Collection of Accounts. Borrower shall at all times maintain lockboxes (the “Lockboxes”) and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).” (f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 2 contracts
Samples: Loan and Security Agreement (Vermont Transit Co Inc), Loan and Security Agreement (Laidlaw International Inc)
Collection of Accounts. Borrower shall at all times maintain lockboxes (the “Lockboxes”a) and shall instruct all Account Debtors with respect 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”), General Intangiblesas Lender may specify, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to with such Lockboxes or to local deposit accounts at financial institutions reasonably banks as are acceptable to AgentLender. Borrower, AgentSuch Blocked Accounts may be Central Collection Deposit Accounts, and the Lockbox Banks term Blocked Accounts shall enter into mean and include the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of AgentCentral Collection Deposit Accounts. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of DefaultDefault or a Compliance Triggering Event (until the occurrence of a Compliance Reinstatement Date related thereto, if any), and upon Lender’s request, Borrowers shall promptly deposit into one or more Blocked Accounts and direct their account debtors to directly remit into such Blocked Accounts 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. If Concurrently with this Agreement, Borrowers shall deliver, or cause to be delivered to Lender, a Lockbox Notice has been sent Deposit Account Control Agreement duly authorized, executed and both delivered by each bank where a Blocked Account is maintained which agreement shall provide that upon notice from Lender (x) there does not exist any which shall be given upon an Event of Default or a Compliance Triggering Event and revoked upon the occurrence of a Compliance Reinstatement Date related thereto, if any), such bank will send funds on a daily basis to the Lender Payment Account and otherwise take instruction with respect to such Blocked Account only from Lender. Promptly upon Lender’s request, Borrowers shall execute and deliver such agreements or documents as Lender may require in connection therewith. Borrowers agree that after notice by Lender to the bank under the Deposit Account Control Agreement, all payments made to such Blocked Accounts or other funds received and collected by Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Lender in respect of the Obligations and therefore shall constitute the property of Lender to the extent of the then outstanding Obligations.
(b) For purposes of calculating the amount of the Loans available to Borrowers, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Lender of immediately available funds in the Lender Payment Account provided such payments and any notice thereof are received in accordance with Lender’s usual and customary practices as in effect from time to time and within sufficient time to credit Borrowers’ loan account on such day, and if not, then on the next Business Day. In the event an Event of Default or a Compliance Triggering Event has occurred (and prior to the occurrence of a Compliance Reinstatement Date related thereto, if any), 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 one (1) Business Day after receipt of immediately available funds by Lender in the Lender Payment Account, provided such payments or other funds and notice thereof are received in accordance with Lender’s usual and customary practices as in effect from time to time and within sufficient time to credit Borrowers’ 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 upon or after an Event of Default or a Compliance Triggering Event (and prior to the occurrence of a Compliance Reinstatement Date related thereto, if any) there are no Loans outstanding, Lender shall be entitled to an administrative charge in an amount equivalent to the interest Lender would have received for such Business Day had there been Loans outstanding on such day.
(c) Upon and after an Event of Default or any Compliance Triggering Event (until the occurrence of a Compliance Reinstatement Date related thereto, if any), Borrowers and their respective shareholders, directors, employees, agents, Subsidiaries or other Affiliates 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 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 Lender. In no event shall the same be commingled with any Borrower’s funds. Borrowers agree to reimburse Lender on demand for any amounts owed or paid to any bank at which a Blocked Account is established or any other bank or person involved in the transfer of funds to or from the Blocked Accounts arising out of Lender’s payments to or indemnification of such Lockbox Notice was based has been waived bank or person. The obligation of Borrowers to reimburse Lender for such amounts pursuant to this Section 6.3 shall survive the terms termination or non-renewal of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 2 contracts
Samples: Loan and Security Agreement (Guess Inc Et Al/Ca/), Canadian Loan and Security Agreement (Guess Inc Et Al/Ca/)
Collection of Accounts. Borrower The Collateral Agent as agent for the Secured Parties hereby authorizes the Debtor to collect and dispose of the proceeds of the Accounts, which authority the Collateral Agent may curtail or terminate at any time following the occurrence and during the continuance of any Event of Default. After such authority has been curtailed or terminated, the Debtor shall, upon receipt of all checks, drafts, cash, and other remittances in payment of or on account of the Accounts, deposit the same in a special account designated by the Collateral Agent, over which account the Collateral Agent as agent for the Secured Parties alone shall at all times maintain lockboxes have the power of withdrawal (the “LockboxesCollection Account”) ). The remittance of the proceeds of such Accounts shall not, however, constitute payment or liquidation of such Accounts until the 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 shall instruct all Account Debtors other items as collected in accordance with respect 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 AccountsDebtor and 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 precisely the form received, General Intangiblesexcept for the endorsement of the Debtor where necessary to permit collection of items, which endorsement the Debtor agrees to make, and Negotiable which endorsement the Collateral Agent is also hereby authorized to make on behalf of Borrower to remit all Collections in respect thereof to the Debtor. Pending such Lockboxes deposit, the Debtor agrees that it will not commingle any such checks, drafts, cash or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agentother remittances with any funds or other property of the Debtor but will hold them separate and apart therefrom, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide upon an express trust for the opening of a Lockbox Account Collateral Agent until deposit thereof is made in the Collection Account. The Collateral Agent as agent for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good Secured Parties will from time to time apply the funds on deposit in each local collection account (other than a local collection account which is either an Excluded the Collection Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without against the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit Obligations in such Lockbox Account (such instruction a “Subsequent Notice”)order of application as is required by the Intercreditor Agreement.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 2 contracts
Samples: Security Agreement, Security Agreement (Trex Co Inc)
Collection of Accounts. (A) To expedite collection, Borrower shall endeavor in the first instance to make collection of its Accounts for Agent and 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 Borrower shall immediately deposit or cause to be deposited same in the Dominion Account. Agent shall have the right at all times maintain lockboxes (any time after the “Lockboxes”) and shall instruct all occurrence of a Default or an Event of Default to notify Account Debtors that Accounts have been assigned to 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 Agent nor any Lender has any duty to protect, insure, collect or realize upon the Accounts or preserve rights in them.
