Exhibit 10.1
FACTORING AND SECURITY AGREEMENT
This Factoring and Security Agreement, dated as of January 21, 2002 is
between INSCI CORP., formerly xxxxx-xxxxxxxxxx.xxx, corp., a Delaware
corporation (the "Client") and Benefactor Funding Corp., a Colorado corporation
(the "Factor").
In consideration of the respective promises, representations,
warranties, covenants and agreements contained herein, Client and Factor agree
as follows:
1. PURCHASE AND SALE OF ACCOUNTS RECEIVABLE
(a) Client hereby sells, assigns, transfers, conveys and delivers to
Factor and Factor purchases and accepts from Client upon the terms and
conditions set fourth herein, all of Client's right, title and interest in and
to (i) all accounts receivable which are accepted for purchase by Factor as
described in Section 1(b) (any and all accounts receivable which are offered by
Client to Factor, whether or not Factor accepts and purchases them, are defined
herein as "Accounts"; the term "Accepted Accounts" is defined herein as Accounts
which are accepted for purchase by Factor) and (ii) all guarantees and security
for Accepted Accounts, and all merchandise or Client services represented by
Accepted Accounts, including all of Client's rights to returned goods and rights
of stoppage in transit, replevin and reclamation as an unpaid vendor (with
respect to each Accepted Account, such guarantees, security and rights are
called "Rights").
(b) Client shall submit Accounts to Factor, to be put on a schedule of
accounts ("Schedule") in the form of Exhibit A. Factor is only obligated to
purchase Accounts when it accepts the Accounts by signing the Schedule; any
Accounts which are crossed out by Factor are not accepted for purchase. It is
hereby agreed and understood that Factor may verify, with the Account Debtor
(each of the terms "Account Debtor" and "Debtor" is defined herein as a customer
of Client), the amount, validity, due date and absence of adjustments and
offsets, of some or all of the Accounts prior to Factor's acceptance of such
Accounts.
(c) At the time the Schedule is presented, Client shall also deliver to
Factor the original and/or a copy of an invoice for each Account, together with
evidence of shipment and the Account Debtor's purchase order.
(d) Each and every payment on each and every Accepted Account by an
Account Debtor, or any other person or entity, is the sole property of Factor.
(e) Prior to Factor's acceptance and purchase of any Account from a
particular Account Debtor, Client shall deliver to Factor an agreement in the
form of Exhibit B hereto ("Customer Agreement")
(f) Invoices should plainly state on their face that the amounts
payable thereunder have been assigned to and are payable to Benefactor Funding
Corp. and billing on such invoice shall constitute an assignment to Benefactor
Funding Corp. of the accounts thereby requested whether or not a specific
written assignment was executed.
(g) Upon signing this Agreement, Client shall sign all UCC financing
statements requested by Factor and, simultaneously with the initial funding
pursuant to this Agreement, Client shall pay to Factor a one-time UCC fee of
$350.00
2. PURCHASE PRICE
The purchase price for each Accepted Account shall be equal to (i) the
face amount of such Accepted Account less (ii) the Commission, and less (iii)
the Factor's Fee, and less (iv) the amount of any trade or cash discounts,
credits or allowances, set-offs or any other reductions or adjustments to such
Accepted Account. The Commission for each Accepted Account shall equal 2.25% of
the face amount of the Accepted Account, and shall compensate Factor for
Factor's administration, monitoring and collection activities with respect to
the Accepted Account. The Factor's Fee for each Accepted Account shall be
determined by the number of days from the date of Factor's Initial Payment (as
defined below) on the Accepted Account to Client to the date of Account Debtor's
full payment of the Accepted Account to Factor as follows: 0% of the face amount
of the Accepted Account for one to thirty days and .7% of such face amount for
each one to ten day period thereafter (with the .7% earned on the first day of
each such one to ten day period.) Upon purchase of an Accepted Account from
Client, Factor shall make an initial payment of the Purchase Price to Client
("Initial Payment") in the amount of 80% of the face amount of such Accepted
Account. The difference between the face amount of an Accepted Account and the
Initial Payment shall go into the Reserve Account (as defined in Section 4
below). "Full Payment" of an Accepted Account by an Account Debtor shall occur
when Factor receives a check for the full amount of the Accepted Account from
the Account Debtor and such check clears and becomes available for Factor's use.
