Exhibit 10.1
SYSTRAN FINANCIAL SERVICES CORPORATION FACTORING AGREEMENT
This Factoring Agreement dated July 1, 2003 (the "Agreement") is between SYSTRAN
Financial Services Corporation ("SYSTRAN") and its successor or assigns and
(jointly and severally the "Customer"), whose addresses are set forth on the
last page hereof.
1. DEFINITIONS
(a) "▇▇▇▇(s)" means any right to payment for services rendered or
goods sold by Customer to a Debtor evidenced by a writing
which complies with the general requirements of SYSTRAN as
those may be set forth in the Customer Information Manual, as
described in Paragraph 2.5.
(b) "Chargeback" the debit of a ▇▇▇▇ or a "Special Purchase
▇▇▇▇(s)" to a Customer's account.
(c) "Commencement Date" means the date that the Customer first
receives funds from SYSTRAN pursuant to the terms of the
Agreement.
(d) "Commercial Account" means any non "Transportation Account".
(e) "Debtor" means a person or entity obligated to pay a ▇▇▇▇.
(f) "Maximum Approved Credit Line" means the amount of credit that
is approved for Customer by SYSTRAN inclusive of deposit and
advances against purchases of Bills that Customer's total
account is not to exceed.
(g) "Maximum Debtor Credit Limit" means the maximum outstanding
dollar amount and/or percentage concentration of Customer's
unpaid Bills open with SYSTRAN owing by an individual Debtor
and/or its affiliates at any given time under the term of the
Agreement.
(h) "Minimum Anticipated Volume" means the dollar amount of Bills
funded by SYSTRAN that Customer presents each month during the
term of the Factoring Agreement for purchase by SYSTRAN that
meet the Maximum Approved Credit Line criteria and Maximum
Debtor Credit Limit(s) established from time to time at the
sole discretion of Systran in connection with Customer's
account.
(i) "Obligation" means all indebtedness, liabilities and
obligations whatsoever and of whatever nature owed by Customer
to SYSTRAN, or any of its affiliates, whether direct or
indirect, absolute or contingent, due or to become due, now
existing or hereafter arising and how ever evidenced or
acquired, whether joint or several or joint and several.
(j) "Recourse" means the right to Chargeback a ▇▇▇▇(s) or "Special
Purchase ▇▇▇▇(s)" to Customer.
(k) "Special Purchase ▇▇▇▇(s)" means the purchase by SYSTRAN of
Customer's outstanding and unpaid Bills that have either been
previously billed by Customer, financed by a lender, or sold
and assigned to another company who buys Bills. Special
Purchase Bills shall be subject to all provisions of this
Agreement.
(l) "Transportation Account" means any Debtor doing business
primarily with any aspect of the transportation industry such
as freight carriers, brokers, forwarders, consolidators, and
rail agents with the exception of steamship companies.
2. PURCHASE OF BILLS
2.1 Customer agrees to present on a monthly basis, a Minimum
Anticipated Volume of Bills for SYSTRAN to purchase which shall be equal to $.
SYSTRAN, at its sole discretion, may purchase such Bills. ▇▇▇▇(s) and or Special
Purchase ▇▇▇▇(s) shall herein collectively be referred to as "The ▇▇▇▇(s)".
Customer shall submit to SYSTRAN an original and one (1) copy, along with any
document which SYSTRAN deems necessary, of each ▇▇▇▇ which shall be attached to
a schedule form provided by SYSTRAN. Should any Debtor require any additional
documentation as a prerequisite to payment, Customer will also provide such
documentation with each ▇▇▇▇. For a Transportation Account, Customer shall also
submit one (1) copy of the respective ▇▇▇▇ of lading. The ▇▇▇▇ of lading must be
signed by the Customer, the shipper, and the consignee if the consignee's
signature is necessary for payment.
2.2 SYSTRAN will settle with the Customer by providing to Customer by
U.S. Mail, electronic mail, or via facsimile a settlement statement setting
forth The ▇▇▇▇(s) and/or Special Bills purchased, the amount paid, and any
deductions made for fees, charges or the "Deposit" and deposit funds as follows:
[Customer shall choose one option] . |_| Deliver overnight funds due Customer
via Federal Express next day service air. |_| Wire transfer funds due Customer
into bank account specified by Customer on wire authorization form. |_| Deposit
funds due Customer. _________ (initials)
2.3 Any payment to Customer may be reduced by SYSTRAN by any amount due
from Customer to SYSTRAN, including but not limited to the security deposit,
Chargebacks, fees and costs.
