Document:

EXHIBIT 4.01

 Exhibit 4.01
  
Prestige Capital Corporation 

   
400 KELBY STREET, 14TH FLOOR, FORT LEE, NEW JERSEY  07024    (201) 944-4455
 

 Purchase and Sale Agreement (“Agreement”)
 

 1.  ASSIGNMENT.  PRESTIGE CAPITAL CORPORATION (“Prestige”) hereby buys and  TRANS-LUX MIDWEST CORPORATION D/B/A FAIR-PLAY (“Seller”) hereby sells, transfers and assigns all of Seller’s right, title and interest in and to those specific accounts receivable owing to Seller as set forth on the assignment forms provided by Prestige (the “Assignments”) together with all rights of action accrued or to accrue thereon, including without limitation, full power to collect, sue for, compromise, assign or in any other manner enforce collection thereof in Prestige’s name or otherwise.  All of Seller’s accounts receivable and contract rights which are presently or at any time hereafter assigned by Seller, and accepted by Prestige, are collectively referred to as (the “Accounts”).
 

 2.  ADVANCE.  Upon Prestige’s receipt and acceptance of each Assignment, Prestige shall pay to Seller SEVENTY-FIVE percent (75%) of the face value of the Accounts therein described (the “Down Payment”).  Notwithstanding anything to the contrary contained in this Agreement, the maximum outstanding balance of Seller to Prestige shall be $2,500,000 (“Maximum Advance”).  
 

 3.  RESERVE. Prestige will hold in reserve the difference between the Purchase Price (hereinafter defined) and the Down Payment (the “Reserve”) and provided there are no outstanding chargebacks or disputes, will pay to Seller, the Reserve, less any sums due Prestige hereunder, within five (5) business days from the date on which the Accounts have been collected in good funds, charged back and/or deemed collected by Prestige due to an account debtor’s insolvency.  For purposes of this Agreement, the term “Purchase Price” shall mean the net face value of Accounts, less; Prestige’s discount fee described in paragraph 4 below, returns, credits, allowances and discounts; and less all other sums charged or chargeable to Seller’s Accounts.
 

 4.  DISCOUNT.  Prestige’s purchase of the Accounts from Seller shall be at a discount fee which is deducted from the face value of each Account upon collection.  The discount fee, which shall be based on the number of days an Account is outstanding from the date of the Down Payment, shall be as follows:  If paid within 30 days a discount fee of  TWO AND ONE QUARTER percent (2.25%); if paid within 40 days a discount fee of THREE percent (3%); if paid within 50 days a discount fee of THREE AND THREE QUARTERS percent (3.75%); if paid within 60 days a discount fee of  FOUR AND ONE HALF percent (4.50%); if paid within 70 days a discount fee of FIVE AND ONE QUARTER percent (5.25%); if paid within 80 days a discount fee of SIX percent (6%); if paid within 90 days a discount fee of SIX AND THREE QUARTERS (6.75%)  percent and an additional TWO percent (2%) for each 10 day period thereafter until the account is paid. 
 

 5.  WARRANTIES, REPRESENTATION AND COVENANTS.  As an inducement for Prestige’s entering into this Agreement and with full knowledge that the truth and accuracy of the warranties, representations and covenants in this Agreement are being relied upon by Prestige, instead of the delay of a complete credit investigation, Seller warrants, represents and covenants that:
 

 (a)
 Seller is properly licensed and authorized to operate the business as a a manufacturer of large scale display video equipment in the sports industry;
 (b)
 Seller is the sole and absolute owner of the Accounts and has the full legal right to make said sale, assignment and transfer;
 (c)
 The correct amount of each Account will be set forth on the Assignments;
 (d)
 Each Account is an accurate and undisputed statement of indebtedness from an account debtor for a sum certain, without offset or counterclaim and which is due and payable in ninety days or less;
 (e)
 Each Account is an accurate statement of a bona fide sale, delivery and acceptance of merchandise or performance of service by Seller to an account debtor;
  
