NON-RECOURSE RECEIVABLES PURCHASE AGREEMENT
Exhibit 10.2
This NON-RECOURSE RECEIVABLES PURCHASE AGREEMENT (the “Agreement”), dated as of June 27,
2006, is between SILICON VALLEY BANK (“Buyer”) having a place of business at 0000 Xxxxxx Xxxxx,
Xxxxx Xxxxx, Xxxxxxxxxx 00000 TELULAR CORPORATION (“Seller”), a Delaware corporation, with its
chief executive office at 000 X. Xxxxxxxx Xxxxxxx, Xxxxxx Xxxxx, Xxxxxxxx 00000.
1 DEFINITIONS.
When
used herein, the following terms have the following meanings.
1.1 “Account Debtor” has the meaning set forth in the Illinois Uniform Commercial Code and
shall include any person liable on any Purchased Receivable, including without limitation, any
guarantor of the Purchased Receivable and any issuer of a letter of credit or banker’s acceptance.
1.2 “Adjustments” means all discounts, allowances, returns, disputes, counterclaims, offsets,
defenses, rights of recoupment, rights of return, warranty claims, or short payments, asserted by
or on behalf of any Account Debtor with respect to any Purchased Receivable.
1.3 “Administrative Fee” means for any Purchase the percentage of the Total Purchased
Receivables Amount set forth in the Schedule for such Purchase.
1.4 “Business Day” means any day other than a Saturday, Sunday, or other day on which banks in
California or Illinois are required or authorized by law to close.
1.5 “Discount Rate” means for any Purchase the “Discount Rate” set forth in the Schedule for
such Purchase.
1.6 “Due Date” means for any Purchase the “Due Date” set forth in the Schedule for such
Purchase.
1.7 “Event of Default” has the meaning set forth in Section10 hereof.
1.8 “Insolvency Event” means, with respect to any Account Debtor, (a) the commencement of a
case, action or proceeding with respect to such Account Debtor before any court or other
governmental authority relating to bankruptcy, reorganization, insolvency, liquidation,
receivership, dissolution, winding-up or relief of debtors, (b) such Account Debtor is generally
not paying its debts when due, or (c) the making or commencement of any general assignment for the
benefit of creditors, composition, marshaling of assets for creditors, or other similar arrangement
in respect of the creditors generally or any substantial portion of the creditors of such Account
Debtor.
1.9 “Interest Reserve” means, for any Purchased Receivable, the product of (i) the amount of
such Purchased Receivable multiplied by the Discount Rate, and (ii) the factor of 90 over 360
1.10 “Invoice Amount” means for any Purchase, the “Invoice Amount” set forth in the Schedule
for such Purchase.
1.11 “Late Payment Settlement Fee” has the meaning set forth in Section 2.2.
1.12 “Late Payment Settlement Period” has the meaning set forth in Section 2.2.
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1.13 “Open Amount” means the portion of any Purchased Receivable which has been pre-paid to
the Seller.
1.14 “Payment in Full” means for any Purchase that Buyer has received payments on account of
the Purchased Receivables under such Purchase equal to the Total Purchased Receivables Amount for
such Purchase.
1.15 “Prime Rate” means per annum rate of interest from time to time announced and made
effective by Buyer as its Prime Rate (which rate may or may not be the lowest rate available from
Buyer at any given time).
1.16 “Purchase” means the purchase by Buyer from Seller of one or more Purchased Receivables
on a Purchase Date as listed in the Schedule applicable to such Purchase.
1.17 “Purchase Date” means for any Purchase the date set forth as the “Purchase Date” in
the Schedule for such Purchase.
1.18 “Purchase Price” means for any Purchase the “Purchase Price” set forth on the Schedule
for such Purchase.
1.19 “Purchased Receivables” means for any Purchase all those Receivables arising out of
the invoices and other agreements identified on the Schedule for such Purchase.