2.4 SYSTRAN may give notice to the Debtors of the assignment of The
▇▇▇▇(s) by placing a legend on The ▇▇▇▇(s) stating The ▇▇▇▇(s) have been sold
and assigned to SYSTRAN and are payable to SYSTRAN at an address designated by
SYSTRAN. Customer will not attempt to direct payment to any place other than to
the SYSTRAN designated address. Customer agrees to pay all costs and expenses
incurred by SYSTRAN in giving such notice. All proceeds of The ▇▇▇▇(s) received
by Customer shall be delivered immediately to SYSTRAN in the identical form of
payment received by Customer. In the event that Customer collects directly from
the Debtor, The ▇▇▇▇(s) which have been sold to SYSTRAN and Customer does not
deliver immediately to SYSTRAN the identical form of payment received by
Customer, Customer will be charged an administrative fee equal to fifteen
percent (15%) of the face amount of The ▇▇▇▇(s) collected directly. Customer
agrees that any collection directly from the Debtor by Customer of The ▇▇▇▇(s)
which have been sold to SYSTRAN will be considered a default under the terms of
this Agreement.
2.5 SYSTRAN has or will provide to Customer a Customer Information
Manual, which is a guide to policy and procedures concerning daily submission of
The ▇▇▇▇(s), collection efforts, and other matters. The Customer Information
Manual (the "Manual") is not part of this Agreement. The procedures set forth in
the Manual are only guidelines to ensure the efficient operation of SYSTRAN's
purchase of The ▇▇▇▇(s). SYSTRAN may change any procedure in the Manual at any
time, and may choose not to follow procedures in the Manual at its discretion.
3. FEE(S)
3.1 SERVICE FEE(S). Customer shall pay a fee of the face amount of all
of The ▇▇▇▇(s) purchased by SYSTRAN as reflected on Exhibit A attached hereto
(the "Service Fee(s)"). The Service Fee(s) shall be payable upon the purchase of
any of The ▇▇▇▇(s) by SYSTRAN, and SYSTRAN may collect Service Fee(s) either
from payments owed to Customer or may ▇▇▇▇ the Customer periodically. SYSTRAN
may, upon prior notice to Customer, change any fee and such change shall be
effective upon receipt of the notice to Customer; provided, that SYSTRAN may
change the amount of any fee caused by a change in SYSTRAN's cost of funds
without prior notice to Customer, but must notify Customer of such change on
Customer's next settlement statement. A fee change due to a change in cost of
funds will be effective upon the date of the change which will be reflected on
Customer's settlement statement. If, at any time during the term of this
Agreement, there is an event of default by Customer including, but not limited
to, a Federal Tax Lien filed against and attaching to the property of Customer
or any of its principals, and the tax lien is satisfied to allow continued
funding pursuant to this Agreement, SYSTRAN shall increase all of Customer's
Service Fee(s) by no less than one-half of one percent (0.5%) discount fee on
the face of The ▇▇▇▇(s).
3.2 MINIMUM FEE. In the event that Customer fails to sell to SYSTRAN
the Minimum Anticipated Volume in any month, Customer shall pay a minimum fee to
SYSTRAN which shall be equal to the amount obtained when the Minimum Anticipated
Volume is multiplied by the current Service Fees reflected on Exhibit "A"
attached hereto and as referenced in section 3.1 above, or as amended by SYSTRAN
from time to time as reflected in Customer's daily settlement statement (the
"Minimum Fee"). The Minimum Fee owing by Customer pursuant to this paragraph may
be deducted from Customer's funding. In the event that Customer fails to sell
the Minimum Anticipated Volume per month for each of any two consecutive months
(the "Low Volume Period"), Customer's Service fee will be increased at the
beginning of the month immediately following the Low Volume Period at SYSTRAN's
discretion. At SYSTRAN's discretion, the Service Fee will be returned to the
last fee in effect should Customer's monthly purchase volume exceed the Minimum
Anticipated Volume per month for each of two consecutive months.
3.3 ADDITIONAL SERVICES and VALUE FEES. From time to time during the
term of this Agreement, Customer may request SYSTRAN to provide additional
services and/or incur additional risk. Such additional services and/or
additional risk shall include but not be limited to advances to the Customer by
SYSTRAN which are not in conformity with the terms of the Agreement, extension
of Customer's contractual recourse under the Agreement, purchases by SYSTRAN of
bills which are outside of the formulas and calculations defined in the
Agreement (hereinafter such services shall be collectively referred to as the
"Additional Services"). Customer shall pay SYSTRAN the cost for added value for
such Additional Services (hereinafter referred to as the "Value Fee (s)"). The
Values Fee(s) will be reflected on Customer's daily settlement statement.
