FACTORING AGREEMENT

 

Date: MAY 12, 2014

 

Account No.: ______

 

Client:

FOCUS FIBER SOLUTIONS, LLC

5495 BRYSON DRIVE SUITE 423

NAPLES, FL 34109

E-mail Address: ____

Phone: 877-878-8136     Fax: 877-781-2583     Cell: _______

 

THE FOLLOWING IS THE AGREEMENT UNDER WHICH AMERIFACTORS FINANCIAL GROUP, LLC,
AGREES TO ACT AS YOUR EXCLUSIVE FACTOR.

This Factoring Agreement (this “Agreement”) is made this day by and between
AMERIFACTORS FINANCIAL GROUP, LLC, a Delaware corporation (referred to as “we”
or “us”) and FOCUS FIBER SOLUTIONS, LLC (referred to as “you”).

 

1.Assignment. You hereby sell and assign to us all of your right, title, and
interest in and to all your Accounts (as defined below), whether now existing or
that may hereafter arise, that are acceptable to us. Title and ownership of an
Account will not vest in us and will remain with you until the date we accept
the Account. “Accounts” means: (a) all of your accounts (as defined in the UCC)
that are acceptable to us and all obligations owed to you arising from or out of
the sale of merchandise or the rendition of services; (b) all of your rights to
goods, property, and merchandise represented thereby (including without
limitation returned and repossessed goods); (c) all of your rights under
insurance policies covering the services or merchandise; (d) all of your rights
against carriers of merchandise; (e) all of your defenses and rights of offset
with respect to any payments received on an Account, and all other rights of an
unpaid seller of services or merchandise; (f) all the rights of the seller of
the underlying goods and services, including all rights of replevin,
reclamation, stoppage in transit, supporting obligations, and letter of credit
rights, and (via subrogation or otherwise) all liens, guarantees, securities,
security interests, other agreements and arrangements, and supporting
obligations of whatever character held in regard to your dealings with your
customers; and (g) all proceeds of the foregoing.

 

2.Documents; Books and Records. Upon our request (and as a condition to our
purchase of an Account), you shall deliver to us a valid purchase order and
documentation sufficient to confirm your completion of services or the shipment
of ordered materials covered by the Account. You promptly shall execute and
deliver to us all shipping or delivery receipts and documents associated with
each Account and all further and confirmatory assignments of your Accounts as we
require in a form and manner satisfactory to us. Additionally, at any time and
from time to time, at our request, you shall execute and deliver to us any
document in further confirmation thereof. You shall maintain at all times and at
your expense proper books of account. We have the right to inspect and make
extracts from all your books and records at all reasonable times. You shall make
appropriate notations on your books and ledgers indicating the sale and
assignment to us of each Account.

 

3.Invoices. You shall bill and invoice all services and merchandise on a bill,
form, or invoice satisfactory to us. All invoices to customers on Accounts
assigned to us shall clearly state, in a manner satisfactory to us, that the
Account has been sold and is payable only to us.

 

4.Risk. With respect to Accounts that are approved and accepted by us, we assume
only the credit risk and are responsible only for the financial inability of
your customers to pay. That assumption of credit risk will go into effect upon
delivery and acceptance of the services and/or merchandise by your customers
without dispute and our acceptance of the Account. We are not liable in any
manner for refusing to give or withdrawing credit approval, for exercising or
for refusing to exercise any rights we have under this Agreement, or for
refusing to accept any particular Account or Account debtor.

 

5.Initial Consideration. Once we approve the purchase of an Account, we will
immediately pay you EIGHTY-FIVE percent (85%) of the “Net Sale Amount” at the
time of the approval. “Net Sale Amount” means the gross sale amount, less
discounts to customers upon shortest payment terms and less any applicable sales
or other taxes.

 

6.Additional Conditional Consideration. As additional conditional consideration
for the sale of an Account, we will, upon receipt of collection, promptly pay to
you an additional:

13.25 percent of the Net Sale Amount, if collected within 30 days from date
sold; or

12.00 percent of the Net Sale Amount, if collected in 31 to 60 days from date
sold: or

10.00 percent of the Net Sale Amount, if collected in 61 to 90 days from date
sold: or

8.50 percent of the Net Sale Amount, if collected in 91 to 105 days from date
sold; or

7.00 percent of the Net Sale Amount, if collected in 106 to 120 days from date
sold.

**ADDITIONAL 1.50% FOR EACH 15 DAY PERIOD THEREAFTER**

 

Initial: ______ Date: __________

 

 

 

  

If we collect less than the full amount of the Account, the additional
conditional consideration otherwise payable pursuant to this paragraph is
subject to any set-off taken by the Account debtor or otherwise compromised, not
collected, or forgiven by us. If we collect only a portion of the Account and
the uncollected portion of the Account exceeds the amount of the contingent part
of the purchase price specified in this paragraph, then the excess of the
uncollected portion will be set-off against and subtracted from any and all
other additional conditional consideration that would otherwise be payable to
you pursuant to this Agreement. For purposes of determining the number of
elapsed days under this paragraph, the date of the “sale” will be counted as the
first day and the date of collection will be deemed to be four banking days
after the date a check or draft drawn on a Florida bank and 4 banking days after
the date a check or draft drawn on an out-of-state bank received from an Account
debtor is deposited by us in our bank account. If we receive cash from an
Account debtor, the date of collection will be the day on which we received the
cash. If any checks are returned to us for insufficient funds or as a result of
stop payment orders and if we have paid any amounts to you, then you shall
return the payment to us upon our request. Additional conditional consideration
owed by us to you will be paid on the FRIDAY following the date we received the
cash payment on the Account or the expiration of the four-day or ten-day
collection period, as applicable. A transaction fee of $35.00 will be charged
according to the number of invoices processed during that given period.

 

7.Volume. You will sell to us $7,000,000of your Accounts (except cash sales)
generated between the date of this Agreement and MAY 12, 2015. During the term
of this Agreement, we will purchase, in the aggregate, Accounts up to
$7,000,000, subject to the other terms and conditions of this Agreement. You
agree that we are entitled to recover damages if you fail to perform your
obligations under this agreement.

 

8.Accounts Receivable Limit. The accounts receivable amount of Accounts
purchased by us from you that are unpaid at any time by your customers must not
exceed $3,000,000.

 

9.Processing Fee. You shall pay to us a processing fee of $.15 per invoice, plus
applicable postage and/or messenger fees and overnight courier charges for each
Account purchased from you. The processing fee is due and payable immediately at
the time of purchase.

 

10Authorized Representatives. You hereby appoint MICHAEL PALLESCHI OR JOHN WOOD
with full power-of-attorney to act on your behalf in regard to this Agreement
and to take any and all actions required or permitted to be taken by you
pursuant to this Agreement, and we are entitled to treat all of their actions as
being authorized by you unless and until we receive written notification from
you to the contrary.

 

11.Guarantees. This Agreement is subject to, and we have agreed to these terms
based, in part, on our receipt of the guarantees of MICHAEL PALLESCHI, JOHN WOOD
AND FTE NETWORKS, INC..

