Exhibit 10.1
MASTER AGREEMENT
BETWEEN: MAAX CANADA INC., duly incorporated under the laws of Canada,
and having its principal place of business at 0000, Xxxxxxxxxx
Xxxxxx Xxxx, Xxxxx 0000, Xxxxxxxx (Quebec) H3A 2R7,
MAAX CABINETS INC., duly incorporated under the laws of
Quebec, and having its principal place of business at 0000,
Xxxxxxxxxx Xxxxxx Xxxx, Xxxxx 0000, Xxxxxxxx (Quebec) H3A 2R7,
MAAX-KSD CORPORATION, duly incorporated under the laws of
Pennsylvania and having its principal place of business at 000
Xxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxxxxxxx, Xxxxxx Xxxxxx,
MAAX SPAS (ARIZONA), INC., duly incorporated under the laws of
California and having its principal place of business at 00000
X. Xxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxx, Xxxxxx Xxxxxx,
all being represented herein by Xx. Xxxxx Xxxxx, Officer and
Xxxxxx Xxxxxx, Officer duly authorized for the purposes hereof
as he hereby does declare.
(hereinafter collectively referred to as "the Seller", acting
solidarily)
AND: NatExport, a Division of National Bank of Canada, a Schedule I
chartered bank incorporated pursuant to the laws of Canada and
having a place of business at 0000, xx xx Xxxxxxxxxxx Xxxxxx
Xxxx, Xxxxxxxx, Xxxxxx, represented herein by Xxxxxxx Xxxxxx,
Customer Services Manager, and Xxxxxx Xxxxxx, Senior Credit
Analyst, duly authorized for the purposes hereof as they
hereby do declare,
(hereinafter referred to as "Natexport")
WHEREAS the Seller wishes to sell certain accounts receivable to Natexport at a
discount;
WHEREAS Natexport wishes to buy, with recourse equal to the percentage as stated
in the financing letter, certain accounts receivable from the Seller at a
discount.
THE PARTIES HERETO AGREE AS FOLLOWS:
1 Natexport may, at its sole discretion, purchase, with recourse equal to the
percentage as stated in the financing letter for each buyer (the "Buyer"),
accounts receivable held by the Seller against the Buyer according to the
terms and conditions of the letter or financing letters to be concluded
between the parties. Natexport may revoke a financing letter, at any time,
upon written notice to the Seller, for example, without limiting the scope
of the aforementioned provision, a material change which could affect the
financial state of the Buyer and/or Seller. The total outstanding amount
discounted cannot exceed $15,000,000.00 US, at any time.
2 For each account receivable which Natexport agrees to purchase, the Seller
undertakes to execute, on its letterhead paper, two copies of a Sale,
Assignment and Transfer form with the same form and content as the document
shown in Appendix A. Except liens to be created pursuant to the financing
letter and current liens created pursuant to MAAX Corporation's Credit
Agreement, the Seller represents that each account receivable will be free
and clear of any liens, securities and encumbrances during the duration of
this Agreement, as may be renewed.
3. Without limiting the scope of any other provision hereof, the Seller
acknowledges that he is responsible for the quality, durability and other
characteristics of any goods sold to any Buyer and for any legal and
conventional warranty and for any services provided to any Buyer and
further acknowledges that Natexport is in no way liable in this regard.
The Seller agrees to save Natexport harmless from any liability towards
any person, including any Buyer, with respect to the quality, durability
or any other characteristics of the goods and to any legal and
conventional warranty and with respect to any services and further agrees
to indemnify Natexport for any damages, losses, charges, legal fees or
expenses or other costs, which could result here from, directly or
indirectly.
4 All sales, assignments and transfers shall be made with recourse, equal to
the percentage as stated in the financing letter for each Buyer, against
the Seller for the principal and 100% of the interest; in the event of the
non-payment of the invoice on the maturity date for any reason whatsoever
and subject to Section 8 hereof, the Seller shall then be liable for the
repayment equal to the percentage as stated in the financing letter for
each Buyer for the principal and 100% of the interest at the post maturity
rate set out in the financing letter from, inclusively, the maturity date
of the invoice to, exclusively, the earliest of: the payment by the Seller
and/or the Buyer of such invoice, or six (6) months from the maturity date
of such invoice. The Seller authorizes Natexport to debit its account for
such amounts pursuant to Section 12 hereof.
5 The "number of days in payment period" indicated hereinabove would be
calculated by adding the number of days specified under the terms of sale
and the additional number of days before payment is made according to the
Buyer's payment habits.