4. DEPOSIT
4.1 In order to secure Customer's Obligations hereunder, Customer shall
deliver to SYSTRAN a deposit equal to percent (%) of Customer's Bills that are
ninety (90) days old or less computed from date of purchase ("Deposit").
4.2 ADJUSTMENT OF DEPOSIT. The amount of Customer's Deposit will be
reviewed and, if necessary, adjusted each day. Increases in the amount of
Customer's Deposit will be withheld by SYSTRAN from payments to Customer. If
sufficient Bills are not purchased to fund the increase, Customer will pay the
amount of the increase upon demand. Decreases will be repaid to Customer from
Customer's Deposit amount.
4.3 REPAYMENT OF DEPOSIT. Upon termination of the Agreement, (a)
SYSTRAN may increase the Deposit percentage to 100%, in its sole discretion, and
(b) all other sums that may become due to Customer by SYSTRAN will be included
in the Deposit. Any shortfall in the Deposit shall bear interest at the rate of
four percent (4%) per month.
5. SECURITY INTEREST
5.1 The purchase of The ▇▇▇▇(s) of Customer by SYSTRAN is absolute,
subject to the right to Chargeback. In no event shall the purchase of Bills
hereunder be construed as a loan. In addition to the outright ownership of The
▇▇▇▇(s) purchased by SYSTRAN, to secure the payment and performance of
Customer's Obligations to SYSTRAN, Customer grants SYSTRAN a security interest
in, and lien on, any and all now owned or hereafter acquired or created assets
of Customer, including without limitation all Customer's present and future
▇▇▇▇(s) and Special Purchase ▇▇▇▇(s), accounts, inventory, deposit accounts,
chattel paper, contract rights, insurance contracts and proceeds, general
intangibles, choses in action, equipment, instruments, real estate and fixtures,
and documents, and the proceeds of the foregoing, including proceeds in the form
of inventory and/or equipment, whether tangible or intangible, wherever located
together with any and all cash and non-cash proceeds and products and accessions
of the forgoing (the "Collateral").
5.2 FINANCING STATEMENTS. Customer shall not execute or file any
financing statement, supplements or amendments thereto, or any other instruments
or security agreement covering the Collateral described above in favor of anyone
other than SYSTRAN. Customer shall execute and deliver to SYSTRAN any financing
statements, title documents, supplements hereunder or the priority of such
security interest. CUSTOMER AUTHORIZES SYSTRAN TO SIGN ITS NAME TO ANY SUCH
FINANCING STATEMENT AND FILE SAME IN CUSTOMER'S NAME COVERING THE COLLATERAL.
Customer shall pay all costs of filing such statements or instruments with
appropriate governmental authorities together with the costs of all lien
searches. Customer agrees that either a carbon, photocopy, or other reproduction
of this Agreement is sufficient as a financing statement under this Agreement.
5.3 SYSTRAN may, in its sole discretion, elect to discharge any
security interest, lien or other encumbrance upon any of The ▇▇▇▇(s) for
services rendered or goods sold purchased by SYSTRAN. Any such payments and all
expenses incurred in connection therewith shall be treated as a Chargeback.
Notwithstanding the foregoing, SYSTRAN shall have no obligation to discharge any
such security interest, lien or encumbrance.
6. RECOURSE, DISPUTES AND CHARGEBACKS
6.1 All of The ▇▇▇▇(s) are purchased by SYSTRAN from Customer with
Recourse. All of The ▇▇▇▇(s) may be Chargedback to Customer at any time after ()
days for a Commercial Account and steamship companies, and ninety (90) for
Transportation Account(s) after the purchase date of The ▇▇▇▇(s) if not
collected from Debtor within such period or at any time, if SYSTRAN determines,
in its sole discretion, that The ▇▇▇▇(s) is not collectible. All of The ▇▇▇▇(s)
owing by Canadian Debtors or logistics companies are subject to Chargeback sixty
(60) days from the date of purchase by SYSTRAN. All Special Purchase Bills are
subject to Chargeback sixty (60) days from the date of purchase by SYSTRAN.
SYSTRAN shall not deem a disputed ▇▇▇▇ or Special Purchase ▇▇▇▇ uncollectable
without allowing Customer a reasonable time to settle the dispute not to exceed
fourteen (14) days from notice of dispute. It is within SYSTRAN's discretion as
to when The ▇▇▇▇(s) over such time periods may be Chargedback to Customer.
