Exhibit 10.12
SALE OF ACCOUNTS RECEIVABLE AGREEMENT
AGREEMENT made October 31, 1996, between APOLLO INTERNATIONAL OF DELAWARE,
INC., a Delaware company ("Seller"), and QUEENSBURY, INC. (the "Company").
The Seller desires to sell to the Company accounts receivable ("accounts")
evidencing sales and deliveries of personal property usually dealt in by the
Seller, or work, labor, and services performed by the Seller.
It is therefore agreed:
1. The Seller shall offer to sell, assign and transfer to the Company all
outstanding accounts now in existence and future accounts as they are created by
the Seller's business, such assignments to be made upon forms prescribed by the
Company so that the Company may be and become subrogated to all the rights
possessed by the Seller. Seller shall also deliver invoices of each account in
duplicate, with proof of sale and delivery. The Company shall, from time to
time during the term of this Agreement, buy such accounts belonging to the
Seller, as may be approved in writing by the credit department of the Company,
and shall pay therefor 94% of the invoice amount thereof. The Company shall
have all the rights of the Seller with respect to the accounts assigned,
including the right of stoppage in transit, and the Company shall not be liable
to any person or in any manner for refusing to approve shipment or delivery of
any goods sold by the Seller or for exercising any rights thereunder.
2. In lieu of a reserve requirement, the Seller will accrue and pay
interest from its operating account at the rate of 1% per month computed on a
daily rate, when factored advances exceed 30 days. The interest amount will be
calculated as of the end of the month, payable by the 10th of the next month.
For calculating the 30 days period, the time starts at the date of receipt of
the wire transfer by the seller. For purposes of the amount subject to interest
calculations, the amount is the principal advanced by the Company.
3. The Seller will, at its own cost and expense, but as the Company's
agent, endeavor to collect from the customers whose accounts have been
assigned to the Company under this Agreement, as and when the same become
due, the installment amounts owning on each account so assigned to the
Company hereunder. In the event of a default under any such account, the
Seller shall have the power and the authority, on the Company's behalf, but
at the Seller's own cost and expense, to take such action with respect to any
defaulted account as the Seller, in the absence of instructions from Buyer,
may deem advisable. Seller hereby agrees to defend and indemnify the Company
against all claims and liability with respect to Seller's act relative to the
assigned accounts. For purposes of this Section 3, an account which shall
have failed to make a payment for six or more consecutive months shall be
deemed a Delinquent Account.
In the event an account assigned by the Seller to the Company pursuant to
this Agreement becomes a Delinquent Account (as hereinafter defined), the Seller
shall remit to the Company an amount equal to 94% of the monies due from the
Delinquent Account, and upon receipt of such payment, the Company shall reassign
the Delinquent Account to the Seller.
4. The Seller represents and warrants that every account to be assigned
to the Company will be based upon a BONA FIDE written order or contract obtained
from the Seller's customer and that the account assigned will be for goods sold
and delivered or for work, labor and services performed or materials furnished,
pursuant to the terms of such written order or contract. The Seller covenants
that there will be no offsets or counterclaims against any account receivable or
chose in action assigned, nor will the Seller, subsequent to such assignment,
incur any obligation which may create any offset or counterclaim thereto. The
Seller shall not sell, grant a security interest in, or assign any of its
accounts elsewhere during the term of this Agreement.
5. The Seller shall, as its own expense, keep proper books of account
showing all sales, claims, and allowances on sales and on merchandise.
Immediately upon the consummation of the purchase of accounts hereunder, the
Seller shall make proper entries in its books disclosing the absolute sale of
such accounts to the Company, and the Seller shall further, upon demand, execute
and deliver to the Company all instruments and do all things necessary to carry
into effect the terms of this agreement. The Seller shall permit the Company to
examine and make extracts from the books and records of the Seller during
Seller's business hours and upon two (2) business days prior notice for the
purpose of certifying the validity of any account assigned or to ascertain any
facts in connection therewith.