6 The said additional number of days shall be established by Natexport
according to the statement of transactions submitted by the Seller. Should
Natexport consider, at its sole discretion, that the said statement is
insufficient for such purpose, it shall establish, at its sole discretion
without obtaining the Seller's consent, the said number of days.
Notwithstanding the above, Natexport may, at any time, at its sole
discretion, revise the said additional number of days according to the
number of days taken by the Buyer to pay its invoices to Natexport.
7 Notwithstanding Section 3 hereof, the Seller shall remain liable to
Natexport for the total amount of each and every purchased account
receivable and agrees to pay Natexport the said amount upon request
together with any and all accrued interest and interest to be accrued at
the post-maturity rate set out in the financing letter calculated from,
inclusively, the maturity date to, exclusively, payment by the Seller,
under any of the following conditions:
7.1 The Seller has presented any relevant facts incorrectly to
Natexport, or has knowingly made any false or fraudulent
statement report or claim or any concealment of any material
fact relating in any way to the purchased account receivable;
7.2 The Seller has omitted to remit to Natexport one or several
relevant documents concerning the purchased account
receivable;
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7.3 A dispute exists between the Seller and the Buyer regarding an
item in the sales contract;
7.4 The Seller or the Buyer has failed to obtain all the licenses,
approvals or authorizations required at the shipping date of
the goods for the proper performance of the sales contract;
7.5 The Seller or its agent has made an agreement with the Buyer
amending the conditions of one of the payments which the Buyer
must make to Natexport, unless Natexport has already approved
such agreement in writing;
7.6 The account receivable is not paid to Natexport for a reason
that could have been avoided by the Seller or its agent or
because of the insolvency of the Seller or its agent;
7.7 Natexport cannot upon demand collect the amount of the
discounted account receivable from the Buyer forthwith due to
the assignment thereof to a third party;
7.8 The Seller has a direct or indirect equity interest in the
Buyer, or the Buyer has any such equity interest in the
Seller; or
7.9 The Seller has failed to make all reasonable and customary
measures to prevent or minimize loss, including any measures,
which may be required by Natexport or to cooperate with
Natexport to effect recovery.
8 The purchased amount for each account receivable shall be equal to the
amount of the account receivable minus the total of the following amounts:
8.1 An amount calculated as follows: the financing rate set out in
the financing letter X amount of the account receivable X
number of days of term of payment /
360 days (for US $) or
365 days (for CAN $)
8.2 The amount of all charges specified in the financing letter.
9 This Agreement shall take effect upon the signing hereof by the parties
hereto and shall terminate on August 31st, 2006. This Agreement may be
renewed for a period of one (1) year at the expiry of the term or of any
renewal thereof upon written agreement between the parties. Notwithstanding
the foregoing, Natexport may terminate this Agreement, at any time, upon
written notice to the Seller provided that the Seller will be required to
perform all of its obligations to Natexport in respect of transactions
arising prior to the date of termination.
Natexport may, at its sole discretion and without any further formality,
continue to purchase accounts receivable presented by the Seller beyond the
expiry date stated in this section. The Seller acknowledges that any and
all purchase of accounts receivable after the expiry date may be governed
by the terms and conditions hereof. The purchase of accounts receivable
after the expiry date may in no way be deemed or considered to be an
extension or renewal of this Agreement.
10 Any and all amounts owed by Natexport to the Seller following any purchase
shall be payable by check issued jointly to the Seller, and if applicable,
any financial institution to which the Seller has made a general assignment
of book debts or a movable hypothec covering claims, as the case may be.
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For the purposes hereof, the Seller represents and warrants that it has
made a general assignment of book debts, or a movable hypothec or a
security under the Bank Act covering claims or the goods subject to the
discount, as the case may be, to the following financial institution(s)
only: NATIONAL BANK OF CANADA or any other financial institution(s). The
Seller agrees to advise Natexport promptly of any general assignment of
book debts, or movable hypothec covering claims, as the case may be, it may
make to a financial institution as of the effective date of this Agreement.
11 The Seller hereby irrevocably authorizes Natexport to debit any and all
amounts owed by the Seller to Natexport in respect hereof from any and all
bank accounts which the Seller holds or may hold from time to time with the
following financial institution(s): NATIONAL BANK OF CANADA or any other
financial institution(s). Any or all employees of such financial
institution(s) may debit said amounts from such account upon presentation
by Natexport of a letter signed by one of its representatives specifying
said amounts.
12 The Seller undertakes not to reveal to the Buyer or any other person, any
information received from Natexport regarding the Buyer, including a
refusal to discount, for the benefit of the Seller, accounts receivable
deriving from one or several sales to the Buyer. The Seller acknowledges
that such information is strictly confidential.
