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Exhibit 10.7
FACTORING AGREEMENT
(DAILY BALANCES)
Republic Factors Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: ▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Gentlemen:
We hereby request that you act as our sole factor, effective as of the
date of your acceptance hereof, upon the terms and conditions set forth below:
1. A. We agree that we will do all of our business through you as our
sole factor and hereby assign and sell to you as absolute owner all Receivables.
As used herein, the term "Receivables" shall mean and include all accounts, and
all other obligations of customers of ours arising out of the sale and delivery
of goods by us or the rendition of services by us, whether now existing or
hereafter created. We represent and warrant that each and every Receivable now
or hereafter assigned to you will be a bona fide and existing obligation of a
customer of ours, owned by and owing to us, arising out of the sale and delivery
of goods by us or the rendition by us of services as aforesaid, free and clear
of any and all deductions, Disputes (as defined in paragraph 8. below), liens,
security interests and encumbrances.
B. You agree to (i) purchase and hereby do purchase, without
recourse to us except as set forth hereinafter, all Receivables approved by you
in accordance with paragraph 2. below and which are promptly assigned to you,
and (ii) assume the risk of non-payment on such Receivables, which nonpayment is
due solely to the financial inability of our customer, whose credit standing you
will have approved in advance in accordance with paragraph 2. below, to make
payment in accordance with the terms of the invoice provided the customer has,
prior to the expiration of the payment terms of the invoice, and thereafter
received and finally accepted the merchandise or services giving rise to such
Receivables without any Dispute.
C. Receivables not covered by the provisions of paragraph 1.B.
above, in whole or in part, shall be assigned to, and purchased by you with full
recourse to us in the event of non-payment thereof or in the
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event of a Dispute.
D. In addition, we hereby sell, assign and transfer to you all of
our right, title and interest in and to the merchandise the sale of which
resulted in creation of Receivables and in all such merchandise that may be
returned by customers and all causes of action and rights in connection
therewith which we now have or may hereafter acquire including our rights of
reclamation, replevin and stoppage in transit and as an unpaid vendor of
merchandise or services as a lienor. We hereby agree upon your instruction to
promptly take any and all action necessary for you to enforce your rights of
reclamation, replevin and stoppage in transit and in the event of our failure to
do so, you shall be authorized to exercise any such right in our name or in any
manner you deem appropriate. Any merchandise so recovered shall be treated as
returned merchandise, and shall be set aside, marked with your name and held for
your account. We shall notify you promptly of all such returned merchandise.
2. No purchase of any Receivable by you shall be deemed to be made
pursuant to paragraph 1.B. above unless the sale of merchandise or rendition of
services by us resulting in such Receivable shall have been made with your prior
written approval of the amount and terms of such sale or rendition of services
and the credit standing of our customer, and you shall have the right to
withdraw such approval at any time before actual delivery of such merchandise or
rendition of such services. Each credit approval shall be automatically
withdrawn in the event the terms of sale are changed or in the event the
shipment of goods or rendition of services shall not be made or performed within
thirty (30) days from the completion date specified in the credit approval or
within thirty (30) days from the date of the credit approval, if no completion
date is specified. When a credit approval specifies special terms and
conditions, the credit approval shall be deemed automatically withdrawn when
such special terms and conditions are not complied with. You shall not be
liable in any manner or respect for refusing to accept or approve any Receivable
or the credit standing of any customer of ours or for withdrawing any approval
as provided in the preceding sentence.
3. On the face of all bills and invoices for all Receivables assigned
to and purchased by you hereunder shall be placed the following legend: "This
Receivable is assigned to, owned by and payable only to: REPUBLIC FACTORS CORP.
at ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇ OR DEPT. 49941, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇. ▇▇▇▇▇, whichever is nearer. Any objection to this invoice must be reported
to Republic Factors Corp. at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇.
4. A. The "Purchase Price of Receivables" shall be the net amount of
Receivables less the amount of your commission described in paragraph 6. below.
As used herein "net amount" of Receivables shall mean the gross amount of said
Receivables less returns, discounts (based upon shortest or longest payment
terms, as you may elect), credits or allowances of any nature at any time
issued, owing, claimed by customers, granted or outstanding. Trade and cash
discounts shall
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be considered applicable to postage, freight and incidental charges, as well as
to the price of the goods.
B. Discounts to customers, at your option, may be calculated on any
of the stated terms. The Purchase Price of Receivables shall be payable to us on
the Collection Date. For the purpose hereof, the term "Collection Date" shall
mean the earlier of (a) 5 business days after receipt by you of payment of the
Receivables or (b) 150 days after the due date of the Receivable in question,
provided that no Dispute has been raised with respect to such Receivable, and
provided that such Receivable has been credit approved by you, ("Deems Paid
Provision"). Moreover, Receivables created under paragraph 1.C. shall not be
subject to the Deems Paid Provision.
C. You may, in your sole discretion, make advances to us from time
to time at our request. In your sole discretion you shall withhold a reserve
against the Purchase Price of Receivables, and you may revise such reserve from
time to time, as a protection to you against all possible returns, claims,
allowances, expenses, indebtedness owing by us to you or any other
contingencies.
D. As security for any and all "Obligations" (as defined below), you
shall be entitled to hold and we hereby grant to you a continuing general lien
upon, security interest in and to, and right of set off on or against any of the
following (collectively, the "Collateral"): All Receivables whether or not
specifically assigned to you and all of our reserves and all of our present and
future instruments, documents, contract rights, notes, bills, chattel paper, all
other forms of obligations owing to us, all general intangibles (including
without limitation all tax refunds, proceeds of insurance, bank and other
deposit accounts, trade names, trademarks, trade secrets, customer lists, and
all other licenses, rights, privileges and franchises), all balances, sums and
other property at any time to our credit or in your possession or in the
possession of any of your Affiliates (as defined in paragraph 11. below),
together with all merchandise the sale of which resulted in the creation of
Receivables and in all such merchandise that may be returned by customers and
all books and records relating to any of the foregoing. We represent and
warrant to you that we now have, and shall at all times continue to have, good
and marketable title to all of the Collateral, free and clear of any and all
liens, security interests and encumbrances. As used herein, the term
"Obligations" means and includes all loans, advances, indebtedness,
liabilities, debit balances, covenants and duties and all other obligations of
whatever kind or nature at any time or from time to time owing by us to you or
any of your Affiliates, whether fixed or contingent, no matter how or when
arising and whether under this or any other agreement or otherwise and including
all obligations for purchases made by us from any other concern factored by you,
together with any applicable late payment interest due with respect to such
purchases. You shall have the right and are hereby irrevocably authorized to
charge to our account the amounts of any and all Obligations and, upon the
demand of any of your Affiliates or clients, to pay over to such Affiliate or
clients any amounts owing to them by us.
