Collection of Accounts. (a) Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein. (b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. (c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.
Appears in 2 contracts
Sources: Loan and Security Agreement (Freedom Group, Inc.), Loan and Security Agreement (Freedom Group, Inc.)
Collection of Accounts. (aA) Borrowers To expedite collection, Borrower shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form in which such payments are made, whether first instance to make collection of its Accounts for Agent and Lenders. All remittances received by cash, check or other manner. Borrowers Borrower on account of Accounts shall deliver, be held as Lenders' property by Borrower as trustee of an express trust for Lenders' benefit and Borrower shall immediately deposit or cause to be delivered to deposited same in the Dominion Account. Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to shall have the right at any time after the occurrence of a Cash Management Event, Borrowers shall be permitted Default or an Event of Default to transfer cash from the Blocked notify Account Debtors that Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments have been assigned to Agent and Lenders and to collect Accounts directly in respect of its own and Lenders' name and to charge the outstanding Obligations collection costs and therefore shall constitute expenses, including reasonable attorneys' fees, to Borrower. Neither Agent nor any Lender has any duty to protect, insure, collect or realize upon the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue or preserve rights in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinthem.
(bB) For purposes of calculating the amount Borrower shall deposit all proceeds of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to a lockbox arrangement with such banks as may be remitted, in kind, selected by Borrower and be acceptable to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Borrower shall issue to any bank such banks, an irrevocable letter of instruction directing such banks to deposit all payments or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved remittances received in the transfer lockbox to the Dominion Account for application on account of the Obligations. All funds deposited in the Dominion Account shall immediately become the property of Lenders and Borrower shall obtain the agreement by such banks to or from waive any offset rights against the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other personfunds so deposited. The obligations of Borrowers to reimburse Neither Agent nor any Lender assumes any responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 shall survive the termination of this Agreementdeposits accepted by any bank thereunder.
Appears in 2 contracts
Sources: Loan and Security Agreement (Brazos Sportswear Inc /De/), Loan and Security Agreement (Brazos Sportswear Inc /De/)
Collection of Accounts. (a) Borrowers shall establish The Collateral Agent as agent for the Secured Parties hereby authorizes the Debtor to collect and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting dispose of the proceeds of Inventory the Accounts, which authority the Collateral Agent may curtail or other Collateral in terminate at any time following the identical form in which occurrence and during the continuance of any Event of Default. After such payments are madeauthority has been curtailed or terminated, whether by the Debtor shall, upon receipt of all checks, drafts, cash, check and other remittances in payment of or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect on account of the ReceivablesAccounts, deposit the same in a special account designated by the Collateral Agent, over which account the Collateral Agent as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of agent for the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent Secured Parties alone shall have the rights power of exclusive dominion and control withdrawal (the “Collection Account”). The remittance of the proceeds of such Accounts shall not, however, constitute payment or liquidation of such Accounts until the Collateral Agent as described herein.
(b) agent for the Secured Parties shall receive good funds for such proceeds. For purposes of calculating computing interest, the amount of the Loans available to each BorrowerCollateral Agent shall treat deposited checks, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments drafts and notice thereof are received other items as collected in accordance with the Collateral Agent’s usual normal availability schedule, but in doing so the Collateral Agent is not agreeing that such funds have in fact been paid, nor is the Collateral Agent as agent for the Secured Parties waiving any right it may have to charge back returned items to the Debtor and customary practices to collect interest on such charged-back items. Funds placed in the Collection Account shall be held by the Collateral Agent as agent for the Secured Parties as security for the Obligations. These proceeds shall be deposited in effect precisely the form received, except for the endorsement of the Debtor where necessary to permit collection of items, which endorsement the Debtor agrees to make, and which endorsement the Collateral Agent is also hereby authorized to make on behalf of the Debtor. Pending such deposit, the Debtor agrees that it will not commingle any such checks, drafts, cash or other remittances with any funds or other property of the Debtor but will hold them separate and apart therefrom, and upon an express trust for the Collateral Agent until deposit thereof is made in the Collection Account. The Collateral Agent as agent for the Secured Parties will from time to time and within sufficient time to credit such Borrower’s loan account apply the funds on such day, and if not, then on deposit in the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to Collection Account against the Obligations on in such order of application as is required by the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Intercreditor Agreement.
Appears in 2 contracts
Sources: Security Agreement, Security Agreement (Trex Co Inc)
Collection of Accounts. (a) Borrowers shall establish and maintainThe Debtor shall, at their expenseupon receipt of all checks, blocked accounts or lockboxes and related blocked accounts (in either casedrafts, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check and other remittances in payment of or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect on account of the ReceivablesAccounts, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked AccountsCollateral Reserve Account. The remittance of the proceeds of such Accounts shall not, however, constitute payment or remit liquidation of such Accounts until the same Collateral Agent as agent for the Secured Parties shall receive good funds for such proceeds. For purposes of computing interest, the Collateral Agent shall treat deposited checks, drafts and other items as collected in accordance with the Collateral Agent’s normal availability schedule, but in doing so the Collateral Agent is not agreeing that such funds have in fact been paid, nor is the Collateral Agent as agent for the Secured Parties waiving any right it may have to charge back returned items to the Debtor and to collect interest on such charged-back items. Funds placed in the Collateral Reserve Account shall be held by the Collateral Agent as agent for the Secured Parties as security for the Secured Obligations. These proceeds shall be deposited in precisely the form received, except for the endorsement of the Debtor where necessary to permit collection of items, which endorsement the Debtor agrees to make, and which endorsement the Collateral Agent is also hereby authorized to make on behalf of the Debtor. Pending such deposit, the Debtor agrees that it will not commingle any such checks, drafts, cash or cause other remittances with any funds or other property of the same to be remittedDebtor but will hold them separate and apart therefrom, and upon an express trust for the Collateral Agent until deposit thereof is made in kindthe Collateral Reserve Account. The Collateral Agent as agent for the Secured Parties shall have the right, upon the occurrence and during the continuance of any Default or Event of Default, to Agent. Borrowers agree to reimburse Agent apply the funds on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer Collateral Reserve Account against the Obligations in such order of funds to or from application as is required by the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Credit Agreement.
Appears in 2 contracts
Sources: Security Agreement, Security Agreement (Trex Co Inc)
Collection of Accounts. (aA) Borrowers To expedite collection, each Domestic Borrower shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form in which such payments are made, whether by cash, check or other mannerfirst instance to make collection of its Accounts for Lender. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered All remittances received by each bank where a Blocked Account is maintained Domestic Borrower on account of Accounts shall be held as provided Lender's property by each such Domestic Borrower as trustee of an express trust for Lender's benefit and each such Domestic Borrower shall immediately deposit same in Section 5.2 hereofthe Dominion Account. Prior to Lender shall have the right at any time after the occurrence of a Cash Management Event, Borrowers shall be permitted Default or an Event of Default to transfer cash from notify the Blocked Account Debtors of each Domestic Borrower that Accounts have been assigned to Lender and to use funds therein for working capital collect Accounts directly in its own name and general corporate purposes to charge the extent permitted herein. Upon the occurrence of a Cash Management Eventcollection costs and expenses, (i) each Borrower and Guarantor agrees that all payments made including reasonable attorneys' fees, to such Blocked Domestic Borrowers. Lender has no duty to protect, insure, collect or realize upon the Accounts or other funds received and collected by Agent or any Lender, whether preserve rights in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinthem.