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 (f)
 Seller does not own, control or exercise dominion in any way whatsoever, over the business of any account debtor;
 (g)
 All financial records, statements, books or other documents shown to Prestige by Seller at any time either before or after the signing of this Agreement are true and accurate;
 (h)
 Seller will not under any circumstance or in any manner whatsoever, interfere with any of Prestige’s rights under this Agreement;
 (i)
 Except for the existing liens on the Collateral held by the Pension Benefit Guaranty Corporation, Seller has not and will not, at any time, permit any lien, security interest or encumbrance to be created upon any of its accounts receivable and/or its inventory without the prior written consent of Prestige;
 (j)
 Seller will not change or modify the terms of the Accounts with any account debtor unless Prestige first consents, in writing;
 (k)
 Seller will notify Prestige, in writing, in advance of: any change in Seller’s place of business; Seller having or acquiring more than one place of business; any change in Seller’s chief executive office; and/or any change in the office or offices where Seller’s books and records concerning accounts receivable are kept;
 (l)
 Seller will immediately notify Prestige of any proposed or actual change of the Seller’s and/or any account debtor’s identity, legal entity or corporate structure;
 (m)
 All invoices will state plainly on their face that the Accounts represented thereby have been sold and assigned to Prestige and are payable directly to Prestige; and
 (n)
 No account shall be on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment or any other repurchase or return basis;
 The warranties, representations and covenants contained in this paragraph 5 shall be continuous and be deemed to be renewed each time Seller assigns Accounts to Prestige.  Notwithstanding the provisions contained in paragraph 6 of this Agreement, Prestige shall have recourse against the Seller in the event that any of the warranties, representations and covenants set forth in this paragraph 5 are breached.
 

 6.  INTENTIONALLY OMITTED
 

 7.  CHARGE-BACK.  In the event that any Account is not paid within 90 days of invoice date for any reason whatsoever, including, without limitation, any alleged defense, counterclaim, offset, dispute or other claim (real or merely asserted) whether arising from or relating to the sale of goods or rendition of services or arising from or relating to any other transaction or occurrence, then in any such event Prestige shall have the right to chargeback such Account to Seller.  No chargeback shall be deemed a reassignment to Seller of the Account involved.  Seller acknowledges that all amounts chargeable to Seller’s account under this Agreement shall be payable by Seller on demand.
 

 8.  NOTICE OF DISPUTE.  Seller must immediately notify Prestige of any disputes between any account debtor and Seller.
 

 9.  SETTLEMENT OF DISPUTE.  Prestige may, at its option, settle any dispute with any account debtor.  Such settlement does not relieve Seller of any of its obligations under this Agreement.
 

 10.  SOLE PROPERTY. Once Prestige has purchased the Accounts, the payment from account debtors relative to the Accounts is the sole property of Prestige.  Any interference by Seller with this payment will result in civil and/or criminal liability.
 

 11.  SECURITY INTEREST.  As a further inducement for Prestige to enter into this Agreement, and as security for the prompt performance, observance and payment of all obligations owing by Seller to Prestige, Seller hereby grants to Prestige a continuing security interest in and lien upon the following (herein collectively referred to as the “Collateral”): all accounts, (as such terms are defined in the Uniform Commercial Code), whether now owned or hereafter created or acquired by Seller, wherever located, and all replacements and substitutions therefore, accessions thereto, and products and proceeds thereof, and all property of Seller at any time in Prestige’s possession.
 

 12.  FINANCING STATEMENTS.   Seller will, at its expense perform all acts and execute all documents requested by Prestige at any time to evidence, perfect, maintain and enforce Prestige’s security interest and other rights in the Collateral and the priority thereof.
 
 
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 13.  HOLD IN TRUST.   Seller will hold in trust and safekeeping, as the property of Prestige and immediately turn over to Prestige, the identical check or other form of payment received by Seller if payment on the Accounts comes into Seller’s possession.  Should Seller come into possession of a check comprising payments owing to both Seller and Prestige, Seller shall turn over said check to Prestige.  In the event a payment belonging to Prestige is improperly deposited into Seller’s bank account, Prestige reserves the right to impose liquidated damages upon Seller of up to 20% of the face amount of any check so improperly deposited.  Notwithstanding the foregoing, Prestige agrees to waive the aforementioned penalty on no more than two occasions provided that on such occasions Seller remits, in full, the improperly deposited funds to Prestige within 3 business days of receipt. 
 