Client agrees to sell and assign to Factor a minimum of $500,000 of
accounts receivable for each month that this Agreement is in effect beginning
with February 2002 and if such minimum isn't met, Factor will charge Client an
amount equal to 2.25% times $500,000 less the actual amount of receivables sold
for each such month, either by charging the Reserve Account or invoicing Client.
Client and Factor agree that Client's right to terminate the Agreement pursuant
to Section 11 is subject to the minimums in this paragraph.
3. RECOURSE PROVISIONS.
(a) All Accepted Accounts shall be purchased by Factor with recourse
against Client. The term "Recourse Event" shall include, without limitation, the
following: (i) a breach of any representation or warranty or covenant of this
Agreement by Client; (ii) the existence of any dispute of any kind, regardless
of validity, now or hereafter arising, between Client and an Account Debtor, or
between and Account Debtor and Factor, that is asserted by an Account Debtor as
a basis for refusing to pay all or part of any Accepted Account ("Dispute");
(iii) the assertion by any Account Debtor, or by a bankruptcy trustee or any
other party which is acting for an Account Debtor, of a claim of loss,
counterclaim, refund, credit, return of goods, return of payment or offset by
any kind against Client or Factor ("Claim"); and (iv) non-payment by the Account
Debtor of the full amount of any Accepted Account 91 days after the purchase of
such Accepted Account by Factor, or, if Factor believes, in Factor's sole
judgment, at any time prior to such 91st day, that the Account Debtor may be
unable to pay any Accepted Account; Client and Factor hereby agree that any
Accepted Account covered by clause (iv) is a "defective good". Upon the
occurrence of any event described in clauses (i), (ii), (iii) or (iv) of the
preceding sentence, Client will immediately pay to Factor, on the Accepted
Account which is subject to the Recourse Event, the amount of the Initial
Payment on the Accepted Account plus the Commission and Factor's Fee on the
Accepted Account calculated at the time of Client's payment. If Factor does not
receive an immediate payment from Client, Factor may, in addition to any other
remedies available to Factor under this Agreement, immediately charge back to
Client any Accepted Account which is subject to a Recourse Event by taking funds
out of the Reserve Account, or immediately exercise the remedies described in
Section 10. With Factor's agreement, Client may assign other accounts receivable
which are, acceptable to factor, in substitution for an Accepted Account which
is subject to a Recourse Event.
(b) Client shall notify Factor of any Recourse Event immediately.
(c) Factor may settle any Dispute or Claim directly with Account
Debtor; such settlement does not relieve Client of final responsibility for
payment of any such Accepted Account.
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4. RESERVE ACCOUNT.
(a) Factor shall create and maintain at all times a reserve account
("Reserve Account") for all Accepted Accounts equal to the difference between
the aggregate face amounts and the aggregate Initial Payments on all Accepted
Accounts. Factor may, in addition to any other remedies available to Factor
under this Agreement, charge back to Client by taking funds out of the Reserve
Account, any amount for which Client may be obligated to Factor at any time;
such amounts include (i) any amounts which Client is obligated to pay Factor
pursuant to the recourse provisions of Section 3, (ii) any damages suffered by
Factor as a result of Client's breach of any provision of Section 5 hereof,
(iii) any amount charged back to Client pursuant to Section 10 hereof, (iv) any
other offsets or adjustments to any Accepted Accounts, and (v) reasonable
attorneys fees and disbursements related to any of the foregoing. If Factor
receives payment on an Accepted Account from Account Debtor subsequent to the
Accepted Account being charged against the Reserve Account pursuant to the
preceding sentence, Factor will credit the Reserve Account by the amount of such
payment.
