1
Exhibit 4.37
CAPITAL FACTORS, INC.
FACTORING AGREEMENT
Date: July 25, 1995
From: Stratford Company, a Division of
Furniture Comfort Corporation
Highway 178 West
P.O. Box 100
New Albany, MS 38652-0100
To: Capital Factors, Inc.
1799 West Oakland Park Boulevard
Fort Lauderdale, FL 33311
Gentlemen:
Upon your written acceptance, to be noted at the foot of this Agreement, the
following will state the terms and conditions under which you are to act as our
sole factor:
1. APPOINTMENT AND SALE OF ACCOUNTS: We hereby appoint you our
sole factor, and hereby sell and assign to you, making you absolute owner
thereof, all of our accounts, contract rights, and all other obligations to us
for the payment of money arising out of the sale of goods (hereinafter referred
to as "Receivables"), together with all proceeds thereof, all security and
guarantees therefor, and all of our rights to the goods and property
represented thereby. You shall have all the rights of an unpaid seller or
provider of the goods or services, the sale or rendering of which gives rise to
each Receivable, including the rights of stoppage in transit, reclamation and
replevin. Upon each sale of goods or rendering of services, we shall execute
and deliver to you such confirmatory assignments of our Receivables as you may
require, in form and manner satisfactory to you, together with copies of
invoices, all shipping or delivery receipts, and such other proof of sale and
delivery or performance as you may, at any time or from time to time, require
to effect collection of our Receivables. We shall make appropriate notations
upon our books and records indicating the sale and assignment of our
Receivables to you. All invoices or other statements to our customers
concerning Receivables shall clearly state, in language satisfactory to you,
that each such Receivable has been sold and assigned to you and is payable to
you and to you only. Copies of Receivables sold and assigned to you shall also
bear this language. During the term of this Agreement, we agree not to sell,
negotiate, pledge, assign or grant any security interest in any or all of our
Receivables to anyone other than you, except with respect to security interests
granted to Court Square Capital Limited and its successors and assigns which
security interest in Receivables shall be inferior and subordinate to your
security interest in Receivables pursuant to a Subordination Agreement to be
signed between you and Court Square Capital Limited and acknowledged by us. If
we are or become engaged in finishing or improving goods, we agree,
notwithstanding any credit approval you may have given on the customer(s)
involved, to assert promptly, at our expense and upon your demand, any lien
rights provided by law on goods in our possession; provided, that so long as
this Agreement has not been terminated for any reason and you have not declared
a breach or default of this Agreement by us, then we shall not be required to
exercise your lien rights until such Receivable is 120 days past due We will
remit to you any proceeds received from customers by us in respect to the sale
of such goods to satisfy the amounts owed to you by the owner of the finished
goods. It is understood that your credit approval is limited to the net amount
of the customer's invoice(s) obligation after the sale and disposition of such
finished goods.
2. ADDITIONAL COLLATERAL: Omitted.
2
2
3. CREDIT RISK: You will assume the credit risk only on
Receivables for which you have given credit approval in writing ("Credit
Approvals"). In the absence of such written approval from you, the Receivable
is at our risk. If we ship merchandise or provide services based on a verbal
approval, we acknowledge our responsibility to ensure that such approval is
received by us in writing in a timely manner. We acknowledge that Credit
Approvals may be withdrawn, in writing, in your discretion at any time if, in
your opinion, a customer's credit standing becomes impaired before actual
delivery of merchandise or rendering of services. Credit Approvals shall be
limited to the specific terms and amounts indicated, and, notwithstanding any
information subsequently provided to us by you, such Credit Approvals are
automatically rescinded and withdrawn if the terms of sale vary from the terms
approved by you, or if the terms of sale are changed by us without your written
Credit Approval on the new terms, or if the Receivable is not assigned to you
promptly (within five days) after creation. We further acknowledge that if we
ship merchandise or provide services to a customer who has outstanding
Receivables from us, and such customer's credit line and/or outstanding
approvals have been withdrawn by you, and the Receivables created thereby,
whether or not they are sold and assigned to you, exceed ten percent (10%) of
the amount outstanding on your books, that any Credit Approvals applying to
those Receivables outstanding on your books are cancelled and all outstanding
Receivables from that customer are at our risk. If a customer, after receiving
and accepting delivery of goods or services (subject to all warranties herein)
for which you have given written Credit Approval, fails to pay a Receivable
when due solely to financial inability to pay, you shall bear any loss thereon.
