Floor Plan Advances Clause Samples
The Floor Plan Advances clause defines the terms under which a lender provides financing to a borrower specifically for the purchase of inventory, such as vehicles or equipment, that will be held for resale. Typically, this clause outlines the process for requesting advances, the types of inventory eligible for financing, and the repayment terms, which often require repayment when the financed item is sold. Its core practical function is to ensure that the borrower has access to working capital for inventory purchases while giving the lender a structured method to monitor and secure repayment as inventory is sold, thereby managing risk and supporting the borrower's business operations.
Floor Plan Advances. Subject to the terms and conditions of this Agreement, CDF agrees to thereafter make available to Dealers extensions of credit on a revolving basis in such amounts as Dealers may from time to time request up to an aggregate total of two hundred five million dollars ($205,000,000.00) (the “Maximum Credit Amount”), minus (i) the outstanding amount of Approvals (as defined below) and (ii) the aggregate outstanding amount of any other Obligations of Dealers to CDF, to purchase inventory, which will be subject to a purchase money security interest in favor of CDF, from Dealers’ existing vendors identified on Exhibit A to this Agreement and any additional vendors acceptable to CDF in its sole discretion (such existing vendors and additional vendors, in each case until any such vendor shall be disapproved by written notice from CDF due to (x) such vendor’s failure to comply with any law, rule, regulation, order or decree; (y) such vendor’s failure to comply with any internal policies and procedures of CDF or any CDF Affiliate (as defined below) relating to import or export controls, anti-money laundering, anti-terrorism, securities law, banking law or regulation, fraud statutes and other similar laws and regulations and codes of ethical conduct (collectively, “Internal Policies”); or (z) any circumstance which may make CDF’s disbursement of any advance to such vendor illegal or otherwise in violation of any law, rule, regulation, order or decree applicable to CDF or any Internal Policies, each, a “Vendor” and, collectively, “Vendors”) and for other purposes (including the Pre-Owned Inventory Sublimit described below); provided, however, that (1) repayments from time to time of the outstanding balance of the indebtedness hereunder shall be available to be reborrowed pursuant to the terms and conditions of this Agreement; (2) if the Obligations hereunder outstanding at any time or from time to time exceed the Maximum Credit Amount, Dealers shall immediately (but in any event within two (2) Business Days) repay the Obligations in such amount necessary to eliminate such excess; provided that, in its reasonable discretion, CDF may immediately cease to make loans and/or to issue Approvals until such repayment occurs, and (3) notwithstanding anything else contained in this Agreement, (I) CDF may, in its reasonable discretion, immediately cease to make loans and/or to issue Approvals (x) upon the occurrence and during the continuance of any Default or upon the occurrence...
Floor Plan Advances. (i) Subject to the terms and conditions of this Agreement (including, without limitation, Sections 2(a)(iv) and (v) below), the Lenders severally and not jointly agree to make available to Dealers extensions of credit (“Loans”) in an amount equal to each such Lenders Ratable Share of such Loan to any one or more Dealers on a revolving basis in such amounts as Dealers may from time to time request up to the amount of Availability to purchase inventory, which will be subject to a purchase money security interest in favor of Agent, as collateral agent for Lenders, from Approved Vendors and any additional Vendors acceptable to Agent in Agent’s Permitted Discretion, and for other purposes (including the Pre-Owned Inventory Sublimit). For the avoidance of doubt, the Closing Principal Balance shall be deemed a Loan outstanding under this agreement, and shall be subject to the funding procedure set forth in Section 2(a)(v) below on the first Settlement Date following the Closing Date. Notwithstanding anything herein or in the Program Terms Letter to the contrary, the sum of all Outstandings and Open Approvals with respect to Sea Pro shall not at any time exceed two million dollars ($2,000,000.00); provided, however, that such amount may be increased from time to time by Agent in writing in its sole and absolute discretion, without the consent of Lenders. Fourth Amended and Restated Inventory Financing Agreement 6 KCP-8393129-10 NOTE: PORTIONS OF THIS EXHIBIT INDICATED BY “[****]” ARE SUBJECT TO A CONFIDENTIAL TREATMENT REQUEST, AND HAVE BEEN OMITTED FROM THIS EXHIBIT. COMPLETE, UNREDACTED COPIES OF THIS EXHIBIT HAVE BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AS PART OF THIS COMPANY’S CONFIDENTIAL TREATMENT REQUEST.
(ii) (A) Repayments from time to time of the outstanding balance of the indebtedness hereunder shall be available to be re-borrowed pursuant to the terms and conditions of this Agreement; (B) no Loan will be made to the extent such Loan would cause any Lender to have outstanding Loans in a principal amount in excess of such Lender’s Allocation; (C) if the Obligations hereunder outstanding at any time or from time to time exceed the lesser of (I) the Maximum Aggregate Credit Amount minus the outstanding amount of Approvals and (II) the Net Eligible Inventory Amount minus the amount of any Reserves, Dealers shall immediately (but in any event within two (2) Business Days) pay the amount of excess to Agent for the benefit of Lenders; provided t...