Finance Factoring Contract

FINANCE FACTORING CONTRACT

Parties

This Finance Factoring Contract (the Agreement) is entered into as of between:

Recitals

WHEREAS, Client originates accounts receivable and invoices arising from the sale of goods or services; and

WHEREAS, Factor purchases and finances accounts receivable pursuant to the terms set forth below; and

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties agree as follows.

Definitions

For purposes of this Agreement:

"Receivables" means accounts, invoices, instruments, and other rights to payment arising from Client's sale of goods or services to third-party account debtors.

"Advance Rate" means the percentage of the Face Amount of Eligible Receivables that Factor will advance to Client as set forth in Section Advances, Fees and Reserve.

Purchase and Sale of Receivables

1. Purchase. Subject to the terms and conditions of this Agreement, Client sells, assigns and transfers to Factor, and Factor purchases from Client, all right, title and interest in and to Eligible Receivables that Client delivers or identifies to Factor.

2. Eligible Receivables. Receivables eligible for purchase shall be commercial receivables arising from bona fide sales of goods or services, not subject to setoff, dispute, or counterclaim, and not more than days past invoice date.

Advances, Fees and Reserve

Factor shall maintain a withholding reserve as security for payment of fees, chargebacks and obligations of Client. Factor may deduct fees, chargebacks and other amounts from the Reserve or any collections.

Funding Procedures

Client shall submit invoices and supporting documentation in the form and by the methods required by Factor. Factor will fund advances to Client by deposit to Client's designated bank account within business days after acceptance of Receivables, subject to verification.

Representations and Warranties

Client represents and warrants that: (a) it is duly organized and validly existing; (b) Receivables sold hereunder arise from bona fide transactions and are free of liens, encumbrances, or prior assignments; (c) invoices are accurate, enforceable and not subject to bona fide disputes or setoffs; and (d) there has been no bankruptcy, insolvency, or similar proceeding involving Client that has not been disclosed.

Factor represents and warrants that it is duly organized, has authority to enter into this Agreement and will fund accepted Receivables in accordance with the terms herein.

Covenants; Reporting; Collections

Client shall promptly notify Factor of any disputes, returns or claims that may affect Receivables, provide documentation and permit Factor to audit Receivable files. Client shall not make any assignment of Receivables other than to Factor.

Factor shall have the right to collect purchased Receivables, to communicate with account debtors, and to apply collections first to fees and then to advances and principal as provided in this Agreement.

Events of Default and Remedies

The following constitute Events of Default: Client's failure to pay or perform, material breach of representations or covenants, insolvency, material adverse change in credit of account debtors, or failure to deliver requested documentation. Upon Event of Default, Factor may suspend funding, demand repayment of advances, offset against reserves, or pursue any remedy at law or in equity, including collection of Receivables.

Indemnification

Client shall indemnify and hold Factor harmless from all losses, liabilities, costs and expenses (including reasonable attorneys' fees) arising from breaches of representations, chargebacks, fraud by Client, or failure to comply with this Agreement, except to the extent caused by Factor's gross negligence or willful misconduct.

Confidentiality

Each party shall keep confidential all non-public information provided by the other party in connection with this Agreement and shall not disclose such information except as required by law or to permit collection of Receivables and enforcement of rights under this Agreement.

Term and Termination

This Agreement shall continue until terminated by either party upon days' prior written notice, subject to obligations relating to purchased Receivables, reserves, and collection rights. Termination shall not affect Factor's rights with respect to Receivables purchased prior to termination.

Notices

All notices or communications required or permitted shall be in writing and delivered to the addresses below:

Miscellaneous

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements. Neither party may assign this Agreement without the other party's prior written consent, except that Factor may assign its rights to a successor or to financing sources. This Agreement shall be governed by the laws of the state of , without regard to conflicts of law principles.

Initial Receivables Schedule

The following Receivables are initially assigned on the Effective Date. Additional Receivables may be assigned in accordance with this Agreement.

Additional Terms and Conditions

The parties acknowledge that this Agreement creates an absolute assignment of Receivables to Factor and that Factor may enforce collection directly against account debtors. The rights and remedies provided to Factor are cumulative and in addition to any rights at law or in equity.

Sign Now