(bB) For purposes of calculating the amount Each Domestic Borrower shall deposit all proceeds of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, kind in one or remit the same more Dominion Accounts pursuant to one or cause the same more lockbox arrangements with such banks as may be selected by such Domestic Borrower and be acceptable to be remitted, in kind, to AgentLender. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Each Domestic Borrower shall issue to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution an irrevocable letter of instruction directing such banks to deposit all payments or other personremittances received in the lockbox to the Dominion Account for application on account of the Obligations. The obligations All funds deposited in the Dominion Account shall immediately become the property of Borrowers Lender and each Domestic Borrower shall obtain the agreement by such banks to reimburse Agent waive any offset rights against the funds so deposited. Lender assumes no responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 shall survive deposits accepted by any bank thereunder. Notwithstanding the termination foregoing, Borrower may utilize collections from its Canadian and Australian lockboxes to pay costs and expenses of this Agreementthe type specified on Exhibit C attached hereto which are due and payable or are to become due and payable in Canadian or Australian currency.
Appears in 1 contract
Sources: Loan and Security Agreement (Lowrance Electronics Inc)
Collection of Accounts. (aA) Borrowers To expedite collection, each Borrower shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form in which first instance to make collection of its Accounts for Agent and Lenders. All remittances received by each Borrower on account of Accounts shall be held as Lenders' property by such payments are made, whether by cash, check or other manner. Borrowers Borrower as trustee of an express trust for Lenders' benefit and such Borrower shall deliver, immediately deposit or cause to be delivered to deposited same in the Dominion Account. Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to shall have the right at any time after the occurrence of a Cash Management Event, Borrowers shall be permitted an Event of Default to transfer cash from the Blocked notify Account Debtors that Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments have been assigned to Agent and Lenders and to collect Accounts directly in respect of its own and Lenders' name and to charge the outstanding Obligations collection costs and therefore shall constitute expenses, including reasonable attorneys' fees, to Borrowers. Neither Agent nor any Lender has any duty to protect, insure, collect or realize upon the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue or preserve rights in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinthem.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(cB) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or shall deposit all proceeds of Accounts or other the Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to a lockbox arrangement with such banks as may be remitted, in kind, selected by Borrowers and be acceptable to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Each Borrower shall issue to any bank such banks, an irrevocable letter of instruction directing such banks to deposit all payments or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved remittances received in the transfer lockbox to the Dominion Account for application on account of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.the
Appears in 1 contract
Sources: Loan and Security Agreement (Brazos Sportswear Inc /De/)
Collection of Accounts. (aA) Borrowers All checks, drafts, cash and other proceeds realized from the sale of any Inventory or otherwise from the sale or other disposition of any of the other Collateral, including, without limitation, all proceeds realized from the collection of the Accounts or otherwise pursuant to any contract right, note, bill, ▇▇aft, acceptance, chose in action and other like forms of general intangibles, and all remittances received by Borrower in respect to the foregoing, shall, upon receipt by the Borrower, be held by Borrower as trustee of an express trust for Lender's sole benefit and subject to immediate deposit (in their original form duly endorsed in blank) in the Cash Collateral Account or in a special account over which Lender has the sole right and power of withdrawal, maintained at a financial institution acceptable to Lender (such financial institution and account being herein referred to as the "Depository Bank" and "Depository Account" respectively). The Depository Account shall establish be subject to the written agreement of the Depository Bank to waive any right of setoff it might otherwise claim to have against any funds in the Depository Account and maintainto otherwise charge any costs relative to the Depository Account to Borrower or such other account(s) as Borrower may maintain with the Depository Bank, such agreement (the "Depository Agreement") to be in form and substance acceptable to Lender. Lender assumes no responsibility for any claim of accord and satisfaction or release with respect to funds which have been deposited in the Depository Account.
(B) Borrower shall instruct all Account Debtors to mail their payments directly to a designated post office lockbox (a "Lockbox") maintained at their Borrower's expense, blocked accounts or lockboxes and related blocked accounts (in either casewith respect to which only Lender or, “Blocked Accounts”)should Lender so agree, with such banks as are reasonably acceptable to Agent into which, Borrowers a designated financial institution shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables have the right of access and all payments constituting proceeds of Inventory so received shall be subject to immediate deposit into the Depository Account or other Cash Collateral Account.
(C) All funds held in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers Depository Account shall deliver, or cause be subject to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior transfer to the occurrence Cash Collateral Account, an account designated by the Lender (the "Lender's Account") as set forth in the Depository Agreement or as otherwise designated by Lender. The application of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use any funds therein for working capital and general corporate purposes to the extent permitted hereinpayment of the Obligations shall not occur until Lender's receipt of such funds in cleared federal funds in the Cash Collateral Account or in Lender's Account. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor Lender agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or Lender by wire transfer for the Borrower's account prior to 10:00 a.m. on any Lender, whether in respect business day of the Receivables, as proceeds of Inventory or other Collateral or otherwise Lender shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available deemed cleared federal funds in the Agent Payment Account provided such payments and notice thereof are Cash Collateral Account. Funds received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such by Lender by wire transfer for the Borrower’s loan 's account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.after
Appears in 1 contract
Sources: Credit Facility and Security Agreement (International Total Services Inc)
Collection of Accounts. (a) Borrowers shall establish and maintainUpon an Event of Default, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds remittances received by Borrower on account of Accounts or other which constitute Collateral or proceeds thereof shall be held as Lender's property by Borrower, as trustee of an express trust for Lender's benefit and Borrower shall immediately deposit same in a lockbox account set up with the Lender. Borrower agrees to pay to Lender any and all reasonable fees, costs and expenses which come into their possession Lender incurs in connection with opening and maintaining a lockbox account and depositing for collection by Lender any check or under their control item of payment received by Lender or delivered to Lender. Borrower further agrees to execute all agreements and immediately upon receipt thereofdocuments and to open and maintain all accounts Lender reasonably deems necessary or appropriate to effectuate an effective lockbox arrangement for the operations of Borrower. Upon an Event of Default, shall deposit or cause Lender retains the same right at all times to be deposited notify Account Debtors that Accounts have been assigned to Lender and to collect Accounts directly in its own name and to charge the Blocked Accountscollection costs and expenses, or remit the same or cause the same to be remitted, in kindincluding attorneys' fees, to AgentBorrower. Borrowers agree Lender has no duty to reimburse Agent protect, insure, collect or realize upon the Accounts or preserve rights in them. For the purpose of computing interest hereunder, all items of payment received by Lender shall be deemed applied by Lender on demand for any amounts owed or paid account of the Obligations (subject to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification final payment of such bank, financial institution or other person. The obligations items) one (1) Business Day after receipt by Lender of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreementitems.
Appears in 1 contract
Sources: Loan and Security Agreement (Franklin Ophthalmic Instruments Co Inc)
Collection of Accounts. (aA) All checks, drafts, cash and other proceeds realized from the sale of any Inventory or otherwise from the sale or other disposition of any of the other Collateral, including, without limitation, all proceeds realized from the collection of the Accounts or otherwise pursuant to any contract right, note, bill, ▇▇aft, acceptance, chose in action and other like forms of general intangibles, and all remittances received by either Borrower in respect to the foregoing, shall, upon receipt by the Borrower, be held by such Borrower as trustee of an express trust for Lender's sole benefit and subject to immediate deposit (in their original form duly endorsed in blank) in the Cash Collateral Account or in a special account over which Lender has the sole right and power of withdrawal, maintained at a financial institution acceptable to Lender (such financial institution and account being herein referred to as the "Depository Bank" and "Depository Account" respectively). The Depository Account shall be subject to the written agreement of the Depository Bank to waive any right of setoff it might otherwise claim to have against any funds in the Depository Account and to otherwise charge any costs relative to the Depository Account to Borrowers or such other account(s) as either Borrower may maintain with the Depository Bank, such agreement (the "Depository Agreement") to be in form and substance acceptable to Lender. Lender assumes no responsibility for any claim of accord and satisfaction or release with respect to funds which have been deposited in the Depository Account.
