GENERAL AGREEMENTS OF BORROWER. Borrower agrees to keep all the Inventory insured with coverage and amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The Bank or its agents have the right to inspect the Inventory and all records pertaining thereto at intervals to be determined by Bank and without hindrance or delay. Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check and make extracts from any copies of the books, records, journals, orders, receipts or correspondence which relate to Borrower's accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. Borrower, during the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the Bank. Borrower will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. Borrower will not sell or dispose of any of its assets except in the ordinary and usual course of its business. The Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's satisfaction the existence, amount and terms of any accounts. This Agreement may but need not be supplemented by separate assignment of accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. If any of Borrower's accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. If any of Borrower's accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
Appears in 1 contract
Samples: Inventory and Accounts Receivable Security Agreement (Global Decisions Group LLC)
GENERAL AGREEMENTS OF BORROWER. Section 12.01. Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank.
Section 12.02. The Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto at intervals to be determined by Bank and without hindrance or delay.
Section 12.03. Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accountsAccounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. BorrowerBorrower shall pay to Bank all reasonable audit fees, during plus all travel and other expenses incurred in connection with any such audit. The foregoing notwithstanding, Bank agrees to keep all such inspected, audited, checked or extracted information confidential in accordance with the term guidelines set forth in Section 11.06 above.
Section 12.04. Borrower will maintain a standard and modern system of this Agreement, will not assign any accounts or other accounting which enables Borrower to produce financial statements in accordance with GAAP and maintain records pertaining to the Collateral that contain information as from time to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the time may be requested by Bank.
Section 12.05. Borrower will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business.
Section 12.06. Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien or charge from attaching to its assets except in the ordinary and usual course of its businessproperty.
Section 12.07. The Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's satisfaction the existence, amount and terms of any accountsAccounts.
Section 12.08. This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement.
Section 12.09. If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act.
Section 12.10. If Excepting only those leases with customers of Borrower having a value of not more than Seventy-Five Thousand ($75,000.00) Dollars, if any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein.
Section 12.11. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Loan and Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
Section 12.12. Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with the Borrower's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms "hazardous waste," "hazardous or toxic substance," "hazardous material" or "oil" shall have the same meanings as defined and used in any of the following (the "Acts"): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.; the Federal Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; M.G.L.A. c. 21E (Massachusetts Oil and Hazardous Material Release Prevention Act); M.G.L.A. c. 21C (Massachusetts Hazardous Waste Management Act); and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
Appears in 1 contract
Samples: Demand Loan and Security Agreement (Asa International LTD)
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that reasonably required by Bank with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The .
(b) Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto at reasonable intervals to be determined by Bank and without hindrance or delay. .
(c) Although, as above set forth, Bank has a continuing security interest in all of Borrower's Collateral and in the proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all loans made hereunder and if Borrower fails to do so, Borrower will immediately make the necessary reduction in the unpaid principal amount of said loans so that the loans outstanding hereunder do not in the aggregate exceed the Borrowing Base.
(d) Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's place or places of business at reasonable intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accountsAccounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. Borrower, during Borrower shall pay to Bank all reasonable audit fees plus all travel and other reasonable expenses incurred in connection with any such audit.
(e) Borrower will maintain a standard and modem system of accounting which enables Borrower to produce financial statements in accordance with generally accepted accounting principles and maintain records pertaining to the term of this Agreement, will not assign any accounts or other Collateral that contain information as from time to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the time may be reasonably requested by Bank. .
(f) Borrower will maintain its corporate existence in good standing and comply in all material respects with all material laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. .
(g) Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien or charge from attaching to its assets except property; provided that nothing herein shall prohibit any "permitted protest" as set forth in the ordinary and usual course of its business. The Section 14(f).
(h) Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's satisfaction the existence, amount and terms of any accounts. Accounts.
(i) This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(j) If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(k) If any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five .
(5l) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor; provided that nothing herein shall prohibit any "permitted protest" as set forth in Section 14(f). At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
(m) Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with the Borrower's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms "hazardous waste," "hazardous or toxic substance," "hazardous material" or "oil" shall have the same meanings as defined and used in any of the following (the "Acts"): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization Act of 1986; the Federal Resource Conservation, and Recovery Act, 42 USC Sections 6901 et seq,; the Hazardous Materials Transportation Act, 49 USC Sections 1801 et seq,; the Toxic Substances Control Act, 15 USC Sections 2601 et seq,; the Federal Water Pollution Control Act, 33 USC Sections 1251 et seq.; the Clean Air Act, 42 USC Sections 741 et seq,; the Clean Water Act, 33 USC Section 701; the Safe Drinking Water Act, 42 USC Sections 300(f)- 300(j); M.G.L.A. c. 21E (Massachusetts Oil and Hazardous Material Release Prevention Act); M.G.L.A. c. 21C (Massachusetts Hazardous Waste Management Act); and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
(n) Except for Bank's gross negligence or willful misconduct, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys' fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank's agreement to make loans available to Borrower and the termination of this Agreement.
(o) At the option of Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof satisfactory to Bank that such deposits have been made as required.
(p) Should Borrower fail to make any of such deposits or furnish such proof then Bank may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) setup such reserves as Bank, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or setup such reserve and the making of one or more of such deposits or payments or the setting-up of such reserve shall not constitute (i) an agreement on Bank's part to take any further or similar action, or (ii) a waiver of any default by Borrower under the terms hereof.
(q) All advances by Bank to Borrower under this Agreement and under any other agreement constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this and under any other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is distinctly understood and agreed that all of the rights of Bank contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements between Bank and Borrower. Any default of this Agreement by Borrower shall constitute, likewise, a default by Borrower of any other existing agreement with Bank, and any default by Borrower of any other agreement with Bank shall constitute a default of this Agreement. The entire Obligation of Borrower to Bank shall become due and payable upon termination of this Agreement.
Appears in 1 contract
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that reasonably required by Bank with loss payable to the Bank and Borrower, as their interests may appearappear (provided that so long as no Event of Default exists, any amounts received by Bank shall be promptly forwarded to Borrower), hereby appoint appointing Bank as attorney for Borrower during an Event of Default in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable during an Event of Default under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The .
(b) Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto at intervals to be determined by Bank during Borrower's regular business hours upon reasonable prior notice but without notice any time while an Event of Default exists and without hindrance or delay. Bank shall also have the right to obtain from time to time upon its reasonable request at the sole cost and expense of Borrower an appraisal of the Collateral by an appraiser reasonably acceptable to Bank.
(c) Although, as above set forth, Bank has a continuing security interest in all of Borrower's Collateral and in the proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all loans made hereunder and if Borrower fails to do so, Borrower will promptly make the necessary reduction in the unpaid principal amount of said loans so that the loans outstanding hereunder do not in the aggregate exceed the Borrowing Base.
(d) Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's place or places of business at intervals to be determined by BankBank during Borrower's regular business hours upon reasonable prior notice but without notice any time while an Event of Default exists, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accountsAccounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. BorrowerBorrower shall pay to Bank all reasonable audit fees (not to exceed $5,000.00 in any calendar year, during absent an Event of Default which is continuing), plus all travel and other expenses incurred in connection with any such audit.
(e) Borrower will maintain a standard and modern system of accounting which enables Borrower to produce financial statements in accordance with generally accepted accounting principles and maintain records pertaining to the term of this Agreement, will not assign any accounts or other Collateral that contain information as from time to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the time may be reasonably requested by Bank. .
(f) Borrower will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. .
(g) Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien or charge from attaching to its assets except in the ordinary and usual course of its business. The property.
(h) After consultation with Borrower, Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's reasonable satisfaction the existence, amount and terms of any accounts. Accounts.
(i) This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(j) If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately promptly notify Bank thereof in writing and while an Event of Default exists execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(k) If any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately promptly deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto.
(l) If any goods are at any time in the possession of a bailee, Borrower shall promptly notify Bank thereof and, if reasonably requested by Bank, shall promptly obtain an acknowledgment from the bailee, in form and substance reasonably satisfactory to Bank, that the bailee holds such Collateral for the benefit of Bank and shall act upon the instructions of Bank, without the further consent of Borrower, during an Event of Default. At Bank agrees with Borrower that Bank shall not give any such instructions unless an Event of Default has occurred and is continuing or would occur after taking into account any action by Borrower with respect to the bailee.
(m) If Borrower is at any time a beneficiary under a letter of credit now or hereafter issued in favor of Borrower, Borrower shall promptly notify Bank thereof and, at the reasonable request and option of the Bank, Borrower will furnish shall, pursuant to an agreement in form and substance reasonably satisfactory to Bank, from either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to Bank of the proceeds of any drawing under the letter of credit, or (ii) arrange for Bank to become the transferee beneficiary of the letter of credit, with Bank agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an Account.
(n) If Borrower shall at any time hold or acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the brief details thereof and grant to timeBank in such writing a security interest therein, within five (5) days after and in the accrual proceeds thereof, all upon the terms of this Agreement, with such writing to be in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. form and withholding taxes, proof substance reasonably satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Bank.