If nonpayment is due to any other reason, however, you shall not be
responsible. Specifically, you shall not be responsible for any nonpayment of
a Receivable: (a) because of the assertion of any claim or dispute by a
customer for any reason whatsoever, including, without limitation, disputes as
to price, terms of sale, delivery, quantity, quality, or other, or the exercise
of any counterclaim or offset (whether or not such claim, counterclaim or
offset relates to the specific Receivable) or; (b) where nonpayment is a
consequence of enemy attack, civil commotion, strikes, lockouts, the act or
restraint of public authorities, acts of God or force majeure; or (c) if any
representation or warranty made by us to you under this agreement pertaining to
such Receivable under this agreement has been breached in a material respect.
The assertion of a dispute by a customer shall have the effect of negating any
Credit Approval on the affected Receivable(s) and such Receivable(s) shall be
at our risk until paid or otherwise cleared from your books. With regard to
sales without Credit Approval or in excess of any Credit Approval as to any
given customer, we agree that any payments or credits applying to any
Receivables owing by such customer will be applied: first, to any
credit-approved Receivables outstanding on your books; second, to any Client
Risk Receivables (as defined in Paragraph 4 of this Agreement) outstanding on
your books; and, third, to any Receivables outstanding on our books. This
order of payment applies regardless of the respective dates the sales occurred
and regardless of any notations on payment items. If you fail to collect a
Receivable, for which you have given credit approval, within 120 days of its
maturity, and your failure to collect such Receivable is due solely to the
customer's financial inability to pay, you shall pay to us the net amount of
such Receivable then owing on the Wednesday next following the week during
which said 120 days expired. Any Receivable for freight, samples, or
miscellaneous sales (including, without limitation, the sale of merchandise
and/or in quantities not regularly sold by us) is always assigned to you at our
risk, notwithstanding any written credit approval from you. You shall have no
liability of any kind for declining or refusing to give, or for withdrawing,
revoking, or modifying, any credit approval pursuant to the terms of this
Agreement, or for exercising or failing to exercise any rights or remedies you
may have under this Agreement or otherwise. In the event you decline to give
your credit approval on any order received by us from a customer, and in
advising us of such decline you furnish us with information as to the credit
standing of the customer, such information shall be deemed to have been
requested of you by us and your advice containing such information is
recognized as a privileged communication. We agree that such information shall
not be given to our customer or to our salesman. If necessary, we shall merely
advise our customer that credit has been declined on the account and that any
questions should be directed to you.
3
3
4. CLIENT RISK RECEIVABLES: Any sale of goods or rendering of
services by us for which we have not received written Credit Approval, or for
which Credit Approval has been withdrawn or revoked, before actual delivery of
merchandise or rendering of service shall be known as a "Client Risk
Receivable." Any Client Risk Receivable(s) assigned to and purchased by you are
with recourse to us and at our sole credit risk. You shall have the right to
charge back to our account the amount of such Client Risk Receivable(s) at any
time and from time to time, either before or after maturity. We agree to pay
you on demand the full amount thereof, and, failing to do so, we agree to pay
all reasonable expenses incurred by you up to the date of such payment in
attempting to collect or enforce payment of such Receivable(s). For purposes
of determining your credit risk hereunder, the Receivable balance due you from
any given customer shall be calculated as the aggregate amount owed by that
customer less any credits to which such customer may be entitled, and is not to
be construed to mean individual invoices owed by that customer.
5. PURCHASE PRICE:
(a) The purchase price you shall pay to us for each
Receivable shall equal the Net Invoice Amount thereof less your factoring
commission, as specified below, As used herein, the term "Net Invoice Amount"
means the gross invoice amount of the Receivable, less returns (whenever made),
all selling discounts (at your option calculated on shortest terms) made
available or extended to our customer, if taken, and credits or deductions of
any kind allowed or granted to or taken by the customer at any time. Unless
specifically shown on the invoice sold and assigned to you, no discount,
credit, allowance, or deduction with respect to any Receivable shall be
granted, or approved, by us to any customer without your prior written consent.
