**                                     Capital-PlusPartners, LLC.**

*                 A Financial Services Company*

                   7620 Olentangy River Road

                                                                                                         Columbus, Ohio PostalCode43235

                                                                                                                  (614) 848-7620/841-3856 Fax

  

  

**FACTORING AGREEMENT**

  

  

THISFACTORING AGREEMENT ("Agreement") made between LBO Capital Corp. a CO Corporation,  having its principal place of

business at addressStreet23399 Commerce Dr, Ste B-1,Farmington Hills, MI PostalCode48335 (“Seller”) and Capital-Plus Partners, LLC, anOhio corporation

 having its  place of business at the address shown above (“Purchaser”).     

 

   

I.

PURCHASE OF ACCOUNTS. Seller hereby sells, transfersand assigns to Purchaser, and Purchaser purchases as absolute

owner. all Seller's accounts receivable created by or arising from Seller's sales of goods or rendition of services ("Accounts") which are credit approved and accepted by Purchaser as provided in Section 2 of this Agreement. "Accounts" shall include without

Iimitation all Accounts arising from sales made or services rendered under any of trade name or style, or by any of division, of Seller. Following such purchase, the rights and obligations of the parties shall be as set forth in this Agreement.

2.

CREDIT APPROVAL AND ACCEPTANCE. Except as otherwise expressly agreed by the parties hereto in writing,

Selleragrees to submit to Purchaser for credit approval and purchase all invoices, without exception, for Seller's goods or services as such invoices are issued, together with such credit information concerning its customers named in said invoices ("customer" or "customers") as Seller may have. Purchaser will promptly review such invoices, make its credit decision with respect thereto (including any limitation on the total factoring exposure Purchaser is willing to accept with respect to Seller) and notify Seller with respect to which Accountsif' any, evidenced by such invoices will be purchased hereunder. Purchaser's purchase of the Account which is the subject of a particular invoice will be evidenced by delivery to Seller (by mail, facsimile or electronic transmission) of a Schedule of Factored Accounts substantially similar to ExhibitA hereto or by such other means that provides a permanent record as

hall be convenient to the parties. Without Purchaser's prior written consent, (i) Seller will not change the amount, terms or shipping dates0 r any in voice once it has been submitted for credit approval and purchase hereunder, nor will Seller grant any other indulgence with respect thereto, and (ii) Seller will not enter into any C.O.D. or pre-paid transactions with its customers whose accounts are being factored or serviced by Purchaser under this Agreement Credit approval with respect to any invoice may be withdrawn by Purchaserat any time in which event Seller shall upon Purchaser's demand pay to Purchaser the unpaid balance of any Advance (as defined below) made with respect thereto together with any interest, commissions01' other charges then due Purchaser. Purchaser shall have no liability whatsoever to Seller or to any person or firm for not approving, or withholding or withdrawing approval of any credit to any customer.

  

3. PURCHASE PRICE AND COMMISSIONS, Purchaser shall purchase Accounts for a price equal to the gross amount of the purchased Account as shown in its respective invoice, including postage, freight and other similar charges (the "Purchase Price"). Trade and cash discounts shown on the invoice and any other credits and allowances granted or made in accordance with this i\greell1ent shall, when taken by01" granted to the customer, be deducted from the unpaid Purchase Price. The Purchase Price for each purchased Account shall be posted to Seller's account with Purchaser and shall be payable to Seller, when the underlying Account is paid in full by the customer, less (i) all commissions, discounts, interest, service charges and other amounts if any, due Purchaser hereunder and (ii) any deductions for discounts or allowances to the customer.

  