(B) Upon the occurrence and during the continuance of an Event of Default, if at any time requested by Lender, Continental shall establish and maintain, instruct all Account Debtors to mail their payments directly to a designated post office lockbox (a "Lockbox") maintained at their Continental's expense, blocked accounts or lockboxes and related blocked accounts (in either casewith respect to which only Lender or, “Blocked Accounts”)should Lender so agree, with such banks as are reasonably acceptable to Agent into which, Borrowers a designated financial institution shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables have the right of access and all payments constituting proceeds of Inventory or other Collateral so received shall be subject to immediate deposit into the Depository Account.
(C) All funds held in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers Depository Account shall deliver, or cause be subject to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior transfer to the occurrence Cash Collateral Account, an account designated by the Lender (the "Lender's Account") as set forth in the Depository Agreement or as otherwise designated by Lender. The application of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use any funds therein for working capital and general corporate purposes to the extent permitted hereinpayment of the Obligations shall not occur until Lender's receipt of such funds in cleared federal funds in the Cash Collateral Account or in Lender's Account. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor Lender agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or Lender by wire transfer for either Borrower's account prior to 10:00 a.m. on any Lender, whether in respect business day of the Receivables, as proceeds of Inventory or other Collateral or otherwise Lender shall be treated as deemed cleared federal funds in the Cash Collateral Account. Funds received by Lender by wire transfer for either Borrower's account after 10:00 a.m. on any business day of Lender shall be deemed cleared federal funds in the Cash Collateral Account on the next business day of Lender. The order and method of application of such payments to Agent and Lenders shall be in respect the sole discretion of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinLender.
(bD) For purposes Lender reserves the right upon the occurrence and during the continuance of calculating the amount an Event of the Loans available Default to each Borrower, notify Account Debtors and other Persons indebted to Borrowers of Lender's interest in any such payments will be applied (conditional upon final collection) amounts payable to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Borrowers and to instruct such Account provided such payments Debtors and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time other Persons to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause directly to Lender and upon collection of the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other and deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer Cash Collateral Account, or in Lender's Account of all funds arising therefrom (less any costs of collection and other charges or expenses incurred in connection therewith as hereinafter provided) in cleared federal funds, the same shall be subject to or from application to the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this AgreementObligations.
Appears in 1 contract
Sources: Credit Facility and Security Agreement (Goodman Conveyor Co)
Collection of Accounts. (a) Borrowers shall establish and maintainOn or before the date that is 60 days following the Closing Date, at their expense, blocked accounts or lockboxes and related blocked accounts such later date agreed to by the Agent in its reasonable discretion (in either case, the “Blocked AccountsControl Agreement Deadline”), with such banks as are reasonably acceptable each Grantor shall (i) execute and deliver to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorizedfor each Collateral Deposit Account, executed and delivered by each bank where a Blocked Account is maintained which Collateral Deposit Accounts as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, Closing Date are identified as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligationssuch on Exhibit E, and (ii) Agent establish lock box service (the “Lock Boxes”) with banks at which lock boxes are maintained (which banks as of the Closing Date are set forth in Exhibit E), which Lock Boxes shall be subject to irrevocable lockbox agreements (which may disregard Borrowers’ instructions with respect be set forth in Deposit Account Control Agreements) in form and substance reasonably acceptable to the Blocked Accounts Agent and, if applicable, shall be accompanied by an acknowledgment by the bank where the Lock Box is located of the Lien of the Agent granted hereunder and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited of irrevocable instructions to wire all amounts collected therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless Dominion Account (a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein“Lock Box Agreement”).
(b) For purposes of calculating Each Grantor shall request in writing and otherwise take all necessary steps to ensure that all payments on Accounts are made directly to a Dominion Account (or a Lock Box relating to a Dominion Account). While a Dominion Trigger Period is in effect, the amount of the Loans available Agent shall be authorized to each Borrower, such payments exercise exclusive control over any Collateral Deposit Account at all times and no Grantor will be applied permitted to remove any item from a Lock Box or from a Collateral Deposit Account without the Agent’s prior written consent. The Agent hereby agrees that (conditional upon final collectionA) except as provided in Section 6.1, it will not deliver a notice exercising exclusive control over a Collateral Deposit Account unless a Dominion Trigger Period is in effect and (B) it will deliver a notice rescinding its exclusive control over any Collateral Deposit Account with respect to which it has previously delivered a notice exercising exclusive control if no Dominion Trigger Period is then in effect. If any Grantor should refuse or neglect to notify any Account Debtor to forward payments directly to a Dominion Account (or a Lock Box relating to a Dominion Account), the Agent shall, notwithstanding anything to the Obligations on contrary set forth herein, be entitled to make such notification directly to such Account Debtor. If notwithstanding the Business Day of receipt by foregoing instructions any Grantor receives cash or Payment Items with respect to any Collateral, it shall hold same in trust for Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on promptly (not later than the next Business Day) deposit same into a Dominion Account, except as otherwise expressly permitted by the Credit Agreement. For the purposes of calculating interest on the Obligations, such payments or other The Agent shall hold and apply funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent into Dominion Accounts as provided in the Agent Payment Account Credit Agreement, including, without limitation, as provided such payments or other funds in Sections 5.6 and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day8.2 thereof.
(c) Each Borrower Cash Collateral Account and Guarantor all Cash Collateral shall be under the sole dominion and their respective employees control of Agent at all times, whether or not a Dominion Trigger Period is in effect, and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts no Grantor or other Person shall have any right to any Cash Collateral, until Full Payment of the Obligations. All such Cash Collateral which come into their possession or under their control and immediately upon receipt thereof, while held in a Cash Collateral Account shall deposit or cause the same continue to be deposited held as collateral security for all the Obligations and shall not constitute payment thereof until applied as provided in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Intercreditor Agreement.
Appears in 1 contract
Sources: Loan Agreement (Horizon Global Corp)
Collection of Accounts. (a) Borrowers and Guarantors shall establish and maintain, at their expense, blocked deposit accounts and cash management services of a type and on terms, as Agent may reasonably specify at ▇▇▇▇▇ Fargo and, subject to Section 5.2(d) hereof, such other banks as such Borrower or lockboxes Guarantor may hereafter select. The banks set forth on Schedule 8.10 of the Information Certificate constitute all of the banks with which Borrowers and related blocked Guarantors have deposit account and cash management arrangements as of the date of this Agreement and describes the nature of the use of such deposit account by such Borrower or Guarantor (collectively, together with any accounts (in either caseof Borrowers and Guarantors at Lender, the “Blocked Cash Management Accounts” and individually a “Cash Management Account”).
(b) Borrowers shall, with such banks as are reasonably acceptable to Agent into whichand shall cause Guarantors to, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered deposited all proceeds of Collateral, including all proceeds from sales of Inventory, all amounts payable to each Borrower and Guarantor and all other proceeds of Collateral, from each location of such Borrower and Guarantor on each Business Day into the Cash Management Account of such Borrower and Guarantor used for such purpose. All such funds deposited into the Cash Management Accounts shall be sent by wire transfer or other electronic funds transfer each day to the Concentration Accounts.