(b) The purchase price (as computed above), less (i) any
reasonable reserves or credit balance that you, in your sole reasonable
discretion, determine to hold, (ii) monies remitted, paid, or otherwise
advanced by you to us or for our account, and (iii) any other charges to our
account provided for by this Agreement, shall be payable by you to us on a
weekly basis on the Wednesday next following the week of collection. Monies
shall be deemed to have been collected on the date of receipt thereof by you
plus three (3) days for clearing.
(c) You shall be entitled to withhold a reasonable
reserve of sums otherwise due us, and may revise the amount of such reserve at
any time and from time to time if you reasonably deem it necessary to do so in
order to protect your interests. Furthermore, at your reasonable request, we
shall maintain a credit balance ("credit balance" or "reserve" shall be defined
for purposes of this subparagraph 5(c) as credit for amounts due us and not a
"cash balance") with you in such amount as you reasonably determine to be
commensurate with the volume and character of the business conducted by us and
sufficient to protect you against all possible returns, claims of our
customers, indebtedness owing by us to you, or any other contingencies. We
shall pay you any debit balance in our account on demand.
(d) In your sole commercially reasonable discretion, in
accordance with the terms of this Agreement, you may from time to time advance
to us, against the purchase price of Receivables purchased by you hereunder,
sums up to seventy-five percent (75%) of the aggregate purchase price of
Receivables outstanding at the time any such advance is made, less: (1) Any
such Receivables that are in dispute; (2) Any such Receivables that are not
credit approved; and (3) Any fees, actual or estimated, that are chargeable to
our reserve account pursuant to this Agreement. Unless otherwise specified in
any promissory note, or loan or other agreement, executed in connection with
such advance, any such advance shall be payable on demand and shall bear
interest at the rate set forth in subparagraph (e) below from the date such
advance is made until the date you would otherwise be obligated hereunder to
pay the purchase price of the Receivable(s) against which such advance was made
or until payment is made in respect of such advance by us.
(e) Interest upon the daily net balance of any monies
remitted, paid, advanced or otherwise charged to us or for our account before
the payment date
4
4
(including any advance made pursuant to subparagraph 5(d) above), and interest
applicable to the charges or to the expenses referred to in this Agreement,
shall be charged to our reserve account as of the last day of each month at a
rate the greater of nine percent (9%) per anum or one percent (1%) above the
rate of interest designated by Capital Bank as its "Prime Rate" or "Base Rate,"
as the case may be. If, during any month, our reserve account or credit
balance, subject to the terms and conditions of this Agreement, shall be in a
net credit balance (i.e., the reserve or credit balance exceeds outstanding
Receivables), then you agree to credit our reserve account as of the last day
of each month with interest at a rate equal to three percent (3%) below the
rate of interest designated by Capital Bank as its "Prime Rate" or "Base Rate,"
as the case may be. All such interest, whether charged or credited to our
reserve account, shall be computed for the actual number of days elapsed on the
basis of a year consisting of 360 days. Any adjustment in your interest rate,
whether downward or upward, will become effective on the first day of the month
following the month in which the prime rate of interest is reduced or
increased. HOWEVER, in no event shall the rate of interest agreed to or
charged to us hereunder exceed the maximum rate of interest permitted to be
agreed to or charged to us under applicable law. IT IS THE INTENTION OF THE
PARTIES HERETO NOT TO MAKE ANY AGREEMENT VIOLATIVE OF THE LAWS OF THE STATE OF
FLORIDA OR THE UNITED STATES RELATING TO USURY. IN NO EVENT, THEREFORE, SHALL
ANY INTEREST DUE HEREUNDER BE AT A RATE IN EXCESS OF THE HIGHEST LAWFUL RATE,
i.e., IN NO EVENT SHALL YOU CHARGE OR SHALL WE BE REQUIRED TO PAY ANY INTEREST
THAT, TOGETHER WITH ANY OTHER CHARGES HEREUNDER THAT MAY BE DEEMED TO BE IN THE
NATURE OF INTEREST, HOWEVER COMPUTED, EXCEEDS THE MAXIMUM LAWFUL RATE OF
INTEREST ALLOWABLE UNDER THE LAWS OF THE STATE OF FLORIDA AND/OR OF THE UNITED
STATES. SHOULD ANY PROVISION OF THIS AGREEMENT OR ANY OTHER AGREEMENT BETWEEN
US BE CONSTRUED TO REQUIRE THE PAYMENT OF INTEREST THAT EXCEEDS SUCH MAXIMUM
LAWFUL RATE, ANY SUCH EXCESS SHALL BE AND IS EXPRESSLY HEREBY WAIVED BY YOU.