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We shall execute and deliver to you all financing statements and other documents
and instruments that you may request to perfect, protect or establish your
security interest hereunder and we authorize you to execute and file any
financing statements covering such security interest without our signature or,
if you so elect, signed in our name by you, and you are hereby irrevocably
appointed our attorney-in-fact to do so. You shall be entitled to have our
account with all costs and expenses incurred by you in connection with the
preparation, execution, administration and enforcement of this Agreement, or to
enforce any of the Obligations, or in the prosecution or defense of any action,
involving you or us, concerning any matter growing out of or in any manner
relating to this Agreement, the Receivables or other Collateral or any
Obligation whatsoever including, without limitation, all reasonable fees and
expenses of your attorneys, and all fees and costs in connection with public
record searches and filings, accounting fees, investigation fees, periodic field
examination fees and expenses and all other costs and expenses with respect
thereto, whether or not a legal action is commenced by or against us, and if
such action is commenced, whether or not judgment is obtained. Moreover, you
shall similarly be entitled to such attorneys' fees in the event of any state
court insolvency proceeding or federal bankruptcy proceeding. Recourse to
security or any Collateral shall not at any time be required and we shall at all
times remain liable for the repayment on demand to you of all loans and advances
to or for our account and of all other Obligations at any time or from time to
time owing to you or any of your Affiliates.
5. A. i) Interest on all sums advanced and charged to us or to or for
our account shall be calculated on the daily balance of all monies remitted,
paid or otherwise advanced to us by you or for our account including all fees
and commissions net of all payments received by you from us including the
Purchase Price of Receivables purchased by you hereunder and which is credited
to our account on the Collection Date.
ii) In the event any sums are paid or credited to us by you in
error, then, without limiting the generality of the foregoing, you may in your
discretion deduct said sum from the funds payable to us on the next Collection
Date. Any such sums paid or credited to us in error shall bear interest, from
the date the sum was paid or credited to us to the date correction is made on
your records, at the interest rate set forth in Section 5.B. below. In the event
you do not credit our account with a payment on a Receivable which you receive
whether by error, or because it was a payment for less than a full invoice
amount (which payments are not credited until the full invoice amount is paid),
or because the payment was unidentified, then the payment received by you shall
bear interest, at the rate set forth in Section 5.B. below, from the date of
deposit to the date the adjustment is made to our account. For purposes of
computing the Collection Date for such payments, the payment shall be deemed
received by you on the date such adjustment is made, and the Purchase Price for
the Receivable shall be remitted to us on the following Collection Date.
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B. All interest charges to our account shall be at one and one-half
percent (1 1/2%) above the reference rate of Republic National Bank of New
York ("Republic Reference Rate"), computed on the basis of a 360-day year for
the actual number of days elapsed and charged to our account at the end of each
month. The term "Republic Reference Rate" shall mean the lending rate announced
by Republic National Bank of New York from time to time as its reference rate.
The interest rate in effect during each calendar month shall be based on the
Republic Reference Rate in effect on the last business day of the preceding
calendar month.
C. You will send us a monthly statement of account after the end of
each month. Unless you receive our written exceptions to any monthly accounting
rendered by you within thirty (30) days after such accounting is rendered, such
monthly accounting shall constitute an account stated and be deemed accepted by
us and shall be conclusive and binding upon us.
D. If funds remain with you past the Collection Date which creates a
balance in our favor in our account with you ("Matured Funds"), you shall pay us
interest on such Matured Funds at a rate per annum equal to 3% below the
Republic Reference Rate.
E. We may from time to time give you oral, telephonic and/or written
instructions to disburse monies out of our factoring account; such requests may
be made by any of our officers, employees or agents and you shall have no
obligation to verify that any such request is authorized or proper.
6. A. As compensation for your services as factor hereunder, we agree
to pay to you a factoring commission equal to (.75%) of the gross amount of each
▇▇▇▇ or invoice, whether or not specifically assigned to you. Your factoring
commission as so calculated shall be charged to our account as of the fifteenth
(15th) day of the month in which the Receivable was created and shall be
deducted from the Purchase Price payable on such Collection Date in the
following month as you shall select. If sufficient funds are not available on a
Collection Date to pay the commissions for the prior month in full, then the
unpaid balance will be deducted from the Purchase Price payable on such
subsequent Collection Date(s) as you shall select.
B. Commissions payable to you hereunder are based upon our usual and
regular terms which do not exceed sixty (60) days. On all Receivables on which
additional terms or dating are granted, your commissions thereon shall be
increased at the rate of one-quarter of one percent of the gross amount of the
invoice for each additional thirty (30) days or fraction thereof by which our
regular terms are extended. No such increase in terms or dating, however, shall
be granted without your prior written approval. A minimum factoring commission
on each invoice shall be $5.00. Each month you shall charge our account with the
greater of (i) $2,500, or (ii) the amount of the factoring commission at the
rate provided for herein based upon the actual aggregate gross amount of all
bills or invoices factored by you in each such month. We will issue credits only
with your
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prior written approval and only the customer may claim allowances, discounts and
credits. All credits for full invoice amounts shall be assigned by us to you.
C. We may from time to time request that you credit approve sales
made by us to Debtors-in-Possession operating under Chapter 11 of the Bankruptcy
Code ("DIP Sales"). On all such DIP Sales credit approved by you, you shall be
entitled to a factoring commission, in addition to the regular factoring
commission charged by you, in an amount to be determined by you from time to
time.
7. We will provide you with an assignment and schedule of Receivables
sold and assigned to you in form satisfactory to you. All invoices shall be
mailed by us to our customers at our sole expense. We will give you copies of
all invoices, together with such proof of shipment or delivery as you may from
time to time require. The issuance of or any billing by us of such invoices,
shall constitute an assignment thereof to you for the Receivables represented
thereby, whether or not we execute any other specific instrument of assignment.
