ACCOUNT PURCHASE AGREEMENT
EXHIBIT
10.44
This
Agreement is dated as of Nov.
3,
2005
between Xxxxx Fargo Bank, National Association, acting through its
Xxxxx
Fargo Business Credit operating division ("WFBC"), and Natural Soda, Inc.
("Customer"). The Customer and WFBC
agree as follows:
ARTICLE
I
Purpose
of Agreement
1.01 Purpose
of Agreement. The
Customer desires to sell and assign to WFBC acceptable accounts receivable
and
WFBC
desires to purchase such accounts on the terms and conditions set forth herein.
The purpose of this Agreement is commercial
in nature and not for household, family and/or personal use. This Agreement
sets
forth the terms and conditions
on which WFBC will consider purchasing accounts receivable from the
Customer.
ARTICLE
II
Definitions
2.01 "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.
2.02 "Acceptable
Account" means
an
Account, in an amount not to be less than $100, acceptable to WFBC, which
conforms
to the warranties and terms set forth herein, net of any credits or allowances
of any nature and is not an Unacceptable
Account as defined below.
2.03 "Account
Debtor" means
Customer's customer or any other person or entity owing money to the Customer
with respect
to the Account.
2.04 "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 WFBC which arises
at
anytime, whether before or after
signing of this Agreement or the purchase of any Account.
2.05 "Collateral"
means
the
intangible or tangible property given as security to WFBC by Customer for
any
obligations
and liabilities of Customer to WFBC under this Agreement.
2.06 "Collected
Reserve Account" means
the
account established by WFBC for Customer to which from time to time
credits will be made, debits taken and disbursements made in accordance with
this Agreement. Provided there is no Event of Default hereunder, or any event
which with the passage of time or notice would be an Event of Default, any
available
balance held in the Collected Reserve Account shall be released to the Customer
on a weekly basis. Any fee, charge
or
other obligation of the Customer under this Agreement may be charged against
this account in WFBC's sole discretion.
2.07 "Customer"
means
the
seller and assignor of the Accounts.
2.08 "Event
of Default" shall
mean the existence of a default pursuant to Article VII hereunder, or a default
under any
documents given to WFBC in connection with this Agreement.
2.09 "Initial
Payment"
shall
mean with respect to a given Account an amount equal to the gross face amount
of
such Account less stated trade discounts offered by the Customer to the Account
Debtor less ten (10%) percent. This percentage
may be adjusted by WFBC at any time at WFBC's sole discretion.
2.10 "Minimum
Fee"
shall
mean the minimum fee paid per month by the Customer as stated in Section
6.06
below.
2.11 "Net
Purchase Price"
for any
Account means an amount equal to the gross face amount of such Account less
WFBC's
Discount and other charges with respect to such Account and less any amount
of
any trade discounts, credits or allowances,
or any other reductions or adjustments to such Account taken by the Account
Debtor.
2.12 "Origination
Fee"
shall
mean the fee payable on closing of this Agreement, and
on each renewal of this Agreement, as
set
forth in Section 6.06 below.
2.13 "Part
Payment"
for any
Account means any payment made by WFBC to the Customer with respect to such
Account which is less than the full Net Purchase Price as more fully described
in Article III below.
2.14 "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. In any event where repurchase is
required under this Agreement, WFBC, at its discretion, may charge the
Repurchase
Price to Customer's Collected Reserve Account which may create a deficit
balance
under Section 3.06 below.
2.15 "Unacceptable
Account"
shall
mean Accounts which are not acceptable in WFBC's sole discretion including
but
not
limited to the following Accounts:
2.15(a)
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 WFBC that (i) WFBC has a first priority perfected security
interest and (ii) such Accounts may be enforced by WFBC directly against
such
unit of government under all applicable
laws);
2.15(b)
Accounts
owed by an Account Debtor located outside the United States which are not
(i)
backed by a bank letter of credit naming WFBC as beneficiary or assigned
to
WFBC, in WFBC's possession and acceptable to
WFBC
in all respects, in its sole discretion, (ii) covered by a foreign receivables
insurance policy acceptable to WFBC
in
its sole discretion;
2.15(c)
Accounts
owed by an Account Debtor that is insolvent, the subject of bankruptcy
proceedings or have gone out of business;
2.15(d)
Accounts
owed by a shareholder, subsidiary, affiliate, officer or employee of the
Customer;
2.15(e)
Accounts
not subject to a duly perfected security interest in WFBC's favor or which
are
subject to any lien,
security interest or claim in favor of any Person other than WFBC including
without limitation any payment or performance bond;
2.15(f)
Accounts
that have been restructured, extended, amended or modified;
2.15(g)
That
portion of Accounts that constitutes advertising, finance charges, service
charges or sales or excise taxes;
2.15(h)
Accounts
that have been invoiced, paid or partially paid in advance of the full delivery
and acceptance of goods or the performance and acceptance of services or
in
advance of the submission of the Account to WFBC.