6.2 SYSTRAN reserves the right, however, from time to time and at its
absolute discretion, to Chargeback to Customer any of The ▇▇▇▇(s) which do not
conform to the representations and warranties set forth in the Agreement or are
discovered not to conform with the reasonable standards which SYSTRAN may set
for The ▇▇▇▇(s). SYSTRAN shall have a continuing security interest in any and
all of The ▇▇▇▇(s) which are Chargedback to the Customer. Chargeback of any of
The ▇▇▇▇(s) does not authorize Customer to collect any outstanding sum owing on
The ▇▇▇▇(s) from a Debtor.
6.3 COLLECTION OF BILLS. SYSTRAN may, but is not required to, commence
any action, including legal action, to collect The ▇▇▇▇(s). All costs of
collection, including attorney fees, court fees, and costs of investigation,
will be charged to the Customer. Prior to any event of default by a Debtor,
SYSTRAN will commence litigation only with Customer's authorization. Subsequent
to an event of default, SYSTRAN may file suit as it deems necessary without
Customer's authorization. In the event of default, Customer hereby grants
authorization to SYSTRAN to settle or compromise any freight ▇▇▇▇ dispute,
including litigation, with any uncollected amount being subject to Chargeback,
together with all other amounts for which Customer is obligated to SYSTRAN.
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6.4 CLEARANCE DAYS. Clearance Days shall mean (i) () business days for
checks drawn on banks located within the United States and for all electronic
funds transfers, and (ii) () business days for all other payments. For all
purposes and computations under this Agreement, Clearance Days will be added to
the date on which any payment is received by SYSTRAN.
7. WARRANTIES AND REPRESENTATIONS
7.1 Customer warrants and represents with respect to all of The ▇▇▇▇(s)
sold to SYSTRAN that (a) The ▇▇▇▇(s) are genuine and in all respects what they
purport to be; (b) Customer has good title to The ▇▇▇▇(s) and The ▇▇▇▇(s) are
free and clear of all encumbrances, liens and prior claims, and that the
Customer has the legal right to sell The ▇▇▇▇(s); (c) Customer has no knowledge
of any fact which may impair the validity of The ▇▇▇▇(s) or make them
uncollectible in accordance with its terms and face amount; (d) for
transportation Customers, The ▇▇▇▇(s) were made in accordance with the laws and
the regulations of the Federal Highway Administration or other federal
regulatory agency, and the appropriate state regulatory commission or made
according to lawful and valid contracts which Customer has executed; (e) for
transportation Customers, The ▇▇▇▇(s) are supported by lawful, effective and
complete bills of lading or other contract of carriage together with bona fide,
genuine, valid and signed delivery receipts, and Customer will not modify or
delete any of the terms of the original Bills or Special Purchase Bills or ▇▇▇▇
of lading with respect to same; (f) there are no counterclaims or setoffs or
defenses existing in favor of the Debtor, whether arising from the services
provided or goods sold which are the subject of The ▇▇▇▇(s) or otherwise and
there has been no agreement as to the issuance or granting of any discount on
The ▇▇▇▇(s); (g) The ▇▇▇▇(s) are not a duplicate of and do not cover the same
services provided or goods sold as a ▇▇▇▇ or Special Purchase ▇▇▇▇ previously
purchased by SYSTRAN from the Customer or billed directly by the Customer to the
Debtor; (h) Customer does not own, control, or exercise dominion over the
business of any Debtor whose Bills or Special Purchase Bills are factored by
Customer to SYSTRAN, Customer is not a subsidiary of any Debtor and no Debtors
control or exercise dominion over the business of Customer; (i) Customer will
not under any circumstances or in any manner whatsoever interfere with any of
SYSTRAN's rights under this Agreement in connection with SYSTRAN's factoring of
The ▇▇▇▇(s); (j) Customer has not and will not pledge the credit of SYSTRAN to
any person or business for any purpose whatsoever; (k) for non-transportation
Customers, until the sale by Customer to Debtor of the goods described in The
▇▇▇▇(s), Customer had good title to the goods sold, the goods were free of all
encumbrances, liens and prior claims, and Customer had the legal right to sell
the goods.