SHOULD ANY EXCESS INTEREST IN FACT BE PAID, SUCH EXCESS SHALL BE DEEMED TO BE A
PAYMENT OF THE PRINCIPAL AMOUNT OF OUTSTANDING INDEBTEDNESS OWING BY US TO YOU
AND SHALL BE APPLIED TO SUCH PRINCIPAL.
6. FACTORING COMMISSIONS.
(a) For your services hereunder, we shall pay and you
shall be entitled to receive a factoring commission equal to point fifty-five
percent (.55%) of the gross Invoice Amount of each Receivable, which commission
shall be due and payable to you on the date you purchase such Receivable.
However, factoring commission equal to point twenty five percent (.25%) of the
gross Invoice Amount of each Receivable shall be paid on sales to Sears and
Montgomery Ward. Factoring commissions shall be chargeable to our account with
you. You shall be entitled to receive a surcharge equal to one percent (1%) of
the gross Invoice Amount of all Receivables arising out of our sales to
Debtors-In-Possession. The minimum factoring commission on each invoice or
credit memo shall be $3.50.
(b) Your commission, specified in paragraph 6(a) above,
is based upon our maximum selling terms of sixty (60) days, and no more
extended terms or additional dating will be granted by us to any customer
without your prior written approval. If and when such extended terms or
additional dating are given to our customers, your commission with respect to
the Receivables represented thereby shall be increased by twenty-five percent
(25%) for each additional 30 days, or portion thereof, of extended or
additional dating.
(c) The minimum aggregate factoring commissions payable
under this Agreement for each contract year hereof shall be Five Hundred Forty
Thousand Dollars ($540,000.00), which shall be payable at the rate of
$45,000.00 per month. To the extent of any deficiency (after giving effect to
commissions payable under the foregoing
5
5
subparagraphs), the difference between the minimum and the amount already
charged shall be chargeable to our account with you.
7. STATEMENT OF ACCOUNT: Once each month, and no later than the
20th day of any such month (subject to circumstances beyond your control which
may result in a reasonable delay and for which you shall notify us of) you
shall render a statement (Client Ledger) to us with respect to the Receivables
purchased by you during the previous month, any advances made by you,
collections received by you, and charges made to our account under this
Agreement. Our account shall be charged with all discounts (at your option,
calculated on shortest terms) made available to customers on assigned
Receivables, all returns, allowances, deductions and credits, and your
reasonable expenses, including, without limitation, postage on invoices, bank
wire fees, filing fees, UCC search and similar charges. We will also be
charged with interest at the rate specified in paragraph 5(e) above, with
respect both to Receivables as to which a credit is issued after the payment
date applicable thereto, and any Receivables collected or charged back after
such credit, or to the date of collection or chargeback, as the case may be. A
discount, credit or allowance after issuance or granting may be claimed solely
by the customer. Each statement, report, or accounting rendered or issued by
you to us shall be deemed accepted by us and shall be conclusive and binding
upon us, unless within thirty (30) days after the date thereof we notify you to
the contrary by registered or certified mail, setting forth with specificity
the reasons why we believe such statement, report, or accounting is incorrect
and what we believe to be the correct amount thereof. Moreover, if we fail to
receive a monthly statement, we shall likewise be obligated to notify you in
the same manner as if we fail to accept the statement, and our failure to do so
shall relieve you of any responsibility or liability arising out of our not
receiving such monthly statement.