(B) Borrower shall deposit all proceeds of the Collateral or cause the same to be deposited in kind in a Dominion Account pursuant to a lockbox arrangement with respect to the Accounts, General Intangibles, such banks as may be selected by Borrower and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably be acceptable to Agent. BorrowerBorrower shall issue to any such banks, Agent, and an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the Lockbox Banks shall enter into lockbox to the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Dominion Account for application on account of the deposit of Collections at a Lockbox BankObligations. Borrower agrees that: (i) all good All funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Dominion Account shall be wired each Business Day into an account (immediately become the “Agent’s Account”) maintained property of Lenders and Borrower shall obtain the agreement by such banks to waive any offset rights against the funds so deposited. Neither Agent at a depositary selected nor any Lender assumes any responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”)bank thereunder.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 2 contracts
Samples: Loan and Security Agreement (Brazos Sportswear Inc /De/), Loan and Security Agreement (Brazos Sportswear Inc /De/)
Collection of Accounts. (A) 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, draft, acceptance, chattel paxxx, 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 Agency Account or in any other 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"). The Agency Account shall at all times be subject to an Agency Account Agreement of the Depository Bank which waives any right of setoff the Depository Bank might otherwise claim to have against any funds in the Agency Account and to otherwise charge any costs relative to the Agency Account to Borrowers or such other account(s) as either Borrower may maintain lockboxes (with the “Lockboxes”) Depository Bank, such Agency Account Agreement to be in form and shall instruct all Account Debtors substance acceptable to Lender. Lender assumes no responsibility for any claim of accord and satisfaction or release with respect to funds that have been deposited in the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: Agency Account.
(iB) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms occurrence and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence continuance of an Event of Default, if at any time requested by Lender, Continental and Goodman shall instruct all Account Xxxxxxx to mail their payments directly to a designated post office lockbox (a "Lockbox") maintained at Continental's expense, with respect to which only Lender or, should Lender so agree, a designated financial institution shall have the right of access and all payments so received shall be subject to immediate deposit into the Cash Collateral Account.
(C) All funds held in the Agency Account shall be transferred to the Cash Collateral Account as set forth in the Agency Account Agreement or as otherwise designated by Lender. If a Lockbox Notice has been sent The application of any funds to the payment of the Obligations shall not occur until Lender's receipt of such funds in cleared federal funds in the Cash Collateral Account. Lender agrees that all funds received by Lender by wire transfer for either Borrower's account prior to 10:00 a.m. on any business day of Lender shall be 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 both method of application of such payments shall be in the sole discretion of Lender.
(xD) there does not exist any Lender reserves the right upon the occurrence and during the continuance of an Event of Default to notify Account Debtors and other Persons indebted to Borrowers of Lender's interest in any such amounts payable to Borrowers and to instruct such Account Debtors and other Persons to remit the same directly to Lender and all such funds (less any costs of collection and any Event of Default upon which such Lockbox Notice was based has been waived pursuant other charges or expenses incurred in connection therewith as hereinafter provided) shall be subject to application to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”)Obligations.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 1 contract
Samples: Credit Facility and Security Agreement (Continental Conveyor & Equipment Co)
Collection of Accounts. Until such time as provided in this Section, Borrower shall at all times maintain lockboxes is authorized to collect the Accounts in a commercially reasonable manner, provided that (the “Lockboxes”a) and shall instruct Borrower instructs all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections payments on all Accounts directly and exclusively to the Lock Box as instructed in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agentthe Notice of Assignment, and (b) in the Lockbox Banks shall enter into event Borrower receives any payment from an Account Debtor on an Account, Borrower immediately delivers such payment to the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox BankLock Box. Borrower agrees that: (i) all to use diligent and good funds on deposit in each local collection account (other than a local collection account which is either an Excluded faith efforts to collect the Accounts. Notwithstanding the foregoing, Borrower authorizes Lender to contact Account or which is subject to a Control Agreement) in excess Debtors concerning verification and payment of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of AgentAccounts. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Daysreceipt of notice from Lender that an Event of Default or event which, with the passage of time or is less than $10,000,000 on any Business Daygiving of notice or both, or (ii) the occurrence of 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 on all Accounts. Borrower shall not otherwise bxxx for, submit any invoice, or otherwise attempt to collect any Account. Lender is authorized to use the Notice of Assignment, or any other form of notice as determined by Lender, to notify Account Debtors of the assignment of Borrower’s Accounts and to 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 any information or records requested to assist in collection of Accounts. If a Lockbox Notice has been sent and both Borrower fails to respond to any request within two (x2) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Banking Business Days, thenLender 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 Agenta commercially reasonable manner does not require, and Lender is not obligated, to commence any legal action, including, without limitation, the sending of an attorney’s sole demand letter, to collect any Account. Borrower acknowledges and agrees that 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 service provider to collect the Accounts. All commissions, fees and charges of any such collection agency, attorney or other service provider shall be paid by 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, Borrower is authorized to file any such mechanic’s liens and other notices and documents in 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, Agent may give Borrower shall immediately notify Lender of the relevant Lockbox Bank an instruction permitting payment and deliver the payment to Lender. If payment is made by check or similar instrument, such instrument shall be immediately delivered to Lender in 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 once again direct tender the disbursement payment to Lender within two (2) Banking Business Days of funds on deposit in such Lockbox Account receipt by Borrower, Borrower shall promptly pay Lender a payment conversion fee equal to ten percent (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b10%) of the Agreement amount of the payment. Lender is hereby amended authorized and directed to read disburse a sufficient amount of the Loan as follows:necessary to pay any payment conversion fees.