Notwithstanding the foregoing, you shall no longer assume the credit risk as
provided in paragraph 1.B. above if we do not supply you with a schedule and
assignment of Receivables within ten (10) days of the creation of the
Receivables involved and the risk of loss with respect to such Receivables shall
immediately revert to and be assumed by us without any act on your part to
effect the same.
8. We hereby further warrant to you that the customer in each instance
has received and will accept the merchandise sold or the services rendered and
the invoice therefor, and will pay the same as and when due without any Dispute.
As used herein, the term "Dispute" shall mean and include any dispute, claim,
offset, defense or counterclaim, regardless of whether the same is in an amount
greater than, equal to or less than the Receivables concerned. whether bona fide
or not, and regardless of whether the same, in part or in whole, relates to
unpaid Receivables or other Receivables, and whether or not such Dispute arises
by reason of an Act of God, civil strife, war, currency restrictions, foreign
political restrictions or regulations, or the like. We will notify you promptly
of, and, at our own cost and expense, including attorneys' fees, shall settle
all Disputes and will pay you promptly the amount of the Receivables affected
thereby. Any Dispute not settled by us by the sixtieth (60th) day next following
the maturity of the invoice affected thereby may, if you so elect, be settled,
compromised, adjusted or litigated by you directly with the customer or other
complainant for our account and risk and upon such terms and conditions as you
in your sole discretion deem advisable. You may also in your discretion take
possession of and sell or cause the sale of any returned or recovered
merchandise, at such prices, upon such terms and to such purchasers as you deem
proper (including, in the event of any public sale, yourself) and in any event
to charge the deficiency costs and expenses thereof, including attorneys' fees,
to us. In addition to all other rights to which you are entitled hereunder,
whenever there is any Dispute, or if any unapproved Receivable is unpaid at its
maturity, you may reduce the amount of our Receivables balance (and
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charge our loan account if you have previously paid us the purchase price) by
the amount of the Receivable so affected or unpaid (as well as all other
Receivables due and owing from that customer) at any time (a "Chargeback"). Such
Chargeback shall not be deemed nor shall it constitute a reassignment to us of
the Receivable affected thereby, and title hereto and to the merchandise
represented thereby shall remain in you until you are fully reimbursed.
Regardless of the date or dates upon which you charge back the amount of any
Receivable with respect to which there is any Dispute, or the amount owing from
a customer which has raised any Dispute, we agree that immediately upon the
occurrence of any such Dispute, any obligation you may otherwise have had
hereunder to bear the risk of loss with respect to such Receivable shall cease
and such obligation shall immediately revert to and be assumed by us without any
act upon your part to effect the same.
9. A. If any remittances are made directly to us, we shall hold the
same in trust for you as your property and immediately deliver to you the
identical checks, monies or other forms of payment received, and you shall have
the right to endorse our name on any and all checks or other forms of
remittances received if such endorsement is necessary to effect collection. We
agree that we will hold at our offices and be fully responsible to you for any
and all shipping receipts evidencing delivery of goods regarding Receivables
factored by you. Such shipping evidences held by us shall be available for your
inspection and for delivery to you at your request at any time. B. We further
agree to make our records, files and books of account, including, but not
limited to, any and all invoices, shipping or transport documents, ledgers,
journals, checkbooks, correspondence, memoranda, copies of correspondence and
memoranda, microfilm, microfiche, computer programs and records, source
materials, tapes and discs (collectively "Documents"), available to you on
request and that you may visit our premises during normal business hours to
examine such Documents and to make copies or extracts thereof and to conduct
such examinations as you deem necessary. You shall be entitled to charge our
account a fee of $500.00 for each day or part thereof in which the examination
is conducted, plus out-of-pocket expenses you incur as a result of conducting
such examinations.
C. You shall charge our factoring account $15.00 in connection with
each disbursement of monies from our factoring account, whether made by check,
electronically, or otherwise.
D. We shall be entitled to receive, at no cost to us, one (1) Client
Detail Aged Trail Balance for each month. For each additional Client Detail Aged
Trial Balance requested by us in that month, you shall charge our account for
$100.00, for each such additional report.
E. If you, at our request and on our behalf, in your sole
discretion, file a proof of claim in any insolvency proceeding with respect to a
Receivable which is not at your credit risk (a "DR Claim") or forward such a DR
Claim to a collection agency or attorney for collection,
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you shall charge our account with an amount equal to ten (10%) percent of the DR
Claim at the time such DR Claim is filed or forwarded and any other expenses or
charges incurred by you thereafter shall be charged to our account.
F. You may modify the charges set forth in Sections 9, B, C, D, and
E above, from time to time, on not less than thirty (30) days prior written
notice to us.
10. Any state, city, local or federal sales or excise taxes on sales of
Receivables hereunder and any payroll taxes, state disability premiums, premiums
for ▇▇▇▇▇▇▇'▇ compensation insurance and unemployment taxes shall be timely paid
by us, but if you should make any payment of any thereof, we will repay the same
to you upon demand.
11. As used herein, an "Affiliate" shall mean and include any person,
firm or corporation controlling, controlled by or in common control with you
and/or any subsidiary or parent corporation of yours.
12. We hereby warrant our solvency (which warranty shall be continuing
throughout the term of this Agreement), and hereby agree that we are not
entitled to and shall not pledge your credit for any purpose whatsoever. This
Agreement is the complete agreement between the parties hereto and is entered
into for the benefit of said parties, their successors and assigns, and cannot
be changed, modified or terminated orally except that we shall not assign or
hypothecate our rights under this Agreement to any other person, firm,
corporation or entity without your prior written consent. No delay or failure on
your part in exercising any right, privilege or option hereunder shall operate
as a waiver of such or of any other right, privilege or option, and no waiver
whatever shall be valid unless in writing signed by you and then only to the
extent a waiver is therein set forth. This Agreement is made in the State of New
York and shall be governed by and construed in accordance with the laws of said
State.