2.15(i)
Accounts, or portions thereof, that fail to conform to the representation
and
warranties contained herein or
are
otherwise deemed unacceptable by WFBC in its sole discretion.
2.16 "WFBC
Discount"
means
the amount to be paid by the Customer according to the following
schedule:
|
Days
|
Rate
|
|
(for
payment
of
Account)
|
|
|
1-10
|
1.0%
of the gross face amount of each Account purchased by
WFBC.
|
|
+11
|
.07
of 1% additionally per day until the Account is paid in
full.
|
If
any
Event of Default exists, as defined below, this discount may increase in
an
amount to be determined by WFBC at its sole discretion. WFBC may, upon prior
written notice to Customer, change the amount of any fee or
charge
at its sole discretion or if WFBC's cost of funds increases for any reason.
Such
change shall be effective
upon delivery of the notice.
ARTICLE
III
Purchase
of Accounts
3.01 Pursuant
to the terms herein, Customer hereby sells, transfers and assigns to WFBC,
its
successors and assigns, as
absolute owner, and WFBC hereby purchases and accepts from the Customer all
of
the Customer's right, title and interest in and to:
3.01(a)
all of
the Customer's Accounts 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; and
3.0l(b)
all
right, title and interest of the Customer in and to the books and records
evidencing or relating to the Accounts, all deposits, or other security for
the
obligation of any person under or relating to the Accounts, all goods relating
to, or which by sale have resulted in, the Accounts, including goods returned
by
any Account Debtor, debtor or obligor in any way obligated on or in connection
with the 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
3.01(c)
proceeds
of the foregoing in any form.
3.02 Approval:
WFBC
shall not purchase an Account unless such Account is first submitted to WFBC
by
Customer for approval. WFBC is not obligated to buy any Account from a Customer
that WFBC does not deem acceptable in its sole
discretion.
3.03 Purchase:
Upon
approval and acceptance by WFBC of an Account for the assignment and sale
of an
Account to WFBC, WFBC shall purchase and Customer shall assign and sell to
WFBC
such Account.
3.04 Purchase
Price:
As
consideration for the assignment and sale of an Account to WFBC, WFBC shall
pay
to the
Customer the Net Purchase Price for such Account on the terms and conditions
as
stated herein.
3.05 Payment
of Purchase Price:
If no
Default exists hereunder, WFBC shall pay for each Account purchased hereunder
the Net Purchase Price for such Account to Customer as follows:
3.05(a)
Upon
assignment or sale of an Account to WFBC, and receipt of all documents and
forms
described in Section
3.07 below and upon fulfillment of all terms precedent to such sale or
assignment as more fully described below,
WFBC shall pay to the Customer, or advance to the Collected Reserve Account
as
appropriate, the Initial Payment with respect to such Account.
3.05(b)
After
collection of an Account by WFBC, WFBC shall credit the Customer's Collected
Reserve Account
with the amount collected on the Account less: (i) the Initial Payment, (ii)
Part Payment(s), and (iii) any fees,
expenses or charges owed to WFBC as more fully described herein.
3.05(c)
Upon
an
Event of Default hereunder (or an event which with the passage of time or
notice
would become an
Event
of Default), WFBC may hold any balance in the Collected Reserve Account as
Collateral for any obligations
of the Customer to WFBC and WFBC may charge any such obligations against
the
Collected Reserve Account
in its sole discretion.
3.05(d)
In
the
event WFBC receives payment on an Account which has not been purchased, such
payment will be credited to the Customer's Collected Reserve Account and
released in accordance with this Agreement.
3.06 Reporting
and Statement of Account:
On a
weekly basis, or as otherwise determined by WFBC at its sole discretion,
WFBC shall prepare, and make available to the Customer, an accounting of
the
purchases, collections, and amounts
credited to and/or charged against the Collected Reserve Account during that
week or other period. Should such
a
statement of account indicate a deficit balance, such balance shall be due
and
payable and the Customer shall immediately pay to WFBC the amount of such
deficit plus accrued 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.