1.20
“Purchased Receivable Amount” means for any Purchased Receivable, the “Invoice Amount”
set forth with respect to such Purchased Receivable on the applicable Schedule minus the Open
Amount.
1.21 “Receivables” means accounts, receivables, chattel paper, instruments, contract rights,
documents, general intangibles, letters of credit, drafts, bankers acceptances, and other rights to
payment, and all proceeds thereof.
1.22 “Related Property” has the meaning as set forth in Section 9 hereof.
1.23 “Repurchase Amount” has the meaning set forth in Section 4.2 hereof.
1.24 “Revolving Line Agreement” is that certain Loan and Security Agreement as of even
date herewith, as amended from time to time, by and between Seller and Buyer.
1.25 “Schedule” means for each Purchase a schedule executed by the parties in the form of
Exhibit A hereto identifying the Purchased Receivables subject to such Purchase and setting
forth financial and other details relating to such Purchase, all as contemplated by Exhibit
A.
1.26 “Settlement Date” has the meaning set forth in Section 3.2 hereof.
1.27 “Total Purchased Receivables Amount” means for any Purchase the total of the Purchased
Receivable Amounts for all Purchased Receivables subject to such Purchase as set forth on the
applicable Schedule.
2 PURCHASE AND SALE OF RECEIVABLES.
2.1 Sale and Purchase. Subject to the terms and conditions of this Agreement, with
respect to each Purchase, effective on each applicable Purchase Date, Seller agrees to sell to
Buyer and Buyer agrees to buy from Seller all right, title, and interest (but none of the
obligations with respect to) of the Seller to the payment of all sums owing or to be owing from the
Account Debtors under each Purchased Receivable to the extent of the Purchased Receivable Amount
for such Purchased Receivable.
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Each purchase and sale hereunder shall be in the sole discretion of Buyer and Seller. In any
event, Buyer will not (i) purchase any Receivables in excess of an aggregate outstanding amount
exceeding Ten Million Dollars ($10,000,000.00), or (ii) purchase any Receivables under this
Agreement after June 26, 2008. The purchase of each Purchased Receivable may be evidenced by an
assignment or xxxx of sale in a form acceptable to Buyer.
Notwithstanding the foregoing, the aggregate amount of Purchased Receivables, together with
the aggregate amount of Obligations (as defined in the Revolving Line Agreement) under the
Revolving Line Agreement, shall not exceed Fifteen Million Dollars ($15,000,000.00). In the event
such aggregate amount of Purchased Receivables, together with the aggregate amount of Obligations
(as defined in the Revolving Line Agreement) under the Revolving Line Agreement, exceeds Fifteen
Million Dollars ($15,000,000,00) at any time, such excess shall be repaid immediately to Buyer in
good funds.
2.2 Purchase Price and Related Matters. With respect to each Purchase:
(a) Payment of Purchase Price. On the Purchase Date, the Purchase Price, less the
Administrative Fee, Interest Reserve with respect to such Purchased Receivable, legal fees,
interest, and other fees, shall be paid by Buyer to Seller.
(b) Late Payment Settlement Fee. If, for any reason, payment (partial or full) of a
Purchased Receivable occurs during the period beginning on the Due Date and ending on the date
which is ninety-one days after the Due Date for such Purchased Receivable (the “Late Payment
Settlement Period”), then, in addition to any other obligations of Seller hereunder, Buyer shall be
entitled to offset against the Interest Reserve with respect to such Purchased Receivable an amount
(the “Late Payment Settlement Fee”) which is equal to (i) the product of the Discount Rate and the
average daily balance of the Purchased Receivable during the Late Payment Settlement Period,
multiplied by (ii) a fraction the numerator of which is the number of days in the Late Payment
Settlement Period and the denominator of which is 360, and Buyer shall rebate to Seller the balance
of such Interest Reserve. If no payment of a Purchased Receivable occurs prior to the end of the
Late Payment Settlement Period, then the entire Interest Reserve with respect to such Purchased
Receivable shall constitute the Late Payment Settlement Fee and Seller shall not be entitled to any
rebate thereof.