Appears in 1 contract
Collection of Accounts. Borrower shall at all times maintain lockboxes (the “Lockboxes”) and shall instruct all Account Debtors with respect 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”), General Intangiblesas Agent may specify, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to with such Lockboxes or to local deposit accounts at financial institutions reasonably banks as are acceptable to Agent. Borrower, AgentSuch Blocked Accounts may be Central Collection Deposit Accounts, and the Lockbox Banks term Blocked Accounts shall enter 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 its account debtors to directly remit into such Blocked Accounts all payments on Receivables, other than the Lockbox AgreementsNon-Borrower Receivables, and all payments constituting proceeds of Inventory or other Collateral in the identical form in which among such payments are made, whether by cash, check or other things manner. Concurrently with this Agreement, each Borrower 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 which agreement shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: that upon notice from Agent (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer given upon an Event of Default or ACH transaction) 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 applicable), such bank will send funds on a daily basis to a Lockbox Account; the Agent Payment Account and (ii) all Collections and other amounts received by Borrower otherwise take instruction with respect to such Blocked Account only from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms Promptly upon Agent’s request, each Borrower shall execute and subject to the conditions set forth deliver such agreements or documents as Agent may require in the Lockbox Agreements, during the period following a connection therewith. Each Borrower agrees that after notice of exclusive control (each such notice, a “Lockbox Notice”) from the by Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox bank under the Deposit Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Control Agreement, all amounts payments made to such Blocked Accounts or other funds received and collected by Agent, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent, for itself and the ratable benefit of the Lenders and the Bank Product Providers, in respect of the Obligations and therefore shall constitute the property of Agent, for itself and the ratable benefit of the Lenders and the Bank Product Providers, to the extent of the then outstanding Obligations; provided, however, that in the applicable Lockbox Account event any Non-Borrower Receivable is deposited into the Blocked Accounts, in error or otherwise, such deposit shall be forwarded pursuant treated as a non-refundable payment to Agent, for itself and the ratable benefit of the Lenders and the Bank Product Providers, in respect of the Obligations and therefore shall constitute the property of Agent, for itself and the ratable benefit of the Lenders and the Bank Product Providers, to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) extent of the Agreement is hereby amended to read as follows:then outstanding Obligations.
Appears in 1 contract
Samples: Loan and Security Agreement (New York & Company, Inc.)
Collection of Accounts. (a) To expedite collection, Borrower shall at all times maintain lockboxes (endeavor in the “Lockboxes”) and shall instruct all Account Debtors with respect first instance to the Accounts, General Intangibles, and Negotiable Collateral make collection of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to its Accounts for Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts All remittances received by Borrower from any Account Debtor or any other source immediately upon receipt on account of Accounts shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified held as Agent's property by Borrower without the prior written consent as trustee of an express trust for Agent. Upon the terms 's benefit and subject to the conditions set forth Borrower shall immediately deposit same in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Dominion Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give have the Lockbox Notice to the Lockbox Bank right at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of DefaultDefault 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. If Agent has no duty to protect, insure, collect or realize upon the Accounts or preserve rights in them.
(b) Borrower shall deposit all proceeds of the Collateral, other than receipts for the sale of Property held by third parties as reserves for like/kind exchanges, or cause the same to be deposited in kind in a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived Dominion Account pursuant to a lockbox arrangement with such banks as may be selected by Borrower and be acceptable to Agent. Borrower shall issue to any such bank, an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more lockbox to the Dominion Account for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds application on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) account of the Agreement is hereby amended 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 read as follows:waive any offset rights against the funds so deposited. Agent assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder.
Appears in 1 contract
Samples: Loan and Security Agreement (Cal Dive International Inc)
Collection of Accounts. Borrower shall Bank is authorized at all times maintain lockboxes (the “Lockboxes”) any time and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless following the occurrence of an Activation Period is then Event of Default (as hereinafter defined) to take all actions necessary to collect all or any part of the accounts in effecttheir own name or in the name of Grantor. Agent Upon request of Bank, Grantor shall be entitled execute and deliver to give 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 Lockbox Notice accounts, and shall obtain an acknowledgment of assignment from any and all account debtors in a form satisfactory to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) 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. If a Lockbox Notice has been sent and both (x) there does not exist any Following the occurrence of an Event of Default (Default, Bank may settle or adjust all disputes or claims directly with the account debtors with respect to any of the accounts, and may compromise or extend the time of payment for any of the accounts on such terms and conditions as Bank may determine without affecting the liability of Grantor under this Security Agreement or any other document evidencing or relating to 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 for any act or omission on the part of Bank or their officers, agents, and employees, except willful misconduct. Until Bank exercise 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 time following the occurrence of an Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement)Default, and (y) Borrower’s Availability has been $25,000,000 or more for Bank may, at least the last five consecutive Business Daystheir election, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds notify any account debtor on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) any of the Agreement is hereby amended to read as follows:accounts of the assignment thereof and effect collection of any of the accounts directly from the account debtor obligated thereon.
Appears in 1 contract
Samples: Security Agreement (Palweb Corp)
Collection of Accounts. Borrower shall at all times maintain lockboxes (The Collateral Agent as agent for the “Lockboxes”) Secured Parties hereby authorizes the Debtor to collect and shall instruct all Account Debtors with respect to dispose of the proceeds of the Accounts, General Intangibleswhich authority the Collateral Agent may curtail or terminate at any time following the occurrence and during the continuance of any Event of Default. After such authority has been curtailed or terminated, the Debtor shall, upon receipt of all checks, drafts, cash, and Negotiable other remittances in payment of or on account of the Accounts, deposit the same in a special account designated by the Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, over which account the Collateral Agent as agent for the Secured Parties alone shall have the power of 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 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 Lockbox Banks 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 Collection Account shall enter into be held by the Lockbox AgreementsCollateral Agent as agent for the Secured Parties as security for the 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 among 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 things shall provide 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 opening of a Lockbox Account Collateral Agent until deposit thereof is made in the Collection Account. The Collateral Agent as agent for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good Secured Parties will from time to time apply the funds on deposit in each local collection account (other than a local collection account which is either an Excluded the Collection Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without against the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit Obligations in such Lockbox Account (such instruction a “Subsequent Notice”)order of application as is required by the Intercreditor Agreement.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 1 contract
Samples: Security Agreement (Trex Co Inc)
Collection of Accounts. (a) Borrowers and Guarantors shall establish and maintain, at their expense, deposit accounts and cash management services of a type and on terms, as Agent may reasonably specify at Xxxxx Fargo and, subject to Section 5.2(d) hereof, such other banks as such Borrower shall or 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 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 of Borrowers and Guarantors at all times maintain lockboxes (Lender, the “LockboxesCash Management Accounts” and individually a “Cash Management Account”).
