EXHIBIT 10.2
AGREEMENT FOR PURCHASE AND ASSIGNMENT OF FOREIGN
ACCOUNTS RECEIVABLE
This Agreement ("Agreement") is dated this 3rd day of August, 2001, and is
between Xxxxxxx Associates, L.P. , a Delaware Limited Partnership, as the
prospective purchaser and assignee of foreign accounts receivable (hereinafter
called "Xxxxxxx") and Grant Geophysical (Int'l), Inc., a Texas corporation, as
the prospective seller and assignor of accounts receivables (hereinafter called
"Grant").
WHEREAS, Grant desires, from time to time during the term of this
Agreement, to sell billed and unbilled foreign accounts receivable to
Xxxxxxx; and
WHEREAS, Xxxxxxx agrees to purchase from Grant up to a maximum amount
of Four Million USD ($4,000,000), at any point in time, commencing
August 3, 2001 and extending through February 28, 2002; and
WHEREAS, the parties hereto desire to enter into this Agreement to
govern the purchase and sale of foreign accounts receivable;
NOW THEREFORE, in consideration of the premises, the mutual agreements
herein contained and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties
agree as follows:
1. OFFER OF ACCOUNTS. At its election from time to time during this
Agreement, Grant agrees to offer for sale to Xxxxxxx certain of its
billed and unbilled foreign accounts receivables ("accounts") arising
out of seismic data acquisition and processing services rendered by
Grant's branch operations in Ecuador and Columbia, and to sell to
Xxxxxxx on the terms set forth in this Agreement such offered accounts
(hereinafter defined as billed and unbilled/ work in progress foreign
accounts receivable) as Xxxxxxx may accept for purchase in the
countries of Ecuador and Columbia or in any other country mutually
agreed to by the parties. The parties agree that the maximum aggregate
face amount of accounts that Xxxxxxx will purchase hereunder at any
time will not exceed Four Million Dollars USD ($4,000,000). Xxxxxxx'x
consent to purchase accounts in excess of such aggregate amounts herein
set forth may only be evidenced by Xxxxxxx'x acceptance for purchase of
such offered accounts.
2. PURCHASE AND SALE OF ACCOUNTS. Each account purchased by Xxxxxxx
hereunder shall be purchased with recourse by Xxxxxxx against Grant and
Grant shall likewise be obligated to Xxxxxxx for any breach by Grant of
any representation, warranty or agreement of Grant contained herein.
Notwithstanding any provision in this agreement to the contrary, it is
contemplated by and it is the intention of the parties hereto that
certain accounts of Grant may be considered and purchased as one
account (herein a "batch") and the terms "account" and "accounts" as
used herein may also refer to and mean a "batch" or "batches," as the
case may be.
In connection with each offer of accounts to Xxxxxxx, Xxxxx agrees to
deliver to Xxxxxxx a written assignment of the subject billed and
unbilled accounts, and if so requested by Xxxxxxx, copies of all
invoices or underlying contracts relating to such accounts and evidence
of performance of the related services, in consideration for an advance
calculated on the basis of Article 4 herein. It is agreed that any
realized gains or losses resulting from currency fluctuations between
the account purchase and settlement date shall be for Grant's account.
Grant hereby sells, transfers, assigns and otherwise conveys to Xxxxxxx
with full recourse (as a sale by Grant and a purchase by Xxxxxxx and
not as security for any indebtedness or other obligation of Grant to
Xxxxxxx) all right, title and interest of Grant in and to all billed
and unbilled foreign accounts accepted by Xxxxxxx for purchase
hereunder, together with all related rights (but not obligations) of
Grant with respect thereto, including all
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contract rights, guarantees, letters of credit, liens in favor of
Grant, insurance and other agreements and arrangements of whatever
character from time to time supporting or securing payment of such
accounts.