2.3 Fees.
(a) A fully earned, non-refundable facility fee of Thirty Seven Thousand Five Hundred
Dollars ($37,500.00) is due to Buyer from Seller upon execution of this Agreement, (the
“Facility Fee”).
(b) A fully earned, non-refundable anniversary fee of Twenty Five Thousand Dollars
($25,000.00) (the “Anniversary Fee”) shall be earned as of the date hereof, and shall be
payable to Buyer on the earlier to occur of (i) the date that is one year from the date of
this Agreement, or (ii) the early termination of this Agreement by Seller for any reason.
2.4 Nature of Transaction. It is the intent of the parties hereto that each purchase and sale
of Receivables hereunder is and shall be a true sale of such Receivables for all purposes and not a
loan arrangement. Each such sale shall be, subject to the terms hereof, absolute and irrevocable,
providing Buyer with the full risks and benefits of ownership of the Purchased Receivables (such
that the Purchased Receivables would not be property of the Seller’s estate in the event of the
Seller’s bankruptcy). The parties agree that appropriate UCC financing statements have been or
shall promptly be filed to reflect that Seller is the seller and Buyer is the purchaser of
Receivables hereunder.
2.5 Good Faith Deposit. Seller has paid to Buyer a good faith deposit of Twenty Thousand
Dollars ($20,000.00) (the “Good Faith Deposit”) to initiate the Buyer’s due diligence review
process, which Good Faith Deposit shall be applied to the facility fee and/or other expenses of the
Buyer and closing costs.
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3 COLLECTIONS, CHARGES AND REMITTANCES.
3.1
Application of Payments. All payments in respect of any Purchased Receivable, whether
received from an Account Debtor or any other source and whether received by Seller or Buyer, shall
be the property of Buyer and Seller shall have no ownership interest therein.
3.2 Collection by Seller. In order to facilitate the collection of the Purchased Receivables
in the ordinary course of business, Seller agrees to act as Buyer’s agent for collection of the
Purchased Receivables. Accordingly, Buyer hereby appoints the Seller its attorney-in-fact to ask
for, demand, take, collect, xxx for and receive all payments made in respect of the Purchased
Receivables and to enforce all rights and remedies thereunder and designates Seller as Buyer’s
assignee for collection: provided that such appointment of Seller as such attorney- in-fact
or assignee for collection may be revoked by Buyer at any time.
Seller, as such attorney-in-fact, shall use due diligence and commercially reasonable lawful efforts in accordance with its usual
policies and practices to collect all amounts owed by the Account Debtors on each Purchased
Receivable when the same become due. In the enforcement or the collection of Purchased Receivables,
Seller shall commence any legal proceedings only in its own name as an assignee for collection or
on behalf of Buyer or, with Buyer’s prior written consent, in Buyer’s name. Seller shall have no
obligation to commence any such legal proceedings unless Buyer has agreed to share the legal fees
and other expenses to be incurred in such proceedings on a basis which is acceptable to Seller. In
no event shall Seller take any action which would make Buyer a party to any litigation or
arbitration proceeding without Buyer’s prior written consent. Until Buyer has received Payment in
Full as to any Purchase, Seller shall (i) hold in trust for Buyer and turn over to Buyer forthwith
upon receipt all payments made to Seller by Account Debtors with respect to the Purchased
Receivables subject to such Purchase and (ii) turn over to Buyer forthwith on receipt all
instruments, chattel paper and other proceeds of the Purchased Receivables; provided that
unless an Event of Default has occurred and is continuing, Seller shall remit amounts received by
Seller and due to Buyer on a weekly basis on Friday of each week (each a “Settlement Date”),
commencing on the last business day of the second week after the Purchase Date. On each
Settlement Date, Seller shall deliver to Buyer a report, in form and substance acceptable to Buyer,
of the account activity (including dates and amounts of payments) and changes in account status for
each Purchased Receivable.