3.07 Required
Forms:
When
Customer offers Accounts to WFBC for sale, WFBC shall receive (a) an assignment
of Accounts,
in a form satisfactory to WFBC and signed by an authorized representative
of
Customer, (b) an original invoice or such other document acceptable to WFBC
in
its sole discretion, (c) a copy of the Xxxx of Lading, (d) proof of delivery,
(e) contract, purchase order, or purchase order number which corresponds
with
such invoice(s), as appropriate to the business of Customer, (f) notification
of
assignment and waiver of offset signed by the Account Debtor in a form
acceptable to WFBC in its sole discretion and (g) and any other document
which
WFBC may require.
3.08 Notification:
Prior to
purchasing any Accounts, WFBC will notify all Account Debtors of the assignment
of Accounts
and instruct the Account Debtor to make payments directly to WFBC.
3.09 Notation
of Assignment:
Customer
shall make a notation on each original invoice (or the electronic equivalent
of
an
invoice) or other such documentation accepted by WFBC for each Account which
indicates that the Account has been assigned and/or sold to WFBC with the
following language:
This
invoice has been assigned to
and
is
payable to:
Xxxxx
Fargo Business Credit, Inc.
Dept.
1494
Xxxxxx,
Xxxxxxxx 00000-0000
For
information call 303/000-0000
In
the
event any invoice (or the electronic equivalent of an invoice) is sent or
transmitted to any Account Debtor without the
required notation, a fee equal to 2.5% of the face amount of such invoice
shall
be assessed.
3.10 Sole
Property:
Once
WFBC has purchased an Account, any and all payments from the Account Debtor
as
to that Account are the sole property of WFBC.
3.12 Book
Entry:
Customer
shall, immediately upon sale of Accounts to WFBC, make proper entries on
its
books and
records disclosing the absolute sale of said Accounts to WFBC, including
the
proper inclusion of the language stated in Section 3.09 above, on said books
and
records and other documents as so directed by WFBC.
ARTICLE
IV
Customer's
Representations, Warranties and Covenants
4.01 Representations
and Warranties. Customer
hereby represents and warrants and as follows:
4.01
(a) Customer
is properly licensed, qualified and authorized to operate the business of
Natural Soda, Inc. under
the
trade name(s) of and Customer's trade name(s) have been properly filed and
published as required by applicable law. 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.
4.01
(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.
4.01
(c) Customer
is, at the time of purchase of each Account by WFBC, the lawful owner of
and has
good and undisputed
title to such Account. Each Account, at the time of purchase is free from
any
liens, mortgages, restrictions or encumbrances. Each Account offered for
sale to
WFBC is an Acceptable Account as defined in Section
2.02 above.
4.01
(d) Each
Account Debtor's business is solvent to the best of Customer's information
and
knowledge at the time
of
this Agreement and at the time each Account is presented to WFBC for
purchase.
4.01
(e) Each
Account offered for sale to WFBC 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 WFBC and Customer, is 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 WFBC and such Accounts are payable by Account Debtor without
offset,
deduction or counterclaim.
4.01
(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 WFBC.
4.01
(g) All
financial records, statements, books or other documents shown to WFBC by
Customer at anytime, either before or after the signing of this Agreement
are
true and accurate.
4.01
(h) 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
WFBC.
4.01
(i) 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.
4.01
(j)
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 requisite
company action, and neither the execution nor the 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 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.
4.02 Negative
Covenants. Customer
agrees as follows:
4.02
(a)
Customer
will not under any circumstances or in any manner whatsoever, interfere with
any
of WFBC's rights
under this Agreement.
4.02
(b)
For the
duration of this Agreement and for any period thereafter for as long as any
obligation to repurchase
or indebtedness whatsoever remains owing by Customer to WFBC, Customer will
not
sell or assign Accounts except to WFBC.
4.02
(c)
Customer
shall not pledge, transfer or grant a security interest in any personal property
or Accounts of Customer
nor shall Customer consent to the transfer, pledge or grant a security interest
in or the 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 any Account
or is indebted to WFBC
hereunder without the written consent of WFBC. Customer shall provide written
notice to WFBC 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. 4.02 (d) 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 WFBC unless WFBC first consents to such change or modification in
writing.
