Factoring Terms of Service
ACCOUNT PURCHASE AND FACTORING AGREEMENT
All capitalized terms not herein defined shall have the meanings set forth in the Uniform Commercial Code, as enacted in the State of Delaware (“UCC”). Client and Denim may be collectively referred to herein as the “Parties” and each a “Party.” Client may request a copy of this Agreement by emailing Denim at contact@denim.com.
1. FACTORING SERVICES
1.1. Scope of Factoring Services.
1.1.1 Purchase of Accounts. Client agrees to use and appoints Denim as its sole factor. Upon submission of an Account to Denim, Client conveys, transfers, assigns and sells to Denim as absolute owner thereof all right, title and interest in all Client’s present and future Accounts owed by such Account Debtor, together with the proceeds thereof and all of Client’s interest in the goods or services sold by Client which gave rise to such Accounts. Denim in its sole discretion may purchase the Accounts offered for sale by Client. Upon receipt by Denim of an invoice and all supporting documentation required by Denim, including but not limited to bills of lading, proof of delivery, contracts and purchase orders, Denim will notify Client as to the Accounts purchased by Denim (“Purchased Accounts”) through the Denim internet based online account detail (the “Portal”). Client agrees it is engaged in a commercial enterprise and that this Agreement and the Factoring Services are intended to be an account purchase transaction. It is the intention of the Parties that the sales of all Accounts constitute true and actual sales of the Accounts from Client to Denim, and that, upon purchase of a Purchased Account, all right, title and interest to such Purchased Account, legal and equitable, shall pass to Denim.
1.1.2 Notification and Verification. For each Account Debtor owing on an Account submitted by Client to Denim for purchase, whether or not purchased by Denim, all Accounts owed by such Account Debtor shall be paid directly to Denim. Each such invoice evidencing an Account will include a notification by Client that the Account has been assigned and conveyed to Denim and is payable only to Denim. Denim shall have the right to notify all Account Debtors that payment shall be made exclusively to Denim. Denim shall have the right to verify directly with an Account Debtor that each Account is valid, is not disputed, and complies with all representations and warranties regarding such Account as set forth herein and verify that the Account Debtor has the financial ability to pay the Account (an “Eligible Account”). The determination of an Eligible Account shall be made by Denim in its sole discretion. Client gives its irrevocable consent and authorization to Denim to disclose, release and exchange all information regarding Client and to communicate without limitation as to any matters related to Client with any third parties or any other persons claiming an interest or right in or the Collateral.
1.2 Advances; Reserves. See Schedule 1 annexed hereto and incorporated as if fully set forth herein by this reference and all additional references.
1.3 Payments to Third Parties. In addition to the Quick Pay Program (as hereinafter defined), Client irrevocably authorizes Denim to remit directly, in the sole discretion of Denim, on behalf of the Client and without further direction from the Client, payments to service providers involved in the transaction giving rise to an Account, including but not limited to drivers, carriers, dispatchers and/or independent contractors (the “Payees”), from Advances or funds that would otherwise be paid to Client. Client acknowledges and agrees that this payment direction is not an obligation of or guaranty by Denim to make such payments to the Payees.
1.4 Repurchase of Accounts. See Schedule 1 annexed hereto.
1.5 Communications. Communications regarding or related to the Factoring Services may occur via a variety of electronic communications mechanisms and Client consents to all such use by the Parties. Client consents to the collection, use and storage of all information related to the Client.
1.6. Maximum Amount. Is the maximum amount of total Accounts Denim will purchase from Client at any one time, subject to change with or without notice. See Schedule 1 annexed hereto.
2. FEES. See Schedule 1 annexed hereto.
3. GRANT OF SECURITY INTEREST.
3.1 Collateral. As a protective measure in the event of a characterization of the sale of the Accounts as a loan, and in order to secure all Obligations of Client to Denim, Client hereby grants to Denim a first priority and exclusive security interest in all of Client’s existing and later acquired assets, including but not limited to all Accounts, Chattel Paper (whether tangible or electronic), contracts and contract rights (including purchase orders) Documents (including bills of lading and proof of delivery), Equipment, Instruments (including promissory notes), Inventory, Investment Property, Letter of Credit rights, Letters of Credit, all General Intangibles, all Reserves, and all books and records of Client (whether tangible or electronic) relating to the assets set forth herein, whenever acquired and whether now or hereafter existing, wherever located and all Proceeds of each of the foregoing (collectively the "Collateral"). Client hereby grants Denim the authority to file a UCC Financing Statement in connection with this grant of security interest in the Collateral. Any unauthorized termination or unauthorized attempt by Client to terminate Denim’s UCC Financing Statement could result in, at Denim’s sole discretion, a $2,500 fee per occurrence.