3.3 No Obligation to Take Action. Buyer shall have no obligation to perform any of Seller’s
obligations under any Purchased Receivables or to take any action or commence any proceedings to
realize upon any Purchased Receivables (including without limitation any defaulted Purchased
Receivables), or to enforce any of its rights or remedies with respect thereto.
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NON-RECOURSE; REPURCHASE OBLIGATIONS.
4.1 Non-Recourse. Except as otherwise set forth in this Agreement, Buyer’s acquisition of
Purchased Receivables from Seller hereunder shall be without recourse against Seller.
4.2 Seller’s Agreement to Repurchase. Seller agrees to pay to Buyer on demand, the full face
amount, or any unpaid portion, of any Purchased Receivable: (A) with respect to such Purchase
Receivable there has been any breach of warranty or representation set forth in Section 6.1
hereof (except For breaches of warranty or representations which are permitted to be, and have
been, cured pursuant to Section 7 hereof) or any breach of any covenant contained in this Agreement
with respect to such Purchased Receivable; or (B) with respect to such Purchased Receivable the
Account Debtor asserts any discount, allowance, return, dispute, counterclaim, offset, defense,
right of recoupment, right of return, warranty claim, or short payment (except for such matters as
are permitted to be, and have been, cured pursuant to Section7 hereof); together with, in
the case of (A) or (B), all reasonable attorneys’ and professional fees and expenses and all court
costs incurred by Buyer in collecting such Purchased Receivable and/or enforcing its rights under,
or collecting amounts owed by Seller in connection with this Agreement (collectively, the
“Repurchase Amount”). Upon such payment, the respective Purchased Receivables
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shall be deemed property of and owned solely by the Seller (and shall not be deemed to be a
Purchased Receivable hereunder).
4.3 Seller’s Payment of the Amounts Due Buyer. All amounts due from Seller to Buyer
shall be paid by Seller to Buyer in immediately available funds by
fedwire to Buyer’s address for
notices.
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POWER OF ATTORNEY.
Seller does hereby irrevocably appoint Buyer and its successors and assigns as Seller’s true
and lawful attorney-in-fact, and hereby authorizes Buyer: (a) to sell, assign, transfer, pledge,
compromise, or discharge the whole or any part of the Purchased Receivables; (b) to demand,
collect, receive, xxx, and give releases to any Account Debtor for the monies due or which may
become due upon or with respect to the Purchased Receivables and to compromise, prosecute, or
defend any action, claim, case or proceeding relating to the Purchased Receivables, including the
filing of a claim or the voting of such claims in any bankruptcy case, all in Buyer’s name or
Seller’s name, as Buyer may choose; (c) to prepare, file and sign Seller’s name on any notice,
claim, assignment, demand, draft, or notice of or satisfaction of lien or mechanics’ lien or
similar document with respect to Purchased Receivables; (d) to notify all Account Debtors with
respect to the Purchased Receivables to pay Buyer directly; (e) to receive, open, and dispose of
all mail addressed to Seller for the purpose of collecting the Purchased Receivables: (f) to
endorse Seller’s name on any checks or other forms of payment on the Purchased Receivables; (g) to
execute on behalf of Seller any and all instruments, documents, financing statements and the like
to perfect Buyer’s interests in the Purchased Receivables; and (h) to do all acts and things
necessary or expedient, in furtherance of any such purposes.
6
REPRESENTATIONS, WARRANTIES AND COVENANTS.