4.02
(e)
Customer
shall not be involved in a material dispute of any kind with an Account Debtor,
regardless of validity,
during the term of this Agreement.
4.02
(f) Customer
shall not breach any warranties or promises in this Agreement with regard
to any
unpaid Account or Account Debtor from whom payment on any such Account is
due.
4.02
(g)
Customer
shall not intentionally contribute to, or aggravate any Credit Problem of
any
Account Debtor.
4.03 Affirmative
Covenants.
Customer
agrees as follows:
4.03
(a)
With
respect to misdirected payments, whenever any payment on any Account comes
into
Customer's possession, Customer shall hold such payment in trust and
safekeeping, as the property of WFBC, and immediately turn over to WFBC such
payment in the same form as it was received by Customer to WFBC. 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 WFBC on the next business day following
the date of receipt by Customer. Further, Customer shall segregate and
hold
in trust and safekeeping, as the property of WFBC, and immediately turn over
to
WFBC, any goods or inventory returned to, reclaimed or repossessed by the
Customer which are covered by an Account purchased by WFBC.
4.03
(b)
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, the Customer shall have WFBC named as loss
payee for such insurance.
4.03
(c)
Customer
will immediately notify WFBC of any material disputes between Account Debtor
and
Customer or the return of any product by Account Debtor to
Customer.
4.03
(d)
Customer
will notify WFBC in writing prior to any change in the location of any of
its
places of business, including the location of the Customer's inventory or,
if
Customer has or intends to acquire any additional
place of business. Customer will not change its chief executive office or
the
office or offices where Customer's books and records concerning Accounts
are
kept without prior notice to WFBC.
4.03
(e)
Customer
will immediately notify WFBC in writing of any proposed change of Customer's
name, identity,
legal entity, corporate structure, business dissolution, use of any additional
trade name, or any proposed change
in
any of the officers, principals, partners, shareholders and/or owners of
Customer and will not effect any such change without WFBC's written
consent.
4.03
(f)
Customer
will immediately notify WFBC 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 petition under the
United
States Bankruptcy Code,
if
any involuntary bankruptcy petition is filed against Customer or if a receiver
is appointed to manage the property
of Customer.
4.03
(g) At
least
once per quarter, or once per month if Customer is in default, Customer will
furnish to WFBC financial statements, including but not limited to a statement
of profit and loss and a balance sheet, satisfactory proof of payment and
compliance with all federal, state and local tax requirements and any other
information requested
by WFBC.
4.03
(h) Customer
will immediately notify WFBC of the return of any product by Account Debtor
to
Customer.
4.03
(i) Customer
shall immediately notify WFBC of any claim or loss or offset of any kind
against
Customer or WFBC asserted by Account Debtor during any time period covered
by
this Agreement.
4.03
(j) Upon
the
occurrence of an Account Debtor Dispute, Customer shall immediately pay to
WFBC
the Repurchase Price for any and all Accounts so disputed.
ARTICLE
V
Security
Interest
5.01 Security
Interest/Collateral: As
further inducement for WFBC to enter into this Agreement, Customer grants
to
WFBC, as collateral for the repayment of any and all obligations and liabilities
whatsoever of Customer to WFBC, 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,
contract rights, investment property, deposit accounts, the Collected Reserve
Account established hereunder, inventory, instruments, chattel paper, documents,
insurance proceeds, and all books and records pertaining to accounts and
all
proceeds and products of the foregoing
property.
5.02 Security
Documents: Customer
shall execute all and deliver to WFBC any and all documents and instruments
as
WFBC may request from time to time, including, without limitation, UCC financing
statements or amendments. Customer
authorizes WFBC to file a financing statement with any appropriate authority
reflecting its security interest and further
authorizes WFBC to file other filings including amendments (other than
amendments adding collateral) or terminations, as WFBC deems
appropriate.
ARTICLE
VI Operational
Provisions
6.01 Repurchase:
Upon
the
occurrence of an Account Debtor Dispute, Customer shall repurchase the Account
subject to
the
Account Debtor Dispute immediately. Regardless of whether there is an Account
Debtor Dispute, in the event that an
Account is outstanding 75 days from the invoice date, Customer shall immediately
repurchase such Account. In either event,
if
the Repurchase Price is not paid immediately, WFBC may (but is not required
to)
deduct the Repurchase Price from
funds available to Customer under Article III hereof.