(c) Without limiting any other rights or remedies of Agent a Deposit and Lenders, Agent may, at its option, instruct the depository banks at which the Concentration Accounts are maintained to transfer all available funds received or deposited into the Concentration Accounts to the Agent Payment Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to at any time after the occurrence of a Cash Management Dominion Event, Borrowers . At all times that Agent shall be permitted have notified any depository bank to transfer cash funds from the Blocked Accounts and to use funds therein for working capital and general corporate purposes a Concentration Account to the extent permitted herein. Upon the occurrence of a Cash Management EventAgent Payment Account, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any LenderConcentration Accounts, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(bd) Without limiting any other rights or remedies of Agent and Lenders, Agent may, at its option, send a “notice of exclusive control” or similar notice and otherwise instruct the securities intermediary or other Person party to an Investment Property Control Agreement that no funds in any investment account or other account subject to such agreement may be transferred except to the Concentration Accounts or otherwise paid to the Agent Payment Account at any time on or after a Cash Dominion Event and for so long as the same is continuing or at any time on or after Agent receives a notice of the intention of the securities intermediary or other party thereto to terminate such Investment Property Control Agreement.
(e) For purposes of calculating the amount of the Loans and Letters of Credit available to each BorrowerBorrowers, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on one (1) Business Day following the date of receipt by Agent of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. In the event that at any time or from time to time there are no Revolving Loans outstanding, Agent shall be entitled to an administrative fee in an amount calculated based on the Interest Rate for Prime Rate Loans (on a per annum basis) multiplied by the amount of the funds received in the Concentration Accounts for such day as calculated by Agent in accordance with its customary practice. The economic benefit of the timing in the application of payments (and the administrative charge with respect thereto, if applicable) shall be for the sole benefit of Agent.
(cf) Each Borrower and Guarantor and their respective employees employees, agents and agents Subsidiaries shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. In no event shall the same be commingled with any Borrower’s or Guarantor’s own funds. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Concentration Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Concentration Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.
Appears in 1 contract
Collection of Accounts. Until such time as provided in this Section, Borrower is authorized to collect the Accounts in a commercially reasonable manner, provided that (a) Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable Borrower instructs all Account Debtors to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables all Accounts directly and exclusively to the Lock Box as instructed in the Notice of Assignment, and (b) in the event Borrower receives any payment from an Account Debtor on an Account, Borrower immediately delivers such payment to the Lock Box. Borrower agrees to use diligent and good faith efforts to collect the Accounts. Notwithstanding the foregoing, Borrower authorizes Lender to contact Account Debtors concerning verification and payment of Accounts. Upon Borrower’s receipt of notice from Lender that an Event of Default or event which, with the passage of time or giving of notice or both, would constitute an Event of Default, has occurred or that Lender deems itself insecure, the following terms and conditions shall thereafter apply to all Accounts:
a. Unless directed otherwise in writing by Lender, Borrower shall promptly mail an invoice to each Account Debtor on each Account, which invoice shall be stamped or printed with a notice, in a form acceptable to Lender, stating that the Account is payable to Lender and providing Lender’s payment instructions. Except as agreed otherwise in writing by Lender, Lender shall have the exclusive right to collect and to receive all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are madeon all Accounts. Borrower shall not otherwise b▇▇▇ for, whether by cash, check or other manner. Borrowers shall deliversubmit any invoice, or cause otherwise attempt to be delivered collect any Account. Lender is authorized to Agent a Deposit use the Notice of Assignment, or any other form of notice as determined by Lender, to notify Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to Debtors of the occurrence assignment of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Borrower’s Accounts and to use funds therein direct Account Debtors to make all payments on Accounts directly to Lender.
b. Borrower authorizes Lender to contact Account Debtors concerning verification, payment, and collection of Accounts and to settle or compromise any Account, in the sole discretion of Lender subject only to acting in good faith. Borrower hereby waives and releases any and all claims relating to or arising out of any act or omission by Lender in the verification and collection of Accounts, excluding those based on gross negligence or intentional misconduct.
c. Borrower shall promptly and completely respond to all requests from Lender for working capital any information or records requested to assist in collection of Accounts. If Borrower fails to respond to any request within two (2) Banking Business Days, Lender may deem the Account to no longer be an Eligible Account.
d. Upon inquiry from a customer or upon request of Lender, Borrower shall notify the customer to make payment directly to or as directed by Lender.
e. All collections of Accounts shall be handled by Lender. Collection of Accounts in a commercially reasonable manner does not require, and general corporate purposes Lender is not obligated, to commence any legal action, including, without limitation, the extent permitted hereinsending of an attorney’s demand letter, to collect any Account. Upon the occurrence of a Cash Management Event, (i) each Borrower acknowledges and Guarantor agrees that all payments made to such Blocked Accounts Lender is not a collection agency and will not provide debt collection services for Borrower’s Accounts. If any Account is not timely paid, Lender may, but is not obligated to, engage a collection agency, attorney or other funds received service provider to collect the Accounts. All commissions, fees and collected charges of any such collection agency, attorney or other service provider shall be paid by Agent Borrower.
f. Lender may, but has no duty to, and Borrower hereby authorizes Lender to, execute and file, on behalf of Borrower or in Lender’s name, mechanic’s liens and all other notices and documents to create, perfect, preserve, foreclose and/or release any lien for work performed or materials provided to improve real property. Except as otherwise instructed by Lender, whether Borrower is authorized to file any such mechanic’s liens and other notices and documents in respect Borrower’s discretion.
g. Any payments received by Borrower on Accounts shall be held in trust by Borrower for Lender. In the event an Account Debtor makes payment to Borrower on any Account, Borrower shall immediately notify Lender of the Receivablespayment and deliver the payment to Lender. If payment is made by check or similar instrument, as proceeds of Inventory or other Collateral or otherwise such instrument shall be treated as payments immediately delivered to Agent and Lenders Lender in respect the form received without negotiation. If any payment received by Borrower on any Account is deposited or negotiated by Borrower, or if Borrower fails to tender the payment to Lender within two (2) Banking Business Days of the outstanding Obligations and therefore receipt by Borrower, Borrower shall constitute the property promptly pay Lender a payment conversion fee equal to ten percent (10%) of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available payment. Lender is authorized and directed to each Borrower, such payments will be applied (conditional upon final collection) disburse a sufficient amount of the Loan as necessary to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Daypay any payment conversion fees.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.
Appears in 1 contract
Collection of Accounts. (a) Borrowers To expedite collection, Borrower shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form first instance to make collection of their Accounts for Lender. All remittances received by Borrower on account of Accounts shall be held as Lender's property by Borrower as trustee of an express trust for Lender's benefit and Borrower shall deposit same in which such payments are madethe Dominion Account. Lender retains the right, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed upon and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to after the occurrence of a Cash Management Eventan Event of Default, Borrowers to notify Account Debtors that Accounts have been assigned to Lender and to collect Accounts directly in its own name and to charge the collection costs and expenses, including attorneys' fees, to Borrower. Lender has no duty to protect, insure, collect or realize upon the Accounts or preserve rights in them. For the purpose of computing interest hereunder, all items of payment received by Lender shall be permitted deemed applied by Lender on account of the obligations (subject to transfer cash final payment of such items) on the first Business Day after Lender's withdrawal of such payment from the Blocked Accounts and to use Dominion Account in immediately available funds. Whenever reasonably practicable, Lender shall withdraw all funds therein contained in the Dominion Account on a daily basis, for working capital and general corporate purposes application of such funds to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect payment of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein obligations as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts Borrower shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount deposit all proceeds of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in kind in the Blocked AccountsDominion Account pursuant to an arrangement with such banks as may be selected by Borrower and be acceptable to Lender. Borrower shall deposit all payments or other remittances received by Borrower in their operating accounts to the Dominion Account. After the occurrence of an Event of Default Lender may, and Borrower shall at Lender's request, notify Account Debtors and all other parties obligated on the Collateral to make payments directly to the Dominion Account. All funds deposited in the Dominion Account shall immediately become the Property of Lender, and Borrower shall obtain the agreement by such banks to waive any offset rights against the funds so deposited. Lender assumes no responsibility for such account arrangement, including, without limitation, any claim of accord and satisfaction or remit the same or cause the same release with respect to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to deposits accepted by any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreementthereunder.