7.2 If the Customer is a corporation, partnership or limited liability
company, it is duly organized, existing, and in good standing under the laws of
.. If Customer represents him or herself to be a sole proprietorship or a
partnership, such representation shall be deemed conclusive and binding upon
Customer. Customer is duly qualified to do business and is in good standing in
every other state in which such qualification is required. If Customer is a
corporation, partnership or limited liability company, execution, delivery and
performance hereof are within its corporate or entity powers, have been duly
authorized, and are not in contradiction of law or the terms of its charter,
by-laws, partnership agreement, operating agreement or other entity papers, or
any indenture, agreement or undertaking to which it is a party or by which it is
bound. In addition, the Customer has all licenses and certificates necessary for
the operation of its business and the issuance of The ▇▇▇▇(s).
8. AUTHORITY
Customer irrevocably authorizes SYSTRAN or any person designated by
SYSTRAN to: ▇▇▇▇, receive and collect all amounts which may be due or become due
to Customer from Debtors and to use Customer's name for purposes of billing and
collection of amounts due; delete Customer's address on all invoices mailed to
Debtor and substitute SYSTRAN's address; receive, open and dispose of all mail
addressed to Customer or Customer's trade name at SYSTRAN's address; negotiate
checks received in payment whether payable to Customer or to SYSTRAN, 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 SYSTRAN on The ▇▇▇▇(s) purchased
by SYSTRAN and on any invoices or other document relating to any of The ▇▇▇▇(s);
in Customer's name, or otherwise, demand, ▇▇▇ for, collect and get or give
releases for any and all monies due or to become due on The ▇▇▇▇(s); compromise,
prosecute, or defend any action, claim or proceeding as to The ▇▇▇▇(s) purchased
by SYSTRAN; take all steps necessary to ensure payment of such amounts due and
do any and all things in Customer's name necessary and proper to carry out the
purpose intended by this Agreement.
9. ADDITIONAL DOCUMENTS
The Customer shall execute and deliver all such additional and further
instruments as may be reasonably requested by SYSTRAN in order to more
completely vest in and assure to SYSTRAN and make available to it, the property
and rights herewith or hereafter granted or assigned and transferred to SYSTRAN
as Collateral and to evidence the sale of The ▇▇▇▇(s) to SYSTRAN and to carry
into effect the provisions and intent of this Agreement.
10. LOCATION OF BOOKS AND RECORDS, PLACE OF BUSINESS
Customer's place of business is the one set forth in this Agreement and
all of its books, accounts, correspondence, papers and records pertaining to the
services performed or sales of products are located there, and all such books,
accounts, correspondence, papers and records will be opened for SYSTRAN's
inspection at all reasonable times.
11. INDEMNIFICATION OF SYSTRAN; SALES AND EXCISE TAXES
Customer will indemnify and hold SYSTRAN harmless against any and all
liability, loss or expense, including attorney's fees and costs, caused by or
arising out of any claims or alleged claims asserted relating in any manner to
The ▇▇▇▇(s) purchased by SYSTRAN hereunder or subject to SYSTRAN's security
interest, including, but not limited to, claims asserted against SYSTRAN
pursuant to Chapter 5, Title 11 of the United States Code. In the event any
sales or excise taxes are imposed by any state, federal or local authorities
with respect to any of The ▇▇▇▇(s) sold and assigned hereunder, where such taxes
are required to be withheld or paid by SYSTRAN, Customer shall also indemnify
SYSTRAN and hold it harmless with respect to all such taxes and hereby
authorizes SYSTRAN to charge to Customer's account any such tax that is paid or
withheld by SYSTRAN. SYSTRAN may charge the Deposit or initiate legal
proceedings to collect any amount due under this paragraph. This paragraph shall
survive and remain effective following the termination of the Factoring
Agreement.
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12. FINANCIAL INFORMATION
So long as Customer factors or has any absolute or contingent
obligation of any kind owing to SYSTRAN, the Customer will provide information
regarding the business, affairs and financial condition of Customer and its
subsidiaries as SYSTRAN may reasonably request, including financial statements.
13. BANKRUPTCY
Customer agrees to notify SYSTRAN of any voluntary or involuntary
bankruptcy petition filed by or against it or any guarantor within twenty-four
(24) hours of such filing.
14. REORGANIZATION, ACQUISITIONS, CHANGE OF NAME OR LOCATION
Customer will not, and will not permit any subsidiary to merge or
consolidate with or into any corporation or other entity, or sell, lease,
transfer, or otherwise dispose of all or any substantial part of its assets,
whether now owned or hereafter acquired. Customer shall notify SYSTRAN in
writing not less than thirty (30) days prior to (a) any change of its name or
use of any trade names; or (b) any change in the address of the chief executive
office and/or chief place of business of Customer or the location of any records
pertaining to The ▇▇▇▇(s).