(b) Borrowers shall, and shall instruct cause Guarantors to, deposit or cause to be deposited all Account Debtors with respect proceeds of Collateral, including all proceeds from sales of Inventory, all amounts payable to the Accountseach Borrower and Guarantor and all other proceeds of Collateral, General Intangibles, from each location of such Borrower and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter Guarantor on each Business Day into the Lockbox Agreements, which among other things shall provide Cash Management Account of such Borrower and Guarantor used for such purpose. All such funds deposited into the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account Cash Management Accounts shall be swept pursuant to standing instructions (sent by wire transfer or ACH transactionother electronic funds transfer each day to the Concentration Accounts.
(c) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or Without limiting any other source immediately upon receipt rights or remedies of Agent 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 at any time after the occurrence of a Cash Dominion Event. At all times that Agent shall have notified any depository bank to transfer funds from a Concentration Account to the Agent Payment Account, all payments made to such Concentration Accounts, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be deposited into treated as payments to Agent in respect of the Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations.
(d) Without limiting any other rights or remedies of Agent and Lenders, Agent may, at its option, send a Lockbox Account. No Lockbox “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 arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and other account subject to such agreement may be transferred except to the conditions set forth in Concentration Accounts or otherwise paid to the Lockbox Agreements, during Agent Payment Account at any time on or after a Cash Dominion Event and for so long as the period following same is continuing or at any time on or after Agent receives a notice of exclusive control the intention of the securities intermediary or other party thereto to terminate such Investment Property Control Agreement.
(each e) For purposes of calculating the amount of the Loans and Letters of Credit available to Borrowers, such notice, a “Lockbox Notice”payments or other funds received will be applied (conditional upon final collection) from to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent to the relevant Lockbox Bank Payment Account provided such payments or other funds and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts notice thereof are received in each Lockbox Account shall be wired each Business Day into an account (the “accordance with Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained usual and customary practices as in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank effect from time to time unless an Activation Period is 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 one (1) Business Day following the date of receipt by Agent of immediately available funds in effectthe 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 give an administrative fee in an amount calculated based on the Lockbox Notice to Interest Rate for Prime Rate Loans (on a per annum basis) multiplied by the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 amount of the funds received in the Concentration Accounts for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) such day as calculated by Agent in accordance with its customary practice. The economic benefit of the occurrence timing in the application of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default payments (and any Event the administrative charge with respect thereto, if applicable) shall be for the sole benefit of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Each Borrower and Guarantor and their respective employees, agents and 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 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 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 2.12(b) 6.3 shall survive the termination of the Agreement is hereby amended to read as follows:this Agreement.
Appears in 1 contract
Collection of Accounts. (A) 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, xxaft, 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 at all times 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 lockboxes with the Depository Bank, such agreement (the “Lockboxes”"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 instruct all Account Debtors to mail their payments directly to a designated post office lockbox (a "Lockbox") maintained at Continental's expense, with respect to which only Lender or, should Lender so agree, a designated financial institution shall have the Accounts, General Intangibles, right of access and Negotiable Collateral of Borrower all payments so received shall be subject to remit all Collections in respect thereof to such Lockboxes or to local immediate deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things Depository Account.
(C) All funds held in the Depository Account shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is be subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions Cash Collateral Account, an account designated by the Lender (the "Lender's Account") as set forth in the Lockbox Agreements, Depository Agreement or as otherwise designated by Lender. The application of any funds to the payment 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. Lender agrees that all funds received by Lender by wire transfer for either Borrower's account prior to 10:00 a.m. on any business day of Lender shall be 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 shall be in the sole discretion of Lender.
(D) Lender reserves the right upon the occurrence and during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence continuance of an Event of Default. If a Lockbox Notice has been sent Default to notify Account Debtors and both other Persons indebted to Borrowers of Lender's interest in any such amounts payable to Borrowers and to instruct such Account Debtors and other Persons to remit the same directly to Lender and upon collection of the same and deposit in the Cash Collateral Account, or in Lender's Account of all funds arising therefrom (xless any costs of collection and other charges or expenses incurred in connection therewith as hereinafter provided) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant in cleared federal funds, the same shall be subject to application to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”)Obligations.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 1 contract
Samples: Credit Facility and Security Agreement (Goodman Conveyor Co)
Collection of Accounts. Borrower shall at all times maintain lockboxes (the “Lockboxes”) and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default, all cash, checks, notes, drafts or other remittances received by Borrower on account of Accounts or 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. If Borrower agrees to pay to Lender any and all reasonable fees, costs and expenses which Lender incurs in connection with opening and maintaining a Lockbox Notice has been sent lockbox account and both (x) there does not exist depositing for collection by Lender any check or item of payment received by Lender or delivered to Lender. Borrower further agrees to execute all agreements and documents 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 (Default, Lender retains the right at all times to notify Account Debtors that Accounts have been assigned to Lender and any Event 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 Default upon which such Lockbox Notice was based has been waived pursuant to the terms computing interest hereunder, all items of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds payment received by Lender shall be deemed applied by Lender on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) account of the Agreement is hereby amended Obligations (subject to read as follows:final payment of such items) one (1) Business Day after receipt by Lender of such items.
