Cash Management Clause Samples
The Cash Management clause outlines how the handling, control, and movement of funds will be managed between the parties involved in an agreement. Typically, it specifies procedures for depositing, transferring, and disbursing cash, and may designate particular accounts or require regular reporting of cash balances and transactions. This clause ensures transparency and accountability in financial operations, helping to prevent mismanagement or unauthorized use of funds.
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Cash Management. (a) Deliver to the Administrative Agent:
(i) on or prior to the Closing Date, copies of notifications (each, a “DDA Notification”) substantially in the form attached hereto as Exhibit J which have been executed on behalf of such Loan Party with respect to each depository institution listed on Schedule 5.21(a);
(ii) on or prior to the Closing Date, copies of notifications (each, a “Credit Card Notification”) substantially in the form attached hereto as Exhibit K which have been executed on behalf of such Loan Party with respect to such Loan Party’s credit card clearinghouses and processors listed on Schedule 5.21(b);
(iii) on or prior to the Closing Date, a fully executed Blocked Account Agreement with respect to the Concentration Account designated on Schedule 5.21(a); and
(iv) on or prior to the Closing Date, fully executed Blocked Account Agreements or Securities Account Control Agreements satisfactory in form and substance to the Agents with each Blocked Account Bank designated on Schedule 5.21(a) and applicable securities intermediary designated on Schedule 5.21(a) (collectively, and together with any DDAs or Securities Accounts subject to a Blocked Account Agreement or Securities Account Control Agreement pursuant to Section 3.2(b) of the Security Agreement, the “Blocked Accounts”). Each DDA Notification and Credit Card Notification shall be held by the Administrative Agent until the occurrence of a Cash Dominion Trigger Event. After the occurrence and during the continuance of a Cash Dominion Trigger Event, the Administrative Agent may (and, at the request of the Required Lenders, shall) deliver each such DDA Notification and Credit Card Notification to the applicable depository institution and credit card processor.
(b) The Loan Parties shall transfer by ACH or wire transfer no less frequently than daily (and whether or not there are then any outstanding Secured Obligations) to a Blocked Account all amounts on deposit in each such DDA (provided, that such covenant shall not apply to (i) minimum balances as may be required to be kept in the subject DDA by the depository institution at which such DDA is maintained, (ii) if greater, any amounts maintained by the Loan Parties in such DDAs (and other DDAs, with the consent of the Collateral Agent, not to be unreasonably withheld) in the ordinary course of business consistent with the past practice, or (iii) any amounts held in Excluded Accounts) and all payments due from credit card processors.
(c) Durin...
Cash Management. (a) Each Loan Party shall (i) instruct all Account Debtors of such Loan Party to remit all payments in respect of any Account on which such Account Debtor is obligated to a “P.O. Box” or “Lockbox Address” associated with a deposit account subject to a Blocked Account Agreement (each, a “Payment Account”), which remittances shall be collected by the depository institution at which such “P.O. Box” or “Lockbox Address” is maintained and deposited in such Payment Account, (ii) except with respect to Excluded Accounts, Transition Accounts and the Operating Account, cause each deposit account held by such Loan Party (including, without limitation, each Payment Account) to become subject to a Blocked Account Agreement pursuant to which (without limiting the terms thereof) all amounts on deposit and available at the close of each Business Day in such deposit account shall be swept to an account designated by the Collateral Agent (the “Collection Account”), with such sweep instructions to be irrevocable unless otherwise agreed to by the Collateral Agent and (iii) cause the Operating Account to become subject to a Blocked Account Agreement pursuant to which (without limiting the terms thereof) the Collateral Agent may, upon the occurrence and during the continuance of an Event of Default, exercise full dominion over such account and sweep all funds on deposit therein to the Collection Account. Without limiting the foregoing, all amounts received by a Borrower or any of its Subsidiaries in respect of any deposit account (or by the depository institution at which such account is held), in addition to all other cash received from any other source, shall upon receipt be deposited into such deposit account. Each Loan Party agrees that it will not cause proceeds of any deposit accounts to be otherwise redirected.
(b) All collected amounts received in the Collection Account shall be distributed and applied on a daily basis in accordance with Section 2.10(b).
(c) If any cash or cash equivalents owned by any Loan Party (other than (i) de minimis cash or cash equivalents from time to time inadvertently misapplied by any Loan Party, (ii) any funds which are held by any Borrower and any of their respective Subsidiaries on behalf of any customer in the ordinary course of business and (iii) any funds which are held by any Borrower and any of their respective Subsidiaries in an Excluded Account or, subject to the terms of this Agreement, a Transition Account, in each case, in the ...
