Inventory Advances Clause Samples

Inventory Advances. Except as set forth in Section 2.3(b), the Inventory Advances shall bear interest, on the outstanding Daily Balance thereof, at a rate equal to one and one half of one percent (1.50%) above the Prime Rate.

Inventory Advances. (i) Subject to and upon the terms and conditions of this Agreement, at any time from the date hereof through the Revolving Maturity Date, Bank agrees to make advances to Borrowers based on Eligible Inventory (the “Inventory Advances”) in an aggregate amount not to exceed the Inventory Sublimit. Each Inventory Advance shall not exceed the lesser of (a) one hundred percent (100%) of the net orderly liquidation value (determined in accordance with GAAP) of the Eligible Inventory or (b) fifty percent (50%) of the Eligible Inventory based on the cost of finished goods on hand (determined in accordance with GAAP). (ii) Interest shall accrue from the date of each Inventory Advance at the rate specified in Section 2.3, and shall be payable monthly on the first day of each month so long as any Inventory Advances are outstanding. Amounts borrowed pursuant to this Section 2.1(b) may be repaid and reborrowed at any time prior to the Revolving Maturity Date, at which time all Inventory Advances under this Section 2.1(b) shall be immediately due and payable. (iii) When a Borrower desires to obtain an Inventory Advance, Parent shall notify Bank (which notice shall be irrevocable) by electronic mail or facsimile transmission to be received no later than 3:00 p.m. Pacific time three (3) Business Days before the day on which the Inventory Advance is to be made. Such notice shall be substantially in the form of Exhibit B. The notice shall be signed by a Responsible Officer or its designee and include a copy of the invoice and proof of payment of such invoice for any Equipment to be financed.

Inventory Advances. Summit may, in its sole discretion and without any duty to do so, elect from time to time to make advances based upon Acceptable Inventory. Advances based upon Acceptable Inventory shall be made only in accordance with the below formula, which formula may be changed or modified at any time in the sole discretion of Summit without the consent or approval of Client: Advances based upon Acceptable Inventory may be made upon request of Client so long as the aggregate amount of all advances based upon Acceptable Inventory outstanding and unpaid does not exceed the lesser of (a) Fifty Percent (50%) of the lower of book value, as determined in accordance with generally accepted accounting principles, of the Acceptable Inventory, (b) Four Hundred Fifty Thousand Dollars ($450,000), (c) Fifty Percent (50%) of Client’s outstanding Acceptable Accounts, and (d) together with the aggregate amount of all other outstanding Advances, the Maximum Credit Line. Summit may decline to make advances based upon Acceptable Inventory for any reason or for no reason, without notice, regardless of any course of conduct or past advances based upon Acceptable Inventory by Summit.

Inventory Advances. Summit may, in its sole discretion and without any duty to do so, elect from time to time to make advances based upon Acceptable Inventory. Advances based upon Acceptable Inventory shall be made only in accordance with the below formula, which formula may be changed or modified at any time in the discretion of Summit without the consent or approval of Borrower: Advances based upon Acceptable Inventory may be made upon request of Client so long as the aggregate amount of all advances based upon Acceptable Inventory outstanding and unpaid does not exceed the lesser of: (a) Fifty Percent (50.00%) of the lower of cost or market value, as determined by Summit, of the Acceptable Inventory, (b) eighty percent of the net orderly liquidation value (NOLV) of Acceptable Inventory as determined by an independent appraiser acceptable to Summit, (c) Three Hundred Fifty Thousand Dollars ($350,000), (d) Fifty Percent (50.00%) of Client’s outstanding Acceptable Accounts, and (e) together with the aggregate amount of all other outstanding advances, the Maximum Credit Line.

Inventory Advances. Notwithstanding anything to the contrary in the Loan Documents, no Inventory Advances shall be made if, after making the requested Inventory Advance, the total principal amount of all Inventory Advances outstanding will exceed: i. fifty percent (50%) of the cost of Eligible Inventory (as determined by Lender in its sole discretion); ii. fifty percent (50%) of the amount of outstanding Eligible Accounts; iii. five hundred thousand dollars ($500,000.00); or iv. together with the aggregate amount of all outstanding Account Advances, one million five hundred thousand dollars ($1,500,000.00). Borrower will maintain at all times Eligible Inventory so that the total, aggregate, principal amount of all Inventory Advances at any time outstanding and unpaid shall be incompliance with this formula. If at any time the total aggregate principal amount of all Inventory Advances outstanding and unpaid exceeds the amount allowable under this formula, Borrower shall immediately make payment to Lender in a sufficient amount to bring the amount of such advances back into compliance, and if such payment is not immediately made, interest shall accrue on such amount at the Default Rate, regardless of whether Lender waives the Event of Default caused by such non-payment.

