Common use of Contractual Payment Obligations Clause in Contracts

Contractual Payment Obligations. Notwithstanding any limitation on recourse contained in this Agreement, the Originator hereby agrees as follows: (a) If on any day the outstanding balance of a Purchased Receivable is reduced or cancelled as a result of any defective or rejected goods or services, any cash discount or adjustment (including as a result of the application of any special refund or other discounts or any reconciliation), any setoff or credit (whether such claim or credit arises out of the same, a related or an unrelated transaction) or other similar reason not arising from the financial inability of the Obligor to pay undisputed indebtedness, the outstanding principal balance of the Note shall be reduced by the amount of such reduction or cancellation in the outstanding balance of such Purchased Receivable; provided that to the extent such reduction would reduce the Note to zero, the Originator shall pay to the Company in cash on such day any remaining amount due on account of such reduction or cancellation. (b) If on any day (i) any representation, warranty, covenant or other agreement of the Originator is not true (as of the date such representation or warranty is made or deemed made) with respect to any Purchased Receivable or (ii) in the case of a covenant or agreement, is not satisfied for a Purchased Receivable, the Company shall sell such Purchased Receivable to the Originator for an amount equal to the amount paid by the Company for such Purchased Receivable, such amount to be paid by reducing the outstanding principal balance of the Note by such amount; provided that to the extent such reduction would reduce the Note to zero, the Originator shall pay to the Company in cash on such day any remaining amount due to purchase such Purchased Receivable.