13. A. This Agreement shall continue in full force and effect for a
period of two years from the effective date hereof and every two years
thereafter unless terminated by you or unless we notify you of our desire to
terminate this Agreement effective at the end of each such two year period by
giving you at least sixty (60) days prior written notice. You shall have the
right to terminate this Agreement at any time upon sixty days' prior written
notice. Termination shall be effective by the mailing by certified mail, return
receipt requested of a letter of notice addressed by either of us to the other
specifying the date of termination. Notwithstanding the foregoing, you may
terminate this Agreement without notice upon the occurrence of any Event of
Default. On termination for any reason, all Obligations shall, unless and to the
extent that you otherwise elect, become immediately due and payable without
notice or demand. Any of the following events shall constitute "Events of
Default" hereunder: we fail to pay or perform any Obligation owing to you or any
of your Affiliates when due or commit any breach of or default in the
performance of any agreement contained herein or in any
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instrument or document delivered pursuant hereto or in any other agreement,
instrument or document under which we are obligated to you or any of your
Affiliates; we as principal, guarantor, surety or other party liable upon any
Obligation make any false or untrue representation to you or any of your
Affiliates in connection with this Agreement or any transaction relating hereto
or in connection with any Obligation; any partner (if we are a partnership)
shall die or otherwise withdraw from the partnership; any guarantor, surety or
other party liable upon any Obligation shall die; we (if a corporation) shall be
dissolved or become a party to any merger or consolidation without your prior
written consent; if we are a corporation, the persons who are in control of us
shall change, or we become insolvent or unable to meet our debts as they mature,
or we file or have filed against us a petition under the Bankruptcy Code or
otherwise seek a rearrangement or restructuring of our indebtedness.
B. Notwithstanding any termination hereof, this Agreement shall
nevertheless continue in full force and effect as to, and be binding upon us,
after any termination, until we have fully paid, performed and satisfied all of
the Obligations, no matter how or when arising and whether under this or any
other agreement.
14. Upon the occurrence of any Event of Default, you shall have all of
the rights and remedies of a secured party under the Uniform Commercial Code and
other applicable laws with respect to all Collateral, such rights and remedies
being in addition to all of your other rights and remedies provided for herein,
and further, you may, at any time or times, after the occurrence of any such
Event of Default, sell and deliver any and all other Collateral held by you or
for you at public or private sale, in one or more sales or parcels, at such
prices and upon such terms as you may deem best, and for cash or on credit or
for future delivery, without your assumption of any credit risk, and at public
or private sales, as you may deem appropriate. If reasonable notice of the time
and place of such sale is required under applicable law, such requirement shall
be met if any such notice is mailed, postage prepaid, to our address shown on
the cover page hereof, or the last shown address in your records, at least five
(5) days before the time of the sale or disposition thereof. You may be the
purchaser at any sale, if it is public, free from any right of redemption, which
we also hereby expressly waive. The proceeds of sale shall be applied first to
all costs and expenses of sale, including attorneys' fees and disbursements, and
then to the payment (in such order as you may elect) of all Obligations. You
will return any excess to us and we shall remain liable to you for any
deficiency. Your rights and remedies under this Agreement will be cumulative and
not exclusive of any other rights or remedies which you may otherwise have.
15. We agree to furnish you with balance sheets, statements of profit
and loss, financial statements and such other information regarding our business
affairs and financial conditions as you may from time to time require, and in
any event, a statement of our financial position for each fiscal year prepared
and certified by our regularly engaged Certified Public
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Accountant. All such statements Shall fairly present our financial condition as
of the dates, and the results of our operations for the periods, for which the
same are furnished.
16. A. This Agreement is made in the State of New York and shall be
governed by and construed in accordance with the laws of said State, without
regard to conflict of laws principles.
B. WE AGREE THAT ANY, DISPUTE, CLAIM OR CONTROVERSY BETWEEN YOU AND
US, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE ("CLAIM" OR "CLAIMS") SHALL,
AT YOUR ELECTION, BE RESOLVED BY ARBITRATION IN ACCORDANCE WITH THE PROVISIONS
OF THIS PARAGRAPH. Such election may be made at any time prior to the
commencement of a judicial proceeding by you, or in the event of a judicial
proceeding instituted by us at any time prior to the last day to answer and/or
respond to a summons and/or complaint made by us (or within thirty (30) days
after the rendition of an order on any motion by you based upon the statute of
limitations). The provisions of this paragraph apply to and include all claims
arising out of or in connection with i) this Agreement or any related agreements
or instruments, ii) all past, present and future agreements involving you or us,
iii) any transaction related to this Agreement and all past, present and future
transactions involving you and us, and iv) any aspect of the past, present or
future relationship between you or us. You may elect to require arbitration of
any Claim with us without thereby being required to arbitrate all Claims between
you and us. Any such Claim shall be resolved by binding arbitration in
accordance with the Arbitration Law of the State of New York and the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). In the event
of any inconsistency between such Rules and these arbitration provisions, these
provisions shall supersede such Rules. All statutes of limitations which would
otherwise be applicable shall apply to any arbitration proceeding under this
paragraph. In any arbitration proceeding subject to this paragraph, the
arbitrator is specifically empowered to decide (by documents only, or with a
hearing, at the arbitrator's sole discretion) pre-hearing motions which are
substantially similar to pre-hearing motions for summary adjudication. In any
such arbitration proceeding, the arbitrator shall not have the power or
authority to award punitive damages to any party nor shall the arbitrator have
the power or authority to alter or modify any express provision of this
Agreement or any other agreement heretofore or hereafter entered into between
us, all of which agreements are hereby incorporated in this arbitration
provision. Judgment upon the arbitration award rendered may be entered in any
court having jurisdiction. Whenever an arbitration is required, the party shall
select an arbitrator in the manner provided in this paragraph. No provision of,
nor the exercise of any rights under this paragraph shall limit your rights i)
to foreclose against collateral pursuant to applicable provisions of the Uniform
Commercial Code or otherwise herein pursuant to applicable law, ii) to exercise
self-help remedies including, but not limited to, set off and repossession or
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iii) to request and obtain from a court having jurisdiction before, during or
after the pendency of any arbitration, provisional or ancillary remedies and
relief including, but not limited to, injunctive or mandatory relief. The
institution and maintenance of an action or judicial proceeding for, or pursuit
of, provisional or ancillary remedies or exercise of self-help remedies shall
not constitute a waiver by you, even if you are a plaintiff to submit the Claim
to arbitration if you would otherwise have such right. Whenever an arbitration
is required under this paragraph, the arbitrator shall be selected, except as
otherwise herein provided, in accordance with the Commercial Arbitration Rules
of the AAA. A single arbitrator shall decide any Claim of $100,000.00 or less
and he or she shall be a Certified Public Accountant with at least five years
experience. Where a Claim of any party exceeds $100,000.00, the Claim shall be
decided by a majority of three arbitrators, at least two of whom shall be
Certified Public Accountants (at least one of whom shall have not less than five
years experience). The arbitrator shall have the power to award recovery of all
costs and fees (including attorney's fees, administrative fees, arbitrator's
fees and, if applicable, court costs) to the prevailing party. In the event of
any Claim governed by this paragraph, each of the parties shall, subject to the
award of the arbitrator, pay an equal share of the arbitrator's fees.