Inventory Advances. If requested by Seller, in accordance with the terms of this Agreement, FGI may in its sole and absolute discretion advance to Seller against Eligible Inventory, submitted to FGI on an Inventory Borrowing Base Certificate, sums not to exceed 75% of the net orderly liquidation value (as determined by an independent appraisal satisfactory to FGI in form and substance) of up to 30% of the Eligible Inventory outstanding at the time any such advance is made. Notwithstanding the foregoing, the outstanding advances against Eligible Inventory may not at any time exceed the Inventory Sublimit. Any resulting overadvance shall be immediately repaid to FGI. The Inventory Borrowing Base Certificate shall be in the form attached hereto as Schedule 3(e) or in such other form as required by FGI, and shall be signed by a duly authorized representative of Seller. At the time the Inventory Borrowing Base Certificate is presented, Seller shall also deliver to FGI its inventory report. Any advance made pursuant to this subsection shall be payable on demand and shall bear interest at the Applicable Interest Rate from the date such advance is made until the date such advance is paid in full. (d) The first sentence of Section 3(h) of each Sale Agreement is hereby amended and restated as follows:

Inventory Advances. Subject to and upon the terms and conditions of this Agreement, each Bank agrees to make Inventory Advances to Borrower in an aggregate amount not to exceed such Bank's Percentage Share of the lesser of (i) the Committed Line minus the outstanding Receivables Advances minus the face amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit) and minus the outstanding amount of the

Inventory Advances. Not less than five (5) Business Days prior to the date of any Loan to be secured in whole or in part by the pledge of Eligible Inventory, the Borrower shall have: (a) delivered to the Agent a list of all Intervals which are to be subject to such requested Loan, together with such additional information as the Agent may require a certificate executed by Borrower certifying as to the retail sales price of each Interval; (b) delivered to the Agent (or, if the Agent shall so instruct, a designee appointed by the Agent in writing), if any, (i) the original or certified copies of any deed or beneficial interest certificate, or other documents evidencing conveyance of the Interval in question to the Borrower, (ii) a copy of any title policy received by the Borrower in connection with its acquisition of the Interval in question, and (iii) original or true copies of any purchase contract (including addenda) or other agreements entered into by the Borrower with any person with respect to the sale by the Borrower or any purchaser of the Interval in question; (c) delivered to the Agent a duly executed Inventory Mortgage or Inventory Mortgages granting to the Agent a first mortgage lien on the Intervals; (d) a UCC financing statements covering the Intervals, filed with the Secretary of State of Texas; and (e) delivered to the Agent, with respect to each Interval constituting a part of the Eligible Inventory, a commitment for a mortgagee's title insurance policy showing that the Inventory Mortgage in respect of such Interval insuring in favor of the Agent the first priority Lien of such Inventory Mortgage in the amount of the Loan to be made in respect of such Interval, with a satisfactory title insurance policy to be issued within a reasonable time following the requested Loan. The Inventory Mortgages to the Agent shall each have been duly recorded in the applicable land records which are described in SCHEDULE 11A.7 hereof. The mortgagee's title insurance policies shall be in form and substance satisfactory to the Agent and shall be issued by a title insurance company satisfactory to the Agent, and name the Agent as the insured party therein. The funding of the Loan, delivery of the Inventory Collateral and issuance of the title insurance policy, and recording of the mortgages or any releases may, in the Agent's discretion, be effected by way of an escrow arrangement with a title insurance company or other fiduciary, the form and substance of which shall be satisfactor...

Inventory Advances. Notwithstanding anything to the contrary in the Loan Documents, no Inventory Advances shall be made on the Loan if, after making the requested Inventory Advance, the total, aggregate principal amount of all Inventory Advances will exceed the lowest of: (i) the total cost of Eligible Inventory (as determined by Lender in its sole discretion) multiplied by the Inventory Advance Rate; (ii) one hundred percent (100%) of the amount of outstanding Account Advances; (iii) Two Million Dollars ($2,000,000); and (iv) together with the aggregate amount of all outstanding Account Advances, the Maximum Loan Amount." · In consideration of Lender's agreement to increase the dollar sublimit on Inventory Advances, Borrower agrees to pay to the Lender a modification fee of Five Thousand Dollars ($5,000) (the "Modification Fee") on the date hereof. The Modification Fee shall include the legal fees of Lender's in-house counsel to prepare this Amendment.