Grant agrees to execute and deliver such bills of sale, assignments,
letters of credit, notices of assignment, financing statements
(including continuation statements) under the applicable UCC and other
documents, and make such entries and markings in its books and records,
and to take all such other actions (including the negotiation,
assignment or transfer of negotiable documents, letters of credit or
other instruments) to the extent necessary and as Xxxxxxx may request
to further evidence or protect the sales and assignments of accounts
and related rights to Xxxxxxx hereunder.
3. TERMS OF ACCOUNTS. Except as otherwise may be agreed to in writing by
Xxxxxxx from time to time, the terms of sale offered by Grant to its
account debtors with respect to all accounts offered to Xxxxxxx for
purchase hereunder shall be NET 30 DAYS for billed foreign accounts and
in the case of unbilled foreign accounts, the terms shall be NET 30
DAYS after actual billing of such unbilled accounts. After a foreign
account has been purchased by Elliott, Grant, in its capacity as agent
for Xxxxxxx, shall advise Xxxxxxx of the terms of sale set forth in the
invoice relating to such account, or any other aspect of the account.
4. PURCHASE PRICE. The purchase price for each account purchased hereunder
shall consist of and be paid at a discounted rate of .991667 per dollar
based on the US Dollar equivalency of each invoice before VAT. In the
event the account is not collected within 30 days, an additional
discount shall accrue and become payable to Xxxxxxx at a monthly rate
of .83333 .
5. SECURITY. For the purpose of securing Xxxxxxx (a) in the payment of any
and all sums of money that may become due and owing Xxxxxxx from Grant
by reason of this Agreement, (b) in the performance by Grant of Grant's
obligations hereunder, and under any other agreement, contract,
document, note or other instrument in favor of Xxxxxxx or its
assignees, Grant hereby grants to Xxxxxxx a security interest in (i)
all of the specific Grant foreign accounts sold, pursuant to this
Agreement, as well as all books and records pertaining to all of the
foregoing; (ii) Grant agrees to execute and deliver such financing
statements under the applicable UCC and other documents, and make such
entries and markings in its books and records and to take all such
other actions, as Xxxxxxx may request to further evidence, perfect,
preserve or protect the security interest granted to Xxxxxxx hereunder.
Xxxxxxx at its sole discretion, shall have all rights and remedies in
respect of the lien and security interest herein granted as are
provided in this Agreement, the UCC and other applicable foreign law,
including the right at any time, before or after any default by Grant
of any of its obligations hereunder, to notify account debtors and
obligors on instruments to make payment to Xxxxxxx (or its designee)
and to take control of proceeds to which Xxxxxxx is entitled, and to
apply proceeds to (in addition to other obligations of Grant to
Xxxxxxx) the reasonable attorneys' fees and legal expenses incurred by
Xxxxxxx in connection with the disposition of collateral or the other
exercise of rights and remedies by Xxxxxxx.
6. AGENT. Xxxxxxx authorizes Grant to act as its agent for the
administration and collection of each account. Grant agrees that, if
any payment is made to Grant on any account purchased by Xxxxxxx from
Grant hereunder, Grant (i) will remit such payment to Xxxxxxx on a
timetable as mutually agreeable, but in any event no later than
February 28, 2002; and (ii) will deliver such payments due to Xxxxxxx
based on the calculations as described in Article 4 herein.
7. REPRESENTATIONS AND WARRANTIES OF GRANT. Grant hereby represents and
warrants to Xxxxxxx with respect to each account offered by Grant to
Xxxxxxx hereunder that (i) Grant is the sole owner of such account,
which account is free and clear of any liens, claims, equities or
encumbrances whatsoever, and upon each purchase by Xxxxxxx of such
account, Xxxxxxx will own such account free and clear of any liens,
claims, equities or encumbrances whatsoever and the consideration
received by Grant from Xxxxxxx for such account is fair and adequate,
(ii) Grant is the sole obligee under such account, and has full power
and is duly authorized to sell, assign and transfer such account to
Xxxxxxx hereunder, and the date of sale of such billed foreign account
is not more than 30 days after the date of the original invoice, (iii)
Grant has no knowledge of any fact which would lead it to expect that,
at the date of sale of such account to Xxxxxxx, such account will not
be paid in the full stated amount when due, and (iv) such account
arises out of the bona fide rendition of services performed by Grant,
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or all underlying services have been rendered by Grant, in complete
fulfillment of all of the terms and conditions of a fully executed,
delivered and unexpired contract with the account debtor, and the
account debtor has accepted the services to which the account relates.