Appears in 1 contract
Samples: Loan and Security Agreement (Franklin Ophthalmic Instruments Co Inc)
Collection of Accounts. To expedite collection, Borrower shall at all times maintain lockboxes (endeavor in the “Lockboxes”) and shall instruct all Account Debtors with respect first instance to the Accounts, General Intangibles, and Negotiable Collateral make collection of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agenttheir Accounts for Lender. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts All remittances received by Borrower from any Account Debtor or any other source immediately upon receipt on account of Accounts shall be deposited into a Lockbox held as Lender's property by Borrower as trustee of an express trust for Lender's benefit and Borrower shall deposit same in the Dominion Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without Lender retains the prior written consent of Agent. Upon the terms right, upon and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default, 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. If 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 deemed applied by Lender on account of the obligations (subject to final payment of such items) on the first Business Day after Lender's withdrawal of such payment from the Dominion Account in immediately available funds. Whenever reasonably practicable, Lender shall withdraw all funds contained in the Dominion Account on a Lockbox Notice has been sent daily basis, for application of such funds to the payment of the obligations as provided herein. Borrower shall deposit all proceeds of the Collateral or cause the same to be deposited in kind in the Dominion Account pursuant to an arrangement with such banks as may be selected by Borrower and both (x) there does not exist any 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 any Event of Default upon which such Lockbox Notice was based has been waived pursuant Borrower shall at Lender's request, notify Account Debtors and all other parties obligated on the Collateral to make payments directly to the terms Dominion Account. All funds deposited in the Dominion Account shall immediately become the Property of this Agreement)Lender, and (y) Borrower’s Availability has been $25,000,000 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 more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower release with respect to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”)deposits accepted by any bank thereunder.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 1 contract
Samples: Loan and Security Agreement (Red Man Pipe & Supply Co)
Collection of Accounts. Borrower shall at all times maintain lockboxes (Debtor shall, unless otherwise directed by Agent following the “Lockboxes”) occurrence and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence continuation of an Event of Default under either of the Bank Agreement or the Met Life Agreement (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 to 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 its option, 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 a Lockbox Notice has been sent so directed by Agent following the occurrence and both (x) there does not exist any 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 upon which such Lockbox Notice was based has been waived pursuant under either of the Bank Agreement or the Met Life Agreement, without notice, to appropriate and apply any balances, credits, property, deposits, accounts or money of or owing to Debtor in Agent's possession, custody or control to the terms payment of this any of the Obligations. Debtor agrees to execute, deliver, file and record all such notices, affidavits, assignments, financing statements and other instruments as shall in the reasonable judgment of Agent be necessary or desirable to evidence, validate and perfect the security interest of Agent in the Receivables. Following the occurrence and during the continuation of an Event of Default under either of the Bank Agreement or the Met Life Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give shall have the relevant Lockbox Bank 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 Agent following the occurrence and during the continuation of an instruction permitting Borrower to once again direct the disbursement Event of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) Default under either of the Bank Agreement is hereby amended or the Met Life Agreement, Debtor shall notify such account debtors and shall indicate on all invoices to read as follows:such account debtors that the accounts are payable to Agent.
Appears in 1 contract
Collection of Accounts. (A) To expedite collection, Borrower shall at all times maintain lockboxes (endeavor in the “Lockboxes”) first instance to make collection of its Accounts for Collateral Agent and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to AgentLenders. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts All remittances received by Borrower from any Account Debtor or any other source immediately upon receipt on account of Accounts shall be deposited into a Lockbox held as Lenders' property by Borrower as trustee of an express trust for Lenders' benefit and Borrower shall promptly deposit same in the Dominion Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Collateral Agent shall be entitled to give have the Lockbox Notice to the Lockbox Bank right at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of DefaultDefault 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. If 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 computing interest hereunder, all items of payment received by Collateral Agent shall be deemed applied by Collateral Agent on account of the Obligations (subject to final payment of such items) on the same Business Day as the receipt by Collateral Agent of such items of payment in Chicago, Illinois in immediately available funds, if such items of payment are received prior to 1:00 P.M. (Chicago, Illinois time) and on the next Business Day if such items of payment are received after 1:00 P.M. (Chicago, Illinois time).
(B) Borrower shall deposit all proceeds of the Collateral or cause the same to be deposited in kind in a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived Dominion Account pursuant to a lockbox arrangement with such banks as may be selected by Borrower and be acceptable to Lenders. Borrower shall issue to any such bank, an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more lockbox to the Dominion Account for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds application on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) account of the Agreement is hereby amended 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 read as follows:waive any offset rights against the funds so deposited. Lender assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder.
Appears in 1 contract
Collection of Accounts. (A) To expedite collection, Borrower shall at all times maintain lockboxes (endeavor in the “Lockboxes”) and shall instruct all Account Debtors with respect first instance to the Accounts, General Intangibles, and Negotiable Collateral make collection of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agentits Accounts for Lender. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts All remittances received by Borrower from any Account Debtor or any other source immediately upon receipt on account of Accounts shall be deposited into a Lockbox held as Lender's property by Borrower as trustee of an express trust for Lender's benefit and Borrower shall immediately deposit same in the Dominion Account. No Lockbox Agreement or arrangement contemplated thereby Lender shall be modified by Borrower without have the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank right at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of DefaultDefault 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 reasonable attorneys' fees, to Borrower. If Lender has no duty to protect, insure, collect or realize upon the Accounts or preserve rights in them.
(B) Borrower shall deposit all proceeds of the Collateral or cause the same to be deposited in kind in a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived Dominion Account pursuant to a lockbox arrangement with such banks as may be selected by Borrower and be acceptable to Lender. Borrower shall issue to any such bank, an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more lockbox to the Dominion Account for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds application on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) account of the Agreement is hereby amended Obligations. All funds deposited in the Dominion Account shall immediately become the property of Lender and Borrower shall obtain the agreement by such banks to read as follows:waive any offset rights against the funds so deposited. Lender assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder.