 

12.Financial Information. You shall provide us with quarterly financial
statements, prepared in conformity with generally accepted accounting principles
applied on a consistent basis, within 30 calendar days after the end of each
calendar quarter. The first quarterly financial statement is due by07/31/2014.
You also shall provide us with copies of all Internal Revenue Code Section 941
tax filings and proof of payment of taxes for the prior quarter within thirty
(30) days after the end of each calendar quarter. The first copies of Section
941 tax filings and proof of tax payment are due07/31/2014. If you fail to
provide required financial statements or Section 941 filings and proof of tax
payments as required, we may, after affording written notice of default or
breach and 10 days opportunity to cure, declare this Agreement to be terminated
and we may, in such event, recover damages due to your breach.

 

13. Term; Termination. This Agreement shall commence on the date hereof, and
shall continue until MAY 12, 2015, and automatically from year to year
thereafter, unless you give us notice in writing by certified or registered
mail, 60 calendar days before the expiration of the original term or any
subsequent renewal term, of your intention to terminate at the end of the term,
with the understanding that we may terminate this Agreement at any time upon 30
calendar days written notice to you by certified or registered mail. We may
immediately suspend our obligation to purchase additional Accounts from you or
immediately terminate this Agreement without notice if (a) there is issued or
filed against you any tax lien, (b) you commit any breach of or default in the
performance of your covenants, warranties, or representations, (c) you make any
false or untrue representation to us in connection with this Agreement or any
transaction relating to it, (d) you convene or cause to be convened a meeting of
your creditors or principal creditors or take advantage of the insolvency laws
of any jurisdiction, (e) you become unable to pay your debts as they mature,
make a general assignment for the benefit of your creditors, or suspend the
transaction of your usual business, (f) there is issued or filed against you any
attachment, injunction, execution, or judgment that is not removed within 30
calendar days after it was issued or filed, (g) a case is commenced or a
petition in bankruptcy or for an arrangement or reorganization under any
bankruptcy or insolvency laws is filed by or against you, a custodian or
receiver (or other court designee performing the functions of a receiver) is
appointed for or takes possession of your assets or affairs, or an order for
relief in a case commenced under any bankruptcy or insolvency law is entered, or
(h) you are dissolved or you or any of your direct or indirect parent companies
enters into any agreement or transaction for the sale or other transfer of a
majority of its assets (measured by fair market value) or outstanding voting
stock, whether pursuant to a sale, lease, merger, spin-off, split-up,
foreclosure, dissolution, bankruptcy, liquidation, consolidation, tender offer,
share exchange, recapitalization, reorganization, or other transaction. Our
rights and your obligations arising out of transactions having their inception
before the suspension of the purchase of Accounts or termination of this
Agreement will not be affected by any suspension of our obligations under or
termination of this Agreement. Upon any termination of this Agreement, whether
at your or our instance, all sums due from you to us shall be deemed to be
immediately due and payable to us, and after such termination any credit balance
in your favor may be held by us until a final account is rendered, unless you
furnish to us indemnity satisfactory to us against any amounts chargeable
against you under this Agreement. Notwithstanding our right to suspend the
purchase of Accounts under this Agreement, you will continue to assign to us, at
our request, additional Accounts and turn over all collections until all your
Obligations (as defined below) to us under this Agreement have been paid in
full, and until then, this Agreement will remain in full force and effect as to
and be binding on you and us, and we will be entitled to retain our security
interests in all assets granted pursuant to this Agreement. Termination of this
Agreement will not become effective until you have fully paid and discharged any
and all of your Obligations to us, matured or unmatured, absolute or contingent,
and whether arising under this Agreement or otherwise. After the giving of any
notice of termination hereunder and until the full liquidation of your
obligations under this Agreement, you will not be entitled to receive any
equities or payments from us.

 

Initial: ______ Date: __________

 

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14.Account Disputes and Adjustments. Each Account that we purchase from you is
our property and we may, in our sole discretion and at your expense, settle,
forgive, compromise, accept payments over time, or otherwise accept payment of
less than the full amount if, in our judgment, that action is appropriate to
effectuate collection (although we have no obligation to do so). Any settlement
or compromise that we make with an Account debtor will not bar or constitute a
waiver of any claims against you or your obligations to us. If any merchandise
is returned by or recovered from a customer, you shall pay to us the full amount
of the related Account (either in cash or by assignment of new Accounts), and
until that payment or assignment, you shall hold the merchandise in trust for us
for our benefit, shall keep that property segregated and identified as property
held in trust for us, and upon our reasonable request, you shall deliver the
merchandise to a place designated by us. Upon notice to you, we may sell or
cause the sale of the merchandise in accordance with applicable law and, in the
event of a public sale, we may purchase the merchandise. We may apply the
proceeds of any sale first to pay the costs and expenses associated with the
sale, and the balance, if any, will be credited to your account with us.

 

In the event any claim of set-off, discount, real or personal defenses, or
counterclaims are asserted, claimed, or alleged by an Account debtor against an
Account purchased by us, whether asserted in writing, orally, or in litigation,
then as between you and us, the burden of proof shall be on you to prove that
the claim, defense, set-off, or counterclaim is false and, as between you and
us, the presumption will be that the Account debtor is correct.

 

15.Customer Claims. You immediately shall report to us in writing (a) all claims
or disputes made by your customers, (b) the loss, return, damage, or rejection
of any merchandise, (c) any offer to return any merchandise, and (d) any request
for an extension of time to pay or request for credit or adjustment, and you
will promptly adjust all such claims and disputes; however, if you fail to do so
immediately, we may make the adjustment at your cost and expense. You shall
indemnify us against all cost, loss, expense, and liability caused by or arising
out of the rejection of goods or services or claims or deductions of every kind
and nature by your customers. We reserve the right at any time to charge back to
you the amount of the Account invoiced in any alleged dispute or claim and that
charge will be deemed a reassignment of the disputed amount of the Account to
you. However, title to the merchandise represented thereby shall remain assigned
to us regardless of notations or conditions placed thereon by your customer, and
we will continue to have a security interest in the Account and the merchandise
represented by it until the Account is fully paid, settled, or discharged or all
your Obligations to us are fully satisfied. In the event of any claim, dispute,
or reassignment, we are entitled to charge back the amount of the claim,
dispute, or reassignment to you against any additional conditional consideration
otherwise payable pursuant to this Agreement. We are also entitled to charge
interest at 18% per annum in regard to a disputed invoice and may assess a
$100.00 service charge in each case.

 

16.Collections. If you receive any cash, notes, checks, drafts, acceptances, or
collections in any form on any Accounts assigned to us, you shall hold those
amounts in trust for us (separate and apart from your own funds), and you shall
immediately transmit and deliver them to us in the identical form received. Your
failure to immediately deliver those payments to us gives us the right to demand
cash payment from you, to immediately terminate this Agreement and to collect
those funds by withholding amounts otherwise due to or held for you by us
without demand or notice, or both, among other remedies. We (and each person
that we may from time to time designate) have the absolute right and power of
attorney to act on your behalf and have the right to sign and/or endorse your
name on any and all checks, drafts, and remittances of any kind or nature where
the endorsement may be required to effect collection, and to sign and/or endorse
papers, receipts, documents, instruments, and bills of lading relating to
transactions between you and us. If, for any reason, you receive a draft, check,
or payment from any Account debtor in payment on an Account conveyed to us and
you do not immediately endorse and deliver the draft, check, or payment to us
(whether you use those funds, deposit the draft, check, or payment to your own
account, turn those funds over to another person, or otherwise), you acknowledge
that you are liable for fraud and are guilty of theft and conversion of our
property. Furthermore, In the event you do not turn over the check or other form
of payment to us, the Seller shall be subject to a misdirected payment fee equal
to 15% of the converted Account.

