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MEMORANDUM OF UNDERSTANDING REGARDING PURCHASES, INVOICING AND PAYMENTS UNDER MASTER AGREEMENT FOR PRODUCTS AND SERVICES FOR THE DALLAS INDEPENDENT SCHOOL DISTRICT

Consulting Services Agreement

MEMORANDUM OF UNDERSTANDING REGARDING PURCHASES, INVOICING AND PAYMENTS UNDER

  MASTER AGREEMENT FOR PRODUCTS AND SERVICES FOR THE DALLAS INDEPENDENT SCHOOL

                                    DISTRICT
 | Document Parties: MICRO SYSTEM ENTERPRISES, INC. | TEXTRON FINANCIAL CORPORATION You are currently viewing:
This Consulting Services Agreement involves

MICRO SYSTEM ENTERPRISES, INC. | TEXTRON FINANCIAL CORPORATION

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Title: MEMORANDUM OF UNDERSTANDING REGARDING PURCHASES, INVOICING AND PAYMENTS UNDER MASTER AGREEMENT FOR PRODUCTS AND SERVICES FOR THE DALLAS INDEPENDENT SCHOOL DISTRICT
Date: 3/29/2005
Industry: Computer Peripherals    

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                                                                   EXHIBIT 10.26

 

  MEMORANDUM OF UNDERSTANDING REGARDING PURCHASES, INVOICING AND PAYMENTS UNDER

  MASTER AGREEMENT FOR PRODUCTS AND SERVICES FOR THE DALLAS INDEPENDENT SCHOOL

                                     DISTRICT

 

            THIS MEMORANDUM OF UNDERSTANDING REGARDING PURCHASES, INVOICING AND

PAYMENTS UNDER MASTER AGREEMENT FOR PRODUCTS AND SERVICES FOR THE DALLAS

INDEPENDENT SCHOOL DISTRICT (this "Memorandum") among (1) MICRO SYSTEM

ENTERPRISES, INC., a Texas corporation ("MSE"), (2) TEXTRON FINANCIAL

CORPORATION, a Delaware corporation ("TFC"), and (3) the entities listed on

Schedule A attached to this Memorandum (each such entity is referred to in this

Memorandum as a "Consortium Member").

 

                                   Background:

 

      A. MSE and each of the Consortium Members are members of that certain

group (the "Consortium") of contractors and suppliers providing products and

services to the Dallas Independent School District ("DISD") pursuant to that

certain Master Agreement for Products and Services between the DISD and MSE

dated as of January 31, 2003, as amended (the "Master DISD Agreement").

 

      B. MSE has entered into a Letter Agreement (the "Letter Agreement(s)")

with each of the Consortium Members providing for, among other things, (1) MSE's

acting on behalf of the Consortium and the Consortium Members as the designated

central ordering entity, central invoicing entity and central payment receiving

entity under the Master DISD Agreement and (2) how payments are to be made by

MSE to the Consortium Members upon receipt by MSE of payments under the Master

DISD Agreement from DISD and/or the Universal Service Administrative Company,

Schools and Libraries Division ("USAC").

 

      C. DISD and USAC have agreed with MSE that all payments by each of them

for invoices under the Master DISD Agreement will be in ACH electronic funds and

made to the account described on Schedule B to this Memorandum or to any other

account which may replace such account (the "Special Account").

 

      D. MSE will not allow any other funds to be sent to or otherwise deposited

into the Special Account; the Special Account will be exclusively for the

receipt of payments on invoices from DISD and USAC under the Master DISD

Agreement; funds received in the Special Account will be disbursed as provided

below.

 

      E. MSE has entered into that certain Loan and Security Agreement, dated

November 3, 2003 with TFC (as amended, the "LSA"), pursuant to which MSE is

expected to request, among other things, certain financing from TFC in

connection with MSE's performance under the Master DISD Agreement for E-rate

Year 6 and the DISD Budget Year 2004/2005.

 

      F. Proceeds of loans obtained by MSE from TFC under and pursuant to the

terms of the LSA in respect of eligible inventory acquired by MSE from a

Consortium Member or in respect of eligible invoices based on services rendered

by a Consortium Member, in each case, under the Master DISD Agreement for E-rate

year 6 and the DISD budget year 2004/2005, will be paid to such Consortium

Member as directed by MSE and otherwise in accordance with the LSA, as provided

below.

 

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      G. MSE has pledged the Special Account to TFC and has given TFC exclusive

control over the same subject to the payment procedures set forth herein.

 

      H. This Memorandum is, among other things, to establish the payment

procedures for payments to be made to Consortium Members from funds received

from DISD and/or USAC under the Master DISD Agreement.

 

                           Procedures and Agreements:

 

1. The background statements above are made a part of this Memorandum.

 

2. All goods and services to be supplied to the DISD under the Master DISD

Agreement by MSE and the Consortium Members will be ordered by DISD through MSE,

as the central ordering entity, and MSE will, as provided in the Letter

Agreements and other agreements and ordering arrangements between MSE and each

Consortium Member, order such goods and services from the Consortium Members

and/or supply the same itself.

 

3. Goods and services ordered by MSE from the Consortium Members will be

supplied by the Consortium Members to the DISD as provided for in the Master

DISD Agreement and pursuant to the Letter Agreements and other agreements

between MSE and the Consortium Members.

 

4. All goods and services supplied directly to the DISD under the Master DISD

Agreement by any Consortium Member will be invoiced by such Consortium Member to

MSE. MSE will re-invoice such goods and services to DISD and USAC, as provided

in paragraph 5 below, and, upon MSE's receiving payment for such re-invoices

from the DISD or USAC as contemplated in paragraph 8 below (or otherwise from

TFC under the LSA as contemplated in paragraph 7 below), MSE will use such

funds, or cause such funds to be used, as provided herein to pay the underlying

invoices of such Consortium Member.

 

5. All goods and services supplied to the DISD under the Master DISD Agreement

by MSE and the Consortium Members will be invoiced by MSE, as the central

invoicing entity, to the DISD and USAC, as the case may be, in accordance with

the terms and provisions of the Master DISD Agreement. MSE agrees that invoices

that it generates to DISD and/or USAC as a result of its re-invoicing of

invoices from any particular Consortium Member will be invoiced separate from

invoices from other Consortium Members and will be re-invoiced by MSE to the

DISD and/or USAC in a manner which will enable MSE to provide each Consortium

Member and TFC with detailed, segregated reporting of its accounts receivables

from the DISD and USAC, segregating the accounts receivables that resulted from

each particular Consortium Member's invoices to MSE, as required in section 11.

hereof.

 

6. MSE has pledged the Special Account to TFC under the LSA and given TFC

exclusive control over it, and MSE has pledged all inventory and other goods

acquired by MSE from the Consortium Members under the Master DISD Agreement to

TFC as collateral under the LSA. Subject to the rights of each Consortium Member

under paragraphs 7 and 8 below (including, without limitation, the rights of

each such Consortium Member to receive payments under and as provided for in

paragraph 8 below), each such Consortium Member acknowledges and agrees to those

pledges and further agrees that its rights and interests in and to the Special

Account and such inventory and goods are junior and subordinate to those of TFC.

 

                                        2

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7. MSE and TFC agree that the proceeds of any loans


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