6. The Seller shall, as its own expense, promptly adjust all disputes
with its customers. In case any dispute remains unadjusted at the time any
account becomes due, the Company shall have the right to charge back to the
Seller the accounts involved, and the Seller shall pay the amount of such
accounts to the Company upon demand, provided, however, any such payment by
Seller should not exceed the amount received by Seller from the Company for such
accounts.
7. In the event of the return or nonacceptance, in whole or in part, of
merchandise, the sale of which resulted in such assigned accounts, the Seller
shall give to the Company immediate notice of such return or nonacceptance, and
shall immediately turn over such merchandise to the Company and legibly xxxx
such merchandise as the property of the Company, and thereafter, upon demand,
the Seller shall repurchase such merchandise from and pay to the Company the 94%
of the invoice price thereof, and upon such payment the Seller shall be entitled
to the redelivery of such merchandise. If the Seller fails to make such
purchase and payment immediately upon demand, the Company shall be entitled to
exercise its rights and remedies an provided herein and under the laws of the
State of Florida. In conjunction therewith, the Company shall have the right to
sell such merchandise at commercially reasonable public or private sale in
accordance with the Florida Uniform Commercial Code and to charge the Seller's
account with the difference between 94% of the invoice price of such merchandise
and the
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amount realized upon the sale, plus all charges, fees and commissions, and, upon
such sale, the company may become a bidder and purchaser.
8. The Seller shall hold in trust for the Company all checks, drafts,
notes, acceptances, cash or other evidences of payment received in payment or on
account of any account purchased by the Company hereunder, and shall transmit or
deliver these to the Company at its office within two (2) business days from
receipt. The failure of the Seller to comply with this provision shall
constitute conversion. The Company is hereby authorized and given power of
attorney to indorse the name of the Seller upon all checks, drafts, notes, money
orders, and all other instruments that may require such indorsement. The
Company shall also have the right to receive all amounts remitted by the
Seller's customers, and relate to the accounts assigned to the Company and such
remittances are to be considered payments on account. The seller will utilize
the Xxxxxxx Bank lock box service.
9. This Agreement shall continue for a period of 365 days from the date
hereof, and shall be deemed renewed from month to month thereafter unless
terminated as follows:
(a) Either party may, upon at least 30 days written notice to the
other party, cancel this agreement as to future transactions at
the end of any monthly period.
(b) Should the Seller make an assignment for the benefit of
creditors, or should a receiver be appointed for the Seller, or
should a bankruptcy proceeding be commenced, voluntarily or
involuntarily, on behalf of the Seller (and if involuntarily,
such proceeding has not been dismissed within ninety (90) days of
commencement), this agreement may be terminated by the Company,
without notice, immediately upon the happening of any such
events.
10. Should any excise, sales, or other tax be imposed by state, federal,
or local authorities in respect to the sales herein, or if the merchandise
affected by such sales is in such form that the Company is required to withhold
or pay the amount of such taxes, the Seller shall indemnify the Company in
respect to such taxes; and any amount which the Company may be required to
withhold or pay may be charged to the Seller's account.
11. This Agreement shall not be modified or altered without the written
consent of both parties hereto. The failure of either party hereto to insist
upon strict observance of all the terms of this agreement in any one or more
instances shall not be deemed a waiver of such terms for the future.
12. The Seller affirms that its only place of business and the place where
the records concerning the accounts herein referred to are kept is the one that
appears beneath the signature of its president below and if such place of
business or records location is changed, the Company will be promptly notified.
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13. This Agreement shall be binding upon the successors, and assigns of
the parties hereto.
14. This Agreement shall be governed by and construed in accordance with
the Law of Florida and venue and jurisdiction for resolution of any disputes
shall be Orange County Florida.
IN WITNESS WHEREOF, the parties have signed this Agreement as of the date
and year written above.
APOLLO INTERNATIONAL OF DELAWARE, INC. QUEENSBURY, INC.
"Seller" "Company"
By: /s/ XXXXX X. XXXXXX, PRESIDENT /s/ XXXXXX X. XXXXXXXXXX, PRESIDENT
0000 X. XX XXX. 00, XXXXX 000 0000 XXXXXXX, XXXXX 000
XXXXXX XXXXX, XX 00000 XXXXXXX, XX 00000
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