THIS PURCHASE AND SALE AGREEMENT is made effective as of the 28th day of
August, 2000, by and between GREYSTONE FUNDING CORPORATION ("BUYER") and DVI
FINANCIAL SERVICES INC. ("DVI").
BACKGROUND
A. DVI has loaned $6,596,189 to SCHICK TECHNOLOGIES, INC., a Delaware
company ("STDE") and SCHICK TECHNOLOGIES, INC., A NEW YORK corporation ("STNY")
(THE "SCHICK LOAN"). DVI is the owner and holder of certain documents evidencing
the Schick Loan including Promissory Notes, Security Agreements and other loan
documents between DVI, as lender, and STNY and STDE, as borrowers, all as more
particularly described on EXHIBIT "A" attached hereto (the "SCHICK LOAN
DOCUMENTS").
B. DVI has agreed to sell, grant, transfer and assign to Buyer all DVI's
right, title and interest in, to and under the Schick Loan and the Schick Loan
Documents, upon and subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual promises contained herein and
other good and valuable consideration, the parties hereto, intending to be
legally bound, agree as follows:
1. PURCHASE AND SALE. For, and in consideration of, the payment of Four
Million Five Hundred Sixty-One Thousand One Hundred Dollars and Twenty-One Cents
($4,561,100.21) by wire transfer on or before September 1, 2000, and the
issuance of and delivery to DVI on or before September 1, 2000, of a secured
promissory note by Buyer to DVI in the original principal amount of One Million
Eight Hundred Ninety-Six Thousand One Hundred Eighty-Nine Dollars
($1,896,189.00) (the "DVI NOTE") in the form attached hereto as EXHIBIT "B", DVI
hereby sells, grants, transfers and assigns to Buyer and its successors and
assigns all DVI's right, title and interest in, to and under (a) the Schick
Loan, (b) the Schick Loan Documents, including the right to collect any and all
loan payments, including interest and principal, and other payments due and to
become due under the Schick Loan Documents and to take any and all actions
against the STDE, STNY, and the Collateral (as defined in the Schick Loan
Documents) and otherwise to collect any amounts owed thereunder, (c) the
Collateral, (d) all rights and remedies of DVI, as lender, under the Schick Loan
Documents and with respect to the Collateral, (e) any guaranty or endorsement of
the Schick Loan Documents, or any of them, or any other agreement with respect
to the Schick Loan Documents or the Collateral, (f) that certain Warrant to
Purchase Share of Common Stock of Schick Technologies, Inc. dated March 15,
2000, issued to DVI (the "Warrant"), for a purchase price of One Dollar ($1.00),
(g) that certain Registration Rights Agreement dated March 15, 2000, by and
between DVI and STDE (the "REGISTRATION RIGHTS AGREEMENT") and (h) all proceeds,
including insurance proceeds, of the foregoing (all of the foregoing being
collectively referred to herein as the "PURCHASED ASSETS").