 14.  FINANCIAL RECORDS.   Seller will furnish to Prestige financial statements and such other information as is, from time to time, reasonably requested by Prestige.
 

 15.  BOOK ENTRY.  Seller will immediately, upon the sale of the Accounts, make the proper entry on its books and records disclosing the absolute sale of the Accounts to Prestige.
 
16.  POWER OF ATTORNEY.  In order to implement this Agreement, Seller irrevocably appoints Prestige its special attorney in fact or agent with power to:
 (a)   Strike out Seller’s address on any correspondence to any account debtor and put on Prestige’s address;
 (b)   Receive and open all mail addressed to Seller via Prestige’s address;
 (c )   Endorse the name of Seller or Seller’s trade name on any checks or other evidences of payment that may come into the possession of Prestige in connection with the Accounts;
 (d)
 In Seller’s name, or otherwise, demand, sue for, collect any and all monies due in connection with the Accounts; and 
 (e)
 Compromise, prosecute or defend any action, claim or proceeding relative to the Accounts;
 

 The authority granted to Prestige shall remain in full force and effect until the Accounts are paid in full and the entire indebtedness of Seller to Prestige is discharged.
 

 17.  NOTIFICATION; VERIFICATION OF ACCOUNTS
 (a)  Without in any way limiting the terms and provisions of paragraph 5 (m) hereinabove, Prestige may at any time and from time to time, in its sole discretion, notify any account debtor to make payment on any of Seller’s open invoices to Prestige;  and
 (b)  Prestige, may at any time verify the Accounts utilizing an audit control company, any agent of Prestige or any other means deemed appropriate by Prestige.
 

 18.  NO ASSUMPTION.  Nothing contained in this Agreement shall be deemed to impose any duty or obligation upon Prestige in favor of any account debtor and/or any other party in connection with the Accounts.
 

 19.  FUTURE ASSIGNMENTS.  Seller may from time to time, at Seller’s option, sell, transfer and assign different Accounts to Prestige.  The future sale of any Accounts shall be subject to and governed by this Agreement and such Accounts shall be identified by separate and subsequent Assignments.
 

 20.  DISCRETION.  Nothing contained in this Agreement shall be construed to impose any obligation upon Prestige to purchase Accounts from Seller.  Prestige shall at its sole discretion determine which Accounts it shall purchase.  Further, Prestige shall have the absolute right at any time to cease accepting any further assignments from Seller.
 

 21.  LEGAL FEES; EXPENSES.  Seller will pay on demand any and all collection expenses and reasonable attorneys’ fees that Prestige incurs in the event it should become necessary for Prestige to enforce its rights under this Agreement.  Each party shall otherwise be responsible for all costs and expenses incurred by such party in connection with the preparation, execution and delivery of this Agreement and any supplement or modification thereof, and in any way relating to the transactions contemplated by this Agreement, including, without limitation, all attorneys’ fees, Federal Express costs (or similar expenses), certified mail costs, and facsimile transmission costs.
 

 22.  BINDING ON FUTURE PARTIES.  This Agreement shall inure to the benefit of and is binding upon the heirs, executors, administrators, successors and assigns of the parties hereto, except that Seller may not assign or transfer any or all of its rights and obligations under this Agreement to any party without the prior written consent of Prestige.
 
 
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 23.  WAIVER; ENTIRE AGREEMENT.  No failure or delay on Prestige’s part in exercising any right, power or remedy granted to Prestige herein, will constitute or operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right set forth herein.  This Agreement contains the entire agreement and understanding of the parties hereto and no amendment, modification or waiver of, or consent with respect to, any provision of this Agreement, will in any event be effective unless the same is in writing and signed and delivered by Prestige.
 

 24.  NEW JERSEY LAW.  This Agreement shall be deemed executed in the State of New Jersey and, in all respects shall be governed and construed in accordance with the laws of the State of New Jersey.
 