(o) Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the reasonable request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
(p) Borrower will promptly notify Bank upon receipt of notification of any potential or known release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with the Borrower's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms "hazardous waste," "hazardous or toxic substance," "hazardous material" or "oil" shall have the same meanings as defined and used in any of the following (the "Acts") the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization Act of 1986, the Federal Resource Conservation and Recovery Act, 42 USC Sections 6901 et seq, the Hazardous Materials Transportation Act, 49 USC Sections 1801 et seq, the Toxic Substances Control Act, 15 USC Sections 2601 et seq, the Federal Water Pollution Control Act, 33 USC Sections 1251 et seq, the Clean Air Act, 42 USC Sections 741 et seq, the Clean Water Act, 33 USC Section 701, the Safe Drinking Water Act, 42 USC Sections 300(f)-300(j), M.G.L.A.c 21E (Massachusetts Oil and Hazardous Material Release Prevention Act), M.G.L.A.c 21C (Massachusetts Hazardous Waste Management Act), and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
(q) Except for Bank's gross negligence or willful misconduct or failure to comply with this Agreement, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys' fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank's agreement to make loans available to Borrower and the termination of this Agreement.
(r) Upon the reasonable request of Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof reasonably satisfactory to Bank that such deposits have been made as required.
(s) Should Borrower fail to make any of such deposits or furnish such proof then Bank may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) set-up such reserves as Bank, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or set-up such reserve and the making of one or more of such deposits or payments or the setting-up of such reserve shall not constitute (i) an agreement on Bank's part to take any further or similar action, or (ii) a waiver of any default by Borrower under the terms hereof.
(t) All advances by Bank to Borrower under this Agreement and under any other agreement constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this and under any other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is distinctly understood and agreed that all of the rights of Bank contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements between Bank and Borrower. Any default of this Agreement by Borrower shall constitute, likewise, a default by Borrower of any other existing agreement with Bank, and any default by Borrower of any other agreement with Bank shall constitute a default of this Agreement. The entire Obligation of Borrower to Bank shall become due and payable upon termination of this Agreement.
(u) Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use all premises or places of business which Borrower presently has or may hereafter have and where any of the Collateral may be located, at a total rental for the entire period of $ 1.00 Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral.
(v) Borrower will, at its expense, upon the reasonable request of Bank promptly and duly execute and deliver such documents and assurances and take such actions as may be necessary or desirable or as Bank may reasonably request in order to correct any defect, error or omission which may at any time be discovered or to more effectively carry out the intent and purpose of this Agreement and to establish, perfect and protect Bank's security interest, rights and remedies created or intended to be created hereunder. Without limiting the generality of the above, Borrower will join with Bank in executing financing and continuation statements pursuant to the Uniform Commercial Code or other notices appropriate under applicable Federal or state law in form reasonably satisfactory to Bank and filing the same in all public offices and jurisdictions wherever and whenever reasonably requested by Bank.
(w) Borrower shall perform any and all further steps reasonably requested by Bank to perfect Bank's security interest in Inventory, such as leasing warehouses to Bank or its designee, placing and maintaining signs, appointing custodians, maintaining stock records and transferring Inventory to warehouses. A physical listing of all Inventory, wherever located, shall be taken by Borrower at least annually and whenever requested by Bank if one or more of the Events of Default exist.
(x) Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owed to Bank are fully paid and discharged, a non-exclusive irrevocable royalty-free license in connection with Bank's exercise of its rights hereunder, to use, apply or affix any trademark, trade name logo or the like and to use any patents, in which the Borrower now or hereafter has rights, which license may be used by Bank upon and after the occurrence of any one or more of the Events of Default, provided, however, that such use by Bank shall be suspended if such Events of Default are cured.
Appears in 1 contract
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank Lender with loss payable to the Bank Lender and Borrower, as their interests may appear, hereby appoint Bank appointing Lender as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank Lender all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The Bank Lender.
(b) Lender or its agents have the right during ordinary business hours to inspect the Inventory Collateral and all records pertaining thereto at intervals to be determined by Bank Lender and without hindrance or delay. .
(c) Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have will permit Lender to audit the right to call at Borrower's place or places of business at intervals to be determined by Bank, books and without hindrance or delay, to inspect, audit, check and make extracts from any copies of the books, records, journals, orders, receipts or correspondence which relate to Borrower's accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition records of Borrower and Bank may remove to conduct or cause to be conducted appraisals of Borrower's assets at such times, upon reasonable notice, and in such manner and detail as Lender deems reasonable. Without limiting the generality of the foregoing, Lender shall be allowed to verify the Receivables and Inventory of Borrower and to confirm with account debtors the validity and amount of Receivables. Borrower shall promptly pay to Lender reasonable audit fees and any out-of-pocket expenses incurred by any third party retained by Lender in connection with any audit if Lender, in its sole discretion, deems it necessary to hire outside auditors after the occurrence of such records temporarily an Event of Default. In addition, Borrower shall promptly pay or reimburse Lender for the purpose of having copies made thereof. Borrower, during the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest costs of any kind covering such appraisals conducted by or for Lender. Lender may pay any such audit fees and out-of-pocket expenses and treat the same as a loan to Borrower.
(d) Borrower will maintain a standard and modern system of accounting which enables Borrower to produce financial statements in accordance with generally accepted accounting principles and maintain records pertaining to the Collateral, other than for the benefit of the Bank. Collateral that contain information as from time to time may be requested by Lender.
(e) Borrower will maintain its corporate existence in good standing and comply in all material respects with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. .
(f) Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien or charge from attaching to its assets except in the ordinary and usual course of its business. The Bank property.
(g) Lender may in its own name or in the name of others communicate with account debtors in order to verify with them to BankLender's reasonable satisfaction the existence, amount and terms of any accountsAccounts. its sole discretion, to adjust the margin over the Prime Rate payable by Borrower hereunder upon ten (10) days notice to Borrower.
(h) This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(i) If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank Lender thereof in writing and execute any instruments and take any steps reasonably required by Bank Lender in order that all monies due and to become due under such contracts shall be assigned to Bank Lender and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(j) If any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to BankLender, appropriately endorsed to BankLender's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five .
(5k) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Loan and Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of BankLender, promptly furnish Bank Lender the receipted bills therefor. At its option, Bank Lender may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank Lender on demand for any payments made, or any expenses incurred by Bank Lender pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse BankLender, any such sums paid or advanced by Bank Lender shall be deemed secured by the Collateral and constitute part of the Obligations.
(l) Borrower will immediately notify Lender upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with the Borrower's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms "hazardous waste," "hazardous or toxic substance," "hazardous material" or "oil" shall have the same meanings as defined and used in any of the following (the "Acts"): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.; the Federal ------ Resource Conservation and Recovery Act, 42 U.S.
Appears in 1 contract
Samples: Commercial Revolving Loan and Security Agreement (Aseco Corp)
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that reasonably required by Bank with loss payable to the Bank and Borrower, as their interests may appear, ; hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts, but only after Bank has provided Borrower with proper Notice of any deficiency in coverage and, provided there is no lapse in coverage, provide Borrower with reasonable time to obtain proper coverage. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to into Borrower’s accounts with Bank. The .
(b) Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto annually, or if an Event of Default is ongoing at intervals to be determined by Bank and without hindrance or delaydelay upon reasonable prior notice to Borrower. Bank shall also have the right to obtain in the case of an Event of Default (or as required by law or regulation) at the sole cost and expense of Borrower an appraisal and/or field examination of the Collateral by an appraiser acceptable to Bank.
(c) Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Xxxxxxxx’s Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's ’s place or places of business at intervals to be determined by BankBank but not unduly burdensome to the Borrower and upon reasonable prior notice to Borrower, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accountsXxxxxxxx’s Accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such have access to all digital records temporarily for the purpose of having copies made thereof. Borrower, during the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any within 48 hours of the Collateralrequest . Borrower shall pay to Bank all reasonable audit fees, plus all travel and other than for expenses incurred in connection with any such audit, which cost shall not exceed $10,000 annually unless an Event of Default has prompted the benefit of audit.
(d) Borrower will maintain records pertaining to the Collateral that contain information as from time to time may be requested by Bank. .
(e) Borrower will maintain its corporate existence in good standing in Delaware and in every other state in which it is doing business, and in which the failure to qualify or become licensed could have a Material Adverse Change on the financial condition, business or operations of Borrower, and will comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. Borrower will maintain its books and records, including but not sell limited to its stock register, minute books and books of account, current in all material respects.
(f) Borrower will pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose payable by it at such times and in such manner as to prevent any material penalty from accruing or any lien or charge from attaching to its property.
(g) Following an Event of any of its assets except in the ordinary Default and usual course of its business. The while it is continuing, Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's ’s satisfaction the existence, amount and terms of any accounts. This Agreement may but need not be supplemented Accounts, so long as the manner and method of communication, and message communicated has been mutually agreed to by separate assignment of accounts the Borrower and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. Bank.
(h) If any of Borrower's accounts ’s Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and so long as legally permitted, upon the Bank’s reasonable written request execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. If contracts are assigned in accordance with this Section, the Bank agrees to deposit any funds obtained into Xxxxxxxx’s account with the Bank.
(i) If any of Borrower's accounts ’s Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately provide written notice to the Bank and where requested by Bank deliver same to BankBank (unless not permitted under the terms of the Borrower’s Accounts or applicable instrument), appropriately endorsed to Bank's ’s order and, regardless of the form of such endorsement, and Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto.