(b) The Reserve Account shall be calculated and maintained on a regular
basis, and any funds which are credited by Factor to Client's Reserve Account as
a result of collected invoices for Client, less all funds charged back to Client
pursuant to this Section 4 ("Excess Reserve") shall be paid to Client weekly;
provided, however that Factor shall not be obligated to pay the Excess Reserve
to Client if a Recourse Event or and Event of Default has occurred and is
continuing. If Client shall cease selling Accounts to Factor, Factor shall not
pay the Reserve Account to Client until all Accepted Accounts have been
collected in full or charged against the Reserve Account, and all Commissions
and Factor's Fees and other sums due Factor hereunder have been paid; if the
Reserve Account has a negative balance after such collections, charges and fees,
then the Client shall make the applicable payment to Factor.
5. CLIENT'S REPRESENTATIONS AND WARRANTIES.
Client represents and warrants to Factor that:
(a) Client is the sole owner and holder of each and every Account and
all related Rights, and, upon Factor's purchase of any Account, Factor shall
become the sole owner and holder of such Account and its related Rights; and
each Account is free and clear of all liens, encumbrances, charges, security
interests, rights to purchase, or other claims of any kind or nature, and none
of such Accounts have been previously sold or assigned to any person or entity.
(b) There are no financing statements now on file in any public office
governing any property of Client of any kind, real or personal, in which Client
is named in or has signed as the debtor, except the financing statement or
statements filed or to be filed with respect to this Agreement, or those
statements now on file that have been disclosed in writing by Client to Factor.
Client will not execute any financing statement in favor of any other person or
entity, except Factor, during the term of this Agreement.
(c) The full amount of each Account is due and owing to Client, and
each Account is an accurate statement of a bona fide sale and delivery by Client
and acceptance by an Account Debtor of merchandise or services. Each Account is
due and payable within 30 days or less, and is not contingent upon the
fulfillment by Client of any further performance of any nature.
(d) The application ("Application") made by Client in connection with
this Agreement, and the statements made in such Application are true and correct
as of the time that this Agreement is executed.
(e) There are no actions, suits, proceedings, attachment proceedings,
orders, or arbitration proceedings, pending or threatened, at law or in equity,
against Client or any affiliate of Client or affecting the Accounts, before any
federal, state, municipal or other government court, department, commission,
board, agency or instrumentality. Client will immediately notify Factor if any
matter described in the preceding sentence arises.
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(f) Client is a corporation duly organized, validly existing and in
good standing under the laws of Delaware. This Agreement and transactions
contemplated hereby have been duly authorized by all necessary action by Client.
6. AFFIRMATIVE COVENANTS BY CLIENT.
Client covenants and agrees that, from the date hereof and until
termination of this Agreement and payment in full of all Accepted Accounts to
Factor, Client will:
(a) Pay all taxes or fees in relation to the Accounts and all goods
sold or services rendered which give rise to Accounts.
(b) Hold in trust for Factor, and immediately notify and turn over to
Factor, any payment on an Accepted Account whenever any such payment comes into
Client's possession, whether such payment is by cash, check (payable to Client,
Factor or both), money order or other form of payment. Client shall also, where
such payment is issued to the order of Client, immediately endorse the payment
to the order of Factor. If Client comes into possession of a check or other
payment which consists of payments owing both to the Client and Factor (i.e. the
payment covers both Accepted Accounts and Accounts which were not purchased by
Factor or other amounts owing to Client from Account Debtor), Client shall
immediately endorse the check or other payment to Factor and turn it over to
Factor who will then refund Client's portion to Client. Client acknowledges that
an Event of Default pursuant to Section 10 shall have occurred, and that Client
will become subject to criminal prosecution and civil actions, if Client does
not immediately turn over to Factor each and every payment on an Accepted
Account which comes into Client's possession. IN ADDITION, IF CLIENT DEPOSITS OR
OTHERWISE NEGOTIATES A CHECK OR OTHER PAYMENT WHICH, BY THE TERMS OF THIS
SECTION 6 (B), SHOULD HAVE BEEN TURNED OVER TO FACTOR, CLIENT SHALL PAY FACTOR A
MISDIRECTED PAYMENT FEE EQUAL TO 20% OF THE AMOUNT OF THE CHECK OR OTHER
PAYMENT.