Each representation and warranty of Grant contained in this Agreement
shall be deemed to be made at and as of the date hereof and as of the
date of each sale of foreign accounts to Xxxxxxx hereunder.
Grant agrees to indemnify and hold Xxxxxxx harmless against any breach
by Grant of any representation, warranty or agreement of Grant
contained in this Agreement, and against any claims or damages arising
out of the manufacture, sale, possession or use of, or otherwise
relating to, goods, or the performance of services, associated with or
relating to accounts or related rights purchased (or with respect to
which a security interest is granted) hereunder.
8. FINANCIAL STATEMENTS. Grant represents and warrants that all financial
and other information provided by Grant to Xxxxxxx in connection with
this agreement or made to induce Xxxxxxx to enter into this Agreement
is true, complete and correct in all material respects. Grant agrees to
furnish and shall continue to provide additional financial and business
information concerning Grant and its business as Xxxxxxx may reasonably
request, including copies of its Form 10-K and Form 10-Q filings with
the United States Securities and Exchange Commission.
9. TAXES. All VAT taxes and governmental charges of any kind imposed with
respect to the rendering of services relating to foreign accounts
purchased by Xxxxxxx hereunder shall be for the account of, and paid
by, Grant.
10. TERMINATION. This Agreement may be terminated by either party hereto by
delivery of written notice of termination of this Agreement to the
other party specifying the date of termination, which date shall be at
least 30 days after the date such notice is given. Xxxxxxx may, at its
election, terminate this Agreement immediately and without the
requirement of notice to Grant if (i) Grant shall fail to perform any
of its obligations hereunder or shall breach any of its representations
and warranties hereunder, (ii) Grant or any of its Affiliates shall
become insolvent or suspend all or a substantial part of its or their
business, (iii) a petition under the Bankruptcy Code or any other
insolvency or debtor statute shall be filed by or against Grant or any
affiliate or any receivership proceedings with respect thereto shall
commence, (iv) any guarantee of any of Grant's obligations hereunder
shall be terminated or become impaired, or (v) Xxxxxxx otherwise deems
that it is insecure hereunder.
Termination of this Agreement shall not affect the rights and
obligations of the parties hereunder with respect to transactions
occurring on or prior to the date of such termination, and this
Agreement shall continue to govern the rights and obligations of the
parties hereto with respect to accounts purchased by Xxxxxxx from Grant
on or prior to the date of such termination. All security interests
granted or contemplated by this Agreement shall survive the termination
of this Agreement until all amounts payable to Xxxxxxx with respect to
transactions occurring on or prior to the date of termination have been
paid to Xxxxxxx, and Grant has performed all its obligations to Xxxxxxx
with respect to such transactions, and all obligations under this
Agreement including but not limited to payment of the Fees.
11. ATTORNEY'S FEES, LITIGATION EXPENSE. Grant agrees to reimburse Xxxxxxx
upon demand for Xxxxxxx'x attorneys' fees, court costs and other fees
and expenses incurred in collecting any sums due or to become due to
Xxxxxxx hereunder, enforcing any of Xxxxxxx'x rights under this
Agreement and all actions taken by Xxxxxxx that it deems necessary or
desirable under the Bankruptcy Code or should any provisions of the
Bankruptcy Code be applicable to any rights or obligations of any party
to this Agreement, as well as all appearances, motions and actions to
which XXXXXXX may be or become a party in any bankruptcy case.