8. REPRESENTATIONS AND WARRANTIES: We hereby represent and
warrant to you that: (i) each Receivable is a bona fide existing obligation
created by a customer's express order for, and the actual sale and physical
delivery of, or legal passage of title to, goods or the rendering of services
to customers in the ordinary course of business, which goods, prior to sale, we
owned free and clear of any liens or encumbrances, except with respect to the
encumbrances created under the Credit Agreement with Court Square Capital
Limited, as amended (the "Credit Agreement") and which Receivable is then
unconditionally owing to us without dispute, defense, offset, or counterclaim;
(ii) the customers, which are not affiliated with us, have to the best of our
knowledge, and at the time a Receivable is created, received and have accepted
the goods or services, and the invoices therefor, without dispute, offset, or
claim of any kind as to price, terms, quality, quantity, delay in shipment,
offsets, counterclaims, contra accounts or any other defense of any other kind
and character; (iii) the Receivables will not be subject to discounts,
deductions, allowances, offsets, counterclaims or other contra items, nor to
any other special terms of payment that are not shown on the face of the
invoice thereof; (iv) the Receivables will not represent delivery of
merchandise upon "consignment," "guaranteed sale," "sale or return," "payment
on reorder," or similar terms; and (v) the Receivables will not represent
"pack, bill and hold" transactions unless we have furnished you with a copy of
our customer's purchase order soon after its receipt, and you have obtained
such customer's agreement to grant you a security interest in the merchandise
and pay for such merchandise at maturity of our invoice irrespective of whether
or not we have received instructions to deliver the same; (vi) we are solvent;
(vii) we have full right and authority to sell or assign to you, and to grant
to you a security interest in, our Receivables; (viii) we have not granted and
will not hereafter grant to any other person a security interest in, or grant
to any other person any right to purchase, our Receivables, or, without your
prior written consent, grant to any other person a security interest in any of
our inventory at any time during the term of this Agreement and until all
security interests or purchases granted hereunder have been terminated except
in connection with the Credit Agreement; and (ix) all taxes due and payable
have been paid prior to the date on which any fine, penalty or interest may be
added thereto for nonpayment thereof, except to the extent contested in good
faith by proper proceedings that stay the imposition of any lien filed against
us or our property during the term of this Agreement resulting from
non-payment; and (x) there are no judgments of assessments for the payment of
money exceeding $250,000 other than that are not fully covered by
6
6
insurance or that have been vacated, stayed, bonded, paid or discharged during
the term of this Agreement.
9. SECURITY: As collateral security for any and all of our
indebtedness and obligations to you whether matured or unmatured, absolute or
contingent, now existing or hereafter arising under this Agreement (including
under indemnity or reimbursement agreements or by subrogation), and however
acquired by you, whether arising directly between us or acquired by you by
assignment, whether relating to this Agreement or independent hereof, including
all obligations incurred by us to any other person factored or financed by you
(collectively, the "Obligations"), we do hereby grant to you a security
interest in all of our accounts, contract rights, and general intangibles,
whether or not otherwise specifically assigned to you in this Agreement, now
existing or hereafter acquired, and in the proceeds and products thereof, any
security and guarantees therefor, in the goods and property represented
thereby, in all of our books and records relating to the forgoing, and in all
reserves, credit balances, sums of money at any time to our credit with you,
and any of our property at any time in your possession. We hereby irrevocably
authorize and direct you to charge at any time to our account any Obligations.
We agree to execute financing statements and any and all other instruments and
documents that may now or hereafter be provided for by the Uniform Commercial
Code or other law applicable thereto reflecting security interests granted to
you hereunder. We hereby appoint you as our attorney-in-fact and authorize you
to sign such financing statements on our behalf as debtor or to file such
financing statements without our signature, signed only by you as secured
party. We shall be liable for, and you may charge our account with, all
reasonable costs and expenses of filing such financing statements (including
any filing or recording taxes), making lien searches, and any reasonable
attorney's fees and expenses that may be incurred by you in perfecting,
protecting, preserving, or enforcing your security interests and rights
hereunder.
10. TERM: This Agreement shall continue in full force and effect
for a period of one year from the date hereof (the "Initial Term") and shall be
deemed renewed from year to year thereafter. After the Initial Term, either
party may terminate this Agreement at any time upon thirty (30) days prior
written notice to the other party. Notwithstanding the foregoing, if we become
insolvent or unable to meet our debts as they mature, fail, close, suspend, or
go out of business, commit an act of bankruptcy, file or become the subject of
a petition under the Bankruptcy Act or law permitting the appointment of a
receiver, liquidator, conservator, or similar functionary, materially breach or
become in material default under this Agreement, or any Obligation to you, or
if there is a change (by death or otherwise) in our principal stockholders or
owners then, notwithstanding the foregoing, you shall have the right to
terminate this Agreement at any time without notice; however, you may consent
to such ownership change in your discretion which consent shall not be
unreasonably withheld. In the event you elect to terminate this Agreement, and
your decision to do so is a result of a material breach of this Agreement by
us, then, notwithstanding any other provisions contained herein, you shall be
entitled to charge our account, and we agree to pay to you, the monthly minimum
factoring fee specified in paragraph 6(c) herein for the later of ninety (90)
days from the effective date of termination or until any and all of our
indebtedness to you pursuant to this Agreement shall have been paid in full.