 

(a)“Misdirected Payment Fee” – Fifteen (15%) percent of the amount of any
payment on account of a Purchased Account which has been received by Seller and
not delivered in kind to Purchaser on the next Business Day following the date
of receipt by Seller.

 

Initial: ______ Date: __________

 

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17.Security Agreement. You and we intend for each sale of an Account to us
pursuant to this Agreement to constitute a true sale of the Account and not as a
loan from us to you. If for any reason a sale of an Account contemplated by this
Agreement is not deemed to constitute a true sale despite the parties’
intentions, and, as collateral security for any and all of your indebtedness and
obligations to us, whether matured or unmatured, absolute or contingent, now
existing or hereafter arising (including under indemnity or reimbursement
agreements or by subrogation), and however acquired by us, whether arising
directly between you and us or acquired by us by assignment, whether relating to
this Agreement or independent hereof, including all obligations incurred by you
to any other person factored or financed by us (collectively, the
“Obligations”), you grant to us a security interest in all of your assets and
property, including without limitation, the following collateral, whether the
collateral is now owned or existing or is owned, acquired, or arises hereafter,
and whether or not the property is specifically assigned to us: (a) all
Accounts, accounts receivable that have not been assigned to us, and your
contract rights and Related Security (defined below) with respect to Accounts
and other accounts receivable; (b) all your other rights to the payment of money
and payment intangibles, including without limitation amounts due from us or
from your affiliates, tax refunds, and insurance proceeds (including credit
insurance proceeds); (c) all of your interest in any returned, repossessed,
finished or unshipped goods; (d) all motor vehicles, trucks, vans, automobiles,
equipment, machinery, inventory, fixtures, furniture, unfinished goods, and
leasehold improvements, whether now owned or hereafter acquired, together will
all replacements thereof, all attachments, accessories, parts and tools
belonging thereto for the use in connection therewith, together with the
proceeds thereof, along with all insurance and insurance proceeds; (e) all of
your files, books, and records (including without limitation computer programs,
tapes, and related electronic data processing software); (f) all goods,
instruments, policies, and certificates of insurance, securities, chattel paper,
documents, deposits, deposit accounts, letter of credit rights, supporting
obligations, investment property, cash, and other property owned by you or in
which you have an interest; (g) all of your security and guarantees therefore
and in the goods and property represented thereby; (h) all your general
intangibles (including, without limitation all patents, trademarks, and
copyrights registered in the United States copyright or patent offices, together
with the good will of the business in connection with which such trademark may
be used and the royalties and other fees which become due for the use of such
patents, trademarks, or copyrights and any of your rights to retrieval from
third parties of electronically processed and recorded information pertaining to
any of the foregoing types of collateral and all software, whether or not
embedded); and (h) proceeds and products of all of the foregoing. You also grant
to us a lien and security interest in all your property now in or at any time
hereafter coming into our control, custody, or possession, whether for the
express purpose of being used by us as collateral, or for any other purpose, and
upon any balance or balances to the credit of any accounts maintained with us by
you. You hereby irrevocably authorize and direct us to charge at any time to
your account, and to pay any Obligations owing by you to us, by so charging your
account. “Related Security” means, with respect to any Account (i) all
instruments, chattel paper, and general intangibles and payment intangibles
arising from, related to, or evidencing the Account, (ii) all UCC financing
statements covering any collateral securing payment of the Account, (iii) all
records of any nature evidencing or related to the Account, including contracts,
invoices, charge slips, credit memoranda, notes, and other instruments and other
documents, books, records, and other information, and (iv) all proceeds and
amounts received or receivable arising from any of the foregoing.

 

This Agreement shall constitute a security agreement pursuant to the Uniform
Commercial Code in effect in your State (the “UCC”), and in addition to any and
all of our other rights under this Agreement, we will have all of the rights of
a secured party pursuant to the provisions of the UCC. In addition to our other
rights hereunder and as additional collateral security to us for any and all of
your Obligations to us, you shall execute a financing statement and any and all
other instruments and documents that we may now or hereafter deem to be required
or provided for by the UCC or other law applicable thereto reflecting the
security interests granted to us under this Agreement. You hereby authorize us
to file a financing statement without your signature, signed only by us as
secured party, to reflect the security interest granted to us in this Agreement
and to describe the foregoing collateral in any financing statement as “all
personal property.” Any term used in the UCC and not defined in this Agreement
has the meaning given to that term in the UCC.

 

We may hold all sums of money due to you by us (including, without limitation,
any additional conditional consideration otherwise due to you) and any of your
money or property at any time in our possession as security for any and all
Obligations now or hereafter owing to us by you, whether arising hereunder,
independently hereof, or acquired by us by assignment or otherwise,
notwithstanding that any of that money or property might have been deposited,
pledged, or delivered by you, or any other entity for any other, different, or
specific purpose. Without in any way limiting the generality of the foregoing
rights, you specifically agree that we may exercise a right of set-off against
additional conditional consideration otherwise due you or against any checks or
other funds due you that may come into our possession (whether by purchase of an
Account, by mistaken payment by your Account debtors, or otherwise), to pay
liquidated damages you may owe pursuant to this Agreement.

 

18.Survival. All warranties, representations and agreements made herein shall
survive the execution of this Agreement and each transaction made pursuant to
this Agreement.

 

19.Representations and Warranties. You make the following representations and
warranties to us, all of which are material to this Agreement and will survive
the conveyance of any or all Accounts hereunder:

 

(a)You are duly organized, validly existing, and in good standing under the laws
of DELAWARE and are duly qualified to do business and good standing in each
other jurisdiction where your ownership of property or the conduct of your
business requires that qualification, except where the failure to be so
qualified could not reasonably be expected to have a material adverse effect on
your assets or business, and your execution, delivery, and performance of this
Agreement does not and will not constitute a violation of any applicable law,
your governing documents, or a breach of any document, instrument, or agreement
to which you are a party or are bound;

 

(b)You are solvent and are the sole and absolute owner of all Accounts conveyed
hereunder, have good and clear title to those Accounts, and have full power and
legal right to sell, convey, assign, and transfer free and clear title to those
Accounts to us;

 

Initial: ______ Date: __________

 

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(c)Each and every Account now or hereafter assigned to us (i) is a valid account
and will cover a bona fide sale and delivery of goods usually dealt in by you or
the rendition by you of services to customers in the ordinary course of your
business, (ii) covers services or goods that have been received and accepted by
your customers who are not your affiliates, without claim or dispute of any kind
or nature (including any dispute or claim by a customer in whole or in part as
to price, terms, quality, quantity, delay in shipment, offsets, counterclaims,
contra accounts, or any other defense of any kind or character), (iii) will be
for an amount certain payable in United States funds in accordance with the
terms of your invoice covering the sale (which will not be changed without our
advance written approval), (iv) does not represent a delivery of merchandise on
“consignment,” “guaranteed sale,” “sale or return,” “payment on reorder,” or
similar terms, (v) does not represent a “pack, bill, and hold” transaction, and
(vi) does not arise from the sale of goods or services performed by you to any
entity that is affiliated with or controlled by you or any of your principals.