15. LITIGATION
Except as disclosed in writing, Customer represents and warrants to
SYSTRAN as follows: There are no suits or proceedings pending or to the
knowledge of Customer, threatened against or affecting Customer or any of its
subsidiaries which, if adversely determined, would have a material adverse
effect on the financial condition or business of Customer and its subsidiaries
and there are no proceedings by or before any governmental commission, board,
bureau, or other administrative agency pending or, to the knowledge of Customer,
threatened, against Customer or any of its subsidiaries. Further, Customer
represents and warrants there is no claim, loss contingency, or proceeding,
whether or not pending, threatened or imminent, against or otherwise affecting
Customer that involves the possibility of any judgment or liability not fully
covered by insurance or that may result in a material adverse change in the
business, properties, or condition, financial or otherwise, of Customer.
16. TRADE NAMES
Customer represents and warrants to SYSTRAN that it utilizes no trade
names or assumed business names in the conduct of its business except .
17. TAXES
Customer represents and warrants to SYSTRAN that: Customer has filed
all federal, state, and local tax returns and other reports it is required to
file and has paid or made adequate provision for payment of all such taxes,
assessments, and other governmental charges.
18. TERM AND TERMINATION
18.1 This Agreement is for a term of () full months to begin on the
Commencement Date as defined in paragraph 1(c) herein. The term of this
Agreement shall renew automatically for consecutive ()month terms unless sooner
terminated in accordance with the terms of the Agreement. Customer may terminate
this Agreement effective at the end of any term by giving thirty (30) days prior
written notice to SYSTRAN at the address set forth in this Agreement. Customer
may continue to offer any of The ▇▇▇▇(s) to SYSTRAN during such thirty (30) day
period. SYSTRAN may terminate this Agreement at any time and for any reason by
notifying Customer in writing of such termination.
18.2 All of Customer's representations, warranties, and other
provisions of this Agreement shall survive such termination until SYSTRAN has
been paid in full and Customer has fully performed all of its obligations. In
addition, should any transfer of money or property to SYSTRAN hereunder be
avoided in a bankruptcy proceeding involving Customer, any Debtor of Customer,
or otherwise, then Customer's Obligations hereunder shall be reinstated and/or
supplemented to the extent of the avoided transfer, whether or not this
Agreement has otherwise been terminated.
18.3 Notwithstanding the foregoing, Customer has the option to
terminate this Agreement prior to the end of any term by giving SYSTRAN thirty
(30) days prior written notice. Customer may continue to offer any of The
▇▇▇▇(s) to SYSTRAN during such thirty (30) day period. Customer shall be deemed
to have terminated this Agreement prior to the end of any term on the date that
Customer shall have ceased presenting The ▇▇▇▇(s) to SYSTRAN in the normal
course for an uninterrupted period of thirty (30) days ("Deemed Termination").
Upon notice of early termination, or the date of a Deemed Termination by
Customer, prior to the end of any term, whether or not Customer continues to
offer The ▇▇▇▇(s) to SYSTRAN during the thirty (30) day notice period applicable
to Customer, Customer shall be obligated to pay to SYSTRAN, and Customer's
Deposit may be charged, an early termination premium ("Early Termination
Premium") as noted in the Addendum.
18.4 Any partial month remaining in the current term shall constitute a
full month for the purpose of calculating the Early Termination Premium. In
addition, if SYSTRAN buys Bills from Customer as part of a Special Purchase
▇▇▇▇, and should Customer terminate this Agreement within the first four (4)
months of the term of this Agreement, Customer's Deposit shall be charged an
Early Termination Premium in the amount of the balance of the Deposit on the
termination date. The termination date shall be thirty (30) days after SYSTRAN's
receipt of the termination notice or on the Deemed Termination date, unless a
termination notice specifies a date that is more than thirty (30) days but less
than sixty (60) days after SYSTRAN's receipt of the termination notice.
18.5 If SYSTRAN terminates this Agreement prior to the end of any term
upon any default in the performance of Customer under this Agreement, in view of
the impracticality and extreme difficulty in ascertaining actual damages and by
mutual agreement of the parties as to the reasonable calculation of SYSTRAN's
lost profits as a result thereof, Customer shall be obligated to pay SYSTRAN
upon the effective date of such termination, and Customer's Deposit may be
charged, a premium in an amount equal to the Early Termination Premium as set
forth above. If Customer terminates this Agreement pursuant to the terms
thereof, Customer shall immediately remit and pay to SYSTRAN, at the time of
termination, all Obligations due and owing to SYSTRAN and/or its affiliates by
Customer, under this and any other Agreement.