Your rights and our Obligations arising out of transactions having their
inception prior to the termination date shall not be affected by any
termination or notice thereof. Termination of this Agreement shall not
terminate, extinguish, or remove any liens or security interests granted to you
hereunder until we have fully paid and discharged any and all of our
Obligations to you, and we shall continue to furnish to you confirmatory
assignments and schedules of Receivables previously assigned to you and all
proceeds in respect thereof. After the giving of any notice of termination
hereunder, and until the full liquidation of our account, we shall not be
entitled to receive any payments from you. From and after the effective date
of termination, all amounts charged or chargeable to our account hereunder, and
all our Obligations to you, shall become immediately due and payable without
further notice or demand.
11. MISCELLANEOUS:
7
7
(a) Any goods rejected or returned by any customer shall
be your property held by us in trust for you separate and apart from any other
goods, and, upon your demand and in accordance with your instructions, shall
forthwith be delivered to you or disposed of by us without charge to you, with
the proceeds of such disposition to be remitted promptly to you. We shall
promptly report to you, in writing, all disputes and claims made by our
customers, the refusal of any services, and the rejection or return of or offer
to return any goods, and we will promptly and diligently prosecute, defend or
settle all such claims and disputes at our expense. WE AGREE TO PREPARE AND
ASSIGN TO YOU ALL CREDIT MEMOS TO WHICH OUR CUSTOMERS HAVE BECOME ENTITLED
SINCE THE DATE OF OUR LAST ASSIGNMENT, and our failure to do so entitles you to
charge our account with any expenses incurred by you as a result. As absolute
owner of each Receivable, you may, in your sole discretion, enforce, effect any
compromise regarding settlement, or adjust any Receivable, in your name or
ours, without affecting or limiting our obligations to you under this
Agreement, whether or not any such Receivable shall have been charged back to
us. You reserve the right at any time to charge back to our account the full
amount of the Receivable(s) involved in any claim, dispute, rejection, or
return asserted or made by our customers, and we agree to pay you upon demand
the full amount thereof. The chargeback to our account of the amount of any
such Receivable shall not be deemed a reassignment to us, and title thereto and
to the proceeds thereof, all security and guarantees therefor, and our interest
in the goods represented thereby shall remain in you. We shall indemnify you
for, and hold you harmless against, any loss, liability, claim or reasonable
expense of any kind arising from any claims of, or disputes with, our customers
as to terms, price, quality, quantity, or otherwise, relating to any
Receivable, including any claim for return or reimbursement of any payments
therefor. We agree to notify you promptly when a customer asserts a dispute or
claim of any kind, and upon your notice to us of a customer dispute or claim,
we agree to contact the customer promptly to effect a resolution of such
dispute or claim.
(b) If any check, draft, note, acceptance, cash
collection or payment in any form is received by us on any Receivable, WE SHALL
IMMEDIATELY TRANSMIT AND DELIVER IT TO YOU IN THE FORM RECEIVED, and our
failure to do so entitles you to charge our account with any reasonable
expenses incurred by you as a result. Until our delivery of each such payment
to you, it shall be held by us in trust for you. We agree that you, and any
such person or entity as you may from time to time designate, shall have the
right to sign and/or endorse our name on all remittances and all papers, bills
of lading, receipts, instruments and documents relating to the Receivables and
the transactions between us. You shall have the right to deposit any checks or
other remittances received on Receivables regardless of notations or conditions
placed thereon by our customers or deductions reflected thereby and to charge
the amount of any such deduction to our account.
(c) In the event a sales or excise tax is levied by State
or Federal authorities, in such form that you are required to pay a tax on
sales represented by any Receivable(s), we agree to reimburse you for the full
amount of taxes payable and agree that all such amounts may be charged to our
account.
(d) We agree to keep proper books of record and accounts
in accordance with sound and accepted accounting practices, which books shall
at all times be open to inspection by you. You and such accountant or other
agents as you may from time to time designate shall have the right, at our
expense, to visit and inspect our properties, assets and books, and to discuss
our affairs, finances and accounts with our officers and employees at such
reasonable times as you may designate, and to make and take away copies of our
records. We agree to do all things necessary or appropriate to permit you to
fully exercise your rights under this Paragraph. We also agree to make
available to you from time to time, upon your request, copies of our quarterly
financial statements. Unless specifically waived in writing, such financial
statements are to be provided to you on a quarterly basis.