6.02 Power
of Attorney: In
order
to carry out this Agreement and avoid unnecessary notification of Account
Debtors, Customer
irrevocably appoints WFBC, or any person designated by WFBC, as its special
attorney in fact, or agent, with power
to:
6.02(a)
strike
out Customer's address on all invoices delivered to Account Debtors and note
WFBC's address on all
invoices.
6.02(b)
receive,
open and dispose of all mail addressed to Customer (including any trade name
of
Customer) sent to WFBC's
address.
6.02(c)
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 WFBC on Accounts , and on any other documents relating
to
any of the Accounts or to Collateral.
6.02(d)
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.
6.02(e)
compromise,
prosecute, or defend any action, claim or proceeding as to said
Accounts.
6.02(f)
In the
Event
of Default, offer a trade discount to Customer's Account Debtor exclusive
of
Customer's normal
business custom with said Account Debtor.
6.02(g)
initiate
electronic debit or credit entries through the ACH system to Customer's account
or any other deposit
account maintained by Customer wherever located.
6.02(h)
sign
Customer's name on any notice of assignment, financing statement, amendment
to
any financing statement and on any notices to Account Debtors.
6.02(i)
do
any
and all things necessary and proper to carry out the purposes intended by
this
Agreement.
The
authority granted to WFBC under this provision shall remain in full force
and
effect until all assigned Accounts are
paid
in full and any indebtedness of Customer to WFBC is discharged.
6.03 Double
Payments: Should
WFBC receive a double payment on an Account or other payment which is not
identified,
WFBC 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 hereof upon proper
identification and documentation.
6.04 Hold
Harmless: Customer
shall hold WFBC harmless against any Account Debtor ill will arising from
WFBC's
collecting or attempting to collect on any Accounts, provided that WFBC acts
in
a commercially reasonable manner.
6.05 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 deduct such tax or levy, then the Customer
shall
immediately pay WFBC the amount of the tax or levy so withheld, and the
Customer shall indemnify and hold WFBC harmless from any loss or expense
on
account of such tax.
6.06 Minimum
and Origination Fee: Customer
shall pay a Minimum Fee per month in the amount of $6,000 during the term
of
this Agreement (and any extension hereof) and Customer shall pay any deficiency
between the Minimum Fee and the
fees
calculated under Section 2.16 hereof on the 15th day of the next calendar
month.
Customer shall pay an origination
fee in the amount of $6,000.00 upon closing of this Agreement, and
at the anniversary date upon each renewal,
in
the
amount of $6,000.00. WFBC agrees, however, that if, after the expiration
of the
first 12 months hereof, Customer
obtains financing from any Xxxxx Fargo & Co. entity, that is utilized for
paying off all obligations to WFBC, and
ceases selling Accounts hereunder, Minimum Fees for the remainder of the
then
current term shall be waived from the
date
of the full pay off to WFBC or the date selling of Accounts ceases, whichever
is
later.
6.07 Reports:
Except
as
provided by Section 3.06, and in the event Customer requests information
from
WFBC regarding
Customer's account hereunder, such requests shall be subject to the schedule
of
fees provided by WFBC which schedule may be adjusted by WFBC from time to
time
in its discretion.
6.08 WFBC
Settlement of Accounts: WFBC
may
settle any Account Debtor Dispute with any Account Debtor. Such settlement
does not relieve Customer of any obligation (including any repurchase
obligation) under this Agreement with respect
to any Accounts.
6.09 Customer
Settlement of Accounts: If
Customer does not fully and promptly settle any Account Debtor Dispute, the
Customer shall repurchase each Account that is subject to such Account Debtor
Dispute from WFBC for its Repurchase
Price.
6.10 Documents:
If
documents submitted by Customer to WFBC for the purchase of any Account are
materially mistaken,
fraudulent, materially incorrect or erroneous, or if the Customer fails to
submit any document required by WFBC
under this Agreement for the purchase of any Account, then Customer shall
repurchase such Account and pay the Repurchase
Price as stated herein.
6.11 Information:
In the
event WFBC provides financial information to Customer regarding third parties,
whether by setting
credit limits, at the request of Customer or otherwise, Customer understands
that WFBC is not making any representations or warranties or expressing an
opinion as to the creditworthiness of any such third party.
