Prestige Capital Corporation
0 Xxxxxxxxx Xxxxx Xxxx Xxx Xxx Xxxxxx 00000
(000) 000-0000
PURCHASE AND SALE AGREEMENT
1. ASSIGNMENT, PRESTIGE CAPITAL CORPORATION ("Prestige") hereby buys and
PRESTIGE FINE JEWELRY, L.L.C.
("Seller") hereby sells, transfers and assigns all of Seller's rights, title and
interest in and to those specific accounts receivable owing to Seller as set
forth on this assignment forms provided by Prestige (the "Assignments") together
with all rights of action accrued or to accrue thereon, including without
limitation, full power to collect, xxx for, compromise, assign or in any other
manner enforce collection thereof in Prestige's name or otherwise. (All of
Seller's accounts receivable and contract rights which are presently or at any
time hereafter assigned by Seller, and accepted by Prestige, are collectively
referred to as the "Accounts".)
2. DISCOUNT, Prestige's purchase of the Accounts from Seller is at a
discount fee of TEN percent (10%) from the face value of each Account.
3. RESERVE. Upon Prestige's receipt and acceptance of each Assignment,
Prestige shall pay to Seller EIGHTY percent (80%) of the net face value of the
Account therein described (the "Down Payment") Prestige will hold in reserve the
difference between the Purchase Price (hereinafter defined) and the Down Payment
(the "Reserve") and will pay to Seller the Reserve, less any sums due Prestige
hereunder, on the Friday following the week in which all Accounts set forth on
the applicable Assignment have been collected in good funds, charged back and/or
deemed collected by Prestige due to an account debtor's (hereinafter defined)
insolvency. For purposed of the agreement, the term "Purchase Price" shall mean
the net face value of Accounts, loss; Prestige's discount fee described in
paragraph 2 above, returns, credits, allowances and discounts on the shortest
or, at Prestige's option, on alternative terms of sale offered by Seller to
account debtors, and less all other sums chargeable to Seller's account.
4. REBATES. As an inducement to Seller to facilitate the prompt payment of
Accounts from Seller's customers ("account debtor"), Prestige agrees to return
to seller a rebate of SIX percent (6%) if the Accounts are paid to Prestige
within 30 days, a rebate of FIVE percent (5%) if the Accounts are paid to
Prestige within 45 days, a rebate of FOUR percent (4%) if the Accounts are paid
to Prestige within 60 days, a rebate of TWO PERCENT (2%) if the Accounts are
paid to Prestige within 90 days.
5. WARRANTIES, REPRESENTATIONS AND COVENANTS. As an inducement for
Prestige's entering into this Agreement and with full knowledge that the truth
and accuracy of the warranties, representations and covenants in this Agreement
are being relied upon by Prestige, instead of complete credit investigation,
Seller warrants, represents and covenants that:
(a) Seller is properly licensed and authorized to operate the business of
wholesale jewelry;
(b) Seller is the sole and absolute owner of the Accounts and has the full
legal right to make said sale, assignment and transfer;
(c) The correct amount of each Account will be set forth on the
Assignments;
(d) Each Account is an accurate and undisputed statement of indebtedness
from an account debtor for a sum certain, without offset or counterclaim and
which is due and payable in ninety days or less;
(e) Each Account is an accurate statement of a bona fide sale, delivery and
acceptance of merchandise or performance of service by Seller to an account
debtor,
(f) Seller does not own, control or exercise dominion in any way
whatsoever, over the business of any account debtor;
(g) All financial records, statements, books or other documents shown to
Prestige by Seller at any time either before or after the signing of this
Agreement are true and accurate;
(h) Seller will not under any circumstance or in any manner whatsoever,
interfere with any of Prestige's rights under this Agreement;
(i) Seller has not and will not, at any time, permit any lien, security
interest or encumbrance to be created upon any of its accounts receivable and/or
its inventory without the prior written consent of Prestige;
(j) Seller will not change or modify the terms of the Accounts with any
account debtor unless Prestige first consents in writing;
(k) Seller will notify Prestige in writing in advance of; any change in
Seller's place of business; Seller having or acquiring more than one place of
business; any change in Seller's chief executive office; and/or any change in
the office or offices where Seller's books and records concerning accounts
receivable are kept;
(m) All invoices will state plainly on their face that the Accounts
represented thereby have been sold and assigned to Prestige and are payable only
and directly to Prestige; and
(n) No Account shall be on a xxxx-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment or any other repurchase or return
basis;
The warranties, representation and covenants contained in this paragraph 5
shall be continuous and be deemed to be renewed each xxxx Xxxxxx assigns
Accounts to Prestige. Notwithstanding the provisions contained in paragraph 6 of
this Agreement, Prestige shall have recourse against the Seller in the event
that any of the warranties, representations and covenants set forth in this
paragraph 5 are breached.