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2. REPRESENTATIONS AND WARRANTIES OF DVI. To induce Buyer to enter into
this Agreement, DVI hereby represents, warrants and covenants that as of the
date hereof and the closing date:
(a) Seller is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware;
(b) DVI has full power and authority to own its assets, including the
Schick Loan Documents and carry on its business where such assets are owned and
such business is conducted;
(c) DVI has full power and authority to (i) sell the Purchased Assets to
Buyer, (ii) execute and deliver this Agreement and (iii) carry out its duties
and obligations under the Schick Loan Documents;
(d) This Agreement and the Schick Loan Documents have been duly
authorized, executed and delivered by Seller and constitute its legal, valid and
binding obligations, enforceable in accordance with their respective terms
subject to applicable bankruptcy, insolvency reorganization, moratorium or
similar laws affecting the enforcement of creditor's rights generally;
(e) As of the date hereof, the outstanding principal balance of the
Schick Loan is $6,457,289.21;
(f) The execution, delivery and performance of this Agreement by DVI (i)
will not require any approval, consent, filing or registration with any
governmental body, regulatory agency or any other third party not already
obtained and in effect, and (ii) will not conflict with or constitute a breach,
default, or violation, with or without the giving of notice, passage of time, or
both, under (A) DVI's Articles of Incorporation, By-Laws or any other governing
document, (B) any other material agreement, instrument or document to which DVI
is a party or by which DVI's assets or properties are bound, or (C) any
applicable law, statute, regulation, rule, judgment or decree of any court,
administrative agency or governmental body to which DVI may be subject;
(g) There are no suits, actions or proceedings of any nature whatsoever
pending or, to DVI's knowledge, threatened against DVI or the Purchased Assets
which if decided adversely to DVI would have a material adverse effect on DVI's
ability to perform its obligations under this Agreement;
(h) DVI has furnished or will furnish to Buyer contemporaneously
herewith accurate and complete copies of each Schick Loan Document;
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(i) DVI has good and marketable title to the Purchased Assets, free and
clear of all liens and encumbrances, except for the rights of STNY and STDE
under the Schick Loan Documents; and
(j) The Schick Loan Documents constitute the entire agreement between
DVI, as lender, STNY and STDE with respect to the subject matters covered
thereby, are in full force and effect and, to DVI's knowledge, no default or
event, which with the giving of notice, passage of time or both, would
constitute a default has occurred under any Schick Loan Document.
3. ADDITIONAL COVENANTS. DVI further covenants that:
(a) At closing hereunder, DVI will deliver to Buyer the original Warrant
endorsed to the order of Buyer;
(b) DVI will direct U.S. Bank Trust N.A., as its trustee, to deliver to
Buyer the executed originals of the Schick Loan Documents, along with
endorsements to the Promissory Notes in favor of Buyer; and UCC-3 assignments
changing the Secured Party to Buyer;
(c) Within ten (10) business days following the execution of this
Agreement, DVI shall deliver to STNY and STDE, with a copy to Buyer, a letter
from DVI, dated as of the date hereof, properly addressed and signed by DVI,
notifying STNY and STDE that the Schick Loan Documents have been assigned to
Buyer, that Buyer has assumed all of DVI's duties and obligations thereunder and
requesting that STNY and STDE make all remaining payments due and owing
thereunder to Buyer; and
(d) DVI shall execute and deliver any further instruments or agreements
reasonably required by Buyer, including without limitation, Uniform Commercial
Code Financing Statements, or any similar instruments required by applicable
law, to evidence the assignment of the Purchased Assets.
4. REMITTANCES. DVI hereby authorizes and appoints Buyer as its
attorney-in-fact to sign and endorse DVI's name upon any remittances received
with respect to the Schick Loan Documents. Buyer may, without notice to DVI and
without affecting DVI's liability hereunder, enter into any settlement,
extension, forbearance, waiver or other variation in terms with respect to the
Schick Loan Documents, or discharge or release such payment obligations, by
operation of law or otherwise.
5. DEFAULTS. Upon the occurrence of a breach by DVI of any material
representation, warranty, covenant or obligation contained in this Agreement,
which breach continues for a period of thirty (30) consecutive days, DVI agrees
to repurchase the Schick Loan Documents for an amount equal to the then
outstanding principal balance thereof less the outstanding principal balance of
the DVI Note within fifteen (15) days after Buyer's demand therefore. Upon
receipt of the repurchase price and the DVI Note marked "cancelled", Buyer
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shall execute and deliver to DVI all instruments and agreements reasonably
required by DVI to evidence the re-assignment of the Purchased Assets to DVI,
free and clear of all liens and encumbrances.
6. ARBITRATION
(a) Any and all disputes or claims arising out of or relating to the
validity, interruption, enforceability or performance of this Agreement,
including, without limitation, this arbitration clause, shall be solely and
finally settled by binding arbitration in Doylestown, Pennsylvania, and except
as otherwise provide herein, in accordance with the then prevailing Commercial
Rules of the AAA; PROVIDED, that in any case where AAA or its successors are not
in existence, the arbitration shall proceed in accordance with the laws relating
to commercial arbitration then in effect in the Commonwealth of Pennsylvania.