C. We agree that any claim or cause of action by us against you, or
any of your directors, officers, employees, agents, accountants or attorneys,
based on, arising from or relating in any way to this Agreement, or any
supplement or amendment hereto, or any other present or future agreement between
us, or any other transaction contemplated hereby or thereby or relating hereto
or thereto, or any other matter whatsoever shall be barred unless asserted by us
by the commencement of an action or proceeding in a court of competent
jurisdiction by the filing of a complaint within one year after the first act,
occurrence or omission upon which such Claim or cause of action, or any part
thereof, is based, and the service of a summons and complaint upon one of your
officers, within thirty (30) days thereafter. We agree that said one year period
is a reasonable and sufficient time for us to investigate and act upon such
Claim or cause of action. Said one year period shall not be waived, tolled or
extended except by specific written consent by you.
D. In performing your obligations under this Agreement, you shall
be liable to us for only your gross negligence or willful misconduct. No person
or entity shall be a third party beneficiary of any of our rights or claims
under this Agreement and in particular, but not by way of limitation, you shall
not be liable to any third party or for any act or omission by you or any third
party including, without limitation, the inability or failure of any third party
to effect a transfer in accordance with our instructions due to mechanical,
computer or electrical failures or for any other reasons beyond your control.
You shall have no obligation to pursue, or assist us in pursuing, any claim we
may have against any third party. In no event, shall you be liable for special,
punitive, indirect or consequential damages, nor shall any action or inaction on
your
-11-
12
part, constitute a waiver by you or any cause of action or defense.
E. You and we each here waive the right to trial by jury in any
action based upon, arising from, or in any way relating to: (i) this Agreement,
or any supplement hereto; or (ii) any other present or future instrument or
agreement between you and us; or (iii) any conduct, acts or omissions by you or
us or any of your respective directors, officers, employees, agents,
attorneys or any other persons affiliated with you or us; in each of the
foregoing cases, whether sounding in contract or tort or otherwise. As a
material part off the consideration to you to enter into this Agreement, we (1)
agree that, at your option, all actions and proceedings based upon, arising out
of or relating in any way directly or indirectly to this Agreement shall be
litigated exclusively in the Supreme Court of the State of New York located
within New York County, New York, (2) consent to the jurisdiction of such court
and consent to the service of process in any such action or proceeding by
personal delivery, first-class mail, or any other method permitted by law, and
(3) waive any and all rights to transfer or change the venue of any such action
or proceeding to any court located outside New York County, New York.
F. This Agreement and the other written documents previously or now
executed in connection herewith are the entire and only agreements between us
with respect to the subject matter hereof, and all oral representations,
agreements and undertakings, previously or contemporaneously made, which are not
set forth herein or therein, are superseded hereby and thereby. The provisions
of this paragraph shall survive any termination of this Agreement.
-12-
13
Very truly yours,
▇▇▇▇▇ ▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
Title: President
----------------------------
ATTEST:
/s/ ▇▇ ▇▇▇▇▇▇ Treasury Secretary
----------------------------------
[SEAL]
ACCEPTED AT NEW YORK,
NEW YORK
ON March 17, 1995
--------------
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
Title: Vice President
----------------------------
-13-
14
[REPUBLIC FACTORS LETTERHEAD]
June 14, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to your Factoring Agreement dated March 17, 1995 as amended
(the "Agreement"). You have requested and we hereby agree, subject to your
acceptance below to amend the Agreement as follows:
1. Section 9.C is eliminated in its entirety.
2. Section 6.B is hereby amended by eliminating in its entirety the fourth
sentence of said Section.
3. Section 6.C is amended in its entirety and replaced with the following:
"We may from time to time request that you credit approve sales made by
us to Debtors-in-Possession operating under Chapter 11 of the
Bankruptcy Code ("DIP Sales"). We agree that any such credit approval
by you of DIP Sales shall be subject to a supplemental factoring
commission of 1% in addition to the regular factoring commission
charged by you. Notwithstanding the foregoing, credit approvals by you
of DIP Sales to ▇▇▇▇▇▇ Stores Inc. shall be subject to a supplemental
factoring commission of 2% in addition to the regular factoring
commission charged by you.
Except as modified herein all terms and conditions of the Agreement shall remain
in full force and effect.
Please indicate your acceptance by your signature below.
Very truly yours,
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Vice President
ACCEPTED & AGREED
▇▇▇▇▇ ▇▇▇▇, Inc.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
15
[REPUBLIC FACTORS LETTERHEAD]
April 15, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: KMART CORPORATION ("KMART")
Gentlemen:
This will confirm that notwithstanding anything to the contrary contained in our
Factoring Agreement, any Receivables assigned to us by you from Kmart for which
we have assumed the credit risk with approvals commencing on April 15, 1996,
including but not limited to the attached listing of invoices ("Kmart
Receivables"), are subject to the following additional terms and conditions,
which by your signature below you agree shall apply to all Kmart Receivables:
1. Republic Factors Corp.'s ("RFC") obligations with respect to the risk
of nonpayment of a Kmart Receivable due solely to the financial
inability of Kmart to make a payment on the due date of the Kmart
Receivable shall be limited to 75% of the net amount of any such Kmart
Receivable for all approvals given by RFC from 11/28/95 to 1/31/96 and
limited to 70% from 2/1/96 to 2/14/96 and limited to 60% from 2/15/96
to 3/15/96 and 70% of such net amount for all approvals given on or
after the date hereof (the "Agreed Portion") and the remaining portion
of such Kmart Receivable shall be treated as not approved by RFC and
RFC shall purchase the remaining portion of such Kmart Receivable with
full recourse to you. Each credit approval shall be automatically
withdrawn in the event the terms of sale are changed without RFC's
written approval or in the event the shipment of goods or rendition of
services shall not be made or performed within fifteen (15) days from
the completion date specified in the credit approval or within fifteen
(15) days from be date of the credit approval, if no completion date is
specified. RFD may in its sole discretion hold as a reserve the full
amount of such remaining unapproved portion.