4... NOTIFICATION ON INVOICES; PAYMENT TO LOCK B0X. All Seller's invoices evidencing Accounts sold to Purchaser hereunder shall bear a notice in form andsubstance satisfactory to Purchaser that the Account has been assigned to, is owned by and is payableill United States dollars to, Purchaser. Such notice shall without exception instruct the customer to direct all its paymentsto Purchaser's lockbox. All such invoices shall be mailed by Seller to Seller's customers at Seller's expense. Any checks, cash" notes or other instruments or property received by Seller with respect to any Account shall not be negotiated or deposited and shall be held by Sellerin trust for Purchaser separate from Seller's own property and funds, and be immediatelyturned over to Purchaser with proper assignments or endorsements. Seller will give Purchaser copies of all invoices with such confirmation of the transfer of Accounts to Purchaser and such proof of shipment or delivery,0.1.' performance of services, as Purchaser may require, Purchaser is authorized to regard Seller's printed name or rubber stamp signature on submissions for credit approval andpurchaseinvoices (whether originals or copies, including facsimile copies), as the equivalent of a manual signatureby one of Seller's authorized officers or agents. Should Seller for any reason defer shipment of goods which Seller has sold and invoiced toa customer, Seller will: :'0 note 011 the copies of invoices submitted to Purchaser; submit all other relevant details to Purchaser; and comply with any conditions Purchaser deems necessary as a prerequisite to Purchaser's purchasing or servicing such Accounts. Seller may note on invoicesnot purchased hereunder, but for which Purchaser is providing collection services, that payments areto be made directly to purchaser or Purchaser's lockbox. 

  

5.

REPRESENTATIONS,WARRANTIES AND COVENANTS, To induce Purchaser to enter into this Agreement,

purchase Accounts hereunder and provide the services contemplated hereby, and with full knowledge that the truth and accuracy of' the representations and warranties and Seller's compliance with the covenants and agreements made herein are being relied upon by the Purchaser, Seller represents, warrants, covenants and agrees that:

(a)

The Seller is the sole and absolute owner of both (i) each Account being offered for purchase hereunder, and (ii) the

goods and inventory being sold pursuant10 such Account; Seller has the full legal right and power 10 sell, assign and transfer suchAccount; and such Accounts and said goods and inventory are not and shall not be subject to any lien, consignment arrangement, encumbrance, security interest or financing statement whatsoever, other than any such in favor of Purchaser;

(b)

Except as Purchaser is otherwise notified in writing by Seller, at the time an Account is purchased hereunder, the

Con-eel amount of such Account is set forth in the invoice relating to such Account and is not in dispute and Seller's customers have actually accepted the goods or services covered by, and owe and are obligated to pay the full amounts stated in, the invoice relating to such Account according to its terms without dispute, offset, defense or counterclaim and the payment of each Account is not contingent upon the fulfillment of any obligation or contract, past or future, or any other express or implied condition, and any and all obligations relating thereto required of the Seller have been fulfilled as of the date such Account is purchased;

(c)

Each Account purchased is based on an actual and bona fide sale and delivery of goods and/or rendition of services

to customers, made by Seller in the ordinary course of its business, is not past due or in default and has not been previously sold, assigned, transferred, or pledged and all documents relating thereto are genuine and in all respects are what they purport to be'

(d)

No agreement has been made with respect to any Account purchased hereunder under which the customer may

claim any deduction, discount or set off, except as stated in the invoice evidencing such Account or in a written notice delivered to Purchaser prior to the purchase of such Account;

(e)

All original invoices relating to accounts purchased hereunder bear notice of the assignment thereof to Purchaser as

required by Section 4 above;

(I)

Any taxes or fees relating to the Accounts or the goods or services which arc the subject thereof, including sales or

excise taxes, are solely for the account of Seller and Seller agrees to pay and has paid such taxes or fees when due;

(g)

None of the Accounts factored with Purchaser hereunder represent sales to any subsidiary, parent or affiliated 

CUJ11panyof Seller;

(h)

To Seller's best knowledge, when an Account is purchased the customer is not insolvent as that term is defined in

tilt: Federal Bankruptcy Code or in the Uniform Commercial Code;

(i)

No customer will object to the payment for, or the quality or the quantity of, the subject matter of tile Account and is

legally obligated to pay the amount referred to above in Section 5(b);

(j)

Seller has the full legal right and power to enter into and perform this Agreement and10 make the assignments

herein contemplated, and Seller will defend the Accounts purchased hereunder against all claims and demands ofany person at any time: and

(k)

The Seller's principal place of business and the place wherethe records concerning all Accounts herein referred to

an: kepi is at the address set forth at the beginning of this Agreement and the information supplied by Seller to Purchaser ill connection with entering into this Agreement and all other documents and information supplied by Seller to Purchaser in connection \\ uh this Agreement or at  the request of Purchaser, are true, correct and complete. Seller will promptly advise Purchaser in writing if its principalplace of business or record keeping is changed or a new place of business or record keeping is added.

Seller also warrants and represents that it is a duly organized and validly existing entity of the kind set forth above and it is qualified to do business in all states where it is legally required to be so qualified. Seller agrees to maintain such books and records