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19. EVENTS OF DEFAULT
19.1 The following shall be events of default under the terms of this
Agreement: (a) default by Customer in the performance of any Obligation to
SYSTRAN or any other financial institution or bank; (b) Customer agrees to the
appointment of a receiver for its assets, makes general assignment for the
benefit of creditors or declares that it is unable to pay its debts as they
mature; (c) Customer files a proceeding under any law for the relief of Debtors,
including but not limited to, Title 11 of the United States Code, referred to as
"The Bankruptcy Code" or any other similar law which may exist; (d) any
involuntary petition under the Bankruptcy Code or similar statute has been filed
against the Customer and not dismissed within sixty (60) days after filing
without the entry of an order for relief; (e) the issuance of an attachment,
execution, tax assessment or similar process against the Customer or its
property which is not released within ten (10) days of its attachment; (f) any
change in the conditions, financial or otherwise, of the Customer which
reasonably causes SYSTRAN to deem itself insecure.
19.2 In addition to all other remedies provided by law, upon the
occurrence of an event of default, SYSTRAN may immediately, and without notice
to the Customer, increase the amount of the Deposit required under Section 4 of
this Agreement to one hundred percent (100%) of the outstanding amount of Bills
purchased from the Customer ("100% Deposit"), and the Customer shall immediately
deliver to SYSTRAN funds sufficient to create this 100% Deposit.
19.3 SYSTRAN may, upon default under the Agreement or any of the
agreements, collect any Obligation owing to SYSTRAN or any of its affiliates by
debiting Customer's account, attach any funds owing to Customer by SYSTRAN or
its affiliates, and exercise any other remedy available to SYSTRAN under the
Agreements or at law. Any deficiency arising under this Agreement shall accrue
interest at the annual rate of twelve percent (12%) or the highest amount
allowed by law, whichever is higher, from the date the deficiency is incurred.
20. EXPENSES
20.1 Customer shall reimburse SYSTRAN for all fees, costs and expenses
incurred by SYSTRAN in relation to this Agreement. SYSTRAN may, at any time, and
without regard to any remedy listed above, demand from Customer payment of the
outstanding fees, costs and expenses.
20.2 ATTORNEYS' FEES. With respect to any default under this Agreement,
Customer shall reimburse SYSTRAN for all costs and expenses incurred by
attorneys, including both SYSTRAN's in-house attorneys and outside attorneys'
and paralegals' whether or not a lawsuit or other court action is actually filed
in connection with the event of default. In the event that a suit, action,
arbitration, or other proceeding of any nature, including, without limitation,
any proceeding under The Bankruptcy Code, any action seeking a declaration of
rights or an action for rescission is instituted to interpret or enforce this
Agreement, including, but not limited to such fees and costs associated with
trial and appeals, Customer agrees to pay the reasonable attorneys' fees
incurred in connection with any such proceeding as awarded by the court.
20.3 OTHER PROFESSIONALS AND EXPERTS. With respect to any event of
default under this Agreement, SYSTRAN in its sole discretion may retain
accountants, auditors, appraisers and other experts and the Customer agrees to
pay the professional fees, expert fees and all other fees and costs reasonably
and actually incurred in connection with the services provided.
20.4 No Lien Termination without Release. In recognition of SYSTRAN's
right to have its attorneys' fees and other expenses incurred in connection with
this Agreement secured by the Collateral, notwithstanding payment in full of all
Obligations by Customer, SYSTRAN shall not be required to record any
terminations or satisfactions of any of SYSTRAN's liens on the Collateral unless
and until Customer has executed and delivered to SYSTRAN a general release in a
form reasonably satisfactory to SYSTRAN. Customer understands that this
provision constitutes a waiver of its rights under ss.9-404 of the UCC.
20.5 JURY TRIAL WAIVER. IN RECOGNITION OF THE HIGHER COSTS AND DELAY
WHICH MAY RESULT FROM A JURY TRIAL, THE PARTIES WAIVE ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING HEREUNDER, OR (B) IN
ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO OR ANY OF THEM WITH RESPECT HERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY FURTHER WAIVES ANY RIGHT TO CONSOLIDATE ANY SUCH ACTION IN WHICH A
JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE
OR HAS NOT BEEN WAIVED; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
21. JURISDICTION AND VENUE
This Agreement shall be deemed to be a contract under the laws of the
State of Oregon and for all purposes shall be governed by and construed in
accordance with the laws of that state. Customer irrevocably agrees that any
legal action or proceeding brought by or against Customer with respect to the
Agreement shall be brought in the courts of the State of Oregon or in the U.S.