3.2 Secured Obligations. The Collateral shall secure the payment of all Obligations at any time owing to Denim, fixed or contingent whether arising under this Agreement, by operation of law or otherwise. Client agrees that, with respect to the security interest granted by this Agreement, Denim shall have all of the rights and remedies of a secured party as provided by the UCC in addition to any and all remedies provided by any other applicable law and all rights and remedies provided for by this Agreement and by any other agreement; it being understood and agreed that that the security interest in the Collateral granted hereby secures any and all present and future Obligations of Client to Denim. In addition, in order to satisfy any of the Obligations due Denim, Client irrevocably authorizes Denim in its sole discretion to initiate electronic debit or credit entries through the ACH system to any deposit account maintained by Client. Client hereby agrees and authorizes Denim to establish an automated clearing house debit arrangement to facilitate such ACH transfers, and Client shall indemnify and hold Denim harmless from any claims or damages that might arise therefrom.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS. Client and those principals and agents authorized by Client to submit Accounts to Denim each make the following representations, warranties and covenants set forth herein to Denim upon the execution of this Agreement, each of which shall be deemed to have been made upon the submission to Denim
of an Account:
4.1 Client (a) is an entity duly organized, validly existing and in good standing under the laws of the state of its formation and is qualified and authorized to do business and is in good standing in all states in which such qualification and good standing are necessary or desirable; (b) has its principal place of business as set forth herein at the Client’s address and will not change its address without first giving Denim written notice thereof; (c) is not and has at no time been affiliated with and does not own, control, or exercise dominion, in any way whatsoever, over any Account Debtor; and (d) is not insolvent.
4.2 In connection with the Accounts (a) Client has offered for sale all Accounts of Client; (b) Client is the sole and absolute owner of each Account offered for sale, each Account offered for sale is sold free and clear of any liens, security interests or encumbrances and all supporting documentation for each Account has been provided to Denim; (c) Client has the full legal right to sell, assign and transfer each Account and such sale, assignment and transfer thereof does not contravene or conflict with the terms of any other agreement, commitment or instrument to which Client is a party; and upon Client's delivery of each Account, there will vest in Denim all of Client's right, title and interest in and to such Account; (d) all terms governing each Account are accurately reflected in the invoice and supporting documentation and each Account is undisputed and represents a sum certain owed by an Account Debtor, without offset or counterclaim and no Account offered for sale has any express or implied condition giving use to a bill-and-hold, guaranteed sale, sale and return, sale on approval, consignment or any right to return basis; (e) each invoice clearly sets forth the assignment of the Account to Denim; (f) each Account represents Client's bona fide sale, delivery and acceptance of merchandise or full and complete performance of service to an Account Debtor; (g) Client shall not change the payment terms to any Account Debtor; (h) no Account purchased hereunder or any payment made with regard thereto will at any time during or after termination of this Agreement be avoidable by any bankruptcy trustee under Title 11 of the United States Bankruptcy Code or by any creditor, whether under state or federal law, as a preference, fraudulent conveyance or otherwise; (i) each Account shall be absolutely enforceable against the Account Debtor in accordance with the express terms of the invoice, whether as to price, terms delivery, guaranty or quality; (j) Client has or will immediately and in any event not more than twenty-four (24) hours upon receipt of such information by Client, notify Denim of any dispute, return, rejection, loss of or damage, any request made by an Account Debtor for an extension of time to pay or any fact or circumstance with respect to any Account which is likely to effect the sum owing thereon or any other fact or circumstance that is likely to give rise to any Event of Default; (k) no Account or product or services billed pursuant to an Account shall be subject to a warranty or any future performance conditions; (l) no Account is for work in progress or represents progress billing; and (m) Client has verified the foregoing prior to submission of the Account to Denim.
