Common use of Accounts Warranties and Covenants Clause in Contracts

Accounts Warranties and Covenants. Except as otherwise disclosed to Agent in writing, as to each of Borrower’s existing Accounts and each of its hereafter arising Accounts that: at the time of its creation, such Account is a valid, bona fide obligation, representing an undisputed indebtedness incurred by the Account Debtor (and any other Person obligated on such Account) for property actually sold and delivered or for services completely rendered; there are no defenses, setoffs, offsets, claims, or counterclaims, genuine or otherwise, against such Account; such Account does not represent a sale to a Subsidiary or an Affiliate, or a consignment, sale or return or a xxxx and hold transaction; the amount represented by Borrower to Agent as owing by each Account Debtor (and by each of the other Persons obligated on such Account) is, or will be, the correct amount actually and unconditionally owing, no agreement exists permitting any other deduction or discount; Borrower is the lawful owner of such Account and has the right to assign the same to Agent, for the benefit of Agent and Lenders; such Account is free of all Liens, other than those in favor of Agent, on behalf of itself and Lenders, and such Account constitutes, the legally valid and binding obligation of the applicable Account Debtor (and any other Person obligated on such Account) and is due and payable in accordance with its terms. Borrower shall, at its own expense, use its best efforts to assure prompt payment of all amounts due or to become due under Accounts. No discounts, credits or allowances will be issued, granted or allowed by Borrower to customers and no returns will be accepted without Agent’s prior written consent; provided, however, so long as such discounts, credits, allowances or returns are customarily issued or accepted in the ordinary course of business and are in amounts which are not material to Borrower, or until Agent notifies Borrower to the contrary, Borrower may presume consent. Borrower will immediately notify Agent in the event that any Account Debtor (or any other Person obligated on such Account) alleges any dispute or claim with respect to such Account or of any other circumstances known to Borrower that may impair the validity or collectibility of any such Account. Agent, or its designee, shall have the right, at any time or times hereafter, to verify the validity, amount or any other matter relating to any Account, by mail, telephone or in person. After the occurrence of a Default or an Event of Default: (i) Borrower shall not, without the prior consent of Agent, adjust, settle or compromise the amount or payment of any Account, or release wholly or partly any Account Debtor (or any other Person obligated on such Account), or allow any credit or discount thereon, and (ii) Agent shall have the right at any time (A) to exercise the rights of Borrower, with respect to the obligation of the Account Debtor (or any other Person obligated on such Account) to make payment or otherwise render performance to Borrower, and with respect to any property that secures the obligations of the Account Debtor or of any such other Person obligated on such Account; and (B) to adjust, settle or compromise the amount or payment of any such Account or release wholly or partly any Account Debtor or obligor thereunder or allow any credit or discount thereon.

Accounts Warranties and Covenants. Except as otherwise disclosed to Agent in writing, as to each of Borrower’s Loan Party's existing Accounts and each of its hereafter arising Accounts that: at the time of its creation, such Account is a valid, bona fide obligation, representing an undisputed indebtedness incurred by the Account Debtor (and any other Person obligated on such Account) for property actually sold and delivered or for services completely rendered; there are no defenses, setoffs, offsets, claims, or counterclaims, genuine or otherwise, against such Account; such Account does not represent a sale or provision of services to a Subsidiary or an Affiliate, or a consignment, sale or return or a xxxx and hold transaction; the amount represented by Borrower Loan Parties to Agent as owing by each Account Debtor (and by each of the other Persons obligated on such Account) is, or will be, the correct amount actually and unconditionally owing, no agreement exists permitting any other deduction or discountdiscount except in the ordinary course of business; Borrower the respective Loan Party is the lawful owner of such Account and has the right to assign the same to Agent, for the benefit of Agent and Lenders; such EXHIBIT 10.1 Account is free of all Liens, other than Permitted Liens and those in favor of Agent, on behalf of itself and Lenders, and such Account constitutes, the legally valid and binding obligation of the applicable Account Debtor (and any other Person obligated on such Account) and is due and payable in accordance with its terms. Borrower Each Loan Party shall, at its own expense, : (i) cause all invoices evidencing such Loan Party's Accounts and all copies thereof to bear a notice that such invoices are payable to the lockboxes established in accordance with Section 6.4 and (ii) use its best reasonable efforts to assure prompt payment of all amounts due or to become due under Accounts. No discounts, credits or allowances will be issued, granted or allowed