2. Any and all recoveries received in connection with or related to any
Kmart Receivable (or may claim related thereto) shall be retained by
and be for the account of RFC, except if and to the extent RFC has
recovered in full the Agreed Portion of any Kmart Receivable plus any
and all expenses incurred by RFC in connection with obtaining such
Agreed Portion, including legal fees and expenses, any additional
amounts net of any such additional expenses ("Net Additional Amounts")
actually received by RFC shall be paid over to you promptly after RFC's
receipt thereof.
3. Nothing contained herein, in our Factoring Agreement or otherwise,
shall create any principal or agency relationship between you and RFC,
or create any fiduciary relationship on the part of RFC
16
refrain from taking any legal or other action with respect to any Kmart
Receivable. RFC's present intention with respect to any "claim" in
respect of Kmart Receivables, within the meaning of Section 101(5) of
the United States Bankruptcy Code, should Kmart become a debtor under
the United States Bankruptcy Code, is to sell such claim (although RFC
shall be under no duty to do so), at such time or times as RFC in its
sole discretion deems appropriate, whether or not such sale is, or is
later determined not to have been, in your best interest, and in no
event and under no circumstance shall RFC be liable to you for any
amounts in excess of the Agreed Portion of any Kmart Receivable, unless
and then only to the extent Net Additional Amounts are actually
received by RFC with respect to such Kmart Receivable.
4. Notwithstanding the foregoing, RFC agrees that (i) you may at any time
after the due date of any Kmart Receivable, upon two business days
prior written notice to RFC, purchase all, but not less than all, of
the then outstanding Kmart Receivables from us for cash in an amount
equal to the Agreed Portion of Kmart Receivables; and (ii) if, at any
time, RFC proposes to sell a claim with respect to a Kmart Receivable,
it (a) only will sell such claim to an unrelated third party for cash,
and (b) before effecting such sale, will offer to sell such claim to
you on the same terms and conditions as such proposed sale (the "Third
Party Terms"). In the event you receive such an offer from RFC
pursuant to clause (b)of this paragraph 4, such offer is conditional
upon you irrevocably agreeing in writing, within the time period
specified by Republic Factors Corp. (which may be as little as 24
hours) to make such purchase on the Third Party Terms, but in no event
shall the purchase price to you be in excess of any amount, payable by
you in cash, equal to the Agreed Portion of such Kmart Receivable
proposed to be sold to such third party, provided that you are ready,
willing and able to effect such purchase within the time period
specified by RFC (which also may be within such 24 hour period).
This letter supersedes and replaces any prior written or oral agreements
regarding Kmart Receivables. Except as hereby modified and amended, all terms
and provisions of the Factoring Agreement shall remain in full force and effect.
Please indicate your acceptance to the foregoing by signing and returning the
enclosed copy of this letter.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------
ACCEPTED AND AGREED
▇▇▇▇▇ ▇▇▇▇, INC.
----------------
By: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
17
[Republic Factors Letterhead]
I
February 15, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Kmart Corporation ("Kmart")
Gentlemen:
This will confirm that notwithstanding anything to the contrary
contained in our Factoring Agreement, any Receivables assigned to us by you from
Kmart for which we have assumed the credit risk with approvals commencing on
2/14/96, including but not limited to the attached listing of invoices ("Kmart
Receivables"), are subject to the following additional terms and conditions,
which by your signature below you agree shall apply to all Kmart Receivables:
1. Republic Factors Corp.'s ("RFC") obligations with respect to the risk
of nonpayment of a Kmart Receivable due solely to the financial
inability of Kmart to make a payment on the due date of the Kmart
Receivable shall be limited to 60% of the net amount of any such Kmart
Receivable date hereof (the "Agreed Portion") except as to Kmart
receivables approved after 11/28/95 and prior to 2/14/96 the Agreed
Portion shall be 75% and the remaining portion of such Kmart Receivable
shall be treated as not approved by RFC and RFC shall purchase the
remaining portion of such Kmart Receivable with full recourse to you.
Each credit approval shall be automatically withdrawn in the event the
terms of sale are changed without RFC's written approval or in the
event the shipment of goods or rendition of services shall not be made
or performed within fifteen (15) days from the completion date
specified in the credit approval or within fifteen (15) days from the
date of the credit approval, if no completion date is specified. RFC
may in its sole discretion hold as a reserve the full amount of such
remaining unapproved portion.
2. Any and all recoveries received in connection with or related to any
Kmart Receivable (or any claim related thereto) shall be retained by
and be for the account of RFC, except if and to the extent RFC has
recovered in full the Agreed Portion of any Kmart Receivable plus any
and all expenses incurred by RFC in connection with obtaining such
Agreed Portion, including legal fees and expenses, any additional
amounts net of any such additional expenses ("Net Additional Amounts")
actually received by RFC shall be paid over to you promptly after RFC's
receipt thereof.
18
Page 2
3. Nothing contained herein, in our Factoring Agreement or otherwise,
shall create any principal or agency relationship between you and RFC,
or create any fiduciary relationship on the part of RFC as to any Kmart
Receivable or otherwise, or imply or impose any duty upon RFC to take
or refrain from taking any legal or other action with respect to any
Kmart Receivable. RFC's present intention with respect to any "claim"
in respect of Kmart Receivables, within the meaning of Section 101(5)
of the United States Bankruptcy Code, should Kmart become a debtor
under the United States Bankruptcy Code, is to sell such claim
(although RFC shall be under no duty to do so), at such time or times
as RFC in its sole discretion deems appropriate, whether or not such
sale is, or is later determined not to have been, in your best
interest, and in no event and under no circumstance shall RFC be liable
to you for any amounts in excess of the Agreed Portion of any Kmart
Receivable, unless and then only to the extent Net Additional Amounts
are actually received by RFC with respect to such Kmart Receivable.