Appears in 1 contract
Sources: Loan and Security Agreement (Red Man Pipe & Supply Co)
Collection of Accounts. (a) Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to Following the occurrence of a Cash Management Eventan Event of Default (as hereinafter defined), Borrowers shall be permitted to transfer cash from the Blocked Accounts Bank is authorized at any time and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time to take all actions necessary to collect all or any part of the Accounts in its own name or in the name of Grantor. Upon request of Bank, Grantor shall execute and within sufficient deliver to Bank (in addition to documents previously delivered to Bank) an assignment, in a form satisfactory to Bank, of all Grantor's right, title, and interest in and to each of the Accounts, and shall obtain an acknowledgment of assignment from any and all account debtors in a form satisfactory to Bank. Following the occurrence of an Event of Default, if the Accounts at any time include more than one Account of the same account debtor, Bank may apply the proceeds of any collection received from such account debtor toward the liquidation of any such Account as Bank may determine. Following the occurrence of an Event of Default, Bank may settle or adjust all disputes or claims directly with the account debtors with respect to credit such Borrower’s loan account any of the Accounts, and may compromise or extend the time of payment for any of the Accounts on such day, terms and if not, then on conditions as Bank may determine without affecting the next Business Day. For the purposes liability of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts Grantor under this Security Agreement or any other payment document evidencing or relating to and/or proceeds the obligations. The costs of such collection and enforcement, including attorneys' fees and out-of-pocket expenses and all other expenses and liabilities resulting therefrom, shall be borne solely by Grantor and shall be immediately due and payable to Bank by Grantor. Bank shall not be liable for failure to collect or enforce any of the Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed act or paid omission on the part of Bank or its officers, agents, and employees, except willful misconduct. Until Bank exercises its right, Grantor is authorized to, and shall use, its best efforts to effect the prompt collection of the Accounts. This authorization may be terminated at any bank or other financial institution time following the occurrence of an Event of Default, and Bank may, at which a Blocked Account or its election, notify any other deposit account or investment account is established or debtor on any other bank, financial institution or other person involved in of the transfer Accounts of funds to or the assignment thereof and effect collection of any of the Accounts directly from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreementaccount debtor obligated thereon.
Appears in 1 contract
Sources: Security Agreement (Palweb Corp)
Collection of Accounts. (a) Prior to the occurrence of a Compliance Triggering Event or Event of Default, Borrowers shall retain control of their cash, including payments and proceeds of Collateral. Concurrently with this Agreement, Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), as Agent may specify, with such banks as are reasonably acceptable to Agent into whichAgent. Such Blocked Accounts may be Central Collection Deposit Accounts, Borrowers and the term Blocked Accounts shall mean and include the Central Collection Deposit Accounts. Upon the occurrence and during the continuance of an Event of Default or upon a Compliance Triggering Event and during any Availability Compliance Period, and upon Agent’s request, each Borrower shall promptly deposit into one or more Blocked Accounts, and direct their respective its account debtors to directly remit into such Blocked Accounts all payments on Receivables Receivables, other than the Non-Borrower Receivables, and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers Concurrently with this Agreement, each Borrower shall deliver, or cause to be delivered to Agent Agent, a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained which agreement shall provide that upon notice from Agent (which shall be given upon an Event of Default or a Compliance Triggering Event and revoked promptly after the expiration of the related Availability Compliance Reinstatement Date or waiver of such Event of Default in accordance with the terms hereof, as provided in Section 5.2 hereof. Prior applicable), such bank will send funds on a daily basis to the occurrence of a Cash Management EventAgent Payment Account and otherwise take instruction with respect to such Blocked Account only from Agent. Promptly upon Agent’s request, Borrowers each Borrower shall be permitted to transfer cash from the Blocked Accounts execute and to use funds therein for working capital and general corporate purposes deliver such agreements or documents as Agent may require in connection therewith. Each Borrower agrees that after notice by Agent to the extent permitted herein. Upon bank under the occurrence of a Cash Management EventDeposit Account Control Agreement, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any LenderAgent, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent Agent, for itself and the ratable benefit of the Lenders and the Bank Product Providers, in respect of the outstanding Obligations and therefore shall constitute the property of Agent Agent, for itself and the ratable benefit of the Lenders and the Bank Product Providers, to the extent of the then outstanding Obligations; provided, and (ii) Agent may disregard Borrowers’ instructions with respect to however, that in the event any Non-Borrower Receivable is deposited into the Blocked Accounts Accounts, in error or otherwise, such deposit shall be treated as a non-refundable payment to Agent, for itself and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount ratable benefit of the Loans available to each BorrowerLenders and the Bank Product Providers, such payments will be applied (conditional upon final collection) to in respect of the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as therefore shall constitute the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds for itself and the ratable benefit of Accounts or other Collateral which come into their possession or under their control the Lenders and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kindBank Product Providers, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer extent of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreementthen outstanding Obligations.
Appears in 1 contract
Sources: Loan and Security Agreement (New York & Company, Inc.)
Collection of Accounts. (a) Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each If Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, Affiliate receives any monies, checks, notes, drafts drafts, and other payments relating to or constituting proceeds of accounts or of any other Collateral, Borrower shall immediately (but in any event within three (3) Business Days) deposit such items in kind in the Collection Account, fully-endorsed. Borrower shall advise each Account Debtor that remits amounts payable on the accounts or any other payment Person that remits amounts to Borrower in respect of any of the Collateral by wire transfer or Automated Clearing House to make such remittances directly to the Collection Account.
(b) Borrower shall establish a Lockbox and shall cause all moneys, checks, notes, drafts and other payments relating to and/or or constituting proceeds of Accounts accounts, or of any other Collateral, to be forwarded to a Lockbox for deposit in the Collection Account. In particular, Borrower will (i) advise each Account Debtor to address to the Lockbox specified by Lender all remittances with respect to amounts payable on all accounts of Borrower, and (ii) stamp all invoices relating to any such amounts with a legend satisfactory to Lender indicating that payment is to be made to Borrower via the specified Lockbox.
(c) To the extent applicable, Borrower and Lender shall cause all balances in each Collection Account (if any) to be transmitted daily to the Collection Account by wire transfer or depository transfer check or Automated Clearing House transfer.
(d) Any payments which are received by Borrower or any Affiliate (including any payment evidenced by a promissory note or other Collateral which come into their possession or under their control instrument) shall be held in trust for Lender and immediately upon receipt thereof, shall deposit or cause the same to be (i) deposited in the Blocked AccountsCollection Account, or remit (ii) delivered to Lender, as promptly as possible in the same or cause the same to be remittedexact form received, together with any necessary endorsements.
(e) Borrower shall pay all customary fees, costs and expenses in kind, to Agent. Borrowers agree to reimburse Agent on demand for connection with opening and maintaining any amounts owed or paid to any bank or other financial institution at which a Blocked Collection Account or any other deposit account or investment account is established or any other bankLockbox, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreementas applicable.