4.3 In connection with the records of Client: (a) each fact in any financial record, statement, books and records or other document Client has provided to Denim, either before or after the execution of this Agreement, is true and accurate and no information has since come to Client’s attention to materially affect same; and (b) Client has contemporaneously as to each Account purchased, made the proper entry on its books and records recording the absolute sale of such Accounts to Denim. Within three (3) days of a request from Denim, Client shall provide Denim with a copy of its (i) financial statements; (ii) current customer list and/or debtor aging; and (iii) federal income tax returns; and (iv) other information regarding Client's business affairs as Denim may request.
4.4 In connection with operations of Client: (a) no financing statement identifying Client as Debtor, except as to Denim as Secured Party, is currently existing or may or has at any time
during the term of this Agreement been authorized or has been filed in any public office; (b) it is fully responsible for the acts and omissions of its employees; (c) no Collateral has been sold outside the ordinary course of Client's business; (d) each individual that submits Accounts has the power and authority to do so on behalf of Client; (e) it shall at all times execute and deliver to Denim any and all documents that Denim deems desirable or necessary to effectuate the provisions of this Agreement; (f) it has no delinquent tax obligations; (g) it has not delinquent labor or pension obligations; (g) the proceeds of the advances shall be used solely by Client for working capital purposes in the ordinary course of business; (h) it will not lend any sum of money whatsoever to any individual or entity (other than advances to Client’s drivers from time-to time in the normal course of Client’s business), nor act as guarantor, surety or endorser without Denim's prior written consent; and (i) it will notify Denim immediately upon any voluntary or involuntary bankruptcy petition under the United States Bankruptcy Code filed by or against Client or any guarantor, or any assignment for the benefit of creditors by Client or any guarantor.
4.5 If Client receives an overpayment or other payment of any kind, Client shall immediately contact Denim (at contact@denim.com or 1-855-250-4142) and pay such funds, within one business day after receipt by you, to Denim via ACH transfer and if not so remitted by Client, Denim shall have the right to charge a fifteen percent (15%) misdirected payment fee.
4.6 Client is duly registered as required by law and has obtained and will maintain all required licenses, registrations, insurance and/or surety bonds as required or necessary to operate its business. If Client is a carrier, Client is registered with FMCSA as a for-hire motor Carrier of property in interstate and foreign commerce pursuant to 49 U.S.C. § 13902. If Client is a broker, Client is duly registered with the appropriate government agencies as a freight broker.
4.7 Client represents and warrants that it will act in a thorough and professional manner, consistent with high professional and industry standards through individuals with the requisite training, background, experience, technical knowledge and skills.
5. OPERATIONS AND PROCEDURES
5.1 Denim as Service Provider. Denim is an independent provider, performing the Factoring Service on behalf of Client. The relationship under the Agreement is principally that of seller and purchaser. Client agrees that there is not now and Client will at no time seek or attempt to establish, any fiduciary or confidential relationship by Denim as to Client. Nothing in this Agreement or the transactions contemplated hereunder will be construed as establishing an employment relationship, joint venture, joint enterprise, partnership, or any other relationship between the Parties.
5.2 Portal. Invoices shall be submitted by Client via the Portal. Information regarding the transactions occurring hereunder will be maintained by Denim and may be available for review by Client through the Portal. Client acknowledges that information available on the Portal is real time and subject to further adjustment by Denim pursuant to the terms herein. All of Client’s rights of access to Denim’s online internet available services shall be provisional and may be terminated upon an Event of Default. The information Denim makes available to Client online constitutes and satisfies any duty to respond to a Request for an Accounting or Request regarding a Statement of Account pursuant to § 9-210 of the UCC.
When using particular Factoring Services, Portal or the website maintained by Denim, Client shall be subject to any posted rules applicable to the Factoring Services or materials that may contain terms and conditions in addition to those in this Agreement. All such guidelines or
rules are hereby incorporated by reference into this Agreement as the “Terms of Service.” Denim reserve the sole right to either modify or discontinue the Portal or the Website, including any of the Portal or website’s features, at any time with or without notice to Client. Denim will not be liable to Client or any third party in connection therewith. Any new features that augment or enhance the then current Portal or website shall also be subject to these Terms of Service.