6. NO RECOURSE; Prestige shall have recourse against Seller in all
instances except if payments are not received due to the "Insolvency" of an
account debtor within 120 days of invoice date. For purposes of the foregoing,
Insolvency shall be deemed to have occurred only when: (a) a voluntary or
involuntary bankruptcy proceeding for the relief of an account debtor under
either Chapter 7 or Chapter 11 shall have been instituted in a United States
Bankruptcy Court; (b) a receiver is appointed for the whole or any part of the
property of an account debtor; (c) an account debtor's assists shall have been
sold under a writ of execution or attachment, or writ of execution shall have
been returned unsatisfied; (d) an account debtor shall have absconded; or (e) an
account debtor's assets shall have been sold under levy by any taxing authority
or by a landlord.
7. CHARGE-BACK. In the event that any Account is not paid within 90 days of
invoice date for any reason whatsoever (other that as a result of an account
debtor's Insolvency), including, without limitation, any alleged defense,
counterclaim, offset, dispute or other claim (real or merely asserted) whether
arising from or relating to the sale of goods or conditions of services or
arising from or relating to any other transaction or occurrence, then in any
such event Prestige shall have the right to charge back such Account to Seller.
No charge back shall be deemed a reassignment to Seller of the Account involved.
Seller acknowledges that all amounts chargeable to Seller's account under this
Agreement shall be payable by Seller on demand.
8. NOTICE OF DISPUTE. Seller must immediately notify Prestige of any
disputed between any account debtor and Seller.
9. SETTLEMENT OF DISPUTE. Prestige may, at its option, settle any dispute
with any account debtor. Such settlement does not relieve Seller of any of its
obligations under this Agreement.
10.SOLE PROPERTY. Once Prestige has purchased the Accounts, the payment
from account debtors relative to the Accounts is the sole property of Prestige.
Any interference by Seller with this payment will result in civil and/or
criminal liability.
11. SECURITY INTEREST, As further inducement for Prestige to enter into
this Agreement, and as security for the prompt performance, observance and
payment of all obligations owing by Seller to Prestige herein, Seller's hereby
grants to Prestige's continuing security interest in and lien upon the following
(herein collectively referred to as the "Collateral"); all accounts,
instruments, documents, chattel paper and general intangibles (as such terms are
defined in the Uniform Commercial Code), whether now owned or hereafter created
or acquired by Seller, wherever located, and all replacements and substitutions
therefore, accessions thereto, and products and proceeds thereof, and all
property of Seller at any time in Prestige's possession.
12. FINANCING STATEMENTS. Seller will, at its expense perform all acts and
execute all documents requested by Prestige at any time to evidence, perfect,
maintain and enforce Prestige's security interest and other rights in the
Collateral and the priority thereof. Upon request, at any time and from time to
time, Seller will execute and deliver to Prestige one or more UCC financing
statements (in form and substance satisfactory to Prestige and its counsel).
13. HOLD IN TRUST. Seller will hold in trust and safekeeping, as the
property of Prestige and immediately turn over to Prestige, the identical check
or other form of payment received by Seller if payment on the Accounts comes
into Seller's possession. Should Seller come into possession of a check
comprising payments owing to both Seller and Prestige, Seller shall turn over
said check to Prestige. Thereafter, Prestige will refund Seller's portion, if
any, to Seller.
14. FINANCIAL RECORDS. Seller will furnish to Prestige financial statements
and such other information as is, from time to time, requested by Prestige.
15. BOOK ENTRY. Seller will immediately, upon the sale of the Accounts,
make the proper entry on its books and records disclosing the absolute sale of
the Accounts to Prestige.
16. POWER OF ATTORNEY. In order to implement this Agreement, Seller
irrevocable appoints Prestige its special attorney in fact or agent with power
to:
(a) Strike out Seller's address on any correspondence to any account debtor
and put on Prestige's address;
(b) Receive and open all mail addressed to Seller via Prestige's address;
(c) Endorse the name of Seller's trade name on any checks or other
evidences of payment that may come into the possession of Prestige in connection
with the Accounts.
(d) In Seller's name, or otherwise, demand, xxx for, collect any and all
monies due in connection with the Accounts; and
(e) Compromise, prosecute or defend any action, claim or proceeding
relative to the Accounts; The authority granted to Prestige shall remain in full
force and effect until the Accounts are paid in full and the entire indebtedness
of Seller to Prestige is discharged.
17. NOTIFICATION: VERIFICATION OF ACCOUNTS.
(a) Without in any way limiting the terms and provisions of paragraph 5 (m)
here in above. Prestige may at any time and from time to time, in its sole
discretion, notify any account debtor to make payment on any open Invoices to
Prestige: and
(b) Prestige, may at any time verify the Accounts utilizing an audit
control company, any agent of Prestige or any other means deemed appropriate by
Prestige.