6.1 Receivables’ Warranties, Representations and Covenants. To induce Buyer to
purchase the Purchased Receivables and to render its services to Seller, and with full knowledge
that the truth and accuracy of the following are being relied upon by the Buyer in determining
whether to accept receivables as Purchased Receivables, Seller represents, warrants, covenants and
agrees, with respect to each Purchased Receivable, that, as of the date of the applicable Purchase
pertaining to such Purchased Receivable:
(a) Seller is the absolute owner of each of the Purchased Receivables and has full legal right
to sell, transfer and assign such receivables;
(b) The correct amount of each Purchased Receivable is as set forth on the applicable
Schedule and is not in dispute:
(c) The payment of each Purchased Receivable is not contingent upon the fulfillment of any
obligation or contract, and any and all obligations required of the Seller have been fulfilled as
of the applicable Purchase Date;
(d) Such Purchased Receivable is based on an actual sale and delivery of goods and/or services
actually rendered, is due no later than the applicable Due Date and is owing to Seller, is not past
due or in default, has not been previously sold, assigned, transferred, or pledged, and is free of
any and all liens, security interests and encumbrances other than liens, security interests or
encumbrances in favor of Buyer or any other division or affiliate of Silicon Valley Bank:
(e) There are no defenses, offsets, or counterclaims against such Purchased Receivable, and no
agreement has been made under which the Account Debtor may claim any deduction or discount, except
as otherwise stated on the applicable Schedule;
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(f) Seller and, to Seller’s knowledge, each Account Debtor set forth on the applicable
Schedule with respect to such Purchased Receivable, is not insolvent as that term is defined in the
United States Bankruptcy Code and the Illinois Uniform Commercial Code, and no such Account Debtor,
to the knowledge of Seller, has filed or had filed against it a voluntary or involuntary petition
for relief under the United States Bankruptcy Code; and
(g) No Account Debtor set forth on the applicable Schedule with respect to such Purchased
Receivable has objected to the payment for, or the quality or the quantity of the subject matter
of, the Purchased Receivable, each such Account Debtor is liable for the amount set forth on such
Schedule.
6.2 Additional Warranties, Representations and Covenants. In addition to the
foregoing warranties, representations and covenants, to induce Buyer to buy the Purchased
Receivables, Seller hereby represents, warrants, covenants and agrees that:
(a) Seller will not assign, transfer, sell, or grant, or permit any lien or security interest
in any interest the Seller may have in any Purchased Receivables to or in favor of any other party,
without Buyer’s prior written consent.
(b) The Seller’s name, form of organization, chief executive office, and the place where the
records concerning all Purchased Receivables are kept is set forth at the beginning of this
Agreement or, if located at any additional location, as set forth on a schedule attached to this
Agreement, and Seller will give Buyer at least 10 days prior written notice if such name,
organization, chief executive office or records concerning Purchased Receivables is changed or
added and shall execute any documents necessary to perfect Buyer’s interest in the Purchased
Receivables.
(c) Seller shall (i) pay all of its normal gross payroll for employees, and all federal and
state taxes, as and when due, including without limitation all payroll and withholding taxes and
state sales taxes; (ii) deliver at any time and from time to time at Buyer’s request, evidence
satisfactory to Buyer that all such amounts have been paid to the
proper taxing authorities.
(d) Seller has not filed a voluntary petition for relief under the United States Bankruptcy
Code or had filed against it an involuntary petition for relief and is not contemplating or
anticipating any such filing.
(e) If Payment in Full of any Purchased Receivable has not occurred by the applicable Due
Date, then Seller shall within 10 days of such date provide a written report to Buyer setting forth
the reasons for such delay in payment.
(f) Seller, and all Seller’s subsidiaries, shall maintain Seller’s, and such
subsidiaries’, depository and operating accounts and securities accounts with Buyer and all of Seller’s and such
subsidiaries’ cash or securities in excess of that amount used for Seller’s or such subsidiaries’
current operations shall be maintained at Seller or SVB Securities.
(g) So
long as any Purchased Receivable is outstanding, Seller shall deliver to
Buyer:
(i) within five (5) days of filing, copies or electronic notice of links to of all
statements, reports and notices made available to Seller’s security holders and all
reports on Form 10-K, 10-Q and 8-K filed with the Securities and Exchange
Commission; and
(ii) any other financial information reasonably requested by
Buyer.