 

(d)You have not sold, pledged, assigned, hypothecated, granted a security
interest in, or otherwise encumbered the Accounts (other than pursuant to this
Agreement) and will not do so other than to us at any time during the term of
this Agreement and until its termination becomes effective;

 

(e)You have not contracted to assign and have not assigned any Account conveyed
hereunder to any other person or entity and you will not sell, factor, transfer,
pledge, or give a security interest in any of your Accounts to anyone other than
us;

 

(f)You are the sole and absolute owner of all property in which a security
interest is granted to us hereunder, have good and clear title to all property
in which you have granted to us a security interest under this Agreement, and
have full power and legal right to grant to us a security interest in your
property;

 

(g)You make no warranties, representations, or guarantees regarding the solvency
of any Account debtor on any Account conveyed hereunder, except that you have no
knowledge of any adverse financial conditions regarding any Account debtors;

 

(h)You are properly licensed and authorized to conduct your business under all
applicable laws and in the trade names you use, all of your financial books and
records are true and accurate, your business is properly insured, and you
operate your business in material compliance with all applicable local, state,
and federal laws;

 

(i)All documents to be delivered by you to us will be genuine and, to your best
knowledge, will be enforceable against your customers free and clear of any
lien, offset, deduction, counterclaim, encumbrance, or any other claim or
dispute, including without limitation, claims or disputes as to price, terms,
delivery, quantity, or quality, and claims of release from liability or because
of the requirements of law or of rules, orders, or regulations having the force
of law; and

 

(j)Neither you nor any of your direct or indirect parent companies will enter
into any agreement or transaction for the sale or other transfer of a majority
of its assets (measured by fair market value) or outstanding voting stock,
whether pursuant to a sale, lease, merger, spin-off, split-up, foreclosure,
dissolution, bankruptcy, liquidation, consolidation, tender offer, share
exchange, recapitalization, reorganization, or other transaction without our
advance written consent.

 

20.Severability. If any term or part of this Agreement is determined by a court
or arbitrator to be invalid, illegal, or unenforceable, in whole or in part, the
invalid provision will be ineffective to the extent of such prohibition without
invalidating the remaining portions of this Agreement.

 

21.Taxes Generally. You shall pay all intangible taxes, documentary stamp taxes,
UCC filing fees, sales taxes or any other taxes applicable to this Agreement or
the transactions occurring pursuant to this Agreement, except state or federal
income taxes owed by us, and shall indemnify us against any amounts paid
directly by us. We may offset against any amounts we owe to you the amount of
any taxes paid by us for which you have not indemnified or reimbursed us. Sales
taxes due to any state on any Account by an Account debtor shall, upon payment
to us, be paid over to you for remittance to the appropriate state taxing
authority. We are not responsible for the collection and payment of sales tax,
and you shall indemnify us from any liability for sales or other taxes payable
by you or an Account debtor.

 

22.Miscellaneous. This Agreement (and any related lockbox agreement) record the
entire agreement regarding the purchase of your Accounts and supersedes any
previous or contemporaneous agreement, understanding, or representation, oral or
written, by either party. A waiver, amendment, or other modification of this
Agreement will be valid and effective only if it is in writing and signed by
both parties. A delay, omission, or course of dealing on our part in exercising
any right, power, or remedy under this Agreement will not operate as a waiver of
it or any other right, power, or remedy under this Agreement, and a single or
partial exercise of any right, power, or remedy under this Agreement does not
preclude any further exercise of it, or the exercise of any other right, power,
or remedy. In addition, the written waiver by us of a right, power, or remedy
under any provision of this Agreement will not constitute a waiver of any
succeeding exercise of that right, power, or remedy or a waiver of the provision
itself. All of powers, rights, and remedies granted to us in this Agreement, any
other agreement or instrument, or by applicable law are cumulative and may be
exercised singularly or concurrently with any other powers, rights, and remedies
we might have. The validity, interpretation, construction, and enforcement of
this Agreement are governed by the laws of the State of Florida and the federal
laws of the United States of America, excluding the laws of those jurisdictions
pertaining to the resolution of conflicts with laws of other jurisdictions. In
any arbitration or litigation between the parties pertaining to this Agreement
or an Account, the losing party shall reimburse the prevailing party, on demand,
for all costs incurred by the prevailing party as a result of the arbitration or
litigation. Each party to this Agreement (a) consents to the personal
jurisdiction of the state and federal courts having jurisdiction over Orange
County, Florida, (b) stipulates that the Circuit Court for Orange County,
Florida, and the United States District Court for the Middle District of Florida
- Orlando Division, are the proper, exclusive, and convenient venues for all
trial court proceedings arising out of this Agreement, and (c) waives any
defense, whether asserted by motion or pleading, that either of those forums is
an improper or inconvenient venue. IT IS AGREED BETWEEN THE PARTIES THAT TRIAL
BY JURY IS HEREBY WAIVED IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY
EITHER OF US AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS AGREEMENT OR OUR RELATIONSHIP CREATED HEREBY. This
Agreement is binding on, and inures to the benefit of, the respective assignees
and successors of the parties to it. You may not pledge our credit for any
purpose. You shall not change your jurisdiction of organization or incorporation
without giving us at least 60 calendar days’ advance written notice of the
change. As used in this Agreement, the word “costs” includes all the fees,
costs, and expenses of experts, attorneys, mediators, arbitrators, witnesses,
and supersedes bonds, whether incurred before or after demand or commencement of
legal proceedings, and whether incurred pursuant to trial, mediation,
arbitration, bankruptcy, administrative, or judgment-execution proceedings. You
shall indemnify us and hold us harmless from and against any and all fees,
costs, claims, expenses, judgments, and liabilities (including attorneys’ fees)
that are imposed on us or threatened or asserted against us from time to time in
any way connected with this Agreement, any Account, or any collateral for your
Obligations.

 

Initial: ______ Date: __________

 

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23.The following fees will be deducted from your first funding by either Focus
Fiber Solutions, LLC or Jus-Com, Inc; Application Fee $600.00, Closing Fee
$3,500.00, and UCC Fee $160.00.

 

24.If funds are wired, a fee of $38.00 will be charged. If funds are ACH
transmitted, a fee of $6.00 will be charged.

 

APPROVED AND ACCEPTED:         Client: FOCUS FIBER SOLUTIONS, LLC.         By:
/s/ Michael Palleschi, CEO         Name     & Title:  MICHAEL PALLESCHI, CEO    
    Date: MAY                , 2014         AMERIFACTORS FINANCIAL GROUP, LLC  
      By: /s/ Kevin R. Gowen Sr. President/CEO         Name     & Title: KEVIN
R. GOWEN SR., PRESIDENT/CEO         Date: MAY                , 2014  

 

(FORM 2001) 3/00

 

1037-008^L Factoring Agreement (GRFH 6-14-05 clean)

 

Initial: ______ Date: __________

 

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FACTORING AGREEMENT

 

Date: MAY 12, 2014

 

Account No.:______

 

Client:

JUS-COM, INC. D/B/A FTE NETWORK SERVICES

5495 BRYSON DRIVE SUITE 423

NAPLES, FL 34109

E-mail Address: _________

Phone: 877-878-8136     Fax: 877-781-2583      Cell: _______

 

THE FOLLOWING IS THE AGREEMENT UNDER WHICH AMERIFACTORS FINANCIAL GROUP, LLC,
AGREES TO ACT AS YOUR EXCLUSIVE FACTOR.