5.3 Authorization to Denim. Client irrevocably authorizes Denim at Client’s expense, to exercise any of the following powers until all of the Obligations have been paid in full:
5.3.1. Receive, take, endorse, assign, deliver, accept and deposit, in the name of Denim or Client, proceeds of any Collateral;
5.3.2. Take or bring, in the name of Denim or Client, all steps, actions, suits or proceedings deemed by Denim necessary or desirable to effect collection of or other realization upon the Accounts;
5.3.3. With respect to any of the following established or issued for the benefit of Client, either individually or as a member of a class or group, file any claim under (i) any bond or (ii) under any trust fund;
5.3.4. Pay any sums necessary to discharge any lien or encumbrance which is senior to Denim’s security interest in any assets of yours, which sums shall be included as Obligations hereunder;
5.3.5. Process and provide signature (physical or electronic) on the Accounts and associated paperwork for securing cargo and billing purposes;
5.3.6. Obtain the necessary certifications, authorities, and other official documents related to Client as required and applicable.
5.3.7. In Denim’s own name or on Client’s behalf, with Client to be bound thereby, extend the time of payment of, compromise or settle for cash, credit, return of merchandise, and upon any terms or conditions (collectively, a “Settlement”), any and all Accounts and discharge or release any Account Debtor or other obligor (including filing of any public record releasing any lien granted to you by such Account Debtor), without affecting any of the Obligations, and Client acknowledges that all Settlements shall be presumed to be commercially reasonable, and the burden of proof shall be on Client with respect thereto.
5.4 Third Party. Client consents to Denim’s use of third party service providers in providing the Factoring Services and administrating the transactions hereunder. Client acknowledges and agrees that Denim may (a) sell participation interests in or assign all or any portion of its rights, obligations and interest under this Agreement and in the Collateral to any Person; (b) contract with affiliates of Denim to provide servicing of the Client facility and exercise Denim’s rights hereunder.
5.5 Authorized Persons. Client shall identify at least one individual that is authorized (a) to submit Accounts and execute documents on behalf of Client in connection with the performance of this Agreement (excluding authority to change deposit account information); and (b) to change deposit account information and direct the remittance of funds, provided, however, that Denim at all times in its sole discretion may rely on authorization received by an
Denim employee or agent.
5.6 Agency. Nothing in this Agreement shall be construed to constitute Denim as agent for Client or to obligate Denim to assume any of Client's obligations with respect to any Account. Denim shall not assume or create any liability for any error or omission or delay occurring in a settlement, collection or payment of any Account. Notwithstanding the foregoing, if Client fails to perform any obligation that Client was required to perform in order to maintain the obligation of an Account Debtor to make payments on an Account, Denim may perform or retain others to perform such obligation, at Client's sole expense and such expense shall constitute part of Client's Obligations described hereunder
5.7 Attorney-in-Fact. In order to facilitate the terms of this Agreement, Client hereby authorizes and appoints Denim as its lawful attorney-in-fact to collect and receive all payments from all Customers and to exercise at any time any of the following powers: (i) to receive, endorse, and deposit in Denim's name all payments received from Customers; (ii) to transmit to any party notice that Client has granted Denim a security interest in the Accounts or that any Account has been sold to Denim; (iii) to institute any proceedings deemed by Denim necessary to effect collection of any Account; (iv) to sign Client's name on any financing statement, or any amendment or continuation statement thereto with respect to any Account; and (v) to take any action deemed reasonable to fulfill the terms of this Agreement.
5.8 Right of Use of Data.
5.8.1 To the extent permitted under applicable law, Client expressly acknowledges and agrees that Client’s information and data that are provided to or made available to Denim under this Agreement, including, but not limited to, information or data related to Client's business, owners, employees, officers, and agents (hereinafter referred to as “Client Data”) may be necessary or appropriate for Denim to perform under this Agreement. Client agrees that Denim maybe collect, store, compile, process, combine, analyze, utilize, license to third parties and use (hereinafter referred to as “Use” or "Used") Client Data in connection with performing under the Agreement.
5.8.2 Subject to the terms of this Agreement and to the extent provided under applicable law, Client expressly acknowledges and agrees that Denim may Use Client Data for (i) the Denim’s own research, analysis, and business development purposes or (ii) to provide analysis on performance, underwriting, due diligence, credit risk analysis, funding information decisions or purposes, and general business trends in the industry (collectively "Company Services")
which Use shall be the sole property of Denim, provided, however, Denim's Use of such Client Data shall not disclose to any third party any personally identifiable information of the Client or persons associated with Client or confidential or proprietary information of Client. Denim will take reasonable commercial efforts to data anonymize Client Data that is aggregated or combined with anonymized client data received from other Clients to ensure the protection of personally identifiable information or confidential or proprietary information of Client.