Appears in 1 contract
Samples: Loan and Security Agreement (Cal Dive International Inc)
Collection of Accounts. (A) To expedite collection, each Domestic Borrower shall at all times maintain lockboxes (endeavor in the “Lockboxes”) and shall instruct all Account Debtors with respect first instance to the Accounts, General Intangibles, and Negotiable Collateral make collection of its Accounts for Lender. All remittances received by each Domestic Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening on account of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account Accounts shall be swept pursuant to standing instructions (held as Lender's property by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; each such Domestic Borrower as trustee of an express trust for Lender's benefit and (ii) all Collections and other amounts received by each such Domestic Borrower from any Account Debtor or any other source shall immediately upon receipt shall be deposited into a Lockbox deposit same in the Dominion Account. No Lockbox Agreement or arrangement contemplated thereby Lender shall be modified by Borrower without have the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank right at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of a Default or an Event of DefaultDefault to notify the Account Debtors of each Domestic Borrower 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 reasonable attorneys' fees, to such Domestic Borrowers. If a Lockbox Notice Lender has been sent and both no duty to protect, insure, collect or realize upon the Accounts or preserve rights in them.
(xB) there does not exist any Event Each Domestic Borrower shall deposit all proceeds of Default (and any Event of Default upon which such Lockbox Notice was based has been waived the Collateral or cause the same to be deposited in kind in one or more Dominion Accounts pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 one or more lockbox arrangements with such banks as may be selected by such Domestic Borrower and be acceptable to Lender. Each Domestic Borrower shall issue to any such bank, an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the lockbox to the Dominion Account for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds application on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) account of the Agreement is hereby amended Obligations. All funds deposited in the Dominion Account shall immediately become the property of Lender and each Domestic Borrower shall obtain the agreement by such banks to read as follows:waive any offset rights against the funds so deposited. Lender assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder. Notwithstanding the foregoing, Borrower may utilize collections from its Canadian and Australian lockboxes to pay costs and expenses of the 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
Samples: Loan and Security Agreement (Lowrance Electronics Inc)
Collection of Accounts. (a) If Borrower or any Affiliate receives any monies, checks, notes, drafts, and other payments relating to or constituting proceeds of accounts or of any other Collateral, Borrower shall at all times maintain lockboxes immediately (but in any event within three (3) Business Days) deposit such items in kind in the “Lockboxes”) and Collection Account, fully-endorsed. Borrower shall instruct all advise each Account Debtors with respect Debtor that remits amounts payable on the accounts or any other Person that remits amounts to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and of any of the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (Collateral by wire transfer or ACH transactionAutomated Clearing House to make such remittances directly to the Collection Account.
(b) on Borrower shall establish a daily basis Lockbox and shall cause all moneys, checks, notes, drafts and other payments relating to or constituting proceeds of 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 Collections 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 other amounts 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 from any Account Debtor or any Affiliate (including any payment evidenced by a promissory note or other source immediately upon receipt instrument) shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby held in trust for Lender and shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Daydeposited in the Collection Account, or (ii) delivered to Lender, as promptly as possible in the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist exact form received, together with any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”)necessary endorsements.”
(fe) Section 2.12(b) of the Agreement is hereby amended to read Borrower shall pay all customary fees, costs and expenses in connection with opening and maintaining any Collection Account or Lockbox, as follows:applicable.
Appears in 1 contract
Collection of Accounts. (A) All remittances received by Borrower on account of Accounts shall be held as Agent's and Lenders' property by Borrower as trustee of an express trust for Agent's and Lenders' benefit and Borrower shall immediately deposit same in the Dominion Account as required by and in accordance with Section (B) below. Agent retains the right at all times maintain lockboxes (the “Lockboxes”) and shall instruct all 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 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 Obligations (subject to final payment of such items) on the first Business Day after Agent's receipt of payment in immediately available funds.
(B) Borrower shall deposit all proceeds of the Collateral or cause the same to be deposited in kind in a Dominion Account pursuant to a lockbox arrangement with respect to the Accounts, General Intangibles, such banks as may be selected by Borrower and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably be acceptable to Agent. Borrower, Agent, and Borrower shall issue to any such banks an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the Lockbox Banks shall enter into lockbox to the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Dominion Account for application on account of the deposit of Collections at a Lockbox BankObligations. Borrower agrees that: (i) all good All funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Dominion Account shall be wired each Business Day into an account (immediately become the “Agent’s Account”) maintained property of Agent and Borrower shall obtain the agreement by Agent at a depositary selected by Agent. Notwithstanding anything such banks to waive any offset rights against the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effectfunds so deposited. Agent shall be entitled assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to give the Lockbox Notice to the Lockbox Bank at deposits accepted by any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”)bank thereunder.”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:
Appears in 1 contract
Collection of Accounts. Borrower (A) To expedite collection, Borrowers shall at all times maintain lockboxes (endeavor in the “Lockboxes”) first instance to make collection of their Accounts for Lender. All remittances received by Borrowers on account of Accounts shall be held by Borrowers as trustee of an express trust for Lender's benefit and Borrowers shall instruct all Account Debtors immediately deposit the same in the Dominion Account. Such express trust shall cease with respect to any funds transferred by the AccountsDominion 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 to collect Accounts directly in its own name and to charge the collection costs and expenses, General Intangiblesincluding attorneys' fees, and Negotiable to the applicable Borrower. Lender has no duty to protect, insure, collect or realize upon the Accounts or preserve rights in them.
(B) Each Borrower shall deposit all proceeds of Collateral of Borrower or cause the same to remit all Collections be deposited in respect thereof kind in a Dominion Account pursuant to such Lockboxes or to local deposit accounts at financial institutions a lockbox arrangement reasonably acceptable to AgentLender. Borrower, Agent, and Each Borrower shall issue to any such banks an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the Lockbox Banks shall enter into lockbox to the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Dominion Account for application in accordance with this Agreement. All funds deposited in the deposit Dominion Account shall immediately become Collateral and Borrowers shall obtain the agreement by such banks to waive any offset rights against the funds so deposited. Lender assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of Collections at a Lockbox Bank. Borrower agrees that: accord and satisfaction or release with respect to deposits accepted by any bank thereunder.