 25.  INDEMNITY.  Seller shall hold Prestige harmless from and against any action or other proceeding brought by any account debtor against Prestige arising from Prestige’s lawful collecting or lawful attempt to collect any of the Accounts.
 

 26.  TERM.  This Agreement will remain in effect for one year from the date that this Agreement becomes effective (the “Term”).  Thereafter, the Term will be automatically extended for successive periods of one (1) year each unless either party provides the other with a written notice of cancellation of at least sixty (60) days prior to the expiration of the initial Term or any renewal Term; provided, however, Prestige may cancel this Agreement at any time upon sixty (60) days written notice to Seller.  In the event of a breach by Seller of any term or provision of this Agreement or upon Seller’s insolvency or the insolvency of any guarantor of Seller’s obligations herein, Prestige shall have the right to cancel this Agreement immediately upon written notice to Seller, and all of Seller’s obligations to Prestige herein shall be immediately due and payable.  In the event of cancellation, the provisions of this Agreement shall remain in full force and effect until all of the Accounts have been paid in full.
 

 27.  EARLY TERMINATION.  In the event that Seller wishes to terminate the Agreement during the Term and requires UCC releases, then in addition to paying Prestige all other obligations due under this Agreement, Seller shall also pay Prestige an early termination fee equal to $7,500 per month for each month remaining under the Term.   Notwithstanding the foregoing, Prestige will waive the early termination fee should Seller terminate the Agreement at any time after the initial six months of the Term.
 

 28.  INVALID PROVISIONS.  If any provision of this Agreement shall be declared illegal or contrary to law, it is agreed that such provision shall be disregarded and this Agreement shall continue in force as though said provision had not been incorporated herein.
 

 29.  EFFECTIVE.  This Agreement shall become effective when it is accepted and executed by an authorized officer of Prestige.  Facsimile machine or PDF copies of an original signature by either party on this Agreement shall be binding as if said copies were original signatures.
 

 30.  JURY WAIVER.  The parties hereto hereby mutually waive trial by jury in the event of any litigation with respect to any matter connected with this agreement.
  
  	  
	  
	  
	 Accepted:

	  
	  
	  
	  

	  
	 TRANS-LUX MIDWEST CORPORATION 
	  
	  
	 PRESTIGE CAPITAL CORPORATION
  
  

	 By:  
	  /s/ J.M.Allain                                                    
	  
	 By:  
	 /s/ Harvey L. Kaminski                                            

	  
	 JEAN-MARC ALLAIN, President
	  
	  
	 HARVEY L. KAMINSKI, President/CEO

	  
	  
	  
	  
	  

	 This 2nd day of July, 2013
	  
	 This 11th day of July, 2013

	  
	  
	  
	  
	  

                                                                          
 
 
 4EXHIBIT 4.02

 Exhibit 4.02
  
 GUARANTY
 

 

                                                DATE: June 28, 2013
 

 

 

 Prestige Capital Corporation (“Prestige”)
 400 Kelby Street
 14th Floor
 Fort Lee, New Jersey 07024   
 

 To induce Prestige to make loans, advances or other financial accommodations to Trans-Lux Midwest Corporation d/b/a Fair-Play, ("Client"), now or in the future, and with full knowledge that said loans, advances or other financial accommodations would not be made without this Guaranty,  the undersigned (sometimes “Guarantor”) agrees as follows:
 The undersigned guarantees full, prompt and unconditional payment when due of each and every Liability of the Client (as hereinafter defined) to Prestige, now existing or hereafter incurred, whether direct or indirect, contingent or absolute, joint or several, matured or unmatured and the full, prompt, and unconditional performance of every term and condition of any transaction to be kept and performed by the Client.  This Guaranty is a primary obligation of the undersigned and shall be a continuing inexhaustible Guaranty without limitation as to the amount or duration and may not be revoked except by notice in writing to Prestige and received by Prestige at least ninety (90) days prior to the date set for such revocation.  No such notice shall affect the liability under this Guaranty for any such loan or advance or other financial accommodations to the Client occurring prior to the date set for revocation whether made after notice of revocation or not.
 The term "Liability of the Client" shall include all liabilities, direct or indirect, absolute or contingent, joint or several, now or hereafter existing, in each case due or to become due to, or held or to be held by Prestige for its own account or as agent for others, whether created directly or acquired by assignment or otherwise.  
 Without incurring responsibility to the undersigned and without impairing or releasing the obligations of the undersigned hereunder, Prestige may at any time and from time to time (whether or not after revocation or termination of this Guaranty) without the consent of, or notice to the undersigned, upon any terms or conditions and in whole or in part:
 1. change the manner, place or terms of payment, and/or change or extend the time for payment or renew or alter, any Liability of the Client or any security therefor, and the Guaranty herein made shall apply to the Liability of the Client as so changed, extended, renewed or altered;
  