ARTICLE
VII
Default
7.01 Any
one
or more of the following shall be an Event of Default hereunder:
7.01
(a)
Customer
shall fail to pay any indebtedness to WFBC when due or repurchase any Account
when required
hereunder.
7.01
(b)
Customer
shall breach any term, provision, promise, warranty, representation or covenant
under this Agreement, or under any other agreements, contracts, between Customer
and WFBC or obligation to WFBC.
7.01
(c) The
appointment of any receiver or trustee of all or a substantial portion of
the
assets of Customer.
7.01
(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.
7.01
(e)
Any
involuntary petition in bankruptcy shall be filed against Customer and is
not
dismissed within 60 days or an order for relief is entered against Customer
under the United States Bankruptcy Code.
7.01
(f)
Any
levies, attachment, executions, liens or similar process shall be issued
against
the Collateral.
7.01
(g)
Any
financial statements, profit and loss statements, or schedules, other statements
or documents furnished by Customer to WFBC are false or incorrect in any
material respect.
7.01
(h)
Any
documents submitted by Customer to WFBC for the purchase of an Account are
mistaken, fraudulent,
incorrect and/or erroneous, or if the Customer fails to submit any document
required by WFBC under this
Agreement for the purchase of that Account.
7.01
(i)
Any
Account Debtor shall assert a claim or offset of any kind against Customer
or
WFBC during any time
period covered by this Agreement.
7.01
(j)
Any
guarantor of Customer's obligations hereunder is in default under the guaranty
or if any guarantor withdraws
or revokes the guaranty as to future sales of Accounts or
otherwise.
ARTICLE
VIII
Remedies
8.01 In
the
event of an occurrence of an Event of Default, WFBC may do any one or more
of
the following:
8.01
(a)
Declare
immediately due and payable, and to charge back, all indebtedness of Customer
to
WFBC, including
without limitation (i) outstanding purchased Accounts, (ii) any unpaid Minimum
Fees and (iii) all other fees,
costs and expenses as required hereunder.
8.01
(b)
Cease
purchasing Accounts under this Agreement.
8.01
(c)
Notify
any Account Debtor and take possession of Collateral and collect any Accounts
without judicial process.
8.01
(d)
Require
Customer to assemble the Collateral and the records pertaining to Accounts
and
make them available to WFBC at a place designated by WFBC.
8.01
(e) Enter
the
premises of Customer and take possession of the Collateral and of the records
pertaining to the Accounts and any other Collateral.
8.01
(f) Grant
extensions, compromise claims and settle Accounts for less than face value,
all
without prior notice
to
Customer.
8.01
(g) 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.
8.01
(h) Initiate
electronic credit or debit entries through the ACH system to and from Customer's
deposit account
maintained by Customer wherever located.
8.01
(i) Hold
Customer liable for any deficiency for any amounts due and owing to
WFBC.
8.01
(j) Require
the Customer to repurchase any and all Accounts, whether disputed or undisputed,
and pay the Repurchase Price for those Accounts as provided herein, and,
in the
event the Repurchase Price is not promptly paid, WFBC may continue to collect
such Accounts and charge a reasonable fee in connection with such collection
activities in addition to any other fees or charges provided for
herein.
8.01
(k) Cease
making reports or accountings to the Customer as otherwise required by this
Agreement.
ARTICLE
IX
Term
and Termination
9.01 This
Agreement shall continue in full force and effect until the earliest of (a)
one
year from the date of this Agreement; (b) any date agreed to in writing by
the
parties hereto, (c) upon at least 60 days written notice by Customer; or
(d) any
date set by WFBC upon the occurrence of an Event of Default. This Agreement
shall automatically continue for the following twelve-month period unless
sixty
days prior to the termination date, the Customer notifies WFBC in writing
that the Customer wishes to terminate this Agreement. On the date of
termination, all obligations owing by the Customer
to WFBC, including any unpaid Minimum Fees for the year term, shall be
accelerated and become immediately due
and
payable in full without further notice or demand.
9.02 Upon
termination, Customer shall repurchase any and all Accounts, whether disputed
or
undisputed, as may be requested
by WFBC, and shall pay the Repurchase Price for those Accounts as provided
herein as well as any other indebtedness or obligations owed to WFBC by Customer
including any unpaid Minimum Fee for the term of this Agreement.
WFBC continues and shall continue to have a security interest in the Collateral
of Customer until all amounts
owed to WFBC by Customer are paid in full or are satisfied.