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7 ADJUSTMENTS.
In the event any Adjustment or dispute is asserted by any Account Debtor, Seller shall
promptly advise Buyer and Seller shall, subject to the Buyer’s approval, resolve such disputes and
advise Buyer of any Adjustments and promptly remit to Buyer the difference between the Invoice
Amount on the Purchase Date and the Invoice Amount after such Adjustment. Unless Buyer has
otherwise elected to exercise its rights under Section 4.2 hereof, Buyer shall remain the absolute
owner of any Purchased Receivable which is subject to Adjustment, and, until the amount of such
adjustment (as set forth above) is paid by Seller to Buyer, any rejected, returned, or recovered
personal property, with the right to take possession thereof at any time, and if such possession is
not taken by Buyer, Seller agrees to resell it for Buyer’s account at Seller’s expense with the
proceeds made payable to Buyer. While Seller retains possession of said returned goods and such
goods are the property of Buyer, Seller shall segregate said goods and xxxx them “property of
Silicon Valley Bank.”
8 INDEMNIFICATION.
(a) Seller
hereby agrees that in the event any Account Debtor is released from all or any part
of its payment obligations with respect to any Purchased Receivable by reason of: (1) any act or
omission of Seller not permitted by this Agreement or consented to in writing by Buyer; or (2) the
operation of any of the provisions of the documentation pertaining to such Purchased Receivables,
which result in the termination of the Account Debtor’s obligation to pay all of any part of the
Purchased Receivables, then, upon the happening of any such event, Seller shall thereafter pay to
Buyer on the date when the Account Debtor would otherwise have paid the Purchased Receivable to
Buyer an amount equal to the lesser of (a) the amount of the Purchased Receivable not payable by
the Account Debtor as a result of such event and (b) the unpaid portion of the Purchased Receivable
Amount for such Purchased Receivable.
(b) Seller hereby agrees to pay, and to indemnify and hold harmless Buyer from and against,
any taxes which may at any time be asserted in respect of this transaction or the subject matter
thereof (including, without limitation, any sales, occupational, excise, gross receipts, general
corporation, personal property, privilege or license taxes, but not including taxes imposed upon
the Buyer with respect to its income arising out of this transaction) and costs, expenses and
reasonable counsel fees in defending against the same, whether arising by reason of the acts to be
performed by Seller hereunder or imposed against Buyer, Seller, the property involved or otherwise;
provided that with respect to any of the foregoing for which Seller shall be liable, Seller
shall receive reasonably prompt notice from Buyer of this assertion of any such taxes on Buyer of
which Buyer has notice.
9 ADDITIONAL RIGHTS.
To secure the prompt payment and performance to Buyer of all of the Purchased Receivables and
the obligations of Seller hereunder, Seller hereby grants to Buyer a continuing lien upon and
security interest in all of Seller’s now existing or hereafter arising rights and interest in the
following, whether now owned or existing or hereafter created, acquired, or arising, and wherever
located (the “Related Property”): (A) Seller’s rights to any returned or rejected goods in respect
of the Purchased Receivables, with respect to which Buyer has all the rights of any unpaid seller,
including the rights of replevin, claim and delivery, reclamation, and stoppage in transit; (B)
All books and records pertaining to the Purchased Receivables or the foregoing goods; and (C) All
proceeds of the foregoing, whether due to voluntary or involuntary disposition, including
insurance proceeds. Seller is not authorized to sell, assign, transfer or otherwise convey any
interest in any Related Property without Buyer’s prior written consent. Seller agrees to sign UCC
financing statements, in a form acceptable to Buyer, and any other instruments and documents
requested by Buyer to evidence, perfect, or protect the interests of Buyer in the Purchased
Receivables and the Related Property. Seller agrees to deliver to Buyer the originals of all
instruments, chattel paper and documents evidencing or related to Purchased Receivables and
Related Property.