(j) If any Collateral is at any time in the possession of a bailee, Borrower shall promptly notify Bank thereof and, if requested by Bank, shall promptly obtain an acknowledgment from the bailee, in form and substance satisfactory to Bank, that the bailee holds such Collateral for the benefit of Bank and shall act upon the instructions of Bank, without the further consent of Borrower. At Bank agrees with Borrower that Bank shall not give any such instructions unless an Event of Default has occurred and is continuing, or an event which, with notice or the passage of time or both, would constitute an Event of Default has occurred and is continuing, or would occur after taking into account any action by Borrower with respect to the bailee.
(k) If Borrower is at any time a beneficiary under a letter of credit now or hereafter issued in favor of Xxxxxxxx, Borrower shall promptly notify Bank thereof and, at the request and option of Bank, Borrower shall, pursuant to an agreement in form and substance satisfactory to Bank, either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to Bank of the proceeds of any drawing under the letter of credit, or (ii) arrange for Bank to become the transferee beneficiary of the letter of credit, with Bank agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an Account.
(l) If Borrower shall at any time hold or acquire a commercial tort claim seeking over $100,000, Borrower shall immediately notify Bank in a writing of the brief details thereof. Borrower may be requested by Bank to grant to Bank a security interest therein, and in the proceeds thereof, which interest shall be granted by Borrower after discussion with the Bank, all upon the terms of this Agreement, with such writing to be in reasonable form and substance satisfactory to Bank.
(m) Borrower will furnish to promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, after the occurrence and during the continuation of any Event of Default, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Xxxxxxxx agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
(n) Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with Xxxxxxxx 's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss Borrower may be liable. As used herein, the terms “hazardous waste,” “hazardous or toxic substance,” “hazardous material” or “oil” shall have the same meanings as defined and used in any of the following (the “Acts”): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization Act of 1986; the Federal Resource Conservation and Recovery Act, 42 USC Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49 USC Sections 1801 et seq.; the Toxic Substances Control Act, 15 USC Sections 2601 et seq.; the Federal Water Pollution Control Act, 33 USC Sections 1251 et seq.; the Clean Air Act, 42 USC Sections 741 et seq.; the Clean Water Act, 33 USC Section 701; the Safe Drinking Water Act, 42 USC Sections 300(f)-300(j); and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
(o) Except to the extent of Bank’s negligence or willful misconduct, within five Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (5including, without limitation, court costs and reasonable attorneys’ fees) days after that Bank may sustain or incur by reason of defending or protecting this security interest or the accrual priority thereof or enforcing the Obligations, or in accordance the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with applicable law this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of Borrowerthe Obligations and the termination of Bank's obligation agreement to make deposits for F.I.C.A. Line of Credit Loans available to Borrower and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. the termination of this Agreement.
(p) Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said the Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until until: (i) Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security AgreementCollateral, or upon any note or notes evidencing the Obligations(ii) an Event of Default is occurring that cannot be cured, and (iii) any such exercise is pursuant to a landlord waiver (to the extent applicable).
(q) Borrower will, at the its expense, upon request of Bank, Bank promptly furnish Bank the receipted bills therefor. At its option, and duly execute and deliver such documents and assurances and take such actions as may be necessary or desirable or as Bank may discharge taxesrequest in order to correct any defect, liens error or security interests or other encumbrances omission which may at any time levied be discovered or placed on to more effectively carry out the Collateralintent and purpose of this Agreement and to establish, may pay for insurance on perfect and protect Bank’s security interest, rights and remedies created or intended to be created hereunder. Without limiting the Collateral and may pay for the maintenance and preservation generality of the Collateral. Borrower agrees above, Xxxxxxxx will join with Bank in executing any notices appropriate under applicable federal or state law in form satisfactory to reimburse Bank on demand for any payments made, or any expenses incurred and filing the same in all public offices and jurisdictions wherever and whenever requested by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
Appears in 1 contract
Samples: Loan and Security Agreement (Star Equity Holdings, Inc.)
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory its assets insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The business.
(b) Bank or its agents have the right right, on reasonable prior notice to the Borrower (except when an Event of Default shall have occurred and be continuing, when no prior notice shall be required) and during normal business hours, to inspect the Inventory assets of the Borrower and all records pertaining thereto at intervals to be determined by Bank and without hindrance or delay. .
(c) Borrower will at all times keep books and records that are accurate and complete records of Borrower's Inventory, accounts and other Collateral, in all material respects and Bank, or any of its agents, shall have the right right, on reasonable prior notice to the Borrower (except when an Event of Default shall have occurred and is continuing, when no prior notice shall be required) and during normal business hours, to call at Borrower's place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, and correspondence which relate to Borrower's accounts, and other Collateral or other transactions, between the parties thereto business and the general financial condition of Borrower.
(d) Borrower will maintain a standard and Bank may remove any modern system of such accounting which enables Borrower to produce financial statements in accordance with generally accepted accounting principles and maintain records temporarily for pertaining to the purpose of having copies made thereof. Borrower, during the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any assets of the Collateral, other than for the benefit of the Borrower that contain information as from time to time may be reasonably requested by Bank. .
(e) Borrower will maintain its corporate existence in good standing in the jurisdiction of its incorporation and in the other jurisdictions in which it conducts business and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. business except where any failure to so maintain or comply could not reasonably be expected to have a Material Adverse Effect.
(f) Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any penalty from accruing or any lien or charge from attaching to its property, except where any of its assets except the same are being contested in the ordinary good faith by appropriate proceedings and usual course of its business. The Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's satisfaction the existence, amount and terms of any accounts. This Agreement may but need not be supplemented by separate assignment of accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. If any of Borrower's accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. If any of Borrower's accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual adequate reserves therefor have been taken in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. generally accepted accounting principles.
(g) Borrower will promptly pay when due (giving effect to any applicable extensions) all taxes and assessments upon the Collateral its assets or for its use or operation thereof or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on any assets of the CollateralBorrower, may pay for insurance as required to be maintained by the Borrower by this Agreement on any such assets of the Collateral Borrower and may pay for the maintenance and preservation of any such assets of the CollateralBorrower. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
(h) Borrower will promptly notify Bank upon receipt of notification of any potential or known release or threat of release, in violation of any applicable environmental laws, of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any material expense or loss in connection therewith or with the Borrower's obtaining knowledge of any investigation, action or the incurrence of any material expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms "hazardous waste," "hazardous or toxic substance," "hazardous material" or "oil" shall have the same meanings as defined and used in any of the following (the "Acts"): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization Act of 1986; the Federal Resource Conservation and Recovery Act, 42 USC Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49 USC Sections 1801 et seq.; the Toxic Substances Control Act, 15 USC Sections 2601 et seq.; the Federal Water Pollution Control Act, 33 USC Sections 1251 et seq.; the Clean Air Act, 42 USC Sections 741 et seq.; the Clean Water Act, 33 USC Section 701; the Safe Drinking Water Act, 42 USC Sections 300(f)-300(j); M.G.L.A. c. 21E (Massachusetts Oil and Hazardous Material Release Prevention Act); M.G.L.A. c. 21C (Massachusetts Hazardous Waste Management Act); and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
(i) Except for Bank's gross negligence or willful misconduct, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys' fees) that Bank may sustain or incur by reason of enforcing the Obligations, or in the prosecution or defense of any action or proceeding (other than the unsuccessful defense of any action or claim by Borrower against Bank or any of its affiliates) concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations. This indemnity shall survive the repayment of the Obligations and the termination of Bank's agreement to make loans available to Borrower and the termination of this Agreement.
(j) At the reasonable request of Bank, Borrower will furnish to Bank, from time to time, within ten (10) Business Days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof reasonably satisfactory to Bank that such deposits have been made as required. Should Borrower fail to furnish such proof to Bank within ten (10) Business Days after a request by Bank, then Bank may, in its reasonable discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) set-up such reserves as Bank, in its reasonable judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or set-up such reserve and the making of one or more of such deposits or payments or the setting-up of such reserve shall not constitute (i) an agreement on Bank's part to take any further or similar action, or (ii) a waiver of any default by Borrower under the terms hereof.
(k) The Borrower will deliver to the Bank within thirty (30) days of the date of this Agreement a list of the leases of personal property to which the Borrower is a party.
(l) Borrower will, at its expense, upon the reasonable request of Bank promptly and duly execute and deliver such documents and assurances and take such actions as may be necessary or desirable or as Bank may reasonably request in order to correct any defect, error or omission which may at any time be discovered or to more effectively carry out the intent and purpose of this Agreement and to establish, perfect and protect Bank's rights and remedies created or intended to be created hereunder.
Appears in 1 contract
GENERAL AGREEMENTS OF BORROWER. (a) Borrower, at its expense, shall keep and maintain the Collateral insured against all risk of loss or damage from fire, theft, vandalism, malicious mischief, explosion, sprinklers, and all other hazards and risks of physical damage included within the meaning of the term "extended coverage" in such amounts as are ordinarily insured against by other owners in similar businesses. Borrower agrees shall also keep and maintain comprehensive general public liability insurance and property damage insurance, and insurance against loss from business interruption, insuring against all risks relating to keep or arising from Borrower's ownership and use of the Collateral and Borrower's other assets and the operation of Borrower's business. Borrower has provided copies of its insurance policies to Lender. All such policies of insurance shall be in such form, with such companies and in such amounts as may be satisfactory to Lender. Borrower shall deliver to Lender certified copies of such policies of insurance and evidence of the payments of all the Inventory insured with coverage premiums therefor. All such policies of insurance (except those of public liability and amounts not less than that usually carried by one engaged property damage) shall contain a Lender's Loss Payable indorsement in a like business form satisfactory to Lender, naming Lender as sole Lender loss payee thereof to the extent of the Obligations, and in any event not less than that required by Bank with loss containing a waiver of warranties, and all proceeds payable thereunder shall be payable to Lender to be applied to the Bank and Borrower, as their interests may appear, hereby appoint Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any draftsObligations. As further assurance for the payment and performance of the Obligations, . Borrower hereby assigns to Bank Lender all sums, including returns return or unearned unreturned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to BankLender. The Bank Lender or its agents have the right to inspect the Inventory and all records pertaining thereto at intervals to be determined by Bank Lender and without hindrance or delay. Although, as above set forth, Lender has a continuing security interest in all of Borrower's Inventory and existing and future Accounts and other Collateral and in the proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all loans made hereunder, and if Borrower fails to do so, Borrower will immediately make the necessary reduction in the unpaid principal amount of said loans. All such policies of insurance shall provide that the same shall nor be cancelled or the amount of coverage thereunder reduced, without thirty (30) days prior written notice thereof to the Lender.