District Court for the District of Oregon. Customer consents to the jurisdiction
of such courts and that the venue for any such action shall be the County of
Clackamas. This provision shall not limit the right of SYSTRAN to bring such
actions or proceedings against Customer in the court of such other states or
jurisdictions where Customer may be subject to jurisdiction. Customer expressly
authorizes service of process in any such suit or action on its behalf upon
Registered Agent: See Addendum , at (address) See Addendum or
upon such other agent as SYSTRAN may approve in writing, as its agent for such
purposes and that service may be deemed complete upon delivery via expedited
national overnight delivery service.
22. WAIVER, NOTICE
The waiver by SYSTRAN of the breach of any term of this Agreement or of
the compliance therewith shall not be construed as a waiver of any other breach
or compliance. Notices from either party to the other shall be given in writing
and mailed postage prepaid, registered or certified mail, or placed in the hands
of a national overnight delivery service, addressed to the addresses set forth
opposite each party's name below, or at such other address as either party may
hereafter advise the other in writing.
23. ASSIGNMENT
Customer may not assign any of its rights or obligations hereunder.
SYSTRAN may assign or grant a security interest in this Agreement or in any of
The ▇▇▇▇(s) purchased by SYSTRAN. SYSTRAN may assign any of its rights and
remedies with respect to The ▇▇▇▇(s) including the right to notify Debtors to
make payment to SYSTRAN's assignee.
24. SEVERABILITY
The provisions of this Agreement are severable and if any of these
provisions shall be held by any court of competent jurisdiction to be
unenforceable such holding shall not affect or impair any other provisions
hereof.
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25. COMPLETE UNDERSTANDING
This Agreement comprises the complete understanding among the parties
and may only be varied by a writing executed by the parties hereto. Paragraph
headings are for convenience only.
26. THIRD PARTY CONSULTATION
Customer hereby agrees and acknowledges that it has had the opportunity
to seek out and consult with legal counsel and/or independent business advisors
of its own choosing in connection with the negotiation, execution and delivery
of this Agreement. This Agreement shall be construed without regard to any
presumption or rule requiring that it be construed against the party causing
this Agreement, or any part hereof to be drafted.
27. NO OFFER/COMMITMENT
The presentation of this Agreement to Customer does not constitute
either an offer or commitment to purchase The ▇▇▇▇(s) or to extend credit to
Customer.
28. JOINT AND SEVERAL LIABILITY
If more than one Customer executes this Agreement, their Obligations
under this Agreement are joint and several.
29. CREDIT INFORMATION
Customer authorizes SYSTRAN or any of its affiliates to obtain credit
bureau reports, and make other credit inquiries that it determines are
necessary. On Customer's written request, SYSTRAN will inform Customer whether
SYSTRAN has requested a consumer credit report and the name and address of any
consumer credit reporting agency that published a report. Customer acknowledges
that without further notice SYSTRAN may use or request additional credit bureau
reports to update its information so long as Customer obligations to SYSTRAN are
outstanding.
30. GUARANTORS
The parties acknowledge that TEKINSIGHT RESEARCH, INC., and
▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., and Newport Acquisition Corp, and TEKINSIGHT E-GOVERNMENT
SERVICE, INC., and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇ ▇. ▇▇▇▇
have executed Continuing Guaranties and/or Collateralized Guaranties and/or
Validity Guaranties for the Obligations of Customer arising hereunder, and that
Systran would not enter into this Factoring Agreement without said guaranties.
SYSTRAN FINANCIAL SERVICES CORPORATION
By:
-----------------------------------------
Title:
--------------------------------------
Date:
--------------------------------------
Address: ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
DynTek, Inc.
WITNESS:
By: By:
----------------------------------------- -----------------------------------------
Print Name: Print Name:
--------------------------------- ---------------------------------
Title: Address:
-------------------------------------- -----------------------------------
Date:
------------------------------ -----------------------------------
Phone:
--------------------------------------
Address: ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇. # ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
DynTek Services, Inc.
WITNESS:
By: By:
----------------------------------------- -----------------------------------------
Print Name: Print Name:
--------------------------------- ---------------------------------
Title: Address:
-------------------------------------- -----------------------------------
Date:
------------------------------ -----------------------------------
Phone:
--------------------------------------
Address: ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇. # ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
6