(b) Any party hereto may demand that any disputed matter pursuant hereto
be submitted to arbitration; PROVIDED, HOWEVER, any such demand must be made by
written notice to the other party within eighteen (18) months after the event,
act; circumstance or occurrence giving rise to the dispute first occurs. The
rights and remedies of any party with respect to any claim or dispute which is
not made pursuant to a timely demand in accordance with the foregoing sentence
shall be forever waived and barred. Any such demand notice shall specify the
nature of the dispute. An arbitrator shall be chosen in accordance with the then
prevailing Commercial Arbitration Rules of AAA. Unless otherwise agreed to in
writing by the parties, the arbitrator shall permit or prohibit discovery in its
sole discretion and may admit or exclude evidence in its sole discretion. The
arbitral award, if any, shall in no event include any award for punitive
damages. The arbitrator shall not be entitled to amend or modify the terms and
conditions of this Agreement.
(c) Except as expressly provided herein, the arbitrator shall decide the
dispute or claim in accordance with the then prevailing Commercial Arbitration
Rules of the AAA, applying the substantive laws of Pennsylvania (without giving
effect to any principles of conflicts of law). Judgment upon the arbitral award
may be entered in any court having jurisdiction over the parties hereto or their
assets. No party may take any dispute or claim subject to arbitration hereunder
to any court until an arbitration decision has been made, except that any party
shall have the right to institute any legal actions for provisional relief
pending final settlement by arbitration including, but not limited to, temporary
restraining orders or preliminary injunctions. Seeking such remedies shall not
be deemed a waiver of either party's right to compel arbitration.
(d) The expense of any related court proceedings shall be allocated to
and borne by the party or parties, as the case may be, as determined by the
arbitrator in its sole discretion; PROVIDED, that each party shall bear and pay
for the cost of its own experts, witnesses, evidence and counsel and any other
cost in connection with the arbitration and presentation of its case.
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(e) The resolution of such arbitration shall be final and binding on the
parties hereto and enforceable in a court competent jurisdiction.
7. NOTICES. Any notice required or desired to be given hereunder shall be
in writing and shall be deemed effective as follows: (a) if mailed, three days
after such notice is sent via first class United States certified mail, postage
prepaid to the address listed below for the party to whom the notice is being
sent ("NOTICE PARTY"); (b) if hand delivered or delivered by courier (whether
overnight or otherwise), upon actual delivery of such notice to the Notice Party
at the address listed below for such Notice Party; or (c) if sent by facsimile,
on the date of the sender's receipt of a confirmed transmission of such notice
to the Notice Party at the facsimile number, if any, listed below for such
Notice Party, provided the party giving such notice mails a copy of such notice
within two days after the transmission of such Notice by facsimile to the Notice
Party. The addresses and facsimile numbers for each party to this Agreement, as
of the date hereof, are:
If to Buyer: If to DVI:
Greystone Funding Corporation DVI Financial Services Inc.
152 West 57th Street, 60th Floor 2500 York Road
New York, NY 10019 Jamison, PA 18929
Attention: Curtis Pollock Attn: Legal Department
Facsimile No. (212) 649-9701 Facsimile No. (215) 488-5415
Any party may change his or its address or facsimile number by providing
written notice, in accordance with the foregoing provisions of this SECTION 7
each other party of such change.
8. AMENDMENT; WAIVERS. Except as otherwise expressly provided in this
Agreement, the parties hereto may amend this Agreement, from time to time,
pursuant to a written amendment signed by duly authorized officers of all such
parties. No waiver of any provision of this Agreement, or consent to any
departure by either party therefrom, shall in any event be effective unless the
same shall be in writing and signed by a duly authorized officer of the party to
be charged with the waiver or consent, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it is given.