5.8.3 Client shall grant a non-exclusive, worldwide, royalty-free license to any Client Data used by Denim related to or in connection with "Company Services" to improve Denim's products and services.
5.8.4 Client represents and warrants to Denim that, except as provided in this Agreement: (i) all Client Data provided by Client to Denim under this Agreement is the sole and exclusive property of Client; and (ii) Client owns any and all any intellectual property rights embodied in or associated with such Client Data.
5.8.5 Subject to this Agreement, Client Data created by or sourced from Client including, rights related thereto shall be and remain the property of Client.
5.8.6 All Client Data Used by Denim under the Agreement shall be protected and treated in the same commercially reasonable manner of protection as like or similar confidential information of Denim in light of the nature of the Client Data disclosed by Client in the course of operating under this Agreement.
6. INDEMNIFICATION. Client will indemnify and hold harmless Denim and its shareholders, officers, directors, partners, employees, agents, representatives and affiliates (each being an "Indemnified Party") from and against any and all losses, claims, actions, damages and liabilities arising under or related to this Agreement or the relationship created by this Agreement, including but not limited to (i) any action by a third party against Denim that is based on a claim that any actions performed under this Agreement or any agreements between Client and a third party, infringe, misappropriate or violate such third party’s rights; (ii) any action by a third party against Denim that is based on any act or omission of Client; or (iii) any claim by an independent contractor, including but not limited to a claim under the Quick Pay Program. Client agrees to indemnify and hold Denim harmless from any loss or liability arising out of the assertion of any avoidance claim and shall pay to Denim on demand the amount thereof. This Section 6 shall survive termination of this Agreement.
7. LIMITATION OF LIABILITY. Client’s sole remedy for any breach alleged to have been committed by Denim of any obligation or duty owed under the Agreement, any other agreement between Client and Denim or any duty or obligation arising out of or related to the Agreement shall be limited to the amount in the Reserve, which Reserve shall be the amount five (5) days after the time notice in writing of such breach is first given to Denim. IN NO EVENT WILL DENIM BE LIABLE FOR ANY SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND IN CONNECTION WITH THIS AGREEMENT, EVEN IF DENIM HAS BEEN INFORMED IN ADVANCE OF THE POSSIBILITY OF SUCH DAMAGES.
8. TERM AND TERMINATION
8.1. Term. This Agreement will be effective upon execution, shall continue for the Term, and shall be automatically extended for successive Terms unless Denim provides the Client at least Thirty (30) days prior written notice of its intention to terminate this Agreement, or Client provides Denim at least Sixty (60) days prior written notice of its intention to terminate before the end of any Term, whereupon this Agreement shall terminate at the end of the applicable Term.
8.2. Termination. Upon receipt of a written notice of termination, Client shall pay all Obligations to Denim and Denim shall have no duty to thereafter purchase any Accounts from Client. Any attempted termination of this Agreement other than as set forth herein shall be ineffective, and this Agreement shall continue in full force and effect as if such attempted termination was not made. In addition, any notice of termination by Client and notwithstanding payment in full of all Obligations by Client, is conditioned on Client’s execution and delivery, to Denim, of a general release in a form satisfactory to Denim. Client understands and agrees that this provision constitutes a waiver of its rights under §9-513 of the UCC. Denim shall not be required to record any terminations or satisfactions of any of Denim’ security interests unless and until Client has executed and delivered to Denim said general release and Client shall have no authority to do so without Denim’s express written consent. In the event Denim consents to
the termination or buyout of the Client’s Obligations, Client shall be subject to an Early Termination Fee irrespective of whether Client is in Default of this Agreement.