(c) Not factor, sell, transfer, pledge or give a security interest in
any of its Accounts, other accounts receivable or other Collateral to any person
or entity other than Factor.
(d) Notify Factor immediately if Account Debtor returns to Client any
goods giving rise to an Accepted Account, and deliver such goods to Factor.
Client shall not intermingle such goods with Client's other property, as the
goods are the property of Factor.
(e) Client shall not change its mailing address, principal place of
business, chief executive office or its legal structure (i.e. from a
proprietorship to a corporation, etc.) without Factor's prior written consent.
(f) Immediately notify Factor of (i) any development which would
materially and adversely affect the business, properties or financial condition
of Client or any Account Debtor, the Accounts or the ability of Client to
perform its obligations under this Agreement, and/or (ii) any actual or
potential insolvency of Client or any Account Debtor.
7. SECURITY INTEREST AND COLLATERAL
In order to secure the payment and performance of all obligations of
Client to Factor, whether presently existing or hereafter arising, Client hereby
grants to Factor a security interest in and lien upon Client's right, title and
interest in all of Client's assets, which include, without limitation, (i) all
of Client's account receivable, returned goods and related Rights, instruments,
inventory, documents, contract rights, chattel paper, general intangibles and
the proceeds thereof, now and hereafter owned by Client , or in which Client now
or hereafter may have any rights, (ii) the Reserve Account and all payments (if
any) due or to become due to Client from the Reserve Account, (iii) all of
Client's other properties and assets, which include, without limitation,
equipment, machinery, products, furniture, fixtures, tools, raw materials, work
in process and supplies, and the proceeds thereof, now or hereafter owned by
Client, or in which Client now or hereafter may have any rights, wherever
located, and (iv) the proceeds of any insurance policies covering any of the
foregoing (collectively, the "Collateral"). Client agrees to comply with all
appropriate laws in order to perfect Factor's security interest in and to the
Collateral and to execute and deliver to Factor and/or file UCC-1 Financing
Statements and any other financing statement(s) or documents that Factor may
require. Xxxxx X. Xxxxxx will sign a personal guaranty, which guaranty is
acceptable to Factor and further secures Client's obligations hereunder.
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8. COLLECTION OF ACCOUNTS.
Factor shall have the sole and exclusive power and authority to collect
each Accepted Account, through legal action or otherwise, and may, in its sole
discretion, settle, compromise or assign (in whole or in part) any Accepted
Account, or otherwise exercise any other right now existing or hereafter arising
with respect to any Accepted Account.
9. POWER OF ATTORNEY.
Client grants to Factor an irrevocable power of attorney authorizing
and permitting Factor, at its option, without notice to Client, to do any or all
of the following:
(a) Endorse the name of Client on any checks or other forms of payment
whatsoever that may come into the possession of Factor regarding Accepted
Accounts, any other accounts or Collateral;
(b) Pay, settle, compromise, prosecute or defend any Claim, Dispute,
action, or other proceeding relating to Accepted Accounts or Collateral;
(c) To extend the time of payment of any or all Accepted Accounts and
to make any discounts, offsets, allowances or other adjustments with reference
thereto;
(d) Execute and file on behalf of Client any financing statement deemed
necessary or appropriate by Factor to protect Factor's interest in and to the
Accepted Accounts or Collateral, or under any provision of this Agreement; and
(e) To do all things necessary and proper in order to carry out this
Agreement.