9. CUMULATIVE RIGHTS. All rights and remedies of the parties hereto pursuant
to this Agreement shall, except as otherwise specifically provided herein, be
cumulative and non-exclusive of any rights or remedies which they may have under
any other agreement or instrument, by operation of law, or otherwise.
10. BINDING EFFECT; ASSIGNMENT; GOVERNING LAW.
(a) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
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(b) THE PARTIES AGREE THAT THIS AGREEMENT SHALL BE GOVERNED BY CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE SUBSTANTIVE LAWS OF THE COMMONWEALTH OF
PENNSYLVANIA WITHOUT RESORT TO ITS CONFLICTS OF LAWS, RULES OR PRINCIPLES.
(c) Any provision of this Agreement which is held by any court of
competent jurisdiction to be illegal, void, or unenforceable shall be of no
force and effect, but the illegality or unenforceability of such provision shall
have no effect upon and shall not impair the enforceability of any other
provision in this Agreement or otherwise diminish either party's rights under
the remaining provisions.
11. SECTION TITLES. The Section headings in this Agreement are for reference
only and are not intended to define, modify, limit, amplify, or describe the
terms and conditions of this Agreement, and such headings shall not be used to
construe or interpret the terms and conditions of this Agreement.
12. COUNTERPARTS. This Agreement may be executed by one or more of the
parties hereto in any number of separate counterparts and all such counterparts
taken together shall be deemed to constitute one and the same instrument.
13. SURVIVAL. The representations and warranties of DVI contained herein
shall survive the execution, delivery and performance of this Agreement for a
period of six (6) months.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by its duly authorized officer as of the date set forth below.
GREYSTONE FUNDING CORPORATION
By: /s/Stephen Rosenberg
------------------------------
Name: Stephen Rosenberg
Title: President
DVI FINANCIAL SERVICES INC.
By: /s/Philip C. Jackson
------------------------------
Name: Philip C. Jackson
Title: Vice President of Banking and Finance
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SCHICK LOAN DOCUMENTS
(1) Second Amended and Restated Secured Promissory Note dated March 15,
2000, given by STNY and STDE to DVI in the original principal amount of
$5,000,000.00
(2) Second Amended and Restated Secured Promissory Note dated March 15,
2000, given by STNY and STDE to DVI in the original principal amount of
$1,596,189.00
(3) Security Agreement dated March 15, 2000, by and between STDE and DVI
(4) Amended and Restated Security Agreement dated March 15, 2000, by and
between STNY an DVI
(5) Collateral Assignment of Patents, Trademarks, Copyrights, Licenses
and Trade Secrets dated July 31, 1999, between STDE and DVI (as filed with the
U.S. Patent and Trademark office on September 20, 1999 at Reel 010247 starting
at Frame 0013)
(6) Lien Subordination and Intercreditor Agreement dated March 15, 2000,
by and between DVI and Greystone Funding Corporation, as consented to by STNY
and STDE
(7) Officer's Certificate of STNY dated March 15, 2000
(8) Officer's Certificate of STDE dated March 15, 2000
(9) Explanation and Waiver of Rights (STDE) dated March 15, 2000
(10) Explanation and Waiver of Rights (STDE) dated March 15, 2000
(11) Explanation and Wavier of Rights (STNY) dated March 15, 2000
(12) Explanation and Waiver of Rights (STNY) dated March 15, 2000
(13) Landlord Subordination dated March 19, 1999, by and between
CFG/AGSCB Falchi, L.L.C.
(14) UCC-l Financing Statements
(a) SOS NY - 99034546 filed February 19, 1999 (STNY)
(b) Queens County, NY - 99PQ02700 filed February 25, 1999 (STNY)
(c) SOS NY - 135226 filed July 11, 2000 (STDE)
(d) SOS DE - 0045070-0000000 filed July 13, 2000 (STDE)
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(e) Queens County, NY- OOPQ11721 filed July 20, 2000 (STDE)
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