8.3. Early Termination Fee. See Schedule 1 annexed hereto.
9. DEFAULT
9.1. Events of Default. The following will constitute an “Event of Default” hereunder: 9.1.1. Client defaults in the payment of any Obligations;
9.1.2 Client breaches any provision, representation, warranty or covenant set forth herein or any warranty, representation or covenant is not true, accurate or correct in any respect, or Client fails to perform any duty hereunder;
9.1.3 Client fails to submit any Account to Denim or fails to submit accounts for a period of twenty one (21) consecutive days for purchase by Denim or fails to respond to communications initiated by Denim within three (3) business days;
9.1.4 any injunction, attachment, judgment or lien shall be filed, occur, arise of attach to any portion of the Collateral or as to Client, or Client shall fail to pay any federal or state tax or fail to timely file any tax forms when due;
9.1.5 the discontinuance or suspension of Client’s present business operations, or a material adverse change occurs in Client’s financial condition, business or operations, or there is a change in the control of the ownership or management of Client;
9.1.6. Client or any guarantor of the Obligations becomes subject to any debtor-relief proceedings or other insolvency proceedings or are unable to meet debts as they mature;
9.1.7. Any guarantor of the Obligations fails to perform or observe any of such guarantor's obligations to Denim or shall notify Denim of its intention to rescind, modify, terminate or revoke any guaranty of the Obligations, or any such guaranty shall cease to be in full force and effect for any reason whatsoever;
9.1.8. Client attempts to terminate this Agreement in contravention of Section 8 herein;
9.1.9 Client double brokers any load; or
9.1.10. Denim for any reason, in good faith, deems itself insecure with respect to the prospect of repayment or performance of the Obligations and/or this Agreement.
9.2. Effect of Event of Default. Upon the occurrence of an Event of Default, and in addition to any other rights and remedies of Denim: (a) at the sole discretion of Denim, all Obligations owed to Denim shall be immediately due and payable upon demand by Denim; (b) Denim shall have the right to charge an additional five percent (5%) Factoring Services Fee (the “Default Rate”), which Default Rate shall be assessed on the face value of the outstanding Accounts and which Default Rate shall be in addition to any other fees due to Denim hereunder; (c) Denim shall have the
right, at its discretion, to cease further advances and/or to terminate this Agreement; (d) Denim
shall have the right to enforce all lien rights of Client; (e) Client hereby irrevocably authorizes any financial institution in which it has an account that so much of the funds necessary to cure Client's breach as set forth in writing by Denim to such financial institution shall be set aside to and for the exclusive benefit of Denim; and (f) Denim may set off and apply the Collateral to the payment of Client's Obligations in such order and manner as Denim in its sole discretion shall determine, or settle, compromise or release, in whole or in part, any amounts owing on the Collateral, or prosecute any proceeding with respect to the Collateral, or extend the time of payment of any or all of the Collateral, or issue credits regarding the Collateral or sell, assign and deliver the Collateral (or any part thereof), at public or private sale and apply the net cash proceeds resulting from the exercise of any of the foregoing rights or remedies to the payment of the Obligations, in such order as Denim in its sole discretion, may elect, and Client and any Guarantor hereof shall remain liable to Denim for any deficiency. Client shall reimburse Denim on demand for all costs incurred by Denim in the (i) enforcement for payment of the Accounts; (ii) all fees, costs and expenses of any kind and nature which Denim may incur in the filing notices, making lien or title examinations; and (iii) protecting, maintaining, preserving or enforcing agreements relating to the Accounts or any other matters related to this Agreement, all of which shall be added and deemed part of Client's Obligations hereunder.
10. QUICK PAY PROGRAM
In the event Client offers a quick pay option to its independent contractors (the “Quick Pay Program”), Client agrees that Denim may pay independent contractors, including but not limited to carriers and dispatchers, participating in such Quick Pay Program directly from Advances under the terms and conditions herein. Denim must receive the following documentation regarding each independent contractor participating in the Quick Pay Program: (A) for the initial Quick Pay Program set up on the Denim on-line system: (1) bank account information; (2) copy of a voided check from the independent contractor bank account; (3) Quick Pay Terms and Conditions executed by independent contractor; and (4) upon request by Denim, a copy of the agreement between Client and the independent contractor; and (B) for each payment request by Client under the Quick Pay Program: (1) the amount owed to the independent contractor for each invoice based on the terms and conditions of the agreement between the Client and independent contractor; and (2) valid independent contractor invoices with supporting documentation; and (C) at all times: (1) a copy of any Notice of Assignment under UCC §9-406 received by Client in connection with any independent contractor participating in the Quick Pay Program; (2) notice of a Quick Pay Program termination by an independent contractor; and (3) any other documentation that Denim may request in connection with the independent contractor (collectively the “Contractor Quick Pay Documentation”). Client covenants and agrees that the Contractor Quick Pay Documentation and all information provided by Client to Denim regarding each independent contractor shall be true, accurate and correct in all respects. Client agrees that Denim may communicate directly with each independent contractor and may obtain directly from independent contractor any documentation needed to effectuate the quick pay payments, including but not limited to documentation required by Denim to make payments directly to such independent contractor on behalf of Client and to ensure that Denim has a priority secured interest in all Accounts. Client shall ensure that all Accounts submitted to Denim for which Client is requesting direct payment to an independent contractor under the Quick Pay Program shall be Eligible Accounts as defined herein. Client acknowledges and agrees that in the event Client has received a Notice of Assignment under UCC §9-406 or other legally enforceable direction of payment as to any independent contractor, such independent contractor is not eligible to receive a direct payment from Denim and Client will not submit Contractor Quick Pay Documentation for such independent contractor.