The power of attorney and authority granted to Factor herein is
irrevocable until this Agreement is terminated and all Accepted Accounts have
been paid in full and Client has satisfied in full all other obligations owed to
Factor.
10. DEFAULTS AND REMEDIES
(a) An event of default ("Event of Default") shall be deemed to have
occurred under this Agreement upon the happening of one or more of the
following:
(A) Client shall fail to pay as and when due any amount of money owed
to Factor;
(B) There shall be commenced by or against Client any voluntary or
involuntary case under the federal Bankruptcy Code, or any assignment for the
benefit of creditors, or any appointment of a receiver or custodian or trustee
for any of Client's assets;
(C) Client shall become insolvent, or Client admits in writing its
inability to pay its debts as they mature;
(D) A material and adverse change shall have occurred in Client's
financial condition, business or operations;
(E) Client shall have a federal , state or local tax lien filed against
any of its properties, or shall fail to pay any federal, state or local tax when
due, or shall fail to file any federal, state of local tax form as and when due,
or shall have a notice of seizure against it sent out by any federal or state
taxing authority;
(F) Any check or other payment described in Section 6(b) comes into
Client's possession and Client does not immediately endorse and turn over such
check or payment to Factor; or
(G) A Recourse Event shall occur.
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(b) If any Event of Default occurs, Factor may immediately exercise any
and all of its rights and remedies with respect to Accepted Accounts and
Collateral under this Agreement, the Uniform Commercial Code, and applicable
law, which rights and remedies include, without limitation: (A) the right to
declare any amount owed by Client to Factor immediately due and payable; (B)
enforcement of the security interest given hereunder pursuant to the Uniform
Commercial Code or any other law; (C) entering the premises of Client and taking
possession of the Collateral and of the records pertaining to the Accepted
Accounts and the Collateral; (D) granting extensions, compromising claims and
settling Accepted Accounts for less than face value, without prior notice to
Client; (E) collecting and depositing all of Client's accounts receivable, and
the proceeds thereof, whether such accounts were purchased by Factor or not, (F)
retaining any surplus realized from asset sales and holding Client liable for
any deficiency as provided in the Uniform Commercial Code; and (G) without
limiting Factor's rights pursuant to Sections 3 and 4, to charge back to Client
any and all amounts or obligations owed by Client to Factor by taking funds out
of the Reserve Accounts. Client shall also pay Factor immediately upon demand
for all attorney's fees and disbursements incurred by Factor which are related
in any way to an Event of Default and/or Recourse Event. In order to satisfy any
amount owed by Client to Factor pursuant to this Agreement, Factor is hereby
authorized by Client to initiate electronic debit or credit entries through the
ACH system to each and every deposit account maintained by Client wherever such
accounts are located.
11. TERM
a) This Agreement shall become effective on the date hereof and shall
continue in full force and effect for a period of twelve (12) months from the
date hereof and will be automatically renewed for like periods thereafter,
unless terminated by Client as of any anniversary date, by Client giving not
less than sixty (60) days prior written notice to Factor or unless terminated by
Factor at any time. Notwithstanding the foregoing, Client may terminate this
Agreement early at any time by giving Factor not less than sixty (60) days prior
written notice, and Factor may terminate this Agreement early at any time
without notice should any Event of Default or Recourse Event occur, provided
that in either event, Client will be obligated to pay Factor an early
termination fee equal to the amounts calculated pursuant to the last paragraph
of Section 2 for each and every remaining month of the term. After termination
of this Agreement, Client shall remain fully responsible to Factor for any
Accepted Accounts purchased before termination of this Agreement, and for any
payment demands described in Section 12(h) no matter when such demands arise.