Appears in 1 contract
Collection of Accounts. (aA) Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into whichTo expedite collection, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form in which such payments are made, whether first instance to make collection of their Accounts for Lender. All remittances received by cash, check or other manner. Borrowers on account of Accounts shall be held by Borrowers as trustee of an express trust for Lender's benefit and Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided immediately deposit the same in Section 5.2 hereofthe Dominion Account. Prior to the occurrence of a Cash Management Event, Borrowers Such express trust shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions cease with respect to any funds transferred by the Blocked Dominion Account Bank to the applicable Borrower in accordance with the Dominion Account Agreement. Lender retains the right after an Event of Default to notify Account Debtors that Accounts have been assigned to Lender and exercise exclusive dominion to collect Accounts directly in its own name and control over to charge the Blocked collection costs and expenses, including attorneys' fees, to the applicable Borrower. Lender has no duty to protect, insure, collect or realize upon the Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue or preserve rights in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinthem.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(cB) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or shall deposit all proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to be remitted, in kind, a lockbox arrangement reasonably acceptable to AgentLender. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Each Borrower shall issue to any bank such banks an irrevocable letter of instruction directing such banks to deposit all payments or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved remittances received in the transfer of lockbox to the Dominion Account for application in accordance with this Agreement. All funds deposited in the Dominion Account shall immediately become Collateral and Borrowers shall obtain the agreement by such banks to or from waive any offset rights against the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other personfunds so deposited. The obligations of Borrowers to reimburse Agent Lender assumes no responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 deposits accepted by any bank thereunder.
(C) All funds on deposit in the Dominion Account shall survive be subject to the termination provisions of this the Dominion Account Agreement.
Appears in 1 contract
Collection of Accounts. (aA) Borrowers To expedite collection, Borrower shall establish endeavor in the first instance to make collection of its Accounts for Collateral Agent and maintain, at their expense, blocked accounts or lockboxes Lenders. All remittances received by Borrower on account of Accounts shall be held as Lenders' property by Borrower as trustee of an express trust for Lenders' benefit and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers Borrower shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral same in the identical form in which such payments are made, whether by cash, check or other mannerDominion Account. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the right at any time after the occurrence of an Event of Default to notify Account Debtors that Accounts have been assigned to Collateral Agent and Lenders, and to collect Accounts directly in its own and Lenders' name and to charge the collection costs and expenses, including reasonable attorneys' fees, to Borrower. Neither Collateral Agent nor any Lender has any duty to protect, insure, collect or realize upon the Accounts or preserve rights in them. For the purpose of exclusive dominion and control as described herein.
(b) For purposes computing interest hereunder, all items of calculating the amount payment received by Collateral Agent shall be deemed applied by Collateral Agent on account of the Loans available Obligations (subject to each Borrower, final payment of such payments will be applied (conditional upon final collectionitems) to the Obligations on the same Business Day of as the receipt by Collateral Agent of such items of payment in Chicago, Illinois in immediately available funds in the Agent Payment Account provided funds, if such payments and notice thereof items of payment are received in accordance with Agent’s usual prior to 1:00 P.M. (Chicago, Illinois time) and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes Day if such items of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof payment are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such dayafter 1:00 P.M. (Chicago, and if not, then on the next Business DayIllinois time).
(cB) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or shall deposit all proceeds of Accounts or other the Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to a lockbox arrangement with such banks as may be remitted, in kind, selected by Borrower and be acceptable to AgentLenders. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Borrower shall issue to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution an irrevocable letter of instruction directing such banks to deposit all payments or other personremittances received in the lockbox to the Dominion Account for application on account of the Obligations. The obligations All funds deposited in the Dominion Account shall immediately become the property of Borrowers Lenders and Borrower shall obtain the agreement by such banks to reimburse Agent waive any offset rights against the funds so deposited. Lender assumes no responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 shall survive the termination of this Agreementdeposits accepted by any bank thereunder.
Appears in 1 contract
Collection of Accounts. Until such time as provided in this Section, Borrower is authorized to collect the Accounts in a commercially reasonable manner, provided that (a) Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable Borrower instructs all Account Debtors to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables all Accounts directly and exclusively to the Lock Box as instructed in the Notice of Assignment, and (b) in the event Borrower receives any payment from an Account Debtor on an Account, Borrower immediately delivers such payment to the Lock Box. Borrower agrees to use diligent and good faith efforts to collect the Accounts. Notwithstanding the foregoing, Borrower authorizes Lender to contact Account Debtors concerning verification and payment of Accounts. Upon Borrower’s receipt of notice from Lender that an Event of Default or event which, with the passage of time or giving of notice or both, would constitute an Event of Default, has occurred or that Lender deems itself insecure, the following terms and conditions shall thereafter apply to all Accounts:
a. Unless directed otherwise in writing by Lender, Borrower shall promptly mail an invoice to each Account Debtor on each Account, which invoice shall be stamped or printed with a notice, in a form acceptable to Lender, stating that the Account is payable to Lender and providing Lender’s payment instructions. Except as agreed otherwise in writing by Lender, Lender shall have the exclusive right to collect and to receive all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are madeon all Accounts. Borrower shall not otherwise ▇▇▇▇ for, whether by cash, check or other manner. Borrowers shall deliversubmit any invoice, or cause otherwise attempt to be delivered collect any Account. Lender is authorized to Agent a Deposit use the Notice of Assignment, or any other form of notice as determined by Lender, to notify Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to Debtors of the occurrence assignment of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Borrower’s Accounts and to use funds therein direct Account Debtors to make all payments on Accounts directly to Lender.
b. Borrower authorizes Lender to contact Account Debtors concerning verification, payment, and collection of Accounts and to settle or compromise any Account, in the sole discretion of Lender subject only to acting in good faith. Borrower hereby waives and releases any and all claims relating to or arising out of any act or omission by Lender in the verification and collection of Accounts, excluding those based on gross negligence or intentional misconduct.
c. Borrower shall promptly and completely respond to all requests from Lender for working capital any information or records requested to assist in collection of Accounts. If Borrower fails to respond to any request within two (2) Banking Business Days, Lender may deem the Account to no longer be an Eligible Account.
d. Upon inquiry from a customer or upon request of Lender, Borrower shall notify the customer to make payment directly to or as directed by Lender.
e. All collections of Accounts shall be handled by Lender. Collection of Accounts in a commercially reasonable manner does not require, and general corporate purposes Lender is not obligated, to commence any legal action, including, without limitation, the extent permitted hereinsending of an attorney’s demand letter, to collect any Account. Upon the occurrence of a Cash Management Event, (i) each Borrower acknowledges and Guarantor agrees that all payments made to such Blocked Accounts Lender is not a collection agency and will not provide debt collection services for Borrower’s Accounts. If any Account is not timely paid, Lender may, but is not obligated to, engage a collection agency, attorney or other funds received service provider to collect the Accounts. All commissions, fees and collected charges of any such collection agency, attorney or other service provider shall be paid by Agent Borrower.
f. Lender may, but has no duty to, and Borrower hereby authorizes Lender to, execute and file, on behalf of Borrower or in Lender’s name, mechanic’s liens and all other notices and documents to create, perfect, preserve, foreclose and/or release any lien for work performed or materials provided to improve real property. Except as otherwise instructed by Lender, whether Borrower is authorized to file any such mechanic’s liens and other notices and documents in respect Borrower’s discretion.
g. Any payments received by Borrower on Accounts shall be held in trust by Borrower for Lender. In the event an Account Debtor makes payment to Borrower on any Account, Borrower shall immediately notify Lender of the Receivablespayment and deliver the payment to Lender. If payment is made by check or similar instrument, as proceeds of Inventory or other Collateral or otherwise such instrument shall be treated as payments immediately delivered to Agent and Lenders Lender in respect the form received without negotiation. If any payment received by Borrower on any Account is deposited or negotiated by Borrower, or if Borrower fails to tender the payment to Lender within two (2) Banking Business Days of the outstanding Obligations and therefore receipt by Borrower, Borrower shall constitute the property promptly pay Lender a payment conversion fee equal to ten percent (10%) of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available payment. Lender is authorized and directed to each Borrower, such payments will be applied (conditional upon final collection) disburse a sufficient amount of the Loan as necessary to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Daypay any payment conversion fees.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.