 

This Factoring Agreement (this “Agreement”) is made this day by and between
AMERIFACTORS FINANCIAL GROUP, LLC, a Delaware corporation (referred to as “we”
or “us”) and JUS-COM, INC D/B/A FTE NETWORK SERVICES (referred to as “you”).

 

1.Assignment. You hereby sell and assign to us all of your right, title, and
interest in and to all your Accounts (as defined below), whether now existing or
that may hereafter arise, that are acceptable to us. Title and ownership of an
Account will not vest in us and will remain with you until the date we accept
the Account. “Accounts” means: (a) all of your accounts (as defined in the UCC)
that are acceptable to us and all obligations owed to you arising from or out of
the sale of merchandise or the rendition of services; (b) all of your rights to
goods, property, and merchandise represented thereby (including without
limitation returned and repossessed goods); (c) all of your rights under
insurance policies covering the services or merchandise; (d) all of your rights
against carriers of merchandise; (e) all of your defenses and rights of offset
with respect to any payments received on an Account, and all other rights of an
unpaid seller of services or merchandise; (f) all the rights of the seller of
the underlying goods and services, including all rights of replevin,
reclamation, stoppage in transit, supporting obligations, and letter of credit
rights, and (via subrogation or otherwise) all liens, guarantees, securities,
security interests, other agreements and arrangements, and supporting
obligations of whatever character held in regard to your dealings with your
customers; and (g) all proceeds of the foregoing.

 

2.Documents; Books and Records. Upon our request (and as a condition to our
purchase of an Account), you shall deliver to us a valid purchase order and
documentation sufficient to confirm your completion of services or the shipment
of ordered materials covered by the Account. You promptly shall execute and
deliver to us all shipping or delivery receipts and documents associated with
each Account and all further and confirmatory assignments of your Accounts as we
require in a form and manner satisfactory to us. Additionally, at any time and
from time to time, at our request, you shall execute and deliver to us any
document in further confirmation thereof. You shall maintain at all times and at
your expense proper books of account. We have the right to inspect and make
extracts from all your books and records at all reasonable times. You shall make
appropriate notations on your books and ledgers indicating the sale and
assignment to us of each Account.

 

3.Invoices. You shall bill and invoice all services and merchandise on a bill,
form, or invoice satisfactory to us. All invoices to customers on Accounts
assigned to us shall clearly state, in a manner satisfactory to us, that the
Account has been sold and is payable only to us.

 

4.Risk. With respect to Accounts that are approved and accepted by us, we assume
only the credit risk and are responsible only for the financial inability of
your customers to pay. That assumption of credit risk will go into effect upon
delivery and acceptance of the services and/or merchandise by your customers
without dispute and our acceptance of the Account. We are not liable in any
manner for refusing to give or withdrawing credit approval, for exercising or
for refusing to exercise any rights we have under this Agreement, or for
refusing to accept any particular Account or Account debtor.

 

5.Initial Consideration. Once we approve the purchase of an Account, we will
immediately pay you EIGHTY-FIVE percent (85%) of the “Net Sale Amount” at the
time of the approval. “Net Sale Amount” means the gross sale amount, less
discounts to customers upon shortest payment terms and less any applicable sales
or other taxes.

 

6.Additional Conditional Consideration. As additional conditional consideration
for the sale of an Account, we will, upon receipt of collection, promptly pay to
you an additional:

13.25 percent of the Net Sale Amount, if collected within 30 days from date
sold; or

12.00 percent of the Net Sale Amount, if collected in 31 to 60 days from date
sold: or

10.00 percent of the Net Sale Amount, if collected in 61 to 90 days from date
sold: or

8.50 percent of the Net Sale Amount, if collected in 91 to 105 days from date
sold; or

7.00 percent of the Net Sale Amount, if collected in 106 to 120 days from date
sold.

**ADDITIONAL 1.50% FOR EACH 15 DAY PERIOD THEREAFTER**

 

Initial: ______ Date: __________

 

 

 

  

If we collect less than the full amount of the Account, the additional
conditional consideration otherwise payable pursuant to this paragraph is
subject to any set-off taken by the Account debtor or otherwise compromised, not
collected, or forgiven by us. If we collect only a portion of the Account and
the uncollected portion of the Account exceeds the amount of the contingent part
of the purchase price specified in this paragraph, then the excess of the
uncollected portion will be set-off against and subtracted from any and all
other additional conditional consideration that would otherwise be payable to
you pursuant to this Agreement. For purposes of determining the number of
elapsed days under this paragraph, the date of the “sale” will be counted as the
first day and the date of collection will be deemed to be four banking days
after the date a check or draft drawn on a Florida bank and 4 banking days after
the date a check or draft drawn on an out-of-state bank received from an Account
debtor is deposited by us in our bank account. If we receive cash from an
Account debtor, the date of collection will be the day on which we received the
cash. If any checks are returned to us for insufficient funds or as a result of
stop payment orders and if we have paid any amounts to you, then you shall
return the payment to us upon our request. Additional conditional consideration
owed by us to you will be paid on the FRIDAY following the date we received the
cash payment on the Account or the expiration of the four-day or ten-day
collection period, as applicable. A transaction fee of $35.00 will be charged
according to the number of invoices processed during that given period.

 

7.Volume. You will sell to us $7,000,000of your Accounts (except cash sales)
generated between the date of this Agreement and MAY 12, 2015. During the term
of this Agreement, we will purchase, in the aggregate, Accounts up to
$7,000,000, subject to the other terms and conditions of this Agreement. You
agree that we are entitled to recover damages if you fail to perform your
obligations under this agreement.

 

8.Accounts Receivable Limit. The accounts receivable amount of Accounts
purchased by us from you that are unpaid at any time by your customers must not
exceed $3,000,000.

 

9.Processing Fee. You shall pay to us a processing fee of $.15 per invoice, plus
applicable postage and/or messenger fees and overnight courier charges for each
Account purchased from you. The processing fee is due and payable immediately at
the time of purchase.

 

10Authorized Representatives. You hereby appoint MICHAEL PALLESCHI OR JOHN WOOD
with full power-of-attorney to act on your behalf in regard to this Agreement
and to take any and all actions required or permitted to be taken by you
pursuant to this Agreement, and we are entitled to treat all of their actions as
being authorized by you unless and until we receive written notification from
you to the contrary.

 

11.Guarantees. This Agreement is subject to, and we have agreed to these terms
based, in part, on our receipt of the guarantees of MICHAEL PALLESCHI, JOHN WOOD
AND FTE NETWORKS, INC..