13 The Seller agrees to save Natexport harmless from any liability towards the
Buyer, or any other person, in the event of non-compliance with Section 14
hereof, and further agrees to indemnify Natexport for any damages, losses,
charges, legal fees or expenses or other costs which would result here
from, directly or indirectly.
14 The Seller will co-operate fully with Natexport to collect any account
receivable sold to Natexport, which remains unpaid on its maturity date.
15 In the event that the Seller is in default under the terms of any other
contract, agreement or writing with Natexport, the National Bank of Canada,
any other division or subsidiary of the National Bank of Canada, any other
bank or financial institution or any other creditor with rights to the
property of the Seller for an amount of $5,000,000.00 CAN or more,
Natexport shall have the right to terminate this present Agreement.
16 For purposes of disclosure pursuant to the Interest Act (Canada), the
yearly rate of interest to which any rate of interest payable under this
Agreement, which is to be calculated on any basis other than a full
calendar year, is equivalent may be determined by multiplying such rate by
a fraction, the numerator of which is the number of days in the calendar
year in which the period for which interest at such rate is payable ends
and the denominator of which is the number of days comprising such other
basis.
17 In this Agreement and in any financing letter:
17.1 "Canadian Prime rate" means the annual variable rate of
interest announced from time to time by the National Bank of
Canada and used to determine the interest rates on Canadian
dollar commercial loans granted by the National Bank of Canada
in Canada.
17.2 "US Prime rate " means the annual variable rate of interest
announced from time to time by the National Bank of Canada and
used to determine the interest rates on US dollar commercial
loans granted by the National Bank of Canada in Canada.
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18 Natexport may, at any time, examine and make copies of all letters,
communications, accounts or other documents in the possession or control of
the Seller, and, in respect thereof, the Seller shall, at the request of
Natexport:
18.1 Provide Natexport with all information in the possession of
the Seller, and
18.2 Take all reasonable steps to obtain any information or to
obtain the sight of any document in the possession of a third
party.
19 If the Seller receives any payment on account of any account receivable
purchased by Natexport pursuant hereto, the Seller shall hold such payment
in trust for the benefit of Natexport, and promptly pay it over immediately
to Natexport.
20 Any and all notices required hereunder or related hereto may be given by
either party to the other party at the address which either party may
indicate from time to time in writing to the other party.
21 The Seller authorizes Natexport to request information regarding his
financial status from banks and any other financial institutions where the
Seller may have an account.
22 The parties hereto acknowledge that this Agreement, the financing letters
and the Sale, Assignment and Transfer forms constitutes a full, complete
and faithful representation of the Agreement made between them and they
therefore formally waive the right to invoke any and all discussions or
negotiations preceding the signature hereof.
23 MAAX CANADA INC., MAAX CABINETS INC., MAAX-KSD CORPORATION, MAAX SPAS
(ARIZONA), INC., may each use this Master Agreement to submit accounts
receivable to Natexport for factoring however, any and all obligations
incurred under this Agreement are solidary. Furthermore, it is understood
that the authorization to debit any banking account as per clause 12 hereto
shall cover all amounts owing under these joint and several obligations.
24 This Agreement shall be governed by the laws of the province of Quebec, and
the laws of Canada applicable therein, and the courts of the province of
Quebec shall have exclusive jurisdiction in ruling on any case related
hereto.
25 The parties hereto have requested that this Agreement, any financing letter
and any documents related thereto be drafted in the English language. Les
parties aux presentes ont requis que cette Convention, toute lettre de
financement et autres documents soient rediges en langue anglaise.
Executed at Montreal, this February 7th, 2006.
NATEXPORT, A DIVISION OF NATIONAL BANK OF CANADA
By: /s/ XXXXXXX XXXXXX By: /s/ XXXXXX XXXXXX
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Xxxxxxx Xxxxxx Xxxxxx Xxxxxx
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Executed at Montreal, this February 20th, 2006.
MAAX CANADA INC.
By: /s/ XXXXX XXXXX By: /s/ XXXXXX XXXXXX
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Xxxxx Xxxxx Xxxxxx Xxxxxx
MAAX CABINETS INC.
By: /s/ XXXXX XXXXX By: /s/ XXXXXX XXXXXX
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Xxxxx Xxxxx Xxxxxx Xxxxxx
MAAX-KSD CORPORATION
By: /s/ XXXXX XXXXX By: /s/ XXXXXX XXXXXX
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Xxxxx Xxxxx Xxxxxx Xxxxxx
MAAX SPAS (ARIZONA) INC.
By: /s/ XXXXX XXXXX By: /s/ XXXXXX XXXXXX
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Xxxxx Xxxxx Xxxxxx Xxxxxx
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