(e) Your failure at any time to insist upon performance
of any term or provision of this Agreement shall not be deemed a waiver of any
right reserved to you,
8
8
and the waiver of one provision shall not be deemed to be a waiver of any other
provision.
(f) This Agreement is the parties' complete and final
agreement, reflects the parties' mutual understanding, supersedes any prior
agreement or understanding between the parties, and may not be modified or
amended orally. We each acknowledge that, but for the promises and
representations expressly contained in this Agreement, no other promise or
representation of any kind has been made to either party to induce each party
to execute this Agreement. Furthermore, the parties acknowledge that if any
such promise or representation has been made, neither party has relied upon it
in deciding to enter into this Agreement.
(g) This Agreement is deemed made in the State of Florida
and shall be governed, interpreted, and construed in accordance with the laws
of the State of Florida. No modification, amendment, waiver, or discharge of
this Agreement shall be binding upon either party, unless in writing and signed
by the applicable party. TRIAL BY JURY IS HEREBY WAIVED by the parties in any
action, proceeding or counterclaim brought by either party against the other on
any matters whatsoever arising out of or in any way connected with this
Agreement, or the relations created hereby, whether for contract, tort, or
otherwise, and the parties hereby consent to the jurisdiction of the courts of
the State of Florida and of any Federal Court in such state for determination
of any dispute as to any such matters. In connection therewith, the parties
hereby waive personal service of any summons, complaint, or other process, and
agree that service thereof may be made by registered or certified mail directed
to such party at its address set forth above or such other address of which
said party shall have previously notified to the other party by registered or
certified mail. In the event that you obtain counsel for the purpose of
collecting any indebtedness due you from us or seeking to enforce any right you
are entitled to under the factoring agreement, we agree to pay the reasonable
attorneys' fees and expenses (including all such fees incurred at trial and the
appellate levels) of your counsel. In addition, in the event you are sued by
us or any other party for any claim or cause of action related to or arising
under this Agreement or the factoring relationship, or you are required to
defend any suit regarding any duty you are alleged to have breached, whether in
the form of a contract duty, tort or otherwise, we agree that if you prevail at
trial or on appeal we shall be obligated to reimburse you for all of the
reasonable attorneys' fees you incur. We also agree that you may charge and/or
set off against our account all such fees and expenses as such fees or expenses
are incurred. Your books and records shall be admissible as prima facie
evidence of the status of the accounts between us. This Agreement shall be
binding upon and inure to the benefit of each of us and our respective heirs,
executors, administrators, successors and assigns, but neither party may assign
this Agreement or any of its rights hereunder to any person without the other
party's prior written consent.
(h) We agree and acknowledge that you and your authorized
representatives are engaged in the provision of factoring services pursuant to
this Agreement. By entering into this Agreement, we expressly acknowledge that
we will not seek advice or counsel from you or any of your representatives with
respect to the management and/or operation of our business, or any other entity
affiliated or controlled by us, and if we deem such advice or counsel to have
been offered, directly or indirectly, we will evaluate it and act or decline to
act upon it based upon our own careful analysis and/or the advice or counsel of
our own independent expert(s) or consultant(s). WE AGREE THAT WE WILL NOT SEEK
OR ATTEMPT TO ESTABLISH A FIDUCIARY RELATIONSHIP BETWEEN YOU AND/OR YOUR
REPRESENTATIVES AND OURSELVES, OR ANY OTHER ENTITY AFFILIATED OR CONTROLLED BY
US. WE HEREBY EXPRESSLY WAIVE ANY RIGHT TO ASSERT, NOW OR IN THE FUTURE, THAT
THERE WAS OR IS A FIDUCIARY RELATIONSHIP BETWEEN US IN ANY ACTION, PROCEEDING
OR CLAIM FOR DAMAGES.
STRATFORD COMPANY, A DIVISON OF
FURNITURE COMFORT CORPORATION
By: /s/ JOHN B. SGANGA
---------------------
John B. Sganga
Vice President
9
9
The foregoing is acknowledged, accepted and agreed to:
CAPITAL FACTORS, INC.
By: /s/ MICHAEL J. SULLIVAN
------------------------------------------
Michael J. Sullivan, Senior Vice President