(b) Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and BankLender, or any of its agents, shall have the right to call at Borrower's place or places of business during Borrower's usual business hours, or during the usual business hours of any third party having control over the records of Borrower, at intervals to be determined by BankLender, and without hindrance or delay, to inspect, audit, check and make extracts from any copies of the books, records, journals, orders, receipts or and/or correspondence which relate to Borrower's accounts, Accounts and other Collateral or other transactions, transactions between the parties thereto thereto, and the general financial condition of Borrower Borrower, and Bank Lender may remove any of such records temporarily for the purpose of having copies made thereof. .
(c) Borrower, during the term of this Agreement, will not assign any accounts Accounts or other Collateral to any other party, nor create or permit to exist be created any lien, encumbrance or security interest of any kind covering against any Collateral, including any of the Collateral, its Accounts and Inventory other than for the benefit of the Bank. Lender.
(d) Borrower will maintain comply with, and its corporate existence properties, business operations and leaseholds will be in good standing compliance in all material respects with, the provisions of all federal, state and comply with all laws local laws, rules and regulations applicable to Borrower, its properties or the conduct of the United States its business, including, without limitation all environmental laws.
(e) Borrower will pay all real and personal property taxes, assessments and charges and all franchise, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or payable by it at such times and in such manner as to prevent any penalty from accruing or any lien or charge from attaching to its property.
(f) Borrower will neither declare nor pay dividends either in cash or kind on any class of its capital stock nor make any distribution on account of its stock, nor redeem, retire, purchase or otherwise acquire directly or indirectly any of its stock, whether now or hereafter outstanding, except to OurPet's Company or as expressly permitted in writing by Lender.
(g) Borrower will not make any loan or advance to any individual, firm or corporation, including without limitation any Related Person; provided, however, that Borrower may make advances to its employees, including its officers, with respect to reasonable and customary expenses incurred by such employees which expenses are reimbursable by Borrower.
(h) Borrower will not invest in or purchase any stock or securities of any state individual, firm, corporation or states thereof other person.
(i) Borrower will not merge or of consolidate with or be merged or consolidated with or into any political subdivision thereofother corporation or other person, or of any governmental authority which may be applicable other than the contemplated transaction consolidating Borrower and Sanar Manufacturing Company into OurPet's Company, upon not less than thirty (30) days advance written notice to it or to its business. Lender.
(j) Borrower will not sell or dispose of any of its assets except in the ordinary and usual course of its business. , nor will it acquire substantially all of the assets of another.
(k) Borrower will not enter into any agreements of guaranty, indemnity or indemnification of the obligations of any individual, partnership, trust, limited liability company, other corporation or other person, including any affiliate or subsidiary corporations, except for the transactions contemplated hereby.
(1) The Bank Lender may in its own name or in the name of others communicate with account Account debtors in order to verify with them to BankLender's satisfaction the existence, amount and terms of any accounts. Accounts or contract rights.
(m) This Agreement may but need not be supplemented by separate assignment assignments of accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(n) If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank Lender thereof in writing and execute any instruments and take any steps action required by Bank Lender in order that all monies due and to become due under such contracts shall be assigned to Bank Lender and notice thereof given to the Government appropriate governmental agency or authority under the Federal Assignment of Claims Act. .
(o) If any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to BankLender, appropriately endorsed to BankLender's order and, regardless of the form of such endorsement, . Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five .
(5p) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of BankLender, promptly furnish Bank Lender the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.bills
Appears in 1 contract
Samples: Inventory and Accounts Receivable Loan and Security Agreement (Ourpets Co)
GENERAL AGREEMENTS OF BORROWER. Section 12.01. Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank (including business interruption insurance) with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank.
Section 12.02. The Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto at reasonable intervals to be determined by Bank and without hindrance or delay.
Section 12.03. Although, as above set forth, Bank has a continuing security interest in all of Borrower’s Collateral and in the proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all Revolving Loans made hereunder including the aggregate amount undrawn on all Letters of Credit issued hereunder and if Borrower fails to do so, Borrower will immediately make the necessary reduction in the unpaid principal amount of said Revolving Loans so that the sum of the Revolving Loans outstanding hereunder plus the amount undrawn on Letters of Credit outstanding hereunder does not in the aggregate exceed the Borrowing Base.
Section 12.04. Borrower will at all times keep accurate and complete records of Borrower's ’s Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's ’s place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accounts’s Accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. BorrowerBorrower shall pay to Bank all reasonable audit fees, during the term of this Agreement, will not assign plus all travel and other expenses incurred in connection with any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the Banksuch audit.
Section 12.05. Borrower will maintain a standard and modern system of accounting which enables Borrower to produce financial statements in accordance with GAAP and maintain records pertaining to the Collateral that contain information as from time to time may be requested by Bank.
Section 12.06. Xxxxxxxx and its subsidiaries will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. Borrower will business except where the failure to comply with which cannot sell reasonably be expected to materially adversely effect its financial condition, business or dispose prospects or the value of any of Collateral.
Section 12.07. Xxxxxxxx and its assets except subsidiaries will pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or payable by it at such times and in the ordinary and usual course of such manner as to prevent any penalty from accruing or any lien or charge from attaching to its businessproperty.
Section 12.08. The Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's ’s satisfaction the existence, amount and terms of any accountsAccounts, and upon the occurrence of an Event of Default the Bank may in its own name communicate with account debtors in order to verify with them to Bank’s satisfaction the existence, amount and terms of any Accounts.
Section 12.09. This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement.
Section 12.10. If any of Borrower's accounts ’s Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereofthereof when Bank has perfected its security interest in the Collateral, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act.
Section 12.11. If any of Borrower's accounts ’s Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of moneymoney when Bank has perfected its security interest in the Collateral, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's ’s order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto.
Section 12.12. At If any material goods are at any time in the option possession of a bailee when Bank has perfected its security interest in the Collateral, Borrower shall promptly notify Bank thereof and, if requested by Bank, Borrower will furnish shall, after the occurrence of a Security Trigger Event, promptly obtain an acknowledgment from the bailee, in form and substance satisfactory to Bank, from that the bailee holds such Collateral for the benefit of Bank and shall act upon the instructions of Bank, without the further consent of Borrower.
Section 12.13. If Borrower is at any time to timea beneficiary under a letter of credit now or hereafter issued in favor of Borrower, within five (5) days Borrower shall promptly notify Bank thereof and, at the request and option of Bank, after the accrual occurrence of a Security Trigger Event, Borrower shall, pursuant to an agreement in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. form and withholding taxes, proof substance satisfactory to Bank that Bank, either (a) arrange for the issuer and any confirmer of such deposits have been made as required. Borrower hereby grants letter of credit to consent to an assignment to Bank of the proceeds of any drawing under the letter of credit, or (b) arrange for Bank to become the transferee beneficiary of the letter of credit, with Bank agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an Account.
Section 12.14. If Borrower shall at any time hold or acquire a term commercial tort claim when Bank has perfected its security interest in the Collateral, Borrower shall immediately notify Bank in a writing signed by Borrower of the brief details thereof and grant to commence on Bank in such writing a security interest therein, and in the date proceeds thereof, all upon the terms of this Agreement Agreement, with such writing to be in form and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower substance satisfactory to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral hereinBank.
Section 12.15. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may at any time following the occurrence and continuance of an Event of Default hereunder, discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
Section 12.16. Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of Hazardous Substance from any site operated by Xxxxxxxx and its subsidiaries of the incurrence of any expense or loss in connection therewith or with the Borrower’s obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any Hazardous Substance for which expense or loss the Borrower may be liable.
Section 12.17. Except for Bank’s gross negligence or willful misconduct, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys’ fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank’s agreement to make Revolving Loans available to Borrower and the termination of this Agreement.
Section 12.18. At the option of Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Xxxxxxxx and its subsidiaries’ obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof satisfactory to Bank that such deposits have been made as required.
Section 12.19. Should Borrower fail to make any of such deposits or furnish such proof then Bank may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) set up such reserves as Bank, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or set up such reserve and the making of one or more of such deposits or payments or the setting up of such reserve shall not constitute (a) an agreement on Bank’s part to take any further or similar action, or (b) a waiver of any default by Borrower under the terms hereof.
Section 12.20. All advances by Bank to Borrower under this Agreement and under any other agreement constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this and under any other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is distinctly understood and agreed that all of the rights of Bank contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements between Bank and Borrower. The entire Obligation of Borrower to Bank shall become due and payable when payments become due and payable hereunder upon termination of this Agreement.