Client hereby irrevocable authorizes and directs Denim to remit Advances that would
otherwise be paid to Client directly to an independent contractor participating in the Quick Pay Program. Client acknowledges and agrees that Denim may remit such payments at the sole discretion of Denim and as and to the extent funds are otherwise available to be paid to Client. Client further acknowledges and agrees that each payment made to an independent contractor is to be paid by Denim from funds otherwise due and owing Client under this Agreement and is not a guaranty of payment or an assumption by Denim of any obligations owed by Client to an independent contractor. Client acknowledges and agrees that Denim, in its sole discretion, may pay an independent contractor even if funds are not currently due to Client and Client shall be liable to Denim for any such payments. Client shall remain liable for the full and indefeasible payment and performance of the Obligations under the Factoring Agreement. Client agrees to pay any associated fees relative to the Quick Pay Program. Nothing set forth in this provision limits the rights of Denim as set forth in Section 1.3 hereof.
11. GENERAL PROVISIONS
11.1 Assignability. Client may neither assign nor transfer any of its rights nor delegate any of its duties under the Agreement. Denim shall have the right at any time to assign and delegate all or any portion of its rights and duties under this Agreement.
11.2 Entire Agreement. This Agreement contains the entire understanding of the Parties hereto and relating to the subject matter hereof and is the final and complete expression of their intent.
11.3 Amendments. No amendment, modification or waiver, oral or otherwise, with respect to any provision will be effective unless the same is in writing and executed by an officer of Denim and no email correspondence shall be considered a writing for purposes of an amendment, modification or waiver hereof.
11.4 No Waiver. No failure or delay on Denim’s part in exercising any right, power or remedy granted to Denim hereunder will constitute or operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right set forth herein.
11.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which so executed shall be deemed an original and constitute one and the same agreement and may be by facsimile or by electronic transmission of a portable document format file or equivalent (also known as a "PDF file"), which shall be effective as delivery of a manually executed original counterpart of this Agreement. Client may also execute this Agreement by electronically accepting this Agreement.
11.6 Severability. In the event any one or more of the provisions contained in the Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof, and the Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.
11.7 Construction. This Agreement is made and entered into for the sole benefit of the Parties hereto and the Parties have read this Agreement, understand its contents, and represent that each has full and complete authority to sign this Agreement and that the execution, delivery and performance hereunder has been duly authorized by each Party as well as each of the
Parties hereto has had an opportunity to consult with its respective legal counsel prior to executing this Agreement.
11.8 No Reliance. Client specifically acknowledges and agrees this Agreement is executed freely and voluntarily and without reliance upon any statement or representation of Denim or any of Denim’s attorneys, agents, or other representatives in connection therewith except as set forth herein and there are no and Client is not relying on any written or oral representations not expressly written in this Agreement.
11.9 Force Majeure. In the event Denim is unable to carry out its obligations under this Agreement due to reasons beyond its reasonable control, it is agreed that the obligations of Denim hereunder shall be suspended during the continuance of such inability, Denim shall not be liable for damages, and Client shall not be entitled to any refund of amounts paid, provided, however that such cause shall be remedied as soon as commercially practicable.
11.10 Election of Remedies. Except as expressly set forth in this Agreement, the exercise by Denim of any of its remedies under this Agreement will be without prejudice to its other remedies under this Agreement or available at law or in equity.