by Borrower any Loan Party to customers and no returns will be accepted without Agent’s 's prior written consent; provided, however, so long as such discounts, credits, allowances or returns are customarily issued or accepted in the ordinary course of business and are in amounts which are not material to Borrowerany Loan Party, or until Agent notifies Borrower to the contrary, Borrower each Loan Party may presume consent. Borrower will immediately promptly notify Agent in the event that any Account Debtor (or any other Person obligated on such Account) alleges any dispute or claim with respect to such any Account in excess of an invoice amount of $250,000 or of any other circumstances known to Borrower any Loan Party that may impair the validity or collectibility of any such Account. Agent, or its designee, shall have the right, at any time or times hereafter, to verify the validity, amount or any other matter relating to any Account, by mail, telephone or in person. After the occurrence of a Default or an Event of DefaultDefault and upon the written request of Agent: (i) Borrower shall notno Loan Party shall, without the prior consent of Agent, adjust, settle or compromise the amount or payment of any Account, or release wholly or partly any Account Debtor (or any other Person obligated on such Account), or allow any credit or discount thereon, and (ii) Agent shall have the right at any such time (A) to exercise the rights of Borrowerany Loan Party, with respect to the obligation of the Account Debtor (or any other Person obligated on such Account) to make payment or otherwise render performance to Borrowerthe applicable Loan Party, and with respect to any property that secures the obligations of the Account Debtor or of any such other Person obligated on such Account; and (B) to adjust, settle or compromise the amount or payment of any such Account or release wholly or partly any Account Debtor or obligor thereunder or allow any credit or discount thereon.

Accounts Warranties and Covenants. Except (i) With respect to each Restricted Loan Party’s Accounts (in each case, except as otherwise disclosed to Agent in writing, as to each of Borrower’s existing Accounts and each of its hereafter arising Accounts that: ): (i) at the time of its creation, to the knowledge of such Restricted Loan Party, such Account is a valid, bona fide obligation, representing an undisputed indebtedness incurred by the Account Debtor (and any other Person obligated on such Account) for property actually sold and delivered or for services completely rendered; (ii) to the knowledge of such Restricted Loan Party there are no defenses, setoffs, offsets, claims, or counterclaims, genuine or otherwise, against such AccountAccount (other than those arising in the ordinary course of business or otherwise being contested by a Loan Party); (iii) such Account does not represent a sale to a Subsidiary or an AffiliateSubsidiary, or a consignment, sale or return or a xxxx and hold transaction; (iv) the amount represented by Borrower any Loan Party to Agent as owing by each Account Debtor (and by each of the other Persons obligated on such Account) is, or will be, the correct amount actually and unconditionally owing, and no agreement exists permitting any other deduction or discount; Borrower (v) the applicable Restricted Loan Party is the lawful owner of such Account and has the right to assign the same to Agent, for the benefit of Agent and Lendersthe Secured Parties; (vi) such Account is free of all Liens, other than those in favor of Agent, on behalf for the benefit of itself and Lendersthe other Secured Parties, and other Permitted Encumbrances; and (vii) to the Knowledge of such Restricted Loan Party such Account constitutes, the legally valid and binding obligation of the applicable Account Debtor (and any other Person obligated on such Account) and is due and payable in accordance with its terms. Borrower shall, at its own expense, 116 (ii) Each Restricted Loan Party shall use its best reasonable efforts consistent with past business practices to assure prompt payment of all amounts due or to become due under Accounts. No discounts, credits or allowances will be issued, granted or allowed by Borrower to customers and no returns will be accepted without Agent’s prior written consent; provided, however, so long as such discounts, credits, allowances or returns are customarily issued or accepted in During the ordinary course continuation of business and are in amounts which are not material to Borrower, or until Agent notifies Borrower to the contrary, Borrower may presume consent. Borrower will immediately notify Agent in the event that any Account Debtor (or any other Person obligated on such Account) alleges any dispute or claim with respect to such Account or of any other circumstances known to Borrower that may impair the validity or collectibility of any such Account. Agent, or its designee, shall have the right, at any time or times hereafter, to verify the validity, amount or any other matter relating to any Account, by mail, telephone or in person. After the occurrence of a Default or an Event of DefaultDefault and upon written notice from Agent to XX Xxxxx: (i) Borrower shall notno Restricted Loan Party shall, without the prior consent of Agent, adjust, settle or compromise the amount or payment of any AccountAccount if such adjustment would be greater than $100,000, or release