10 DEFAULT.
The occurrence of any one or more of the following shall constitute an Event of Default
hereunder:
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(a) Seller fails to pay any amount owed to Buyer as and when due;
(b) There shall be commenced by or against Seller any voluntary or involuntary case under the
United States Bankruptcy Code, or any assignment for the benefit of creditors, or appointment of a
receiver or custodian for any of its assets which, in the case of an involuntary case, is not
dismissed or stated within forty-five (45) days of the filing thereof;
(c) Seller shall become insolvent in that its debts are greater than the fair value of its
assets, or Seller is generally not paying its debts as they become due or is left with unreasonably
small capital;
(d) Any involuntary lien, garnishment, attachment or the like is issued against or attaches to
the Purchased Receivables or any Related Property;
(e) Seller shall breach any covenant, agreement, warranty, or representation set forth herein,
and the same is not cured (whether pursuant to the provisions of Section 6 hereof, if
applicable, or otherwise) to Buyer’s reasonable satisfaction within 10 days after Buyer has given
Seller oral or written notice thereof; provided, that if such breach is incapable of being cured it
shall constitute an immediate default hereunder;
(f) Seller is not in compliance with, or otherwise is in default under, any term of
any document, instrument or agreement evidencing a debt, obligation or liability of any kind or
character of Seller, now or hereafter existing, in favor of Buyer or any division or affiliate of
Silicon Valley Bank, regardless of whether such debt, obligation or liability is direct or
indirect, primary or secondary, joint, several or joint and several, or fixed or contingent,
together with any and all renewals and extensions of such debts, obligations and liabilities, or
any part thereof; or
(g) An event of default shall occur under any guaranty executed by any guarantor of the
obligations of Seller to Buyer under this Agreement, or any material provision of any such guaranty
shall for any reason cease to be valid or enforceable or any such guaranty shall be repudiated or
terminated, including by operation of law.
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REMEDIES UPON DEFAULT.
Upon the occurrence of an Event of Default, Buyer has and may exercise all the rights and
remedies under this Agreement and under applicable law, including the rights and remedies of a
secured party under the Illinois Uniform Commercial Code, all the power of attorney rights
described in Section 5 with respect to all Purchased Receivables and Related Property, and the
right to collect, dispose of, sell, lease, use, and realize upon all Purchased Receivables and all
Related Property.
12 ACCRUAL OF INTEREST.
If any amount owed by Seller to Buyer hereunder is not paid when due, such amount shall bear
interest from such date until paid at a per annum rate equal to the Prime Rate plus 3,0%.
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FEES, COSTS AND EXPENSES.
The Seller will pay to Buyer immediately upon demand all reasonable fees, costs and expenses
(including reasonable fees of attorneys and professionals and their costs and expenses) that Buyer
incurs with any of the following: (a) preparing, negotiating, and administering, and enforcing
this Agreement or any other agreement executed by Buyer and Seller in connection herewith,
including any amendments, waivers or consents in connection with any of the foregoing, (b)
enforcing Buyer’s rights under, or collecting amounts owed by Seller to Buyer in connection with
this Agreement, including, without limitation, to enforce (i) Seller’s agreement to repurchase as
set
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forth in Section 4.2, (ii) Seller’s payment of any amounts owing by Seller pursuant to Section 7
hereof, or (iii) Seller’s payment of any amounts owing by Seller pursuant to Section 8 hereof, (c)
enforcing any other rights against Seller or any guarantor, (d) protecting or enforcing its title
to the Purchased Receivables or its security interest in the Related Property, and (e) the
representation of Buyer in connection with any bankruptcy case or insolvency proceeding involving
Seller or any guarantor. Seller shall indemnify and hold Buyer harmless from and against any and
all claims, actions, damages, costs, expenses, and liabilities of any nature whatsoever arising in
connection with any of the foregoing, except to the extent arising as a result of Buyer’s own gross
negligence or willful misconduct.