Appears in 1 contract
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank Lender with loss payable to the Bank Lender and Borrower, as their interests may appear, hereby appoint Bank appointing Lender as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank Lender all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The Bank or its agents have Lender.
(b) Although, as above set forth, Lender has a continuing security interest in all of Borrower's Collateral and in the right proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all loans made hereunder and if Borrower fails to inspect do so, Borrower will immediately make the Inventory and all records pertaining thereto at intervals to be determined by Bank and without hindrance or delay. necessary reduction in the unpaid principal amount of said loans so that the loans outstanding hereunder do not in the aggregate exceed the Borrowing Base.
(c) Borrower will at all times keep accurate and complete records of Borrower's Inventoryinventory, accounts and other Collateral, and BankLender, or any of its agents, shall have the right to call at Borrower's place or places of business at intervals to be determined by BankLender, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank Lender may remove any of such records temporarily for the purpose of having copies made thereof. Borrower, during the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the Bank. .
(d) Borrower will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. .
(e) Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien (other than Permitted Liens) or charge from attaching to its assets except in the ordinary and usual course of its business. The Bank property.
(f) Lender may in its own name or in the name of others communicate with account debtors in order to verify with them to BankLender's satisfaction the existence, amount and terms of any accounts. This Agreement may but need not be supplemented by separate assignment of accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(g) If any of Borrower's accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank Lender thereof in writing and execute any instruments and take any steps required by Bank Lender in order that all monies due and to become due under such contracts shall be assigned to Bank Lender and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(h) If any of Borrower's accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to BankLender, appropriately endorsed to BankLender's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto.
(i) If any goods are at any time in the possession of a bailee, Borrower shall promptly notify Lender thereof and, if requested by Lender, shall promptly obtain an acknowledgment from the bailee, in form and substance satisfactory to Lender, that the bailee holds such Collateral for the benefit of Lender and shall act upon the instructions of Lender, without the further consent of Borrower. At Lender agrees with Borrower that Lender shall not give any such instructions unless an Event of Default has occurred and is continuing or would occur after taking into account any action by Borrower with respect to the bailee.
(j) If Borrower is at any time a beneficiary under a letter of credit now or hereafter issued in favor of Borrower, Borrower shall promptly notify Lender thereof and, at the request and option of the BankLender, Borrower will furnish shall, pursuant to Bank, from time to time, within five (5) days after the accrual an agreement in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. form and withholding taxes, proof substance satisfactory to Bank Lender, either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to Lender of the proceeds of any drawing under the letter of credit, or (ii) arrange for Lender to become the transferee beneficiary of the letter of credit, with Lender agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an account.
(k) If Borrower shall at any time hold or acquire a commercial tort claim, Borrower shall immediately notify Lender in a writing signed by Borrower of the brief details thereof and grant to Lender in such deposits have been made as required. Borrower hereby grants to Bank for writing a term to commence on security interest therein, and in the date proceeds thereof, all upon the terms of this Agreement Agreement, with such writing to be in form and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower substance satisfactory to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Lender.
(l) Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of BankLender, promptly furnish Bank Lender the receipted bills therefor. At its option, Bank Lender may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank Lender on demand for any payments made, or any expenses incurred by Bank Lender pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse BankLender, any such sums paid or advanced by Bank Lender shall be deemed secured by the Collateral and constitute part of the Obligations.
(m) Borrower will immediately notify Lender upon receipt of notification of any potential or known release or threat of release of any Hazardous Substances under any Environmental Law. As used herein, the following terms shall the following meanings:
Appears in 1 contract
Samples: Demand Loan and Security Agreement (Divine Skin Inc.)
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank business, with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, and settling and canceling such insurance and endorsing any drafts, at any time during the continuance of an Event of Default. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to BankBank and Borrower; provided that, in the absence of a continuing Event of Default, Bank will agree that casualty insurance proceeds of $500,000.00 or less shall be released to Borrower without condition for repair or replacement of Borrower’s property. The With respect to casualty insurance proceeds in excess of $500,000.00, Bank will authorize release of such proceeds to Borrower on a commercially reasonable basis provided (i) there is no continuing Event of Default, (ii) such proceeds are adequate to repair, replace or restore the property, together with any of Borrower’s own available funds, (iii) such repair, replacement or restoration can be completed within a commercially reasonable period of time, and (iv) Borrower promptly undertakes the repair, replacement or restoration of such property.
(b) Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto and the books and financial records of the Borrower at intervals to be determined by Bank and without hindrance or delaydelay at reasonable times and on reasonable notice to Borrower. Borrower will at all times keep accurate and complete records In the absence of Borrower's Inventoryan Event of Default, accounts and other CollateralBank anticipates that it shall not conduct more than 2 such examinations in any calendar year, and BankBank will not charge Borrower for more than one such examination in any calendar year. At any time during the continuance of an Event of Default, or any of its agents, Bank shall also have the right to call obtain from time to time at Borrower's place or places the sole cost and expense of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check and make extracts from any copies Borrower an appraisal of the books, records, journals, orders, receipts or correspondence Collateral by an appraiser acceptable to Bank.
(c) Borrower will maintain a system of accounting which relate enables Borrower to Borrower's accounts, and other Collateral or other transactions, between the parties thereto and the general produce financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. Borrower, during the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the Bank. statements in accordance with GAAP.
(d) Borrower will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. , except where the failure to be so qualified or in good standing could not reasonably be expected to result in a material adverse effect on (a) the Collateral, business operations or financial condition of Borrower, (b) the ability of Borrower will not sell to perform its Obligations under the Loan Documents, (c) the validity or dispose enforceability of any of the Loan Documents, or (d) the rights, remedies, powers and privileges of Bank under any of the Loan Documents (“Material Adverse Effect”).
(e) Borrower will pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or payable by it at such times and in such manner as to prevent any penalty from accruing or any lien or charge from attaching to its assets except property, (“Property Charges”), unless such Property Charges are being contested by Borrower through appropriate proceedings and for which Borrower has established a Payment Reserve.
(f) During the continuance of a Default or an Event of Default, and in the ordinary and usual course of its business. The any field examination in accordance with the Bank’s customary examination procedures, Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's ’s satisfaction the existence, amount and terms of any accounts. This Agreement may but need not be supplemented by separate assignment of accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. Accounts.
(g) If any of Borrower's accounts ’s Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(h) If any of Borrower's accounts ’s Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order ’s order.
(i) If any goods are at any time in the possession of a warehouseman, processor or other bailee, Borrower shall promptly notify Bank thereof and, regardless if requested by Bank, shall promptly obtain an acknowledgment from such bailee, in form and substance reasonably satisfactory to Bank, that the bailee holds such Collateral for the benefit of Bank and shall act upon the form instructions of Bank, without the further consent of Borrower. Bank agrees with Borrower that Bank shall not give any such endorsementinstructions unless an Event of Default has occurred and is continuing or would occur after taking into account any action by Borrower with respect to any bailee.
(j) If Borrower is at any time a beneficiary under a letter of credit now or hereafter issued in favor of Borrower, Borrower hereby waives presentmentshall promptly notify Bank thereof and, demand, notice of dishonor, protest at the request and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish shall, pursuant to an agreement in form and substance reasonably satisfactory to Bank, from either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to Bank of the proceeds of any drawing under the letter of credit, or (ii) arrange for Bank to become the transferee beneficiary of the letter of credit, with Bank agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an Account.
(k) If Borrower shall at any time hold or acquire a commercial tort claim, Borrower shall immediately notify Bank in a writing signed by Borrower of the brief details thereof and grant to timeBank in such writing a security interest therein, within five (5) days after and in the accrual proceeds thereof, all upon the terms of this Agreement, with such writing to be in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. form and withholding taxes, proof substance satisfactory to Bank that such deposits have been made as required. Bank.
(l) Unless being contested by Borrower hereby grants to Bank for by appropriate proceedings and with a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and dischargedPayment Reserve, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its optionIf such charges are not promptly paid or contested with appropriate proceeding and Payment Reserve, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
(m) Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with the Borrower’s obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms “hazardous waste,” “hazardous or toxic substance,” “hazardous material” or “oil” shall have the same meanings as defined and used in any of the following (the “Acts”): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization Act of 1986; the Federal Resource Conservation and Recovery Act, 42 USC Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49 USC Sections 1801 et seq.; the Toxic Substances Control Act, 15 USC Sections 2601 et seq.; the Federal Water Pollution Control Act, 33 USC Sections 1251 et seq.; the Clean Air Act, 42 USC Sections 741 et seq.; the Clean Water Act, 33 USC Section 701; the Safe Drinking Water Act, 42 USC Sections 300(f)-300(j); and/or the regulations adopted and publications promulgated pursuant to any of the Acts or pursuant to applicable state laws, as the same may be amended from time to time.
(n) Except for Bank’s gross negligence or willful misconduct, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys’ fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank’s agreement to make loans available to Borrower and the termination of this Agreement.
(o) At the option of Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower’s obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof satisfactory to Bank that such deposits have been made as required.
(p) Should Borrower fail to make any of such deposits required by (o) above, then Bank may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, or (b) set-up such reserves as Bank, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or set-up such reserve and the making of one or more of such deposits or payments or the setting-up of such reserve shall not constitute (i) an agreement on Bank’s part to take any further or similar action, or (ii) a waiver of any default by Borrower under the terms hereof.