Appears in 1 contract
Collection of Accounts. Debtor shall, unless otherwise directed by Agent following the occurrence and during the continuation of an Event of Default under either of the Bank Agreement or the Met Life Agreement (a) Borrowers shall establish as "Event of Default" is defined in those respective agreements), collect all of Debtor's Receivables. With respect to any Receivables collected by the Agent, Debtor authorizes Agent to indorse the name of Debtor upon any checks or other items received in payment of any Receivable and maintainto do any and all things necessary in order to reduce the same to money. All amounts received by Agent representing payment of Receivables may be applied by Agent to the payment of the Obligations in such order of preference as Agent may determine, or Agent may, at their expenseits option, blocked impound all or any portion of such amounts and retain said amounts as security for the payment of the Obligations, with the right on the part of Debtor, upon approval by Agent, to obtain the release of all or part of such impounded amounts. Agent may, however, at any time, apply all or any part of such impounded amounts as aforesaid. If so directed by Agent following the occurrence and during the continuation of an Event of Default under either of the Bank Agreement or the Met Life Agreement, Debtor shall hold all payments of any Receivable in trust for Agent and shall forthwith deliver the same to Agent in the form received by Debtor without commingling with any funds of Debtor. Debtor also authorizes Agent at any time following the occurrence and during the continuation of an Event of Default under either of the Bank Agreement or the Met Life Agreement, without notice, to appropriate and apply any balances, credits, property, deposits, accounts or lockboxes money of or owing to Debtor in Agent's possession, custody or control to the payment of any of the Obligations. Debtor agrees to execute, deliver, file and related blocked accounts (in either caserecord all such notices, “Blocked Accounts”)affidavits, with such banks assignments, financing statements and other instruments as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form reasonable judgment of Agent be necessary or desirable to evidence, validate and perfect the security interest of Agent in which such payments are made, whether by cash, check or other mannerthe Receivables. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to Following the occurrence and during the continuation of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence an Event of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect Default under either of the ReceivablesBank Agreement or the Met Life Agreement, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights right to notify any persons or entities owing any Receivables and to demand and receive payment, but Agent shall have no duty so to do. Upon request of exclusive dominion Agent following the occurrence and control as described herein.
(b) For purposes during the continuation of calculating the amount an Event of Default under either of the Loans available Bank Agreement or the Met Life Agreement, Debtor shall notify such account debtors and shall indicate on all invoices to each Borrower, such payments will be applied (conditional upon final collection) to account debtors that the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof accounts are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, payable to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.
Appears in 1 contract
Collection of Accounts. (a) Borrowers To expedite collection, Borrower shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form in which such payments are made, whether first instance to make collection of its Accounts for Agent. All remittances received by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence Borrower on account of a Cash Management Event, Borrowers Accounts shall be permitted to transfer cash from held as Agent's property by Borrower as trustee of an express trust for Agent's benefit and Borrower shall immediately deposit same in the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted hereinDominion Account. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the right at any time after the occurrence of an Event of Default to notify Account Debtors that Accounts have been assigned to Agent and to collect Accounts directly in its own name and to charge the collection costs and expenses, including reasonable attorneys' fees, to Borrower. Agent has no duty to protect, insure, collect or realize upon the Accounts or preserve rights of exclusive dominion and control as described hereinin them.
(b) For purposes of calculating the amount Borrower shall deposit all proceeds of the Loans available to each BorrowerCollateral, such payments will be applied (conditional upon final collection) to other than receipts for the Obligations on the Business Day sale of receipt Property held by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices third parties as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such dayreserves for like/kind exchanges, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to a lockbox arrangement with such banks as may be remitted, in kind, selected by Borrower and be acceptable to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Borrower shall issue to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution an irrevocable letter of instruction directing such banks to deposit all payments or other personremittances received in the lockbox to the Dominion Account for application on account of the Obligations. The obligations All funds deposited in the Dominion Account shall immediately become the property of Borrowers Agent and Borrower shall obtain the agreement by such banks to reimburse waive any offset rights against the funds so deposited. Agent assumes no responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 shall survive the termination of this Agreementdeposits accepted by any bank thereunder.
Appears in 1 contract
Sources: Loan and Security Agreement (Cal Dive International Inc)
Collection of Accounts. (a) Borrowers shall establish and maintainLender or its designee may, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”)any time, with or without notice to Borrower, notify customers or Account debtors that the Accounts have been assigned to Lender, and that Lender has a security interest in them and collect the Accounts directly, and add the collection costs and expenses to the Obligations, but, unless and until Lender does so or gives Borrower other written instructions, Borrower shall notify all Account debtors to remit payments on Accounts by check to Lender’s lockbox to be designated by Lender. Any wire transfers or ACH electronic payments shall be sent directly into Lender’s blocked account. All such banks as are reasonably acceptable payments remitted to Agent the lockbox shall be credited to a deposit account of Lender and into which, Borrowers shall promptly deposit and direct their respective which account remittances from account debtors to directly remit of other clients of Lender may be credited. If notwithstanding said notice Borrower obtains payment on any Account, Borrower shall receive all payments on Receivables Accounts and all payments constituting proceeds other proceeds, including cash, of Inventory or other Collateral in the identical form in which such trust for Lender and immediately deposit said payments are madeinto Lender’s blocked account, whether with any necessary endorsements and remit copies of said payments to Lender via electronic mail. Any credit card payments obtained by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers Borrower on Accounts shall be permitted remitted to transfer cash from Lender on the Blocked Accounts and day of receipt of such credit card payment, by depositing an exchange check into Lender’s blocked account. Notwithstanding the foregoing, on or before January 31, 2011, Lender shall use its good faith commercially reasonable efforts to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of establish a Cash Management Event, separate deposit account (i“Lender’s Deposit Account”) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any under Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise ’s exclusive dominion and control over the Blocked Accounts and apply control. No funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts Lender or any other payment relating to and/or proceeds of Accounts person shall be held in the Lender’s Deposit Account or other Collateral which come into their possession commingled in any way with the funds held therein. Once the Lender’s Deposit Account has been established, all checks received in the lockbox and all wire transfers or under their control and immediately upon receipt thereof, ACH electronic payments shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of AgentLender’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this AgreementDeposit Account.
Appears in 1 contract
Sources: Loan and Security Agreement (Corporate Resource Services, Inc.)
Collection of Accounts. (aA) Borrowers To expedite collection, Borrower shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral endeavor in the identical form first instance to make collection of its Accounts for Lender. All remittances received by Borrower on account of Accounts shall be held as Lender's property by Borrower as trustee of an express trust for Lender's benefit and Borrower shall immediately deposit same in which such payments are made, whether by cash, check or other mannerthe Dominion Account. Borrowers Lender shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to have the right at any time after the occurrence of a Cash Management Event, Borrowers shall be permitted an Event of Default to transfer cash from the Blocked notify Account Debtors that Accounts have been assigned to Lender and to use funds therein for working capital collect Accounts directly in its own name and general corporate purposes to charge the extent permitted hereincollection costs and expenses, including reasonable attorneys' fees, to Borrower. Upon Lender has no duty to protect, insure, collect or realize upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether preserve rights in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinthem.
(bB) For purposes of calculating the amount Borrower shall deposit all proceeds of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to a lockbox arrangement with such banks as may be remitted, in kind, selected by Borrower and be acceptable to AgentLender. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Borrower shall issue to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution an irrevocable letter of instruction directing such banks to deposit all payments or other personremittances received in the lockbox to the Dominion Account for application on account of the Obligations. The obligations All funds deposited in the Dominion Account shall immediately become the property of Borrowers Lender and Borrower shall obtain the agreement by such banks to reimburse Agent waive any offset rights against the funds so deposited. Lender assumes no responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 shall survive the termination of this Agreementdeposits accepted by any bank thereunder.