9.03 In
the
event WFBC is required to repay any Account Debtor for a payment received
by
WFBC on an Account, and non-payment of that Account would have required
repurchase by Customer under this Agreement, the amount of the repayment
by WFBC shall be an obligation of Customer to WFBC notwithstanding the
termination of this Agreement. In the
event
the Customer receives a payment from WFBC to which the Customer has no rights,
repayment of the funds to WFBC
is
an obligation of the Customer to WFBC whether or not the Agreement has been
terminated. In either event, if the
obligation is not paid upon five (5) days notice of the obligation to pay
from
WFBC to Customer, WFBC may file a financing
statement in connection with the security interest granted herein (if necessary)
and exercise any and all rights it has
under
this Agreement to collect the amounts due.
ARTICLE
X
Miscellaneous
Provisions
10.01 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 hereto except that the Customer shall
not
have the right to assign its rights
hereunder or any interest herein without WFBC's prior written
consent.
10.2 Cumulative
Rights:
No
failure or delay by WFBC 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.
10.3 Waiver:
WFBC may
not waive its rights and remedies unless the waiver is in writing and signed
by
WFBC. A waiver
by
WFBC of a right or remedy under this Agreement on one occasion is not a waiver
of the right or remedy on any subsequent occasion.
10.4 Choice
of Law:
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of Colorado.
10.5 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.
10.06: Entire
Agreement:
This
instrument contains the entire Agreement between the parties. 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.
10.07 Amendment:
Except
as
otherwise provided herein, any addendum or modification hereto must be signed
by
both parties.
10.08 Effective:
This
Agreement becomes effective when it is accepted and executed by an authorized
officer of WFBC.
10.09 Information:
Without
limiting WFBC's right to share information regarding the Customer and its
affiliates with WFBC's agents, accountants, lawyers and other advisors, Xxxxx
Fargo & Co., and all direct and indirect subsidiaries of Xxxxx
Fargo & Co. and other persons WFBC deems appropriate may exchange, discuss
or otherwise utilize any and all information they may have in their 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.
10.10 Indemnification:
Customer
agrees to indemnify and hold WFBC harmless from any and all liability, claims
and damages,
including attorneys' fees, costs of suit and interest which WFBC may incur
as a
result of the failure of Customer
to pay withholding taxes due and payable to any taxing authority.
10.11 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 WFBC 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.
10.12 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 WFBC 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 WFBC.
10.13 Audit:
The
Customer hereby agrees to pay WFBC, on demand, audit fees in connection with
any
audits or inspections
conducted by WFBC of any Collateral or the Customer's operations or business
at
the rates established from time to time by WFBC as its audit fees, together
with
all actual out-of-pocket costs and expenses incurred in conducting any
such
audit or inspection.
10.14 Jurisdiction:
The
parties hereby (a) 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;
(b)
waive any argument that venue in any such forum is not convenient, (c) agree
that any litigation initiated by WFBC or the Customer in connection with
this
Agreement
shall be venued in either the State Courts of the City and County of Denver,
Colorado or the United States District Court, District of Colorado, and (d)
agree 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.
10.15 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.
|
Executed
and accepted this
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3
|
day
of
|
November
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at
|
Rifle,
CO.
|
|
Month/Year
|
City/State
|
|
Natural
Soda, Inc.
|
XXXXX
FARGO BANK, NATIONAL ASSOCIATION
|
|||
|
0000
Xxxxxx Xxxx 00
|
0000
Xxxxxxxx MAC C7300-060
|
|||
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Xxxxx,
XX 00000
|
Xxxxxx,
XX 00000
|
|||
|
By:
|
/s/
Xxxx X. Xxxx
|
By:
|
/s/
Kei Lehigh
|
|
|
Signature
|
Signature
|
|||
|
By:
|
Xxxx
X. Xxxx
|
By:
|
Kei
Lehigh
|
|
|
Name
|
Name
|
|||
|
Its:
|
President
|
Its:
|
Vice
President
|
|
|
Title
|
Title
|
|||
|
Sworn
and subscribed before me this
|
3
|
day
|
Witnessed
by:
|
||
|
of
|
November,
2005.
|
||||
|
Signature
|
|||||
|
/s/
Xxxx X. Xxxxxx
|
|||||
|
NOTARY
PUBLIC
|
NAME
AND TITLE
|
||||