(iC) all good All funds on deposit in each local collection account (other than a local collection account which is either an Excluded the Dominion Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) provisions of the Agreement is hereby amended to read as follows:Dominion Account Agreement.
Appears in 1 contract
Collection of Accounts. Borrower shall at all times maintain lockboxes Following the occurrence of an Event of Default (the “Lockboxes”) and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”hereinafter defined), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent Bank is authorized at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank any time and from time to time unless 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 deliver to Bank (in addition to documents previously delivered to Bank) an Activation Period is then assignment, in effecta 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. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) 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. If a Lockbox Notice has been sent and both (x) there does not exist any Following the occurrence of an Event of Default (Default, Bank may settle or adjust all disputes or claims directly with the account debtors with respect to any of the Accounts, and may compromise or extend the time of payment for any of the Accounts on such terms and conditions as Bank may determine without affecting the liability of Grantor under this Security Agreement or any other document evidencing or relating to 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 for any act or 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 time following the occurrence of an Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement)Default, and (y) Borrower’s Availability has been $25,000,000 or more for Bank may, at least the last five consecutive Business Daysits election, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds notify any account debtor on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) any of the Agreement is hereby amended to read as follows:Accounts of the assignment thereof and effect collection of any of the Accounts directly from the account debtor obligated thereon.
Appears in 1 contract
Samples: Security Agreement (Palweb Corp)
Collection of Accounts. (A) 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, xxaft, 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 at all times 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 Borrower or such other account(s) as Borrower may maintain lockboxes with the Depository Bank, such agreement (the “Lockboxes”"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 Borrower's expense, with respect to which only Lender or, should Lender so agree, a designated financial institution shall have the Accounts, General Intangibles, right of access and Negotiable Collateral of Borrower all payments so received shall be subject to remit all Collections in respect thereof to such Lockboxes or to local immediate deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Depository Account or which is Cash Collateral Account.
(C) All funds held in the Depository Account shall be subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions Cash Collateral Account, an account designated by the Lender (the "Lender's Account") as set forth in the Lockbox Agreements, during the period following a notice Depository Agreement or as otherwise designated by Lender. The application of exclusive control (each such notice, a “Lockbox Notice”) from the Agent any funds to the relevant Lockbox Bank and continuing payment of the Obligations shall not occur until Lender's receipt of such time, if any, as Agent has delivered funds in cleared federal funds in the Cash Collateral Account or in Lender's Account. Lender agrees that all funds received by Lender by wire transfer for the Borrower's account prior to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account 10:00 a.m. on any business day of Lender shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts deemed cleared federal funds in the applicable Lockbox Account shall be forwarded pursuant to Cash Collateral Account. Funds received by Lender by wire transfer for the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of Default. If a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:'s account after
Appears in 1 contract
Samples: Credit Facility and Security Agreement (International Total Services Inc)
Collection of Accounts. (A) To expedite collection, each Borrower shall at all times maintain lockboxes (endeavor in the “Lockboxes”) first instance to make collection of its Accounts for Agent and shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral Lenders. All remittances received by each Borrower on account of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account Accounts shall be swept pursuant held as Lenders' property by such Borrower as trustee of an express trust for Lenders' benefit and such Borrower shall immediately deposit or cause to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of Agent. Upon the terms and subject to the conditions set forth same in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Dominion Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give have the Lockbox Notice to the Lockbox Bank right at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any Business Day, or (ii) the occurrence of an Event of DefaultDefault to notify Account Debtors that Accounts have been assigned to 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 Borrowers. If Neither Agent nor any Lender has any duty to protect, insure, collect or realize upon the Accounts or preserve rights in them.
(B) Each Borrower shall deposit all proceeds of the Collateral or cause the same to be deposited in kind in a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived Dominion Account pursuant to a lockbox arrangement with such banks as may be selected by Borrowers and be acceptable to Agent. Each Borrower shall issue to any such banks, an irrevocable letter of instruction directing such banks to deposit all payments or other remittances received in the terms lockbox to the Dominion Account for application on account of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Business Days, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) of the Agreement is hereby amended to read as follows:the
Appears in 1 contract
Samples: Loan and Security Agreement (Brazos Sportswear Inc /De/)
Collection of Accounts. Until such time as provided in this Section, Borrower shall at all times maintain lockboxes is authorized to collect the Accounts in a commercially reasonable manner, provided that (the “Lockboxes”a) and shall instruct Borrower instructs all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections payments on all Accounts directly and exclusively to the Lock Box as instructed in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agentthe Notice of Assignment, and (b) in the Lockbox Banks shall enter into event Borrower receives any payment from an Account Debtor on an Account, Borrower immediately delivers such payment to the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox BankLock Box. Borrower agrees that: (i) all to use diligent and good funds on deposit in each local collection account (other than a local collection account which is either an Excluded faith efforts to collect the Accounts. Notwithstanding the foregoing, Borrower authorizes Lender to contact Account or which is subject to a Control Agreement) in excess Debtors concerning verification and payment of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without the prior written consent of AgentAccounts. Upon the terms and subject to the conditions set forth in the Lockbox Agreements, during the period following a notice of exclusive control (each such notice, a “Lockbox Notice”) from the Agent to the relevant Lockbox Bank and continuing until such time, if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation Period is then in effect. Agent shall be entitled to give the Lockbox Notice to the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Daysreceipt of notice from Lender that an Event of Default or event which, with the passage of time or is less than $10,000,000 on any Business Daygiving of notice or both, or (ii) the occurrence of 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 on all Accounts. Borrower shall not otherwise xxxx for, submit any invoice, or otherwise attempt to collect any Account. Lender is authorized to use the Notice of Assignment, or any other form of notice as determined by Lender, to notify Account Debtors of the assignment of Borrower’s Accounts and to 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 any information or records requested to assist in collection of Accounts. If a Lockbox Notice has been sent and both Borrower fails to respond to any request within two (x2) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement), and (y) Borrower’s Availability has been $25,000,000 or more for at least the last five consecutive Banking Business Days, thenLender 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 Agenta commercially reasonable manner does not require, and Lender is not obligated, to commence any legal action, including, without limitation, the sending of an attorney’s sole demand letter, to collect any Account. Borrower acknowledges and agrees that 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 service provider to collect the Accounts. All commissions, fees and charges of any such collection agency, attorney or other service provider shall be paid by 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, Borrower is authorized to file any such mechanic’s liens and other notices and documents in 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, Agent may give Borrower shall immediately notify Lender of the relevant Lockbox Bank an instruction permitting payment and deliver the payment to Lender. If payment is made by check or similar instrument, such instrument shall be immediately delivered to Lender in 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 once again direct tender the disbursement payment to Lender within two (2) Banking Business Days of funds on deposit in such Lockbox Account receipt by Borrower, Borrower shall promptly pay Lender a payment conversion fee equal to ten percent (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b10%) of the Agreement amount of the payment. Lender is hereby amended authorized and directed to read disburse a sufficient amount of the Loan as follows:necessary to pay any payment conversion fees.