(q) All advances by Bank to Borrower under this Agreement and the Loan Documents constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this Agreement and the other Loan Documents constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is understood and agreed that all of the rights of Bank contained in this Agreement and the Loan Documents shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement or any of the Loan Documents. The entire Obligation of Borrower to Bank shall become due and payable upon termination of this Agreement.
(r) Borrower hereby grants to Bank the right to use all premises or places of business which Borrower presently has or may hereafter have and where any of the Collateral may be located. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral after an Event of Default.
(s) Borrower will, at its expense, upon request of Bank promptly and duly execute and deliver such documents and assurances and take such actions as Bank may reasonably deem to be necessary in order to correct any defect, error or omission which may at any time be discovered or to more effectively carry out the intent and purpose of this Agreement and to establish, perfect and protect Bank’s security interest, rights and remedies created or intended to be created hereunder. Without limiting the generality of the above, Borrower will join with Bank in executing financing and continuation statements pursuant to the Uniform Commercial Code or other notices appropriate under applicable Federal or state law in form reasonably satisfactory to Bank and filing the same in all public offices and jurisdictions which Bank reasonably determines are necessary to perfect its security interest in the Collateral. Borrower shall perform any and all further reasonable steps as may be reasonably requested by Bank to perfect or maintain perfection of Bank’s security interest in the Collateral.
(t) Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until the Obligations are fully paid and discharged, a non-exclusive irrevocable royalty-free license in connection with Bank’s disposition of tangible personal property hereunder after the occurrence of an Event of Default, to use, apply or affix any trademark, trade name logo or the like and to use any patents, in which the Borrower now or hereafter has rights, which license may be used by Bank in connection with such disposition of Collateral.
Appears in 1 contract
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, settling and canceling cancelling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. .
(b) The Bank or its agents have the right to inspect the Inventory and all records pertaining thereto at intervals to be determined by Bank and without hindrance or delay. .
(c) Although, as above set forth, Bank has a continuing security interest in all of Borrower's Inventory and existing and future Accounts and other Collateral and in the proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all loans made hereunder and if Borrower fails to do so, Borrower will immediately make the necessary reduction in the unpaid principal amount of said loans so that the loans outstanding hereunder do not in the aggregate exceed the Borrowing Base.
(d) Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accountsAccounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. BorrowerBorrower shall pay to Bank an audit fee of Three Hundred Fifty ($350.00) Dollars per audit, during not to exceed the term sum of this AgreementSeven Hundred ($700.00) Dollars in any calendar year, will plus expenses. Notwithstanding the foregoing, Borrower shall not assign be obligated to pay to Bank an audit fee in any accounts or other Collateral to any other partyyear in which Borrower has a positive net income, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the Bank. determined in accordance with generally accepted accounting principles.
(e) Borrower will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. .
(f) Borrower will not sell pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien or charge from attaching to its assets except in the ordinary and usual course of its business. property.
(g) The Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's satisfaction the existence, amount and terms of any accounts. Accounts.
(h) This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(i) If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(j) If any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five .
(5k) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, if Borrower fails to maintain adequate insurance, Bank may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
(l) Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with the Borrower's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss the Borrower may be liable. As used herein, the terms "hazardous waste," "hazardous or toxic substance," "hazardous material" or "oil" shall have the same meanings as defined and used in any of the following (the "Acts"): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.; the Federal Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; M.G.L.A. c. 21E (Massachusetts Oil and Hazardous Material Release Prevention Act); M.G.L.A. c. 21C (Massachusetts Hazardous Waste Management Act); and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
(m) Except for the Bank's gross negligence or willful misconduct, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys' fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank's agreement to make loans available to Borrower and the termination of this Agreement.
(n) At the option of the Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof satisfactory to Bank that such deposits have been made as required.
(o) Should Borrower fail to make any of such deposits or furnish such proof then Bank may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) set-up such reserves as Bank, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or set-up such reserve and the making of one or more of such deposits or payments or the setting-up of such reserve shall not constitute (i) an agreement on Bank's part to take any further or similar action, or (ii) a waiver of any default by Borrower under the terms hereof.
(p) All advances by Bank to Borrower under this Agreement and under any other agreement constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this and under any other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is distinctly understood and agreed that all of the rights of Bank contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements between Bank and Borrower. Any default of this Agreement by Borrower shall constitute, likewise, a default by Borrower of any other existing agreement with Bank, and any default by Borrower of any other agreement with Bank shall constitute a default of this Agreement, except as otherwise provided in the Line of Credit Agreement for the Acquisition of Equipment of even date herewith. The entire Obligation of Borrower to Bank shall become due and payable when payments become due and payable hereunder upon termination of this Agreement.
(q) Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Bank are fully paid and discharged, the right to use all premises or places of business which Borrower presently has or may hereafter have and where any of the Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral.
(r) Borrower will, at its expense, upon request of Bank promptly and duly execute and deliver such documents and assurances and take such actions as may be necessary or desirable or as Bank may request in order to correct any defect, error or omission which may at any time be discovered or to more effectively carry out the intent and purpose of this Agreement and to establish, perfect and protect Bank's security interest, rights and remedies created or intended to be created hereunder. Without limiting the generality of the above, Borrower will join with Bank in executing financing and continuation statements pursuant to the Uniform Commercial Code or other notices appropriate under applicable Federal or state law in form satisfactory to Bank and filing the same in all public offices and jurisdictions wherever and whenever requested by Bank.
(s) Borrower shall perform any and all further steps requested by Bank to perfect Bank's security interest in Inventory, such as leasing warehouses to Bank or its designee, placing and maintaining signs, appointing custodians, maintaining stock records and transferring Inventory to warehouses. A physical listing of all Inventory, wherever located, shall be taken by Borrower at least annually and whenever requested by Bank if one or more of the Events of Default exist.
(t) Borrower hereby grants to Bank for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owed to Bank are fully paid and discharged, a non-exclusive irrevocable royalty-free license in connection with the Bank's exercise of its rights hereunder, to use, apply or affix any trademark, trade name logo or the like and to use any patents, in which the Borrower now or hereafter has rights, which license may be used by Bank upon and after the occurrence of any one or more of the Events of Default, provided, however, that such use by Bank shall be suspended if such Events of Default are cured. This license shall be in addition to, and not in lieu of, the inclusion of all of Borrower's trademarks, servicemarks, tradenames, logos, goodwill, patents, franchises and licenses in the Collateral; in addition to the right to use said Collateral as provided in this paragraph, Bank shall have full right to exercise any and all of its other rights regarding Collateral with respect to such trademarks, servicemarks, tradenames, logos, goodwill, patents, franchises and licenses.
Appears in 1 contract
Samples: Demand Loan and Security Agreement (International Electronics Inc)
GENERAL AGREEMENTS OF BORROWER. (a) Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank Lender with loss payable to the Bank Lender and Borrower, as their interests may appear, hereby appoint Bank appointing Lender as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank Lender all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The Bank Lender.
(b) Lender or its agents have the right during normal business hours to inspect the Inventory Collateral and all records pertaining thereto at intervals to be determined by Bank Lender and without hindrance or delay. Lender shall also have the right to obtain from time to time at the sole cost and expense of Borrower will an appraisal of the Collateral by an appraiser acceptable to Lender.
(c) Borrower shall at all times keep accurate and complete records of Borrower's Inventory, accounts Accounts and other Collateral, and BankLender, or any of its agents, shall have the right to call at Borrower's place or places of business during normal business hours at intervals to be determined by BankLender but not more than twice annually unless there is an event of default, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accountsAccounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank Lender may remove any of such records temporarily for the purpose of having copies made thereof. Borrower, during Borrower shall pay the term of this Agreement, will not assign any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any costs of the Collateral, other than for audit.
(d) Borrower shall maintain a standard and modern system of accounting which enables Borrower to produce financial statements in accordance with generally accepted accounting principles and maintain records pertaining to the benefit of the Bank. Collateral that contain information as from time to time may be requested by Lender.
(e) Borrower will shall maintain its corporate existence along with all of its licenses and permits in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. .
(f) Borrower will not sell shall pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or dispose of payable by it at such times and in such manner as to prevent any of penalty from accruing or any lien or charge from attaching to its assets except in the ordinary and usual course of its business. The Bank property.
(g) Lender may in its own name or in the name of others communicate with account debtors in order to verify with them to BankLender's satisfaction the existence, amount and terms of any accounts. Accounts.
(h) This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. .
(i) If any of Borrower's accounts Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will shall immediately notify Bank Lender thereof in writing and execute any instruments and take any steps required by Bank Lender in order that all monies due and to become due under such contracts shall be assigned to Bank Lender and notice thereof given to the Government under the Federal Assignment of Claims Act. .
(j) If any of Borrower's accounts Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will shall immediately deliver same to BankLender, appropriately endorsed to BankLender's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto.
(k) If any goods are at any time in the possession of a bailee, Borrower shall promptly notify Lender thereof and, if requested by Lender, shall promptly obtain an acknowledgment from the bailee, in form and substance satisfactory to Lender, that the bailee holds such Collateral for the benefit of Lender and shall act upon the instructions of Lender, without the further consent of Borrower. At Lender agrees with Borrower that Lender shall not give any such instructions unless an Event of Default has occurred and is continuing or would occur after taking into account any action by Borrower with respect to the bailee.
