pay debts as they mature,
shall make a general assignment for the benefit of creditors or shall
voluntarily file a petition under the United States Bankruptcy Code or any
similar law.
e. Any involuntary petition in bankruptcy shall be filed against Customer
and shall not be dismissed within 60 days or an order for relief is entered
against Customer under the United States Bankruptcy Code.
f. Any levies, attachment, executions, tax assessments or similar process
shall be issued against the Collateral.
g. Any financial statements, profit and loss statements, or schedules, other
statements or documents furnished by Customer to WFBCI are false or incorrect in
any material respect.
8. REMEDIES. In the event of an occurrence of an Event of Default, WFBCI may
do any one or more of the following:
a. Declare any indebtedness including outstanding purchased Accounts and the
Minimum fee for the applicable year period immediately due and payable.
b. Notify any Account Debtor and take possession of Collateral and collect
any Accounts without judicial process.
c. Require Customer to assemble the Collateral and the records pertaining to
Accounts and make them available to WFBCI at a place designated by WFBCI.
d. Enter the premises of Customer and take possession of the Collateral and
of the records pertaining to the Accounts and any other Collateral.
x. Xxxxx extensions, compromise claims and settle Accounts for less than
face value, all without prior notice to Customer.
f. Use, in connection with any assembly or disposition of the Collateral,
any trademark, trade name, trade style, copyright, patent right or technical
process used or utilized by Customer.
g. Hold Customer liable for any deficiency for any amounts due and owing to
WFBCI.
h. Require the Customer to repurchase any and all Accounts as so requested
by WFBCI and pay the Repurchase Price for those Accounts as provided herein.
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i. Cease making reports or accountings to the Customer as otherwise required
by this Agreement.
9. TERMINATION. This Agreement shall continue in full force and effect until
the earlier of 12 months from the date of this Agreement, upon written agreement
of both parties hereto or upon 60 days written notice by one of the parties
hereto, or upon default by the Customer. This Agreement shall automatically
continue for subsequent 12 months periods unless sixty days prior to the
termination date, the Customer notifies WFBCI in writing that the Customer
wishes to terminate this Agreement. On the date of termination, all obligations
owing by the Customer to WFBCI shall become immediately due and payable in full
without further notice or demand.
10. POST TERMINATION. After termination, Customer shall be liable to WFBCI
for the full and prompt payment of the full amount of Accounts sold to WFBCI
which are then outstanding and unpaid, disputed or undisputed, as well as any
other indebtedness or obligations owed to WFBCI by Customer including the
Minimum Fee through 12 months from the date of this agreement or extension
thereof. (Except as provided in Section 5.m). WFBCI continues and shall continue
to have a security interest in the Collateral of Customer until all amounts owed
to WFBCI by Customer are paid in full or are satisfied.
11. MISCELLANEOUS.
a. Binding on Future Parties: This Agreement inures to the benefit of and is
binding upon the heirs, executors, administrators, successors and assigns of the
parties thereto.
b. Cumulative Rights: No failure or delay by WFBCI in exercising any right,
power or remedy under the Agreement or documents given in connection with the
Agreement shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy under the
Agreement. The remedies provided herein are cumulative and not exclusive of any
remedies provided by law.
c. Waiver: WFBCI may not waive its rights and remedies unless the waiver is
in writing and signed by WFBCI. A waiver by WFBCI of a right or remedy under
this Agreement on one occasion is not a waiver of the right or remedy on any
subsequent occasion.
d. Choice of Law: This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado.
e. Invalid Provisions: Any provision of this Agreement which is prohibited
or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
f. Entire Agreement: This instrument contains the entire Agreement between
the parties. Except as otherwise provided herein, any addendum or modification
hereto must be signed by both parties.
g. Effective: This Agreement becomes effective when it is accepted and
executed by an authorized officer of WFBCI and shall be binding upon and inure
to the benefit of the Customer and WFBCI and their respective successors and
assigns, except that the Customer shall not have the right to assign its rights
thereunder or any interest therein without WFBCI's prior written consent. This
Agreement together with the documents given in connection herewith , comprises
the complete and integrated agreement of the parties on the subject matter
hereof and supersedes all prior agreements, written or oral, on the subject
matter hereof.
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h. Information: Without limiting WFBCI's right to share information
regarding the Customer and its affiliates with WFBCI's agents, accountants,
lawyers and other advisors, Xxxxx Fargo Corporation, and all direct and indirect
subsidiaries of Xxxxx Fargo Corporation and other persons WFBCI deems
appropriate, WFBCI may exchange any and all information it may have in its
possession regarding the Customer and its Affiliates, and the Customer waives
any right of confidentiality it may have with respect to such exchange of such
information.
i. Indemnification: Customer agrees to indemnify and hold WFBCI harmless
from any and all liability, claims and damages, including attorneys' fees, costs
of suit and interest which WFBCI may incur as a result of the failure of
Customer to pay withholding taxes due and payable to any taxing authority.
j. Notices hereunder: All notices and communications hereunder shall be
given or made to the parties at their respective addresses set forth below, or
at such other address as the addressee may hereafter specify for the purpose of
written notice to the other party hereto. Such notices and communications shall
be effectively given by WFBCI when and if given in writing and delivered to the
address set forth herein, delivered by facsimile or duly deposited in the mails
with first-class postage prepaid.
k. Jurisdiction: The parties hereby (i) consent to the personal jurisdiction
of the state and federal courts located in the State of Colorado in connection
with any controversy related to this Agreement; (ii) waives any argument that
venue in any such forum is not convenient, (iii) agrees that any litigation
initiated by WFBCI or the Customer in connection with this Agreement shall be
venued in either the District Court of Denver County, or the United States
District Court, District of Colorado, and (iv) agrees that a final judgment in
any such suit, action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law.
l. Waiver of Jury Trial: THE CUSTOMER HEREBY IRREVOCABLY WAIVES ALL RIGHTS
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF, BASED
ON OR PERTAINING TO THIS AGREEMENT.
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Executed and accepted this 2nd day of November, 2001 at Irvine, California,
Orange County.
SSP Solutions, Inc. XXXXX FARGO BUSINESS CREDIT, INC.
00000 Xxxxxxxxxx Xx.
Xxxxxx, XX 00000 By
---------------------------------
Signature
/s/ XXXXXX XXXXXXX
--------------------------------- ---------------------------------
NAME AND TITLE NAME AND TITLE
Xxxxxx Xxxxxxx Co-CEO
Sworn and subscribed before me this Witnessed by: s
2nd day of November, 2001. ---------------------
------------------------------------
Signature
/s/ XXXXX X. XxXXXXX
--------------------------------- ------------------------------------
NOTARY PUBLIC NAME AND TITLE
[SEAL]
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