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SEVERABILITY, WAIVER, AND CHOICE OF LAW.
In the event that any provision of this Agreement is deemed invalid by reason of law, this
Agreement will be construed as not containing such provision and the remainder of the Agreement
shall remain in full force and effect. If Buyer waives a default it may enforce a later default.
Any consent or waiver under, or amendment of, this Agreement must be in writing. Nothing contained
herein, or any action taken or not taken by Buyer at any time, shall be construed at any time to
be indicative of any obligation or willingness on the part of Buyer to amend this Agreement or to
grant to Seller any waivers or consents. This Agreement has been transmitted by Seller to Buyer at
Buyer’s office in the State of Illinois and has been executed and accepted by Buyer in the State
of Illinois. This Agreement shall be governed by and interpreted in accordance with the internal
laws of the State of Illinois.
15 NOTICES.
All notices shall be given to Buyer and Seller at the addresses or faxes set forth on the
first page of this Agreement and shall be deemed to have been delivered and received: (a) if
mailed, three calendar days after deposited in the United States mail, first class, postage
pre-paid, (b) one calendar day after deposit with an overnight mail or messenger service; or (c)
on the same date of confirmed transmission if sent by hand delivery, telecopy, telefax or telex.
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JURY TRIAL.
SELLER AND BUYER EACH HEREBY (a) WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL ON ANY CLAIM
OR ACTION ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, ANY
RELATED AGREEMENTS, OR ANY OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY; (b) RECOGNIZE AND AGREE THAT THE FOREGOING WAIVER
CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT; AND (c) REPRESENT AND
WARRANT THAT IT HAS REVIEWED THIS WAIVER, HAS DETERMINED FOR ITSELF THE NECESSITY TO REVIEW THE
SAME WITH ITS LEGAL COUNSEL, AND KNOWINGLY AND VOLUNTARILY WAIVES ALL RIGHTS TO A JURY TRIAL.
17 TITLES AND SECTION HEADINGS.
The titles and section headings used herein are for convenience only and shall not be used in
interpreting this Agreement.
-9-
IN
WITNESS WHEREOF, Seller and Buyer have executed this Agreement under seal as of the date
first written above.
| SELLER: | ||||
| TELULAR CORPORATION | ||||
By |
||||
Title
|
EVP & COO/CFO | |||
| BUYER: | ||||
| SILICON VALLEY BANK | ||||
By |
||||
Title
|
Relationship Manager | |||
-10-
EXHIBIT A
SCHEDULE
SCHEDULE
-11-
Seller:
|
Telular Corporation | |
Buyer:
|
Silicon Valley Bank | |
Purchase Date:
|
||
Due Date:
|
days from Purchase Date | |
Total Purchased Receivables:
|
$ _______(List of Receivables total) |
Discount Rate: % (calculated as follows: (i) the Prime Rate per annum, or (ii) such
other Discount Rate, as determined by Buyer in its sole and absolute discretion, for invoices for
which either (A) the Account Debtor is located outside of the United States, as determined by
Buyer in its sole discretion, or (B) the date on which payment on such account is due is more than
ninety (90) days after the Purchase Date).
Purchase
Price:
$ (is % of the Total Purchased Receivables Amount which is the straight discount of the Total Purchased
Receivables Amount discounted from the Due Date to the Purchase Date at the Discount Rate).
Administrative Fee: 0.25% multiplied by the Total Purchased Receivables Amount.
Interest Reserve: $ (the aggregate, for all Purchased Receivables included in any purchase).
Seller warrants and represents that (a) its warranties and representations in the Agreement are
true and correct as of the date of this Schedule and (b) no Event of Default has occurred under the
Agreement.
| SELLER: TELULAR CORPORATION | ||||
By: |
||||
Title: |
||||
| BUYER: SILICON VALLEY BANK | ||||
By: |
||||
Title: |
||||
-12-