(l) If Borrower is at any time a beneficiary under a letter of credit now or hereafter issued in favor of Borrower, Borrower shall promptly notify Lender thereof and, at the request and option of the BankLender, Borrower will furnish shall, pursuant to Bank, from time to time, within five (5) days after the accrual an agreement in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. form and withholding taxes, proof substance satisfactory to Bank Lender, either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to Lender of the proceeds of any drawing under the letter of credit, or (ii) arrange for Lender to become the transferee beneficiary of the letter of credit, with Lender agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an Account.
(m) If Borrower shall at any time hold or acquire a commercial tort claim, Borrower shall immediately notify Lender in a writing signed by Borrower of the brief details thereof and grant to Lender in such deposits have been made as required. Borrower hereby grants to Bank for writing a term to commence on security interest therein, and in the date proceeds thereof, all upon the terms of this Agreement Agreement, with such writing to be in form and continuing thereafter until all debts and Obligations of any kind or character owing from substance satisfactory to Lender.
(n) Borrower to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will shall promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of BankLender, promptly furnish Bank Lender the receipted bills therefor. At its option, Bank Lender may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank Lender on demand for any payments made, or any expenses incurred by Bank Lender pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse BankLender, any such sums paid or advanced by Bank Lender shall be deemed secured by the Collateral and constitute part of the Obligations.
(o) Borrower shall immediately notify Lender upon receipt of notification of any potential or known release or threat of release of hazardous materials, hazardous waste, hazardous or toxic substance or oil from any site operated by Borrower or of the incurrence of any expense or loss in connection therewith or with Borrower's obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any hazardous material or oil for which expense or loss Borrower may be liable. As used herein, the terms “hazardous waste,” “hazardous or toxic substance,” “hazardous material” or “oil” shall have the same meanings as defined and used in any of the following (the "Acts"): the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization Act of 1986; the Federal Resource Conservation and Recovery Act, 42 USC Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49 USC Sections 1801 et seq.; the Toxic Substances Control Act, 15 USC Sections 2601 et seq.; the Federal Water Pollution Control Act, 33 USC Sections 1251 et seq.; the Clean Air Act, 42 USC Sections 741 et seq.; the Clean Water Act, 33 USC Section 701; the Safe Drinking Water Act, 42 USC Sections 300(f)-300(j); any other federal, state, local or governmental state regulation, law or ordinance dealing with the protection of human health and the environment; and/or the regulations adopted and publications promulgated pursuant to any of the Acts, as the same may be amended from time to time.
(p) Except for Lender's gross negligence or willful misconduct, Borrower shall indemnify and save Lender harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys' fees) that Lender may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Lender's agreement to make loans available to Borrower and the termination of this Agreement.
(q) At the option of Lender, Borrower shall furnish to Lender, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof satisfactory to Lender that such deposits have been made as required.
(r) Should Borrower fail to make any of such deposits or furnish such proof then Lender may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) set! up such reserves as Lender, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Lender. Nothing herein shall be deemed to obligate Lender to make any such deposit or payment or set! up such reserve and the making of one or more of such deposits or payments or the setting! up of such reserve shall not constitute (i) an agreement on Lender's part to take any further or similar action, or (ii) a waiver of any default by Borrower under the terms hereof.
(s) All advances by Lender to Borrower under this Agreement and under any other agreement constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Lender under this and under any other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Lender. It is distinctly understood and agreed that all of the rights of Lender contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements between Lender and Borrower. Any default of this Agreement by Borrower shall constitute, likewise, a default by Borrower of any other existing agreement with Lender, and any default by Borrower of any other agreement with Lender shall constitute a default of this Agreement. The entire Obligation of Borrower to Lender shall become due and payable upon termination of this Agreement.
(t) Borrower hereby grants to Lender for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower to Lender are fully paid and discharged, the right to use all premises or places of business which Borrower presently has or may hereafter have and where any of the Collateral may be located, at a total rental for the entire period of $1.00. Lender agrees not to exercise the rights granted in this paragraph unless and until Lender determines to exercise its rights against the Collateral.
(u) Borrower shall, at its expense, upon request of Lender promptly and duly execute and deliver such documents and assurances and take such actions as may be necessary or desirable or as Lender may reasonably request in order to correct any defect, error or omission which may at any time be discovered or to more effectively carry out the intent and purpose of this Agreement and to establish, perfect and protect Lender's security interest, rights and remedies created or intended to be created hereunder. Without limiting the generality of the above, Borrower shall join with Lender in executing financing and continuation statements pursuant to the Uniform Commercial Code or other notices appropriate under applicable Federal or state law in form satisfactory to Lender and filing the same in all public offices and jurisdictions wherever and whenever requested by Lender.
(v) Borrower shall perform any and all further steps requested by Lender to perfect Lender's security interest in Inventory, such as leasing warehouses to Lender or its designee, placing and maintaining signs, appointing custodians, maintaining stock records and transferring Inventory to warehouses. A physical listing of all Inventory, wherever located, shall be taken by Borrower at least annually and whenever requested by Lender if one or more of the Events of Default exist.
(w) Borrower hereby grants to Lender for a term to commence on the date of this Agreement and continuing thereafter until all debts and Obligations of any kind or character owed to Lender are fully paid and discharged, a non!-exclusive irrevocable royalty!-free license in connection with Lender's exercise of its rights hereunder, to use, apply or affix any trademark, trade name logo or the like and to use any patents, in which Borrower now or hereafter has rights, which license may be used by Lender upon and after the occurrence of any one or more of the Events of Default, provided, however, that such use by Lender shall be suspended if such Events of Default are cured. This license shall be in addition to, and not in lieu of, the inclusion of all of Borrower's trademarks, service-marks, trade-names, logos, goodwill, patents, franchises and licenses in the Collateral; in addition to the right to use said Collateral as provided in this paragraph, Lender shall have full right to exercise any and all of its other rights regarding Collateral with respect to such trademarks, service-marks, trade-names, logos, goodwill, patents, franchises and licenses.
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GENERAL AGREEMENTS OF BORROWER. (a) Except for Bank’s gross negligence or willful misconduct, Borrower agrees will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys’ fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank’s agreement to keep all make loans available to Borrower and the Inventory insured with coverage and amounts not less than that usually carried by one engaged in a like business and in any event not less than that required termination of this Agreement.
(b) All advances by Bank with loss payable to Borrower under this Agreement and under any other agreement relating to the loans made hereunder constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this and under any such other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is distinctly understood and agreed that all of the rights of Bank contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements relating to the loans made hereunder between Bank and Borrower. Any default of this Agreement by Borrower shall constitute, as their interests may appearlikewise, hereby appoint a default by Borrower of any other agreement with Bank as attorney for now existing or hereinafter entered into relating to the loans made hereunder, and any default by Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank. The other agreement with Bank or its agents have the right to inspect the Inventory and all records pertaining thereto at intervals to be determined by Bank and without hindrance or delay. Borrower will at all times keep accurate and complete records of Borrower's Inventory, accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check and make extracts from any copies of the books, records, journals, orders, receipts or correspondence which relate to Borrower's accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. Borrower, during the term constitute a default of this Agreement. The entire Obligation of Borrower to Bank shall become due and payable when payments become due and payable hereunder upon demand, will not assign any accounts termination or other Collateral to any other partyacceleration of this Agreement.
(c) Borrower will, nor create or permit to exist any lienat its expense, encumbrance or security interest upon request of any kind covering any of the Collateral, other than for the benefit of the Bank. Borrower will maintain its corporate existence in good standing Bank promptly and comply with all laws duly execute and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which deliver such documents and assurances and take such actions as may be applicable to it necessary or to its business. Borrower will not sell desirable or dispose of any of its assets except in the ordinary and usual course of its business. The as Bank may in its own name or in the name of others communicate with account debtors reasonably request in order to verify with them correct any defect, error or omission which may at any time be discovered or to Bank's satisfaction more effectively carry out the existence, amount intent and terms of any accounts. This Agreement may but need not be supplemented by separate assignment of accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement. If any of Borrower's accounts arise out of contracts with the United States or any department, agency, or instrumentality thereof, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act. If any of Borrower's accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of money, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto. At the option of the Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. and withholding taxes, proof satisfactory to Bank that such deposits have been made as required. Borrower hereby grants to Bank for a term to commence on the date purpose of this Agreement and continuing thereafter until all debts to establish, perfect and Obligations of any kind protect Bank’s security interest, rights and remedies created or character owing from Borrower intended to Bank are fully paid and discharged, be created hereunder. Without limiting the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral herein. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation generality of the Collateral. above, Borrower agrees authorizes Bank to reimburse Bank on demand for any payments made, or any expenses incurred by Bank file financing and continuation statements pursuant to the foregoing authorization, Uniform Commercial Code or other notices appropriate under applicable Federal or state law in form satisfactory to Bank if and upon failure of when necessary to perfect Bank’s security interest in the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the ObligationsCollateral.
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Samples: Loan and Security Agreement (Cubist Pharmaceuticals Inc)
GENERAL AGREEMENTS OF BORROWER. Section 12.01. Borrower agrees to keep all the Inventory Collateral insured with coverage and in amounts not less than that usually carried by one engaged in a like business and in any event not less than that required by Bank (including business interruption insurance) with loss payable to the Bank and Borrower, as their interests may appear, hereby appoint appointing Bank as attorney for Borrower in obtaining, adjusting, settling and canceling such insurance and endorsing any drafts. As further assurance for the payment and performance of the Obligations, Borrower hereby assigns to Bank all sums, including returns or of unearned premiums, which may become payable under any policy of insurance on the Collateral and Borrower hereby directs each insurance company issuing any such policy to make payment of such sums directly to Bank.