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2. subject to the existing liens existing on the assets of the Client held by the Pension Benefit Guaranty Corporation (the “PBGC Liens”) and applicable law, sell, exchange, release, surrender, realize upon or otherwise deal with in any manner and in any order any property by whomsoever at any time pledged, mortgaged or in which a security interest is given to secure, or howsoever securing, the Liability of the Client to Prestige;
  3. exercise or refrain from exercising any rights against the Client or others (including the undersigned) or against the security, or otherwise act or refrain from acting;
  4. settle or compromise any Liability of the Client, and subject to the PBGC Liens and applicable law, dispose of any security therefor, with or without consideration, or any liability incurred directly or indirectly in respect thereof or hereof, and subject to the PBGC Liens and applicable law, may subordinate the payment of all or any part thereof to the payment of any Liability (whether due or not) of the Client; and
  5. apply any sums by whomsoever paid or howsoever realized to any Liability of the Client.
 No invalidity, irregularity or unenforceability of all or any part of the Liability of the Client or the impairment or loss of any security therefor, whether caused by any actions or inactions of Prestige, or otherwise, shall affect, impair or be a defense to this Guaranty.
 Guarantor hereby waives any right of subrogation to any security and will not exercise any rights which it may acquire by way of subrogation under this Guaranty, by any payment made hereunder or otherwise, until all of the Liability of the Client to Prestige shall have been paid in full.  If any amount shall be paid to a Guarantor on account of such subrogation rights at any time when all the Liability of the Client shall not have been paid and performed in full, such amount shall be held in trust for the benefit of Prestige and shall be paid to Prestige to be credited and applied upon the Liability of the Client, whether matured or unmatured.  Guarantor hereby waives any and all suretyship defenses.
 Any and all rights and claims of the undersigned against the Client or any of its property, arising by reason of any payment by the undersigned to Prestige pursuant to the provisions of this Guaranty, shall be subordinate and subject in right of payment to the prior payment in full of all Liability of the Client.  Guarantor hereby agrees that all indebtedness owing from the Client to the Guarantor, whether now existing or in the future created, shall be subordinate to the payment of the Liability of the Client to Prestige and agree further that should the Client default with respect to the Liability of the Client, no such indebtedness owing from the Client to the Guarantor shall be paid, and no security therefor received, until all the Liability of the Client have been paid in full.  Any instrument evidencing any such indebtedness owing from the Client to Guarantor, and any payment, security or other property received by Guarantor in violation of this provision, shall be held in trust for the benefit of Prestige and shall be delivered immediately upon receipt by Guarantor to Prestige to apply to the Liability of the Client, whether matured or unmatured.
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Upon the happening of any of the following events:  the failure of Client to pay when due any Liability of the Client; the death or insolvency of the Client or any person (including the undersigned) who is liable directly or indirectly in respect of any of the Liability of the Client; or an adverse change in the financial condition of the Client or any aforesaid person; or suspension of business of the Client or any aforesaid person; or the issuance of any warrant, process or order of attachment, garnishment or other lien and/or the filing of a lien as a result thereof against any of the property of the Client or any aforesaid person (in each case except for liens filed against such property by the Pension Benefit Guaranty Corporation); or the making by the Client or any aforesaid person of an Assignment for the Benefit of Creditors; or a Custodian, Trustee or  Receiver being appointed for the Client or any aforesaid person or for any property of any of them; or any proceeding being commenced by or against the Client or any aforesaid person under any bankruptcy, reorganization, arrangement of debt, insolvency, readjustment of debt, receivership, liquidation or dissolution law or statute; or