4. Notwithstanding the foregoing, RFC agrees that (i) you may at any time
after the due date of any Kmart Receivable, upon two business days
prior written notice to RFC, purchase all, but not less than all, of
the then outstanding Kmart Receivables from us for cash in an amount
equal to the Agreed Portion of Kmart Receivables; and (ii) if, at any
time, RFC proposes to sell a claim with respect to a Kmart Receivable,
it (a) only will sell such claim to an unrelated third party for cash,
and (b) before effecting such sale, will offer to sell such claim to
you on the same terms and conditions as such proposed sale (the "Third
Party Terms"). In the event you receive such an offer from RFC pursuant
to clause (b) of this paragraph 4, such offer is conditional upon you
irrevocably agreeing in writing, within the time period specified by
RFC (which may be as little as 24 hours) to make such purchase on the
Third Party Terms, but in no event shall the purchase price to you be
in excess of any amount, payable by you in cash, equal to the Agreed
Portion of such Kmart Receivable proposed to be sold to such third
party, provided that you are ready, willing and able to effect such
purchase within the time period specified by RFC (which also may be
within such 24 hour period).
19
Page 3
This letter supersedes and replaces any prior written or oral
agreements regarding Kmart Receivables. Except as hereby modified and amended,
all terms and provisions of the Factoring Agreement shall remain in full force
and effect.
Please indicate your acceptance to the foregoing by signing and
returning the enclosed copy of this letter.
Very truly yours,
REPUBLIC FACTORS CORP.
By:_______________________
ACCEPTED AND AGREED
▇▇▇▇▇ ▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
20
[Republic Factors Letterhead]
II
February 1, 1996
▇▇▇▇▇ ▇▇▇▇, Inc.
4C)O ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Kmart Corporation ("Kmart")
Gentlemen:
This will confirm that notwithstanding anything to the contrary
contained in our Factoring Agreement, any Receivables assigned to us by you from
Kmart for which we have assumed the credit risk with approvals commencing on
11/28/95 including but not limited to the attached listing of invoices ("Kmart
Receivables"), are subject to the following additional terms and conditions,
which by your signature below you agree shall apply to all Kmart Receivables:
1. Republic Factors Corp.'s ("RFC") obligations with respect to the risk
of nonpayment of a Kmart Receivable due solely to the financial
inability of Kmart to make a payment on the due date of the Kmart
Receivable shall be limited to 75% of the net amount of any such Kmart
Receivable for all approvals given by RFC from 11/28/95 to the date
hereof and 70% of such net amount for all approvals given on and after
the date hereof (the "Agreed Portion") and the remaining portion of
such Kmart Receivable shall be treated as not approved by RFC and RFC
shall purchase the remaining portion of such Kmart Receivable with full
recourse to you. Each credit approval shall be automatically withdrawn
in the event the terms of sale are changed without RFC's written
approval or in the event the shipment of goods or rendition of services
shall not be made or performed within fifteen (15) days from the
completion date specified in the credit approval or within fifteen (15)
days from the date of the credit approval, if no completion date is
specified. RFC may in its sole discretion hold as a reserve the full
amount of such remaining unapproved portion.
2. Any and all recoveries received in connection with or related to any
Kmart Receivable (or any claim related thereto) shall be retained by
and be for the account of RFC, except if and to the extent RFC has
recovered in full the Agreed Portion of
21
Page two
any Kmart Receivable plus any and all expenses incurred by RFC in
connection with obtaining such Agreed Portion, including legal fees and
expenses, any additional amounts net of any such additional expenses
("Net Additional Amounts") actually received by RFC shall be paid over
to you promptly after RFC's receipt thereof.
3. Nothing contained herein, in our Factoring Agreement or otherwise,
shall create any principal or agency relationship between you and RFC,
or create any fiduciary relationship on the part of RFC as to any Kmart
Receivable or otherwise, or imply or impose any duty upon RFC to take
or refrain from taking any legal or other action with respect to any
Kmart Receivable. RFC's present intention with respect to any "claim"
in respect of Kmart Receivables, within the meaning of Section 101(5)
of the United States Bankruptcy Code, should Kmart become a debtor
under the United States Bankruptcy Code, is to sell such claim
(although RFC shall be under no duty to do so), at such time or times
as RFC in its sole discretion deems appropriate, whether or not such
sale is, or is later determined not to have been, in your best
interest, and in no event and under no circumstance shall RFC be liable
to you for any amounts in excess of the Agreed Portion of any Kmart
Receivable, unless and then only to the extent Net Additional Amounts
are actually received by RFC with respect to such Kmart Receivable.
4. Notwithstanding the foregoing, RFC agrees that (i) you may at any time
after the due date of any Kmart Receivable, upon two business days
prior written notice to RFC, purchase all, but not less than all, of
the then outstanding Kmart Receivables from us for cash in an amount
equal to the Agreed Portion of Kmart Receivables; and (ii) if, at any
time, RFC proposes to sell a claim with respect to a Kmart Receivable,
it (a) only will sell such claim to an unrelated third party for cash,
and (b) before effecting such sale, will offer to sell such claim to
you on the same terms and conditions as such proposed sale (the "Third
Party Terms"). In the event you receive such an offer from RFC pursuant
to clause (b) of this paragraph 4, such offer is conditional upon you
irrevocably agreeing in writing, within the time period specified by
RFC (which may be as little as 24 hours) to make such purchase on the
Third Party Terms, but in no event shall the purchase price to you be
in excess of any amount, payable by you in cash, equal to the Agreed
Portion of such Kmart Receivable proposed to be sold to such third
party, provided that you are ready, willing and able to effect such
purchase within the time period specified by RFC (which also may be
within such 24 hour period).
22
Page 3
This letter supersedes and replaces any prior written or oral
agreements regarding Kmart Receivables. Except as hereby modified and amended,
all terms and provisions of the Factoring Agreement shall remain in full force
and effect.