Cash Management. The Borrower will keep all of its operating accounts, Deposit Accounts and other bank accounts separate from, and will not co-mingle any of its cash or money with, those of other Persons (including its Subsidiaries). The Borrower will, and will cause each Subsidiary Guarantor to: (a) ensure that such Person’s Account Debtors forward payment of all amounts owed by them to such Person to one of the Deposit Accounts of such Person set forth on Item 6.19(a) of the Disclosure Schedule, and (b) deposit, or cause to be deposited, promptly, and in any event no later than the second Business Day after the date of receipt thereof, all of such Person’s Collections in one of the Deposit Accounts of such Person set forth on Item 6.19(a) of the Disclosure Schedule. Within 60 days of the Closing Date (as such date may be extended with the consent of the Administrative Agent), the Borrower will deliver or cause to be delivered to the Administrative Agent fully executed Control Agreements with respect to each Deposit Account and Securities Account of the Borrower set forth on Item 6.19(a) and Item 6.19(b) of the Disclosure Schedule. At all times thereafter, the Borrower will use commercially reasonable efforts to ensure, prior to any termination or expiration of the Control Agreement relating to the Deposit Accounts initially set forth on Item 6.19(a) of the Disclosure Schedule, that such Deposit Accounts are replaced with Deposit Accounts subject to a Control Agreement. So long as no Default has occurred and is continuing (except with respect to the Deposit Accounts initially set forth in Item 6.19(a) of the Disclosure Schedule, which Deposit Accounts may be replaced at any time, subject to the proviso to this sentence), the Borrower may amend Item 6.19(a) and Item 6.19(b) of the Disclosure Schedule to add or replace one or more of the Deposit Accounts; provided, however, that (i) the prospective depository institution at which such Deposit Account will be held shall be reasonably satisfactory to the Administrative Agent and (ii) in the event such Deposit Account will replace or be in addition to a Deposit Account set forth on Item 6.19(a) of the Disclosure Schedule hereto, prior to the time of the opening of such Deposit Account, the Borrower or relevant Subsidiary and such prospective depository institution shall use commercially reasonable efforts to have executed and delivered to the Administrative Agent a Control Agreement in respect of such Deposit Account. The Borr...
Cash Management. 37 2.8 Crediting Payments...............................................38 2.9
Cash Management. On or before the Closing Date, Borrower shall establish in accordance with the terms and provisions of the Cash Management Agreement (i) with Deposit Bank an account for the deposit of all Rents (the "DEPOSIT ACCOUNT"), the Prepaid Rent Funds (the "PREPAID RENT ACCOUNT"), an operating account (the "OPERATING ACCOUNT") from which, provided no Event of Default shall have occurred, Borrower shall be entitled to withdraw monies for uses permitted under this Credit Agreement and the Cash Management Agreement, and (ii) with Agent an account into which balances held in the Deposit Account will be swept (the "CASH MANAGEMENT ACCOUNT") and separate accounts for each of the Tax Funds (the "TAX ACCOUNT"), Insurance Premium Funds (the "INSURANCE PREMIUM ACCOUNT"), the Ordinary Capital Expenditure Funds (the "ORDINARY CAPITAL EXPENDITURE FUNDS ACCOUNT"), the Capital Improvement Funds (the "CAPITAL IMPROVEMENT ACCOUNT"), the Prepaid Rent Funds (the "PREPAID RENT ACCOUNT") and the Monthly Debt Service Payment Amount and any fees, late charges, default interest and other charges, expenses or reimbursements due to Lender under any of the Loan Documents (the "DEBT SERVICE ACCOUNT"). All of the Accounts shall be held and maintained, invested and governed by the terms of the Cash Management Agreement. Lender shall have no liability for any loss resulting from the investments of funds in the Accounts that are invested in Permitted Investments and no such loss shall affect Borrower's obligations to pay the Debt or to make the deposits required under ARTICLE IX hereof. Borrower shall report on its federal, state and local income tax reports all interest or income accrued on funds in the Accounts. Any reference in this Agreement to the "TAX ACCOUNT," the "INSURANCE PREMIUM ACCOUNT," the "ORDINARY CAPITAL EXPENDITURES ACCOUNT," the "CAPITAL IMPROVEMENT ACCOUNT," the PREPAID RENT ACCOUNT," and the "DEBT SERVICE ACCOUNT," shall be deemed to refer to the funds on deposit in the Cash Management Account which constitute, respectively, the Tax Funds, Insurance Premium Funds, Ordinary Capital Expenditure Funds, Capital Improvement Funds, the Prepaid Rent Funds, Monthly Debt Service Payment Amount (and other sums due under the Loan Documents), as calculated and determined by Lender or Servicer, it being understood that the foregoing funds are to remain in and be commingled with each other in the Cash Management Account until such time as they are withdrawn for the purposes for which they ...