Section 12.02. The Bank or its agents have the right to inspect the Inventory Collateral and all records pertaining thereto at reasonable intervals to be determined by Bank and without hindrance or delay.
Section 12.03. Although, as above set forth, Bank has a continuing security interest in all of Borrower’s Collateral and in the proceeds thereof, Borrower will at all times maintain as the minimum security hereunder a Borrowing Base not less than the aggregate unpaid principal of all Revolving Loans made hereunder including the aggregate amount undrawn on all Letters of Credit issued hereunder and if Borrower fails to do so, Borrower will immediately make the necessary reduction in the unpaid principal amount of said Revolving Loans so that the sum of the Revolving Loans outstanding hereunder plus the amount undrawn on Letters of Credit outstanding hereunder does not in the aggregate exceed the Borrowing Base.
Section 12.04. Borrower will at all times keep accurate and complete records of Borrower's ’s Inventory, accounts Accounts and other Collateral, and Bank, or any of its agents, shall have the right to call at Borrower's ’s place or places of business at intervals to be determined by Bank, and without hindrance or delay, to inspect, audit, check check, and make extracts from any copies of the books, records, journals, orders, receipts or receipts, correspondence which relate to Borrower's accounts’s Accounts, and other Collateral or other transactions, between the parties thereto and the general financial condition of Borrower and Bank may remove any of such records temporarily for the purpose of having copies made thereof. BorrowerBorrower shall pay to Bank all reasonable audit fees, during the term of this Agreement, will not assign plus all travel and other expenses incurred in connection with any accounts or other Collateral to any other party, nor create or permit to exist any lien, encumbrance or security interest of any kind covering any of the Collateral, other than for the benefit of the Banksuch audit.
Section 12.05. Borrower will maintain a standard and modern system of accounting which enables Borrower to produce financial statements in accordance with GAAP and maintain records pertaining to the Collateral that contain information as from time to time may be requested by Bank.
Section 12.06. Sxxxxxxx and its subsidiaries will maintain its corporate existence in good standing and comply with all laws and regulations of the United States or of any state or states thereof or of any political subdivision thereof, or of any governmental authority which may be applicable to it or to its business. Borrower will business except where the failure to comply with which cannot sell reasonably be expected to materially adversely effect its financial condition, business or dispose prospects or the value of any of Collateral.
Section 12.07. Sxxxxxxx and its assets except subsidiaries will pay all real and personal property taxes, assessments and charges and all franchises, income, unemployment, old age benefits, withholding, sales and other taxes assessed against it, or payable by it at such times and in the ordinary and usual course of such manner as to prevent any penalty from accruing or any lien or charge from attaching to its businessproperty.
Section 12.08. The Bank may in its own name or in the name of others communicate with account debtors in order to verify with them to Bank's ’s satisfaction the existence, amount and terms of any accountsAccounts, and upon the occurrence of an Event of Default the Bank may in its own name communicate with account debtors in order to verify with them to Bank’s satisfaction the existence, amount and terms of any Accounts.
Section 12.09. This Agreement may but need not be supplemented by separate assignment assignments of accounts Accounts and if such assignments are given the rights and security interests given thereby shall be in addition to and not in limitation of the rights and security interests given by this Agreement.
Section 12.10. If any of Borrower's accounts ’s Accounts arise out of contracts with the United States or any department, agency, or instrumentality thereofthereof when Bank has perfected its security interest in the Collateral, Borrower will immediately notify Bank thereof in writing and execute any instruments and take any steps required by Bank in order that all monies due and to become due under such contracts shall be assigned to Bank and notice thereof given to the Government under the Federal Assignment of Claims Act.
Section 12.11. If any of Borrower's accounts ’s Accounts should be evidenced by promissory notes, trade acceptances, or other instruments for the payment of moneymoney when Bank has perfected its security interest in the Collateral, Borrower will immediately deliver same to Bank, appropriately endorsed to Bank's ’s order and, regardless of the form of such endorsement, Borrower hereby waives presentment, demand, notice of dishonor, protest and notice of protest and all other notices with respect thereto.
Section 12.12. At If any material goods are at any time in the option possession of a bailee when Bank has perfected its security interest in the Collateral, Borrower shall promptly notify Bank thereof and, if requested by Bank, Borrower will furnish shall, after the occurrence of a Security Trigger Event, promptly obtain an acknowledgment from the bailee, in form and substance satisfactory to Bank, from that the bailee holds such Collateral for the benefit of Bank and shall act upon the instructions of Bank, without the further consent of Borrower.
Section 12.13. If Borrower is at any time to timea beneficiary under a letter of credit now or hereafter issued in favor of Borrower, within five (5) days Borrower shall promptly notify Bank thereof and, at the request and option of Bank, after the accrual occurrence of a Security Trigger Event, Borrower shall, pursuant to an agreement in accordance with applicable law of Borrower's obligation to make deposits for F.I.C.A. form and withholding taxes, proof substance satisfactory to Bank that Bank, either (a) arrange for the issuer and any confirmer of such deposits have been made as required. Borrower hereby grants letter of credit to consent to an assignment to Bank of the proceeds of any drawing under the letter of credit, or (b) arrange for Bank to become the transferee beneficiary of the letter of credit, with Bank agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied in the same manner as any other payment on an Account.
Section 12.14. If Borrower shall at any time hold or acquire a term commercial tort claim when Bank has perfected its security interest in the Collateral, Borrower shall immediately notify Bank in a writing signed by Borrower of the brief details thereof and grant to commence on Bank in such writing a security interest therein, and in the date proceeds thereof, all upon the terms of this Agreement Agreement, with such writing to be in form and continuing thereafter until all debts and Obligations of any kind or character owing from Borrower substance satisfactory to Bank are fully paid and discharged, the right to use of all premises or places of business which Borrower presently has or may hereafter have and where any of said Collateral may be located, at a total rental for the entire period of $1.00. Bank agrees not to exercise the rights granted in this paragraph unless and until Bank determines to exercise its rights against the Collateral hereinBank.
Section 12.15. Borrower will promptly pay when due all taxes and assessments upon the Collateral or for its use or operation or upon this Security Agreement, or upon any note or notes evidencing the Obligations, and will, at the request of Bank, promptly furnish Bank the receipted bills therefor. At its option, Bank may at any time following the occurrence and continuance of an Event of Default hereunder, discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the Collateral, may pay for insurance on the Collateral and may pay for the maintenance and preservation of the Collateral. Borrower agrees to reimburse Bank on demand for any payments made, or any expenses incurred by Bank pursuant to the foregoing authorization, and upon failure of the Borrower so to reimburse Bank, any such sums paid or advanced by Bank shall be deemed secured by the Collateral and constitute part of the Obligations.
Section 12.16. Borrower will immediately notify Bank upon receipt of notification of any potential or known release or threat of release of Hazardous Substance from any site operated by Sxxxxxxx and its subsidiaries of the incurrence of any expense or loss in connection therewith or with the Borrower’s obtaining knowledge of any investigation, action or the incurrence of any expense or loss by any governmental authority in connection with the assessment, containment or removal of any Hazardous Substance for which expense or loss the Borrower may be liable.
Section 12.17. Except for Bank’s gross negligence or willful misconduct, Borrower will indemnify and save Bank harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys’ fees) that Bank may sustain or incur by reason of defending or protecting this security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of Bank’s agreement to make Revolving Loans available to Borrower and the termination of this Agreement.
Section 12.18. At the option of Bank, Borrower will furnish to Bank, from time to time, within five (5) days after the accrual in accordance with applicable law of Sxxxxxxx and its subsidiaries’ obligation to make deposits for F.I.C.A. and withholding taxes and/or sales taxes, proof satisfactory to Bank that such deposits have been made as required.
Section 12.19. Should Borrower fail to make any of such deposits or furnish such proof then Bank may, in its sole and absolute discretion, (a) make any of such deposits or any part thereof, (b) pay such taxes, or any part thereof, or (c) set up such reserves as Bank, in its judgment, shall deem necessary to satisfy the liability for such taxes. Each amount so deposited or paid shall constitute an advance under the terms hereof, repayable on demand with interest, as provided herein, and secured by all Collateral and any other property at any time pledged by Borrower with Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit or payment or set up such reserve and the making of one or more of such deposits or payments or the setting up of such reserve shall not constitute (a) an agreement on Bank’s part to take any further or similar action, or (b) a waiver of any default by Borrower under the terms hereof.
Section 12.20. All advances by Bank to Borrower under this Agreement and under any other agreement constitute one general revolving fluctuating loan, and all indebtedness of Borrower to Bank under this and under any other agreement constitute one general Obligation. Each advance to Borrower hereunder or otherwise shall be made upon the security of all of the Collateral held and to be held by Bank. It is distinctly understood and agreed that all of the rights of Bank contained in this Agreement shall likewise apply, insofar as applicable, to any modification of or supplement to this Agreement and to any other agreements between Bank and Borrower. The entire Obligation of Borrower to Bank shall become due and payable when payments become due and payable hereunder upon termination of this Agreement.
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