Please indicate your acceptance to the foregoing by signing and
returning the enclosed copy of this letter.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Vice President
ACCEPTED AND AGREED
▇▇▇▇▇ ▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------
23
[Republic Factors Letterhead]
December 20, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to the Factoring Agreement entered into between us as amended
from time to time (the "Agreement").
As provided in paragraph 6.C. of the Agreement the additional Factoring
Commission with respect to DIP Sales shall be two percent (2%) on sales terms of
up to net 30 days with respect to the debtors in possession set forth on the
attached Schedule "A".
We shall not be responsible for the credit risk in connection with DIP Sales
unless the shipment is made within thirty days from the date that the credit
approval has been communicated by us to you. In addition, notwithstanding any
practice or procedure to the contrary with respect to credit approved sales in
general, our maximum credit risk with respect to DIP Sales shall not exceed the
actual amount approved by us as to credit.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Vice President
24
Schedule A
- ▇▇▇▇▇▇ Retail, Inc.
25
[REPUBLIC FACTORS LOGO]
December 20, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
RE: Kmart Corporation ("Kmart")
Gentlemen:
This will confirm that notwithstanding anything to the contrary contained in our
Factoring Agreement, any Receivables assigned to us by you from Kmart for which
we have assumed the credit risk with Approvals commencing on November 28, 1995
shall be subject to the following additional conditions and by your signature
below you agree that these conditions shall apply to all such Receivables.
1. Republic Factors Corp.'s ("RFC") obligations with respect to the risk of
nonpayment of a Receivable due to the financial inability of Kmart to
make a payment on the due date of the Receivable shall be limited to 75%
of the net amount of any such Receivable.
2. It is agreed that any and all recoveries received in connection with or
related to any such Receivable or any claim related thereto shall be
retained by RFC until such time as RFC has recovered the amount of any
payments made to you together with any and all expenses incurred by RFC
in connection therewith. After such recoveries any additional amounts
shall be paid to you.
Except as hereby modified and amended, all terms and provisions of the
Factoring Agreement shall remain in full force and effect.
Please indicate your acceptance to the foregoing by signing and returning the
enclosed copy of this letter.
Very truly yours,
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ V.P.
-------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
ACCEPTED AND AGREED
▇▇▇▇▇ ▇▇▇▇, Inc.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, President
--------------------------------------
26
[Republic Factors Letterhead]
October 19, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to the letter agreement entered into between us amending our
factoring agreement with respect to "DIP Sales", as defined therein ("the Letter
Agreement").
In accordance with the terms of the Letter Agreement, we are hereby
notifying you that the name ▇▇▇▇▇▇▇ Stores, Inc. shall be added to Schedule "A"
and any credit approved sales made by you to that company shall be subject to
the Additional Commission.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Title: Vice President
27
[Republic Factors Letterhead]
June 27, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to the Factoring Agreement entered into between us as amended
(the "Agreement").
This will confirm that Paragraph 6B of the Agreement, effective as of the date
hereof is amended as follows:
The increased commission for sales in excess of your regular terms of sale shall
only apply when such terms of sale exceed ninety days.
Except as herein specifically provided, no other changes in the terms and
provisions of the Agreement are intended or implied.
Kindly acknowledge your agreement to the foregoing by signing and returning the
enclosed copy of this letter.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Vice President
READ AND AGREED TO:
▇▇▇▇▇ ▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------
President
28
[Republic Factors Letterhead]
May 31, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to the Factoring Agreement entered into between us as amended
from time to time (the "Agreement") including, without limitation, that certain
letter agreement with reference to DIP Sales (the "The DIP Agreement").
You are hereby notified that effective immediately, in accordance with said DIP
Agreement, The name:
- Weiner Stores, Inc.
shall be deemed added to Schedule A of the DIP Agreement.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Title: Vice President
29
[Republic Factors Letterhead]
March 8, 1995
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to the Factoring Agreement entered into between us as amended
from time to time (the "Agreement").
As provided in paragraph 6.C. of the Agreement the additional Factoring
Commission with respect to DIP Sales shall be one percent (1%) on sales terms of
up to net 30 days with respect to the debtors in possession set forth on the
attached Schedule "A".
We shall not be responsible for the credit risk in connection with DIP Sales
unless the shipment is made within thirty days from the date that the credit
approval has been communicated by us to you. In addition, notwithstanding any
practice or procedure to the contrary with respect to credit approved sales in
general, our maximum credit risk with respect to DIP Sales shall not exceed the
actual amount approved by us as to credit.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Vice President
30
SCHEDULE A
▇▇▇▇▇▇▇'▇ Stores
▇▇▇▇▇▇ ▇▇▇
Piece Goods Shops, Inc.
Roses Stores Inc.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Inc.
Bills Dollar Store
Merry-Go-Round Ent.
▇▇▇ ▇▇▇▇▇▇, Inc.
Solo Serve, Inc.
Gantos
31
[Republic Factors Letterhead]
March 24, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇
Gentlemen:
Reference is made to the Factoring Agreement entered into between us as
amended (the "Agreement").
This will confirm that Paragraph 6.B. of the Agreement, effective as of
the date hereof is amended as follows:
l. The minimum factoring commission on each invoice shall be $3.50,
provided, however, that no minimum per invoice commission shall apply to the
following customers:
Pamida, Inc., Hills Dept. Stores,
Laneco, Inc., Wal Mart, Shopko,
Clover Stores, J, ▇▇▇▇▇▇, ▇▇▇
Hope, Inc. and Variety
Wholesalers, Inc.
2. The increased commission for sales in excess of your regular terms
of sale shall only apply to Rainbow Shops, ▇▇▇▇▇▇ Stores and ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
when such terms of sale exceed 120 days.
Except as herein specifically provided, no other changes in the terms
and provisions of the Agreement are intended or implied.
32
▇▇▇▇▇ ▇▇▇▇, Inc.
March 24, 1995
Page 2
Kindly acknowledge your agreement to the foregoing by signing and
returning the enclosed copy of this letter.
Very truly yours,
REPUBLIC FACTORS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
Vice President
READ AND AGREED TO:
▇▇▇▇▇ ▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------
President
33
[Republic Factors Letterhead]
May 1, 1995
▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇▇▇▇▇▇▇:
Enclosed please find executed copies of ▇▇▇▇▇ ▇▇▇▇ documents for your
files.
If you have any questions please call.
Very truly yours,
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