Appears in 1 contract
Collection of Accounts. Borrower shall at all times maintain lockboxes (a) On or before the date that is 60 days following the Closing Date, or such later date agreed to by the Agent in its reasonable discretion (the “LockboxesControl Agreement Deadline”) and ), each Grantor shall instruct all Account Debtors with respect to the Accounts, General Intangibles, and Negotiable Collateral of Borrower to remit all Collections in respect thereof to such Lockboxes or to local deposit accounts at financial institutions reasonably acceptable to Agent. Borrower, Agent, and the Lockbox Banks shall enter into the Lockbox Agreements, which among other things shall provide for the opening of a Lockbox Account for the deposit of Collections at a Lockbox Bank. Borrower agrees that: (i) all good funds execute and deliver to the Agent a Deposit Account Control Agreement for each Collateral Deposit Account, which Collateral Deposit Accounts as of the Closing Date are identified as such on deposit in each local collection account (other than a local collection account which is either an Excluded Account or which is subject to a Control Agreement) in excess of $25,000 per account shall be swept pursuant to standing instructions (by wire transfer or ACH transaction) on a daily basis to a Lockbox Account; Exhibit E, and (ii) all Collections and other amounts received by Borrower from any Account Debtor or any other source immediately upon receipt shall be deposited into a Lockbox Account. No Lockbox Agreement or arrangement contemplated thereby shall be modified by Borrower without establish lock box service (the prior written consent “Lock Boxes”) with banks at which lock boxes are maintained (which banks as of Agent. Upon the terms and subject to the conditions Closing Date are set forth in Exhibit E), which Lock Boxes shall be subject to irrevocable lockbox agreements (which may be set forth in Deposit Account Control Agreements) in form and substance reasonably acceptable to the Lockbox AgreementsAgent and, during if applicable, shall be accompanied by an acknowledgment by the period following bank where the Lock Box is located of the Lien of the Agent granted hereunder and of irrevocable instructions to wire all amounts collected therein to a Dominion Account (a “Lock Box Agreement”).
(b) 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 Agent shall be authorized to exercise exclusive control over any Collateral Deposit Account at all times and no Grantor will be 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 (A) except as provided in Section 6.1, it will not deliver a notice of exercising exclusive control over a Collateral Deposit Account unless a Dominion Trigger Period is in effect and (each such notice, B) it will deliver a “Lockbox Notice”) from the Agent notice rescinding its exclusive control over any Collateral Deposit Account with respect to the relevant Lockbox Bank and continuing until such time, which it has previously delivered a notice exercising exclusive control if any, as Agent has delivered to such Lockbox Bank a Subsequent Notice as set forth below (such period, an “Activation Period”), all amounts received in each Lockbox Account shall be wired each Business Day into an account (the “Agent’s Account”) maintained by Agent at a depositary selected by Agent. Notwithstanding anything to the contrary contained in this Section 2.8 or elsewhere in this Agreement, all amounts in the applicable Lockbox Account shall be forwarded pursuant to the instructions of Borrower given to such Lockbox Bank from time to time unless an Activation 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 shall, notwithstanding anything to the contrary set forth herein, be entitled to give make such notification directly to such Account Debtor. If notwithstanding the Lockbox Notice foregoing instructions any Grantor receives cash or Payment Items with respect to any Collateral, it shall hold same in trust for Agent and promptly (not later than the Lockbox Bank at any time after either (i) Borrower’s Availability is less than $25,000,000 for five consecutive Business Days, or is less than $10,000,000 on any next Business Day) deposit same into a Dominion Account, except as otherwise expressly permitted by the Credit Agreement. The Agent shall hold and apply funds received into Dominion Accounts as provided in the Credit Agreement, including, without limitation, as provided in Sections 5.6 and 8.2 thereof.
(c) Each Cash Collateral Account and all Cash Collateral shall be under the sole dominion and control of Agent at all times, whether or (ii) the occurrence of an Event of Default. If not a Lockbox Notice has been sent and both (x) there does not exist any Event of Default (and any Event of Default upon which such Lockbox Notice was based has been waived pursuant to the terms of this Agreement)Dominion Trigger Period is in effect, and (y) Borrower’s Availability has been $25,000,000 no Grantor or more for at least the last five consecutive Business Daysother Person shall have any right to any Cash Collateral, then, in Agent’s sole discretion, Agent may give the relevant Lockbox Bank an instruction permitting Borrower to once again direct the disbursement of funds on deposit in such Lockbox Account (such instruction a “Subsequent Notice”).”
(f) Section 2.12(b) until Full Payment of the Agreement is hereby amended Obligations. All such Cash Collateral while held in a Cash Collateral Account shall continue to read be held as follows:collateral security for all the Obligations and shall not constitute payment thereof until applied as provided in the Intercreditor Agreement.
Appears in 1 contract
Samples: Loan Agreement (Horizon Global Corp)