 

12.Financial Information. You shall provide us with quarterly financial
statements, prepared in conformity with generally accepted accounting principles
applied on a consistent basis, within 30 calendar days after the end of each
calendar quarter. The first quarterly financial statement is due by07/31/2014.
You also shall provide us with copies of all Internal Revenue Code Section 941
tax filings and proof of payment of taxes for the prior quarter within thirty
(30) days after the end of each calendar quarter. The first copies of Section
941 tax filings and proof of tax payment are due07/31/2014. If you fail to
provide required financial statements or Section 941 filings and proof of tax
payments as required, we may, after affording written notice of default or
breach and 10 days opportunity to cure, declare this Agreement to be terminated
and we may, in such event, recover damages due to your breach.

 

13. Term; Termination. This Agreement shall commence on the date hereof, and
shall continue until MAY 12, 2015, and automatically from year to year
thereafter, unless you give us notice in writing by certified or registered
mail, 60 calendar days before the expiration of the original term or any
subsequent renewal term, of your intention to terminate at the end of the term,
with the understanding that we may terminate this Agreement at any time upon 30
calendar days written notice to you by certified or registered mail. We may
immediately suspend our obligation to purchase additional Accounts from you or
immediately terminate this Agreement without notice if (a) there is issued or
filed against you any tax lien, (b) you commit any breach of or default in the
performance of your covenants, warranties, or representations, (c) you make any
false or untrue representation to us in connection with this Agreement or any
transaction relating to it, (d) you convene or cause to be convened a meeting of
your creditors or principal creditors or take advantage of the insolvency laws
of any jurisdiction, (e) you become unable to pay your debts as they mature,
make a general assignment for the benefit of your creditors, or suspend the
transaction of your usual business, (f) there is issued or filed against you any
attachment, injunction, execution, or judgment that is not removed within 30
calendar days after it was issued or filed, (g) a case is commenced or a
petition in bankruptcy or for an arrangement or reorganization under any
bankruptcy or insolvency laws is filed by or against you, a custodian or
receiver (or other court designee performing the functions of a receiver) is
appointed for or takes possession of your assets or affairs, or an order for
relief in a case commenced under any bankruptcy or insolvency law is entered, or
(h) you are dissolved or you or any of your direct or indirect parent companies
enters into any agreement or transaction for the sale or other transfer of a
majority of its assets (measured by fair market value) or outstanding voting
stock, whether pursuant to a sale, lease, merger, spin-off, split-up,
foreclosure, dissolution, bankruptcy, liquidation, consolidation, tender offer,
share exchange, recapitalization, reorganization, or other transaction. Our
rights and your obligations arising out of transactions having their inception
before the suspension of the purchase of Accounts or termination of this
Agreement will not be affected by any suspension of our obligations under or
termination of this Agreement. Upon any termination of this Agreement, whether
at your or our instance, all sums due from you to us shall be deemed to be
immediately due and payable to us, and after such termination any credit balance
in your favor may be held by us until a final account is rendered, unless you
furnish to us indemnity satisfactory to us against any amounts chargeable
against you under this Agreement. Notwithstanding our right to suspend the
purchase of Accounts under this Agreement, you will continue to assign to us, at
our request, additional Accounts and turn over all collections until all your
Obligations (as defined below) to us under this Agreement have been paid in
full, and until then, this Agreement will remain in full force and effect as to
and be binding on you and us, and we will be entitled to retain our security
interests in all assets granted pursuant to this Agreement. Termination of this
Agreement will not become effective until you have fully paid and discharged any
and all of your Obligations to us, matured or unmatured, absolute or contingent,
and whether arising under this Agreement or otherwise. After the giving of any
notice of termination hereunder and until the full liquidation of your
obligations under this Agreement, you will not be entitled to receive any
equities or payments from us.

 

Initial: ______ Date: __________

 

2

 

  

14.Account Disputes and Adjustments. Each Account that we purchase from you is
our property and we may, in our sole discretion and at your expense, settle,
forgive, compromise, accept payments over time, or otherwise accept payment of
less than the full amount if, in our judgment, that action is appropriate to
effectuate collection (although we have no obligation to do so). Any settlement
or compromise that we make with an Account debtor will not bar or constitute a
waiver of any claims against you or your obligations to us. If any merchandise
is returned by or recovered from a customer, you shall pay to us the full amount
of the related Account (either in cash or by assignment of new Accounts), and
until that payment or assignment, you shall hold the merchandise in trust for us
for our benefit, shall keep that property segregated and identified as property
held in trust for us, and upon our reasonable request, you shall deliver the
merchandise to a place designated by us. Upon notice to you, we may sell or
cause the sale of the merchandise in accordance with applicable law and, in the
event of a public sale, we may purchase the merchandise. We may apply the
proceeds of any sale first to pay the costs and expenses associated with the
sale, and the balance, if any, will be credited to your account with us.

 

In the event any claim of set-off, discount, real or personal defenses, or
counterclaims are asserted, claimed, or alleged by an Account debtor against an
Account purchased by us, whether asserted in writing, orally, or in litigation,
then as between you and us, the burden of proof shall be on you to prove that
the claim, defense, set-off, or counterclaim is false and, as between you and
us, the presumption will be that the Account debtor is correct.

 

15.Customer Claims. You immediately shall report to us in writing (a) all claims
or disputes made by your customers, (b) the loss, return, damage, or rejection
of any merchandise, (c) any offer to return any merchandise, and (d) any request
for an extension of time to pay or request for credit or adjustment, and you
will promptly adjust all such claims and disputes; however, if you fail to do so
immediately, we may make the adjustment at your cost and expense. You shall
indemnify us against all cost, loss, expense, and liability caused by or arising
out of the rejection of goods or services or claims or deductions of every kind
and nature by your customers. We reserve the right at any time to charge back to
you the amount of the Account invoiced in any alleged dispute or claim and that
charge will be deemed a reassignment of the disputed amount of the Account to
you. However, title to the merchandise represented thereby shall remain assigned
to us regardless of notations or conditions placed thereon by your customer, and
we will continue to have a security interest in the Account and the merchandise
represented by it until the Account is fully paid, settled, or discharged or all
your Obligations to us are fully satisfied. In the event of any claim, dispute,
or reassignment, we are entitled to charge back the amount of the claim,
dispute, or reassignment to you against any additional conditional consideration
otherwise payable pursuant to this Agreement. We are also entitled to charge
interest at 18% per annum in regard to a disputed invoice and may assess a
$100.00 service charge in each case.

 

16.Collections. If you receive any cash, notes, checks, drafts, acceptances, or
collections in any form on any Accounts assigned to us, you shall hold those
amounts in trust for us (separate and apart from your own funds), and you shall
immediately transmit and deliver them to us in the identical form received. Your
failure to immediately deliver those payments to us gives us the right to demand
cash payment from you, to immediately terminate this Agreement and to collect
those funds by withholding amounts otherwise due to or held for you by us
without demand or notice, or both, among other remedies. We (and each person
that we may from time to time designate) have the absolute right and power of
attorney to act on your behalf and have the right to sign and/or endorse your
name on any and all checks, drafts, and remittances of any kind or nature where
the endorsement may be required to effect collection, and to sign and/or endorse
papers, receipts, documents, instruments, and bills of lading relating to
transactions between you and us. If, for any reason, you receive a draft, check,
or payment from any Account debtor in payment on an Account conveyed to us and
you do not immediately endorse and deliver the draft, check, or payment to us
(whether you use those funds, deposit the draft, check, or payment to your own
account, turn those funds over to another person, or otherwise), you acknowledge
that you are liable for fraud and are guilty of theft and conversion of our
property. Furthermore, In the event you do not turn over the check or other form
of payment to us, the Seller shall be subject to a misdirected payment fee equal
to 15% of the converted Account.