(b) This Agreement and all covenants, agreements, representations and
warranties made herein, shall survive the purchase by Factor of the Accounts
hereunder, and shall continue in full force and effect after termination of this
Agreement so long as Factor has not received payment in full on all Accepted
Accounts or Client shall have any other obligations to Factor hereunder. Once
this Agreement has been terminated and (i) Factor has received payment in full
on all Accepted Accounts and (ii) Client has met all obligations to Factor
hereunder, then Factor shall promptly terminate Factor's lien on the Collateral.
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12. MISCELLANEOUS
(a) Client shall pay Factor $10.00 for each wire transfer made by
Factor to Client, $20.00 for each FedEx, $2.00 for each cashier's check, $3.94
for each certified piece of mail, standard postage rates for the mailing of
invoices, and $21.28 for each Dun & Bradstreet report; provided, however that if
Factor's cost for the preceding items increases, Client shall also pay an
additional amount equal to such increase.
(b) This Agreement and the Exhibits and attachments hereto constitute
the entire agreement between the parties pertaining to the subject matter
contained in it and supersede all prior and contemporaneous agreements,
commitments, negotiations, and understandings of the parties. No supplement,
modification or amendment of this Agreement or any part thereof shall be binding
unless executed in writing by both parties. This Agreement may not be assigned
by Client without the prior written consent of Factor. This Agreement may be
assigned by Factor without notice to or the consent of Client.
(c) All rights, remedies and powers granted to Factor in this
Agreement, or in any other instrument or document given by Client to Factor, are
cumulative and may be exercised singularly or concurrently with such other
rights as Factor may have. No waiver of any of the provisions of this Agreement
shall be deemed, or shall constitute, a waiver of any other provisions, whether
or not similar, nor shall any waiver constitute a continuing waiver. No waiver
shall be binding unless executed in writing by the party making the waiver.
(d) Whenever possible, each provision of this Agreement will be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
(e) Client shall hold Factor harmless against any Customer ill will
arising from (i) Factor's verification or collection of, or attempts to collect,
any Account, and/or (ii) any other actions of Factor pursuant to this Agreement.
Factor may cease attempts to collect any Accepted Account at any time.
(f) All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed sufficiently given only if
served personally on the party to whom notice is to be given, or sent by
facsimile (followed by a phone call which confirms receipt) or mailed to the
party to whom notice is to be given, by first class mail, registered or
certified, postage prepaid, and properly addressed as follows:
To Client:
INSCI Corp.
0 Xxxxxxxxxxx Xxxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
To Factor:
Benefactor Funding Corp.
000 Xxxxxxx Xx., Xxx. 000
Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
or to such other address as the party may have specified in a notice duly given
to the other party as provided herein. Such notice or communication will be
deemed to have been given as of the date so delivered or faxed (and confirmed)
or three days after the date so mailed.
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(g) This Agreement and the legal relations between the parties shall be
governed by and construed in accordance with the laws of the State of Colorado
without regard to principles of conflicts of law otherwise applicable to such
determinations. Client and Factor agree that any suit, action or proceeding
arising out of the subject matter hereof, or the interpretation, performance or
breach of this Agreement, shall, if Factor so elects, be instituted in any court
sitting in Colorado (the "Acceptable Forums"). Client and Factor agree that the
Acceptable Forums are convenient to it, and each party irrevocably submits to
the jurisdiction of the Acceptable Forums, irrevocably agrees to be bound by any
judgment rendered thereby in connection with this Agreement, and waives any and
all objections to jurisdiction or venue that it may have under the laws of
Colorado or otherwise in those courts in any such suit, action or proceeding.
Should such proceeding be initiated in any other forum, Client waives any right
to oppose any motion or application made by Factor as a consequence of such
proceeding having been commenced in a forum other than an Acceptable Forum.
(h) If Factor receives a payment from an Account Debtor and a trustee
in Bankruptcy, debtor in possession, receiver, custodian or other party demands
that such payment be returned and/or given to such party or to a bankruptcy
estate, then a Recourse Event under this Agreement shall have occurred and
Client shall owe Factor any and all amounts demanded by such trustee in
bankruptcy, debtor in possession, receiver, custodian or other party, and Client
shall pay such amounts to Factor immediately upon Factor's demand. This Section
(h) shall survive the termination of this Agreement and shall remain in effect
for seven years after termination of this Agreement.