12. GOVERNING LAW; VENUE; SUBMISSION TO JURISDICTION. This Agreement shall
be governed by and interpreted in accordance with the internal laws (as
opposed to conflicts of laws provisions) of the State of New York or if
such laws are inapplicable, governed by the laws of Colombia or Ecuador
to the extent applicable, and any dispute arising out of, connected
with, related to, or incidental to the relationship established between
Grant and Xxxxxxx in connection with this Agreement, and whether
arising in contract, tort, equity or otherwise, shall be resolved in
accordance with the internal laws and decisions of the State of New
York, except to the extent
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that the perfection and the effect of perfection or non-perfection of
the security interest created by this Agreement, in respect of any
particular collateral, are governed by the laws of jurisdiction other
than the State of New York.
13. NOTICES. All notices and other communications provided for herein shall
be given or made in writing and telecopied or delivered by courier or
mail to the intended recipient at the "Address for Notices" specified
opposite its name on the signature page hereto, or at such other
address or telecopy number as shall be designated by a party to the
other party in the manner specified in this Section. All such notices
and other communications shall be deemed to have been duly given when
transmitted by telecopier (with receipt thereof confirmed by
telecopier) or personally delivered or, in the case of a mailed notice,
upon deposit in the United States Postal System postage prepaid and
properly addressed, in each case given or addressed as aforesaid.
14. INDEMNIFICATION. Grant agrees to indemnify, defend and hold Xxxxxxx
harmless from and against any and all loss, liability, obligation,
damage, penalty, judgment, claim, deficiency and expense (including
interest, penalties, attorneys' fees and amounts paid in settlement)
owing to any third party to which Xxxxxxx may become subject arising
out of or based upon this Agreement as well as any prior relationship
of Grant with Xxxxxxx, WHETHER BY ALLEGED OR ACTUAL NEGLIGENCE OF
XXXXXXX, except and to the extent caused by the gross negligence or
willful misconduct of Xxxxxxx.
15. CAPTIONS; FINAL AGREEMENT; COUNTERPARTS; SUCCESSORS AND ASSIGNS.
Captions and headings appearing herein are included solely for
convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement. This Agreement
represents the final agreement between the parties hereto with respect
to the subject matter hereof, and supersedes all prior proposals,
negotiations, agreements and understandings, oral or written, related
to such subject matter. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the
same instrument. This Agreement may not be assigned by Grant without
the prior written consent of Xxxxxxx. This Agreement may be assigned by
Xxxxxxx, in whole or in part, and any foreign accounts purchased by
Xxxxxxx hereunder, together with all rights and interests related
thereto granted to Xxxxxxx hereunder, may be assigned by Xxxxxxx, all
without notice to or the consent of Grant. This Agreement shall be
binding upon the parties hereto and their respective successors and
permitted assigns.
16. EFFECTIVENESS OF AGREEMENT. This Agreement shall become effective only
upon acceptance by Xxxxxxx as evidenced by Xxxxxxx'x signature hereon.
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IN WITNESS WHEREOF, the parties hereto, heretofore duly authorized, have
executed this Agreement to be effective as of the date first set forth above.
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Address for Notices: GRANT GEOPHYSICAL, (INT'L.) INC.
00000 Xxxx Xxx
Xxxxxxx, Xxxxx 00000
Telecopy No.: (000)000-0000 By: /S/ XXXXXX X. XXXXXX
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President - Finance and
Administration
Address for Notices: XXXXXXX INTERNATIONAL, L.P.
000 Xxxxx Xxx., 00xx Xxxxx
XXX XXXX XXXX, XXX XXXX By: /s/ XXXX X. XXXXXX
10019 Name: Xxxx X. Xxxxxx
Telecopy No.: (000) 000-0000 Title: General Partner
Date: August 3, 2001
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