 

(a)“Misdirected Payment Fee” – Fifteen (15%) percent of the amount of any
payment on account of a Purchased Account which has been received by Seller and
not delivered in kind to Purchaser on the next Business Day following the date
of receipt by Seller.

 

Initial: ______ Date: __________

 

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17.Security Agreement. You and we intend for each sale of an Account to us
pursuant to this Agreement to constitute a true sale of the Account and not as a
loan from us to you. If for any reason a sale of an Account contemplated by this
Agreement is not deemed to constitute a true sale despite the parties’
intentions, and, as collateral security for any and all of your indebtedness and
obligations to us, whether matured or unmatured, absolute or contingent, now
existing or hereafter arising (including under indemnity or reimbursement
agreements or by subrogation), and however acquired by us, whether arising
directly between you and us or acquired by us by assignment, whether relating to
this Agreement or independent hereof, including all obligations incurred by you
to any other person factored or financed by us (collectively, the
“Obligations”), you grant to us a security interest in all of your assets and
property, including without limitation, the following collateral, whether the
collateral is now owned or existing or is owned, acquired, or arises hereafter,
and whether or not the property is specifically assigned to us: (a) all
Accounts, accounts receivable that have not been assigned to us, and your
contract rights and Related Security (defined below) with respect to Accounts
and other accounts receivable; (b) all your other rights to the payment of money
and payment intangibles, including without limitation amounts due from us or
from your affiliates, tax refunds, and insurance proceeds (including credit
insurance proceeds); (c) all of your interest in any returned, repossessed,
finished or unshipped goods; (d) all motor vehicles, trucks, vans, automobiles,
equipment, machinery, inventory, fixtures, furniture, unfinished goods, and
leasehold improvements, whether now owned or hereafter acquired, together will
all replacements thereof, all attachments, accessories, parts and tools
belonging thereto for the use in connection therewith, together with the
proceeds thereof, along with all insurance and insurance proceeds; (e) all of
your files, books, and records (including without limitation computer programs,
tapes, and related electronic data processing software); (f) all goods,
instruments, policies, and certificates of insurance, securities, chattel paper,
documents, deposits, deposit accounts, letter of credit rights, supporting
obligations, investment property, cash, and other property owned by you or in
which you have an interest; (g) all of your security and guarantees therefore
and in the goods and property represented thereby; (h) all your general
intangibles (including, without limitation all patents, trademarks, and
copyrights registered in the United States copyright or patent offices, together
with the good will of the business in connection with which such trademark may
be used and the royalties and other fees which become due for the use of such
patents, trademarks, or copyrights and any of your rights to retrieval from
third parties of electronically processed and recorded information pertaining to
any of the foregoing types of collateral and all software, whether or not
embedded); and (h) proceeds and products of all of the foregoing. You also grant
to us a lien and security interest in all your property now in or at any time
hereafter coming into our control, custody, or possession, whether for the
express purpose of being used by us as collateral, or for any other purpose, and
upon any balance or balances to the credit of any accounts maintained with us by
you. You hereby irrevocably authorize and direct us to charge at any time to
your account, and to pay any Obligations owing by you to us, by so charging your
account. “Related Security” means, with respect to any Account (i) all
instruments, chattel paper, and general intangibles and payment intangibles
arising from, related to, or evidencing the Account, (ii) all UCC financing
statements covering any collateral securing payment of the Account, (iii) all
records of any nature evidencing or related to the Account, including contracts,
invoices, charge slips, credit memoranda, notes, and other instruments and other
documents, books, records, and other information, and (iv) all proceeds and
amounts received or receivable arising from any of the foregoing.

 

This Agreement shall constitute a security agreement pursuant to the Uniform
Commercial Code in effect in your State (the “UCC”), and in addition to any and
all of our other rights under this Agreement, we will have all of the rights of
a secured party pursuant to the provisions of the UCC. In addition to our other
rights hereunder and as additional collateral security to us for any and all of
your Obligations to us, you shall execute a financing statement and any and all
other instruments and documents that we may now or hereafter deem to be required
or provided for by the UCC or other law applicable thereto reflecting the
security interests granted to us under this Agreement. You hereby authorize us
to file a financing statement without your signature, signed only by us as
secured party, to reflect the security interest granted to us in this Agreement
and to describe the foregoing collateral in any financing statement as “all
personal property.” Any term used in the UCC and not defined in this Agreement
has the meaning given to that term in the UCC.

 

We may hold all sums of money due to you by us (including, without limitation,
any additional conditional consideration otherwise due to you) and any of your
money or property at any time in our possession as security for any and all
Obligations now or hereafter owing to us by you, whether arising hereunder,
independently hereof, or acquired by us by assignment or otherwise,
notwithstanding that any of that money or property might have been deposited,
pledged, or delivered by you, or any other entity for any other, different, or
specific purpose. Without in any way limiting the generality of the foregoing
rights, you specifically agree that we may exercise a right of set-off against
additional conditional consideration otherwise due you or against any checks or
other funds due you that may come into our possession (whether by purchase of an
Account, by mistaken payment by your Account debtors, or otherwise), to pay
liquidated damages you may owe pursuant to this Agreement.

 

18.Survival. All warranties, representations and agreements made herein shall
survive the execution of this Agreement and each transaction made pursuant to
this Agreement.

 

19.Representations and Warranties. You make the following representations and
warranties to us, all of which are material to this Agreement and will survive
the conveyance of any or all Accounts hereunder:

 

(a)You are duly organized, validly existing, and in good standing under the laws
of INDIANA and are duly qualified to do business and good standing in each other
jurisdiction where your ownership of property or the conduct of your business
requires that qualification, except where the failure to be so qualified could
not reasonably be expected to have a material adverse effect on your assets or
business, and your execution, delivery, and performance of this Agreement does
not and will not constitute a violation of any applicable law, your governing
documents, or a breach of any document, instrument, or agreement to which you
are a party or are bound;

 

(b)You are solvent and are the sole and absolute owner of all Accounts conveyed
hereunder, have good and clear title to those Accounts, and have full power and
legal right to sell, convey, assign, and transfer free and clear title to those
Accounts to us;

 

Initial: ______ Date: __________

 

4

 

  

(c)Each and every Account now or hereafter assigned to us (i) is a valid account
and will cover a bona fide sale and delivery of goods usually dealt in by you or
the rendition by you of services to customers in the ordinary course of your
business, (ii) covers services or goods that have been received and accepted by
your customers who are not your affiliates, without claim or dispute of any kind
or nature (including any dispute or claim by a customer in whole or in part as
to price, terms, quality, quantity, delay in shipment, offsets, counterclaims,
contra accounts, or any other defense of any kind or character), (iii) will be
for an amount certain payable in United States funds in accordance with the
terms of your invoice covering the sale (which will not be changed without our
advance written approval), (iv) does not represent a delivery of merchandise on
“consignment,” “guaranteed sale,” “sale or return,” “payment on reorder,” or
similar terms, (v) does not represent a “pack, bill, and hold” transaction, and
(vi) does not arise from the sale of goods or services performed by you to any
entity that is affiliated with or controlled by you or any of your principals.