18. NO ASSUMPTION. Nothing contained in this Agreement shall be deemed to
impose any duty or obligation upon Prestige in favor of any account debtor
and/or any other party in connection with the Accounts.
19. FUTURE ASSIGNMENTS. Seller may from time to time, at Seller's option,
sell, transfer and assign different Accounts to Prestige. The future sale of any
Accounts shall be subject to and governed by this Agreement and such Accounts
shall be identified by separate and subsequent Assignments.
20. DISCRETION. Nothing contained in this Agreement shall be construed to
impose any obligation upon Prestige to purchase Accounts from Seller. Prestige
shall at its sole discretion determine which Accounts it shall purchase.
Further, Prestige shall have the absolute right at any time to cease accepting
any further assignments from Seller.
21. LEGAL FEES; EXPENSES. Seller will pay on demand any and all collection
expenses and reasonable attorneys' fees that Prestige incurs in the event it
should become necessary for Prestige to enforce its rights under this Agreement.
In addition, Seller will pay on demand all costs and expenses incurred by
Prestige in connection with the preparation, execution and delivery of this
Agreement and any supplement or modification thereof, and in any way relating to
the transactions contemplated by this Agreement, including, without limitation,
all reasonable attorneys' fees, Federal Express costs (or similar expenses),
wire transfer costs, certified mail costs, facsimile transmission costs and lien
search costs.
22. BINDING ON FUTURE PARTIES. This Agreement shall insure to the benefit
of and is binding upon the heirs, executors, administrators, successors and
assigns of the parties hereto, except that Seller may not assign or transfer any
or all of its rights and obligations under this Agreement to any party without
the prior written consent to Prestige.
23. WAIVER; ENTIRE AGREEMENT. No failure or delay on Prestige's part in
exercising any right, power or remedy granted to Prestige herein, will
constitute or 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 set forth herein. This
Agreement contains the entire agreement and understanding of the parties hereto
and no amendment, modification or waiver of, or consent with respect to, any
provision of this Agreement, will in any event be effective unless the same is
in writing and signed and delivered by Prestige.
24. NEW JERSEY LAW. This agreement shall be deemed executed in the State of
New Jersey and, in all respects, shall be governed and construed in accordance
with the laws of the State of New Jersey.
25. INDEMNITY. Seller shall hold Prestige harmless from and against any
action or other proceeding brought by any account debtor against Prestige
arising from Prestige's collecting or attempting to collect any of the Accounts.
26. TERM. This Agreement will remain in effect until JANUARY 15,1999 (the
"Term"). Thereafter, the Term will be automatically extended for successive
periods of one (1) year each unless either party provides the other with a
written notice of cancellation at least sixty (60) days prior to the expiration
of the initial Term or any renewal Term; provided however Prestige may cancel
this Agreement at any time upon sixty (60) days notice to Seller. In the event
of a breach by Seller of any term or provision of this Agreement or upon
Seller's Insolvency or the Insolvency of any guarantor of Seller's obligations
herein, Prestige shall have the right to cancel this Agreement without notice to
Seller, and all of Seller's obligations to Prestige herein shall be immediately
due and payable. In the event of cancellation, the provisions of this Agreement
shall remain in full force and effect until all of the Accounts have been paid
in full.
27. INVALID PROVISIONS. If any provision of this Agreement shall be
declared illegal or contrary to law, it is agreed that such provision shall be
disregarded and this Agreement shall continue in force as though said provision
had not been incorporated herein.
28. EFFECTIVE. This Agreement shall become effective when it is accepted
and executed by an authorized office of Prestige.
29. JURY WAIVER. The parties hereto mutually waive trial by jury in the
event of any litigation with respect to any matter connected with this
agreement.
Executed this 24th day of APRIL, 1998
PRESTIGE FINE JEWELRY, L.L.C.
By: /s/ Xxxxxxx XxXxxxxx
XXXXXXX XxXXXXXX, Member Title
Accepted this 27th day of APRIL, 1998
PRESTIGE CAPITAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
XXXXXX X. XXXXXXXX, President Title
Each of the undersigned hereby personally guarantees and shall be jointly and
severally liable for any damages suffered by Prestige Capital Corporation by
virtue of the breach of any warranty, representation or convenant [sic] made by
Seller in paragraph 5 above. Each of the undersigned also personally waives
presentment for payment, demand, protest, notice of protest, notice of dishonor
and notice of every nature whatsoever.
Date: 6/26/98 By: /s/ Xxxxxxx XxXxxxxx
XXXXXXX XxXXXXXX
Individually
Date: 6/26/98 By: /s/ Zeki Koschisarli
ZEKI KOSCHISARLI
Individually