Appears in 1 contract
Sources: Loan and Security Agreement (Cal Dive International Inc)
Collection of Accounts. (aA) Borrowers All remittances received by Borrower on account of Accounts shall establish be held as Agent's and maintain, at their expense, blocked accounts or lockboxes Lenders' property by Borrower as trustee of an express trust for Agent's and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers Lenders' benefit and Borrower shall promptly immediately deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral same in the identical form Dominion Account as required by and in which such payments are made, whether by cash, check or other manneraccordance with Section (B) below. Borrowers shall deliver, or cause Agent retains the right at all times to be delivered to Agent a Deposit notify Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Debtors that Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments have been assigned to Agent and Lenders to collect Accounts directly in respect its own name and to charge the collection costs and expenses, including attorneys' fees to Borrower. Agent has no duty to protect, insure, collect or realize upon the Accounts or preserve rights in them. For the purpose of computing interest hereunder, all items of payment received by Agent shall be deemed applied by Agent on account of the outstanding Obligations and therefore shall constitute (subject to final payment of such items) on the property first Business Day after Agent's receipt of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue payment in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described hereinimmediately available funds.
(bB) For purposes of calculating the amount Borrower shall deposit all proceeds of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same kind in a Dominion Account pursuant to a lockbox arrangement with such banks as may be remitted, in kind, selected by Borrower and be acceptable to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid Borrower shall issue to any bank such banks an irrevocable letter of instruction directing such banks to deposit all payments or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved remittances received in the transfer lockbox to the Dominion Account for application on account of the Obligations. All funds deposited in the Dominion Account shall immediately become the property of Agent and Borrower shall obtain the agreement by such banks to or from waive any offset rights against the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other personfunds so deposited. The obligations of Borrowers to reimburse Agent assumes no responsibility for such amounts pursuant lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to this Section 6.3 shall survive the termination of this Agreementdeposits accepted by any bank thereunder.
Appears in 1 contract
Collection of Accounts. (a) Borrowers shall establish The Collateral Agent as agent for the Secured Parties hereby authorizes the Debtor to collect and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “Blocked Accounts”), with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting dispose of the proceeds of Inventory the Accounts, which authority the Collateral Agent may curtail or other Collateral in terminate at any time following the identical form in which occurrence and during the continuance of any Event of Default. After such payments are madeauthority has been curtailed or terminated, whether by the Debtor shall, upon receipt of all checks, drafts, cash, check and other remittances in payment of or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect on account of the ReceivablesAccounts, deposit the same in a special account designated by the Collateral Agent, over which account the Collateral Agent as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of agent for the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent Secured Parties alone shall have the rights power of exclusive dominion and control withdrawal (the "Collection Account"). The remittance of the proceeds of such Accounts shall not, however, constitute payment or liquidation of such Accounts until the Collateral Agent as described herein.
(b) agent for the Secured Parties shall receive good funds for such proceeds. For purposes of calculating computing interest, the amount of the Loans available to each BorrowerCollateral Agent shall treat deposited checks, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments drafts and notice thereof are received other items as collected in accordance with the Collateral Agent’s usual 's normal availability schedule, but in doing so the Collateral Agent is not agreeing that such funds have in fact been paid, nor is the Collateral Agent as agent for the Secured Parties waiving any right it may have to charge back returned items to the Debtor and customary practices to collect interest on such charged-back items. Funds placed in the Collection Account shall be held by the Collateral Agent as agent for the Secured Parties as security for the Obligations. These proceeds shall be deposited in effect precisely the form received, except for the endorsement of the Debtor where necessary to permit collection of items, which endorsement the Debtor agrees to make, and which endorsement the Collateral Agent is also hereby authorized to make on behalf of the Debtor. Pending such deposit, the Debtor agrees that it will not commingle any such checks, drafts, cash or other remittances with any funds or other property of the Debtor but will hold them separate and apart therefrom, and upon an express trust for the Collateral Agent until deposit thereof is made in the Collection Account. The Collateral Agent as agent for the Secured Parties will from time to time and within sufficient time to credit such Borrower’s loan account apply the funds on such day, and if not, then on deposit in the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to Collection Account against the Obligations on in such order of application as is required by the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Intercreditor Agreement.
Appears in 1 contract
Sources: Security Agreement (Trex Co Inc)
Collection of Accounts. (a) Borrowers shall establish and maintain, at their expense, blocked deposit account arrangements and merchant payment arrangements with the banks set forth on SCHEDULE 8.10 hereto and after prior written notice to Agent, such other banks as Borrowers may hereafter select as are acceptable to Agent. The banks set forth on SCHEDULE 8.10 constitute all of the banks with whom Borrowers have deposit account arrangements and merchant payment arrangements as of the date hereof and identifies the Borrower maintaining such arrangements and identifies each of the deposit accounts at such banks to a retail store location of Borrowers or lockboxes otherwise describes the nature of the use of such deposit account by Borrowers.
(b) Each Borrower shall deposit all proceeds from sales of Inventory in every form, including cash, checks, credit card sales drafts, credit card sales or charge slips or receipts and related blocked other forms of daily store receipts, from each retail store location of such Borrower on each Business Day into the deposit accounts of such Borrower used solely for such purpose and identified to each retail store location as set forth on SCHEDULE 8.10. Borrowers shall cause all such funds deposited into the separate deposit accounts to be sent by wire transfer or by automated clearinghouse transfer daily and all other proceeds of Collateral to be sent daily by wire transfer, to the Blocked Accounts or the Agent Payment Account. Each Borrower shall irrevocably direct in writing, in form and substance satisfactory to Agent (in either case, “Blocked Accounts”a "Payment Direction Letter"), each of the banks in which any such deposit account is located and into which proceeds from sales of Inventory from a retail store location of such Borrower are at any time deposited not to honor any instruction from a Borrower with respect to such deposit account or any funds in such account other than an instruction of such Borrower to send all funds deposited in such account by wire transfer or automated clearinghouse transfer to a Blocked Account or the Agent Payment Account, and to honor any direction of Agent with respect to such deposit account and the funds in such account, even if Agent's direction is contrary to any instruction of a Borrower. Such direction shall not be rescinded, revoked or modified without the prior written consent of Agent.
(c) Borrowers shall establish and maintain, at its expense, deposit accounts with such banks as are reasonably acceptable to Agent into which, Borrowers shall promptly deposit and direct their respective account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in (the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof. Prior to the occurrence of a Cash Management Event, Borrowers shall be permitted to transfer cash from the Blocked Accounts and to use funds therein for working capital and general corporate purposes to the extent permitted herein. Upon the occurrence of a Cash Management Event, (i) each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the outstanding Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations, and (ii) Agent may disregard Borrowers’ instructions with respect to the Blocked Accounts and exercise exclusive dominion and control over the Blocked Accounts and apply funds deposited therein as provided herein. Agent’s right to exercise exclusive dominion and control over the Blocked Accounts shall continue in effect only until the occurrence of a Cash Management Reinstatement Event, unless a subsequent Cash Management Event shall occur, whereupon Agent shall have the rights of exclusive dominion and control as described herein.
(b) For purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Agent in the Agent Payment Account provided such payments or other funds and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower’s loan account on such day, and if not, then on the next Business Day.
(c) Each Borrower and Guarantor and their respective employees and agents shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the "Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. Borrowers agree to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent’s payments to or indemnification of such bank, financial institution or other person. The obligations of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement."
Appears in 1 contract