Cash Management. (a) The Credit Parties shall deliver, or cause to be delivered, to Collateral Agent a Blocked Account Agreement duly authorized, executed and delivered by each bank where a Deposit Account for the benefit of any Credit Party is maintained. Each Borrower shall further execute and deliver, and shall cause each Guarantor to execute and deliver, such agreements and documents as Collateral Agent may reasonably require in connection with such Blocked Accounts and such Blocked Account Agreements. Other than Excluded Deposit Accounts, no Credit Party shall establish any Deposit Accounts after the Closing Date, unless such Borrower or Guarantor (as applicable) has complied in full with the provisions of this Section 5.15(a) with respect to such Deposit Accounts. Each Blocked Account Agreement shall require, after notice from the Collateral Agent to a Blocked Account Bank (which the Collateral Agent agrees will only be given after the occurrence of an Account Control Event) (and until the Collateral Agent notifies such Blocked Account Bank to the contrary (which the Collateral Agent agrees will be given promptly after the written request of the Borrower Representative if such Account Control Event has terminated), the ACH or wire transfer no less frequently than daily (and whether or not there are then any outstanding Obligations) to the collection account maintained by the Collateral Agent at JPMorgan Chase Bank, N.A. (the “Collection Account”), of all cash receipts and collections, including, without limitation, the following:
(i) all available cash receipts from the sale of Inventory and other assets;
(ii) all proceeds of collections of Accounts;
(iii) all Net Asset Sale Proceeds and Net Insurance/Condemnation Proceeds, and all other cash payments received by a Credit Party from any Person or from any source or on account of any sale or other transaction or event;
(iv) the then contents of each Deposit Account;
(v) the then entire ledger balance of each Blocked Account; and
(vi) the net proceeds of all credit card charges.
(b) The Collection Account shall at all times be in the name, and under the sole dominion and control of the Collateral Agent. The Credit Parties hereby acknowledge and agree that (i) the Credit Parties have no right of withdrawal from the Collection Account, (ii) the funds on deposit in the Collection Account shall at all times be collateral security for all of the Obligations and (iii) the funds on deposit in the Collection Account shall be a...
Cash Management. (a) Borrower shall establish and maintain, at its expense, a lockbox and related blocked account (the "Blocked Account"), as Lender may specify, with bank which is acceptable to Lender into which Borrower shall promptly deposit and direct its account debtors to directly remit, on a daily basis, all payments and receipts in the identical form in which such payments and receipts are made or received, whether by cash, check or other manner. Borrower shall deliver, or cause to be delivered to Lender, a Deposit Account Control Agreement duly authorized, executed and delivered by such bank where the Blocked Account is maintained and Borrower shall execute and deliver such other agreements or documents as Lender may require in connection therewith. In addition, Borrower shall take the necessary steps to allow Lender "read only" online access to the Blocked Account so that Lender may electronically monitor the Blocked Account at any time and from time to time in its discretion.
(b) Borrower and its employees and agents shall, acting as trustee for Lender, receive, as the property of Lender, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of 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 Account, or remit the same or cause the same to be remitted, in kind, to Lender. In no event shall the same be commingled with Borrower's own funds. Borrower agrees to reimburse Lender 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 Account arising out of Lender's payments to or indemnification of such bank, financial institution or other person. The obligation of Borrower to reimburse Lender for such amounts pursuant to this Section shall survive the termination or non-renewal of this Agreement.
(c) All amounts deposited in the Blocked Account shall be swept daily and remitted as follows:
(i) from and after the occurrence of an Event of Default, 100% of such receipts shall be remitted to the Lender to be applied in reduction of the Obligations in a manner determined by the Lender in its sole and exclusive discretion, or, if no Event of Default has occurred and is continuing, then as follows ...