wholly or partly any Account Debtor (or any other Person obligated on such Account), or allow any credit or discount thereonthereon in an amount greater than $100,000, and (ii) with respect to each Account of the Restricted Loan Parties, Agent shall have the right from time to time at any time Agent’s discretion (A) to exercise the rights of Borrower, the applicable Restricted Loan Party with respect to the obligation obligations of the any Account Debtor (or any other Person Persons obligated on any such Account) Account to make payment or otherwise render performance to Borrowerthe applicable Restricted Loan Party, and with respect to any property that secures the obligations of the any such Account Debtor or of any such other Person obligated on such Account; and (B) to adjust, settle or compromise the amount or payment of any such Account or release wholly or partly any Account Debtor or obligor thereunder or allow any credit or discount thereon. (iii) At any time following the occurrence of an Event of Default, Agent shall have the right to send notice of the assignment of, and Agent’s security interest in and Lien on, the Restricted Loan Parties’ Accounts to any and all customers or any third party holding or otherwise concerned with any of the Collateral. Thereafter, Agent shall have the sole right to collect such Accounts, take possession of the Collateral, or both. Agent’s actual collection expenses shall be included as part of the Obligations. (iv) Agent shall have the right to receive, endorse, assign and/or deliver in the name of Agent or any Borrower any and all checks, drafts and other instruments for the payment of money relating to the Restricted Loan Parties’ Accounts, and each Borrower hereby waives notice of presentment, protest and non-payment of any instrument so endorsed. Each Borrower hereby constitutes Agent or Agent’s designee as such Borrower’s attorney with power (x) at any time: (A) to endorse such Borrower’s name upon any notes, acceptances, checks, drafts, money orders or other evidences of payment or Collateral; (B) to sign such Borrower’s name on any invoice, xxxx of lading or customs documentation relating to any of the Restricted Loan Parties’ Accounts or Inventory, drafts against customers, assignments and verifications of the Restricted Loan Parties’ Accounts; (C) to send verifications of the Restricted Loan Parties’ Accounts to any customer; (D) to sign such Borrower’s name on all financing statements or any other documents or instruments deemed necessary or appropriate by Agent to preserve, protect, or perfect Agent’s interest in the Collateral and to file same; and (y) at any time following the occurrence of a Default or Event of Default: (A) to demand payment of the Restricted Loan Parties’ Accounts; (B) to enforce payment of the Restricted Loan Parties’ Accounts by legal proceedings or otherwise; (C) to exercise all of such Borrower’s rights and remedies with respect to the collection of the Restricted Loan Parties’ Accounts and any other Collateral; (D) to settle, adjust, compromise, extend or renew the Restricted Loan Parties’ Accounts; (E) to settle, adjust or compromise any legal proceedings brought to collect the Restricted Loan Parties’ Accounts; (F) to prepare, file and sign such Borrower’s name on a proof of claim in bankruptcy or similar document against any customer; (G) to prepare, file and sign such Borrower’s name on any notice of Lien, assignment or satisfaction of Lien or similar document in connection with the Restricted Loan Parties’ Accounts; and (H) to do all other acts and things necessary to carry out this Agreement. All acts of said attorney or designee are hereby ratified and approved, and said attorney or designee shall not be liable for any acts of omission or commission nor for any error of judgment or mistake of fact or of law, unless done maliciously or with gross (not mere) negligence (as determined by a court of competent jurisdiction in a final non-appealable judgment); this power being coupled with an interest is irrevocable while any of the Obligations remain unpaid. Agent shall have the right at any time following the occurrence of an Event of Default or Default, to change the address for delivery of mail addressed to any Borrower to such address as Agent may designate and to receive, open and dispose of all mail addressed to any Borrower. 117 (v) Neither Agent nor any other Secured Party shall, under any circumstances or in any event whatsoever, have any liability for any error or omission or delay of any kind occurring in the settlement, collection or payment of any of the Restricted Loan Parties’ Accounts or any instrument received in payment thereof, or for any damage resulting therefrom. Following the occurrence of an Event of Default or Default Agent may, without notice or consent from any Borrower, xxx upon or otherwise collect, extend the time of payment of, compromise or settle for cash, credit or upon any terms any of the Restricted Loan Parties’ Accounts or any other securities, instruments or insurance applicable thereto and/or release any obligor thereof. Agent is authorized and empowered to accept following the occurrence of an Event of Default or Default the return of the goods represented by any of the Restricted Loan Parties’ Accounts, without notice to or consent by any Borrower, all without discharging or in any way affecting any Borrowers’ liability hereunder.