(i) Each of Client and Factor hereby (1) waive any right it may have to
a jury trial, or any right to claim or recover in any litigation any special,
exemplary, punitive or consequential damages, or damages other then, or in
addition to, actual damages, plus interest and fees, and (2) acknowledge that it
has been induced to enter into this Agreement and the transactions contemplated
hereby by, among other things, the mutual waivers contained in this subsection
(i).
IN WITNESS WHEREOF, the parties to this Agreement have duly executed it
as of the day and year first above written.
FACTOR:
BENEFACTOR FUNDING CORP
By: /s/ Xxxxxxx Xxxxxx
---------------------------
Title: President
CLIENT:
INSCI CORP.,
FORMERLY XXXXX-XXXXXXXXXX.XXX, CORP.
By: /s/ Xxxxx X. Xxxxxx
---------------------------
Title: President and CEO
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EXHIBIT A
This Exhibit A, dated ________________, is part of the Factoring and
Security Agreement (the "Agreement"), dated as of January 21, 2002, between
INSCI Corp., formerly xxxxx-xxxxxxxxxx.xxx, corp., a Delaware corporation (the
"Client") and Benefactor Funding Corp., a Colorado corporation (the "Factor").
Pursuant to Section 1 of the Agreement, Client hereby sells and assigns to
Factor, and Factor accepts for purchase, the following Accounts with the
following Initial Payments (as defined in the Agreement):
Initial Payments at 80%: see attached report for Account detail; each Accounts
is identified on the attached report by Invoice ID and Debtor name.
TOTAL: $XX, XXX.XX
The aggregate Initial Payment pursuant to this Exhibit A is $__________, less
the one time UCC fee of $350.00, and less the $10.00 wire fee. $_________ is
being paid by wire.
NOTE: any receivable on this Exhibit A that is crossed out by Factor is not
accepted by Factor for purchase.
IT IS A CRIME TO DEPOSIT ANY ACCOUNT DEBTOR PAYMENT FOR ANY OF THESE INVOICES,
AS SUCH INVOICES BELONG TO FACTOR. Factor may pursue civil and criminal remedies
if any such payments are deposited. By signing on this Exhibit A, you are taking
full responsibility for all actions of all employees and/or agents who deposit
any such payments and you are agreeing that every possible precaution is being
made to ensure that such payments are not deposited.
INSCI CORP., FORMERLY INSCI- BENEFACTOR FUNDING CORP.
XXXXXXXXXX.XXX, CORP.
BY: ______________________________ BY: ______________________________
EXHIBIT B
Date
Account Debtor Name
Address
Dear Accounts Payable;
In order to grow our business and to better serve our customers, we
have entered into a Factoring and Security Agreement with Benefactor Funding
Corp. ("Benefactor"), and have assigned and sold to Benefactor all of our rights
in all accounts receivable and other payments due from you and your affiliates.
This letter serves as your irrevocable authority to pay the full
amount of all current and future invoices and all other payments directly and
solely to:
Benefactor Funding Corp.
for INSCI Corp.
X.X. Xxx 0000
Xxxxxx, XX 00000
This assignment and the instructions herein are effective as of the
date of this letter and cannot be modified or revoked, without Benefactor's
prior written consent. If there are any questions concerning your billing,
please call Xxxx Xxxxxx at Benefactor at (000) 000-0000.
Thank you for your consideration.
Sincerely,
_______________________________
INSCI CORP.
XXXXX-XXXXXXXXXX.XXX, CORP.
_______________________________
BENEFACTOR FUNDING CORP.
Please provide us with your Federal Tax ID# so that we may correctly apply your
payments.
________________________________ by: ___________________________
your name
PLEASE FAX THIS TO (000) 000-0000