Cash Management. (a) Parent and Borrower shall and Borrower shall cause each of its Subsidiaries to (i) establish on the Closing Date cash management services of a type and on terms satisfactory to the Required Lenders and maintain from and after the Closing Date cash management services of a type and on terms similar to those cash management services established on the Closing Date (it being understood that the cash management services established on the Closing Date are satisfactory to the Required Lenders), at one or more of the banks set forth on Schedule 2.7(a) (each a "Cash Management Bank"), (ii) request in writing and otherwise take such reasonable steps to ensure that all of its and its Subsidiaries' Account Debtors and Credit Card Processors forward payment of the amounts owed by them directly to such Cash Management Bank, and (iii) deposit or cause to be deposited promptly, and in any event no later than the first Business Day after the date of receipt thereof, all of their Collections (including those sent directly by their Account Debtors and Credit Card Processors to Parent, Borrower, or one of Borrower's Subsidiaries) into a bank account in Parent's, Borrower's, or such Subsidiary's name (a "Cash Management Account") at one of the Cash Management Banks.
(b) Each Cash Management Bank shall establish and maintain Cash Management Agreements with Agent, Parent, Borrower, and Borrower's Subsidiaries. Each such Cash Management Agreement shall provide, among other things, that (i) the Cash Management Bank will comply with any instructions originated by Agent directing the disposition of the funds in such Cash Management Account without further consent by Parent, Borrower, or Borrower's Subsidiaries, as applicable, (ii) the Cash Management Bank has no rights of setoff or recoupment or any other claim against the applicable Cash Management Account other than for payment of its service fees and other charges directly related to the administration of such Cash Management Account and for returned checks or other items of payment, and (iii) from and after the date that the Cash Management Bank receives written notification from Agent, the Cash Management Bank will forward, by daily sweep, all amounts in the applicable Cash Management Account to the Agent's Account. Agent agrees that it shall not provide such written notification to the Cash Management Bank unless and until either of the following events (each, a "Triggering Event") has occurred: (A) an Event of Default h...
Cash Management. (a) On or prior to the date 90 days (which amount of time may be extended by the Administrative Agent in its sole discretion) after the Closing Date (or, in the case of Cortz, Inc., the Amendment No. 1 Effective Date):
(i) deliver to the Administrative Agent copies of notifications (each, a “Credit Card Notification”) substantially in the form attached hereto as Exhibit M which have been executed on behalf of such Loan Party and delivered to such Loan Party’s credit card clearinghouses and processors listed on Schedule 5.24(b); and
(ii) enter into a blocked account agreement (each, a “Blocked Account Agreement”), in form and substance reasonably satisfactory to the Administrative Agent, with each Blocked Account Bank (collectively, the “Blocked Accounts”).
(b) Each Credit Card Notification shall require the ACH or wire transfer no less frequently than daily (and whether or not there are then any outstanding Obligations) of all proceeds therefrom to a Blocked Account. Each Blocked Account Agreement shall require, after notice from the Administrative Agent to a Blocked Account Bank of the occurrence of a Cash Dominion Event (and until the Administrative Agent notifies such Blocked Account Bank that such Cash Dominion Event has terminated), the ACH or wire transfer no less frequently than daily (and whether or not there are then any outstanding Obligations) to the concentration account maintained by the Administrative Agent at Bank of America, N.A. (the “Concentration Account”), of all cash receipts and collections of the Loan Parties, including, without limitation, the following:
(i) all available cash receipts from the sale of Inventory and other assets;
(ii) all proceeds of collections of Accounts;
(iii) the then contents of each DDA;
(iv) the then entire ledger balance of each Blocked Account; and
(v) the net proceeds of all credit card charges.
(c) During the continuance of a Cash Dominion Event, the Loan Parties shall provide the Administrative Agent with an accounting of the contents of the Blocked Accounts and the Concentration Account, which shall identify, to the satisfaction of the Administrative Agent, the proceeds from the Term Loan Priority Collateral which were deposited into a Blocked Account and swept to the Concentration Account. Upon the receipt of (x) the contents of the Blocked Accounts, and (y) such accounting, the Administrative Agent agrees to promptly remit to the agent under the Term Facility the proceeds of the Term Loan Priority Co...
Cash Management. Requests for advance payment shall be limited to ▇▇▇▇▇▇▇'s immediate cash needs. Grantee must have written procedures to minimize the time elapsing between the receipt and the disbursement of Grant Funds to avoid having excess funds on hand. 2 CFR 200.305.