 

(d)You have not sold, pledged, assigned, hypothecated, granted a security
interest in, or otherwise encumbered the Accounts (other than pursuant to this
Agreement) and will not do so other than to us at any time during the term of
this Agreement and until its termination becomes effective;

 

(e)You have not contracted to assign and have not assigned any Account conveyed
hereunder to any other person or entity and you will not sell, factor, transfer,
pledge, or give a security interest in any of your Accounts to anyone other than
us;

 

(f)You are the sole and absolute owner of all property in which a security
interest is granted to us hereunder, have good and clear title to all property
in which you have granted to us a security interest under this Agreement, and
have full power and legal right to grant to us a security interest in your
property;

 

(g)You make no warranties, representations, or guarantees regarding the solvency
of any Account debtor on any Account conveyed hereunder, except that you have no
knowledge of any adverse financial conditions regarding any Account debtors;

 

(h)You are properly licensed and authorized to conduct your business under all
applicable laws and in the trade names you use, all of your financial books and
records are true and accurate, your business is properly insured, and you
operate your business in material compliance with all applicable local, state,
and federal laws;

 

(i)All documents to be delivered by you to us will be genuine and, to your best
knowledge, will be enforceable against your customers free and clear of any
lien, offset, deduction, counterclaim, encumbrance, or any other claim or
dispute, including without limitation, claims or disputes as to price, terms,
delivery, quantity, or quality, and claims of release from liability or because
of the requirements of law or of rules, orders, or regulations having the force
of law; and

 

(j)Neither you nor any of your direct or indirect parent companies will enter
into any agreement or transaction for the sale or other transfer of a majority
of its assets (measured by fair market value) or outstanding voting stock,
whether pursuant to a sale, lease, merger, spin-off, split-up, foreclosure,
dissolution, bankruptcy, liquidation, consolidation, tender offer, share
exchange, recapitalization, reorganization, or other transaction without our
advance written consent.

 

20.Severability. If any term or part of this Agreement is determined by a court
or arbitrator to be invalid, illegal, or unenforceable, in whole or in part, the
invalid provision will be ineffective to the extent of such prohibition without
invalidating the remaining portions of this Agreement.

 

21.Taxes Generally. You shall pay all intangible taxes, documentary stamp taxes,
UCC filing fees, sales taxes or any other taxes applicable to this Agreement or
the transactions occurring pursuant to this Agreement, except state or federal
income taxes owed by us, and shall indemnify us against any amounts paid
directly by us. We may offset against any amounts we owe to you the amount of
any taxes paid by us for which you have not indemnified or reimbursed us. Sales
taxes due to any state on any Account by an Account debtor shall, upon payment
to us, be paid over to you for remittance to the appropriate state taxing
authority. We are not responsible for the collection and payment of sales tax,
and you shall indemnify us from any liability for sales or other taxes payable
by you or an Account debtor.

 

22.Miscellaneous. This Agreement (and any related lockbox agreement) record the
entire agreement regarding the purchase of your Accounts and supersedes any
previous or contemporaneous agreement, understanding, or representation, oral or
written, by either party. A waiver, amendment, or other modification of this
Agreement will be valid and effective only if it is in writing and signed by
both parties. A delay, omission, or course of dealing on our part in exercising
any right, power, or remedy under this Agreement will not operate as a waiver of
it or any other right, power, or remedy under this Agreement, and a single or
partial exercise of any right, power, or remedy under this Agreement does not
preclude any further exercise of it, or the exercise of any other right, power,
or remedy. In addition, the written waiver by us of a right, power, or remedy
under any provision of this Agreement will not constitute a waiver of any
succeeding exercise of that right, power, or remedy or a waiver of the provision
itself. All of powers, rights, and remedies granted to us in this Agreement, any
other agreement or instrument, or by applicable law are cumulative and may be
exercised singularly or concurrently with any other powers, rights, and remedies
we might have. The validity, interpretation, construction, and enforcement of
this Agreement are governed by the laws of the State of Florida and the federal
laws of the United States of America, excluding the laws of those jurisdictions
pertaining to the resolution of conflicts with laws of other jurisdictions. In
any arbitration or litigation between the parties pertaining to this Agreement
or an Account, the losing party shall reimburse the prevailing party, on demand,
for all costs incurred by the prevailing party as a result of the arbitration or
litigation. Each party to this Agreement (a) consents to the personal
jurisdiction of the state and federal courts having jurisdiction over Orange
County, Florida, (b) stipulates that the Circuit Court for Orange County,
Florida, and the United States District Court for the Middle District of Florida
- Orlando Division, are the proper, exclusive, and convenient venues for all
trial court proceedings arising out of this Agreement, and (c) waives any
defense, whether asserted by motion or pleading, that either of those forums is
an improper or inconvenient venue. IT IS AGREED BETWEEN THE PARTIES THAT TRIAL
BY JURY IS HEREBY WAIVED IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY
EITHER OF US AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS AGREEMENT OR OUR RELATIONSHIP CREATED HEREBY. This
Agreement is binding on, and inures to the benefit of, the respective assignees
and successors of the parties to it. You may not pledge our credit for any
purpose. You shall not change your jurisdiction of organization or incorporation
without giving us at least 60 calendar days’ advance written notice of the
change. As used in this Agreement, the word “costs” includes all the fees,
costs, and expenses of experts, attorneys, mediators, arbitrators, witnesses,
and supersedes bonds, whether incurred before or after demand or commencement of
legal proceedings, and whether incurred pursuant to trial, mediation,
arbitration, bankruptcy, administrative, or judgment-execution proceedings. You
shall indemnify us and hold us harmless from and against any and all fees,
costs, claims, expenses, judgments, and liabilities (including attorneys’ fees)
that are imposed on us or threatened or asserted against us from time to time in
any way connected with this Agreement, any Account, or any collateral for your
Obligations.

 

Initial: ______ Date: __________

 

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23.The following fees will be deducted from your first funding by either Focus
Fiber Solutions, LLC or Jus-Com, Inc; Application Fee $600.00, Closing Fee
$3,500.00, and UCC Fee $160.00.

 

24. If funds are wired, a fee of $38.00 will be charged. If funds are ACH
transmitted, a fee of $6.00 will be charged.

 

APPROVED AND ACCEPTED:         Client: JUS-COM, INC D/B/A FTE NETWORK SERVICES  
      By: /s/ Michael Palleschi, CEO         Name     & Title: MICHAEL
PALLESCHI, CEO         Date: MAY             , 2014         AMERIFACTORS
FINANCIAL GROUP, LLC         By: /s/ Kevin R. Gowen Sr. President/CEO        
Name     & Title: KEVIN R. GOWEN SR., PRESIDENT/CEO         Date:
MAY             , 2014  

 

(FORM 2001) 3/00

 

1037-008^L Factoring Agreement (GRFH 6-14-05 clean)

 

Initial: ______ Date: __________

 

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