if an Order for Relief as to the Client or any aforesaid person is entered under the Bankruptcy Code; or if the Client or any aforesaid person is generally not paying their debts as they become due; or any representation in any financial or other statement of the Client or any aforesaid person, delivered to Prestige by or in behalf of the Client or such person, is untrue or incomplete; then and in such event, and at any time thereafter, Prestige may, immediately upon written notice to the Client or any aforesaid person, make the Liability of the Client immediately due and payable hereunder as to the undersigned, and Prestige shall be entitled to enforce the obligations of the undersigned hereunder.
 The undersigned shall pay all costs and expenses of every kind for collection or enforcement of Prestige’s remedies hereunder, including reasonable attorneys' fees and expenses.
 If claim is ever made upon Prestige for repayment or recovery of any amount or amounts received by Prestige in payment or on account of any of the Liability of the Client and Prestige repays all or part of said amount by reason of (a) any judgment, decree or order of any court or administrative body having jurisdiction over Prestige or any of its property, or (b) any settlement or compromise of any such claim effected by Prestige with any such claimant (including the Client), then, and in such event, the undersigned agree that any such judgment, decree, order settlement or compromise shall be binding upon the undersigned, notwithstanding any revocation hereof or the cancellation of any note or other instrument evidencing any Liability of the Client, and the undersigned shall be and remain jointly and severally liable to Prestige hereunder for the amount so repaid or recovered.
 All rights, powers and remedies of Prestige hereunder and under any agreement between the Client or Guarantor and Prestige, now, or at any time hereafter in force, shall be cumulative and not alternative, and shall be in addition to all rights, powers and remedies given to Prestige by law.  The Guarantor’s liability hereunder shall be joint and several.
 If any term or provision of this Guaranty is at any time held to be invalid by any court of competent jurisdiction, that invalidity shall not affect the remaining terms and provisions of this Guaranty, which shall continue to be in full force and effect.
 No delay on the part of Prestige in exercising any of its options, powers or rights or partial or single exercise thereof, shall constitute a waiver thereof.  No waiver of any of its rights hereunder, and no modification or amendment of this Guaranty, shall be deemed to be made by Prestige unless the same shall be in writing, duly signed on behalf of Prestige, by a duly authorized officer, and each such waiver, if any, shall apply only with respect to the specific instance involved, and shall in no way impair the rights of Prestige or the obligations of the undersigned to Prestige in any other respect at any other time.
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Guarantor hereby irrevocably consents to the nonexclusive jurisdiction of the Courts of the State of New Jersey or any Federal court in such State in connection with any action or proceeding arising out of or related to this Guaranty.  In such litigation, Guarantor waives personal service of any summons, complaint or other process and agree that service may be made by certified or registered mail, return receipt requested.  IN ANY LITIGATION RELATING TO THIS GUARANTY, PRESTIGE AND GUARANTOR HEREBY WAIVES HIS RIGHT TO TRIAL BY JURY AND ACKNOWLEDGE THAT HE HAS CONSULTED WITH HIS RESPECTIVE COUNSEL SPECIFICALLY ON THE RAMIFICATIONS OF WAIVING THE RIGHT TO REQUEST TRIAL BY JURY.
 The undersigned waive notice of acceptance of this Guaranty and notice of any Liability of the Client to which it may apply and waive notice of default, non-payment, partial payment, presentment, demand, protest, notice of protest or dishonor and all other notices to which Guarantor might otherwise be entitled, except those which are be required by law and required to be given by Prestige.
 This Agreement of Guaranty shall be binding upon the undersigned Guarantor, his or its heirs, executors, administrators, successors and assigns and shall enure to the benefit of Prestige, its successors and assigns.
          
                Trans-Lux Corporation
 

 

 By:_/s/ J.M. Allain______________
          
         Jean-Marc Allain
          
          President & CEO
 

 

 
 
 
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