Accounts Warranties and Covenants. Except as otherwise disclosed to Agent in writing, as to each of BorrowerLoan Party’s existing Accounts and each of its hereafter arising Accounts that: at the time of its creation, such Account is a valid, bona fide obligation, representing an undisputed indebtedness incurred by the Account Debtor (and any other Person obligated on such Account) for property actually sold and delivered or for services completely rendered; there are no defenses, setoffs, offsets, claims, or counterclaims, genuine or otherwise, against such Account; such Account does not represent a sale or provision of services to a Subsidiary or an Affiliate, or a consignment, sale or return or a xxxx bxxx and hold transaction; the amount represented by Borrower Loan Parties to Agent as owing by each Account Debtor (and by each of the other Persons obligated on such Account) is, or will be, the correct amount actually and unconditionally owing, no agreement exists permitting any other deduction or discountdiscount except in the ordinary course of business; Borrower the respective Loan Party is the lawful owner of such Account and has the right to assign the same to Agent, for the benefit of Agent and Lenders; such Account is free of all Liens, other than Permitted Liens and those in favor of Agent, on behalf of itself and Lenders, and such Account constitutes, the legally valid and binding obligation of the applicable Account Debtor (and any other Person obligated on such Account) and is due and payable in accordance with its terms. Borrower Each Loan Party shall, at its own expense, : (i) cause all invoices evidencing such Loan Party’s Accounts and all copies thereof to bear a notice that such invoices are payable to the lockboxes established in accordance with Section 6.4 and (ii) use its best reasonable efforts to assure prompt payment of all amounts due or to become due under Accounts. No discounts, credits or allowances will be issued, granted or allowed by Borrower any Loan Party to customers and no returns will be accepted without Agent’s prior written consent; provided, however, so long as such discounts, credits, allowances or returns are customarily issued or accepted in the ordinary course of business and are in amounts which are not material to Borrowerany Loan Party, or until Agent notifies Borrower to the contrary, Borrower each Loan Party may presume consent. Borrower will immediately promptly notify Agent in the event that any Account Debtor (or any other Person obligated on such Account) alleges any dispute or claim with respect to such any Account in excess of an invoice amount of $250,000 or of any other circumstances known to Borrower any Loan Party that may impair the validity or collectibility of any such Account. Agent, or its designee, shall have the right, at any time or times hereafter, to verify the validity, amount or any other matter relating to any Account, by mail, telephone or in person. After the occurrence of a Default or an Event of DefaultDefault and upon the written request of Agent: (i) Borrower shall notno Loan Party shall, without the prior consent of Agent, adjust, settle or compromise the amount or payment of any Account, or release wholly or partly any Account Debtor (or any other Person obligated on such Account), or allow any credit or discount thereon, and (ii) Agent shall have the right at any such time (A) to exercise the rights of Borrowerany Loan Party, with respect to the obligation of the Account Debtor (or any other Person obligated on such Account) to make payment or otherwise render performance to Borrowerthe applicable Loan Party, and with respect to any property that secures the obligations of the Account Debtor or of any such other Person obligated on such Account; and (B) to adjust, settle or compromise the amount or payment of any such Account or release wholly or partly any Account Debtor or obligor thereunder or allow any credit or discount thereon.