11.11 Notices. All notices required or permitted under this Agreement will be in writing and delivered by (i) confirmed facsimile transmission, (ii) courier or nationally recognized overnight delivery service, or (iii) certified mail, and in each instance will be deemed given upon receipt. All notices to Denim will be sent to:
Attn: Denim
205 Hudson St, Floor 7
New York, NY 10013
All notices to Client will be sent to the address provided by Client on the signature page hereof or otherwise in writing and acknowledged by Denim. Communications which by their nature relate to the day-to-day activities of the Factoring Service may be delivered in electronic form, provided, however, that no email correspondence shall constitute written notice as may be required under this Agreement.
11.12 Modification of this Agreement. Denim reserves the right, at Denim’s sole discretion, to modify this Agreement on a going-forward basis at any time, with or without prior notice, and such changes will be effective upon the earlier of Client’s (i) first use of the Factoring Services with actual notice of such change, (ii) consent to such changes via a written amendment hereto, or (ii) 30 days from posting of such change on the Portal. Client’s use of the Factoring Services following the date that any such change becomes effective constitutes an agreement to be bound by the modified Agreement. If Client does not agree to the modified Agreement, its sole and exclusive remedy is to terminate this Agreement in accordance with the termination provisions hereof.
11.13 Waiver. The waiver of any breach of any provision of this Agreement will not constitute a waiver of any subsequent breach of the same nature and does not constitute a waiver of other provisions hereof. A waiver is only effective if it is in writing and signed by the waiving Party.
11.14 GOVERNING LAW, JURISDICTION, WAIVER OF JURY TRIAL AND ATTORNEY’S FEES.
11.14.1 GOVERNING LAW & JURISDICTION. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware in all respects, including but not limited to the construction, validity and interpretation of this Agreement and the performance of the obligations imposed by this Agreement, without reference to any conflict of law provisions or decisions. Client hereby consents to the exclusive jurisdiction of any state or federal court sitting in Kent County, Delaware (the “Chosen Forum”) in any action or proceeding the subject matter of which arises out of or relates, directly or indirectly, to this Agreement and each of the Parties agree that all claims in respect to any action or proceeding shall be heard and determined exclusively in the Chosen Forum. Client further waives any objection or right it may have to seek a change of venue based on lack of personal jurisdiction, improper venue, forum non conveniens or otherwise. Client hereby waives personal service of the summons, complaint and other process issued in any such action or suit and agrees that service of such summons, complaint and other processes may be made by certified mail addressed to Client at the address of Client set forth in this Agreement and that service so made shall be deemed completed upon the earlier of Seller's actual receipt thereof or 3 days after deposit in the United States mail, proper postage prepaid. Nothing in this Agreement shall be deemed or operate to affect the right of Denim to (i) serve legal process in any other manner permitted by law, or (ii) to preclude the enforcement of any judgment or order obtained in such forum or the taking of any action under this Agreement to enforce same in any other appropriate forum or jurisdiction; or (iii) proceed against the Collateral in any other appropriate forum or jurisdiction.
11.14.2 WAIVER OF JURY TRIAL. EACH OF THE PARTIES AND ANY OBLIGOR HEREUNDER ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR ANY DOCUMENT ARISING HEREUNDER OR WITH RESPECT TO THE TRANSACTION CONTEMPLATED HEREIN WOULD BE BASED UPON DIFFICULT AND COMPLEX ISSUES. ACCORDINGLY, EACH OF THE PARTIES AND ANY OBLIGOR HEREUNDER KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT THAT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED HEREON, INCLUDING BUT NOT LIMITED TO ANY CLAIM, COUNTERCLAIM, CROSS-CLAIM, THIRD PARTY CLAIM, DISPUTE, DEMAND, SUIT OR PROCEEDING ARISING OUT OF OR RELATED HERETO WHETHER, UNDER OR IN CONNECTION WITH THE AGREEMENT OR ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION HEREWITH, INCLUDING ANY COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY AND AGREES THAT ALL SUCH PROCEEDINGS SHALL BE TRIED BEFORE A JUDGE AND NOT A JURY.
11.14.3 ATTORNEY’S FEES. Client agrees to reimburse Denim for all reasonable attorney’s fees, court costs and other expenses incurred by Denim arising under or related to this Agreement. Notwithstanding the existence of any law, statute or rule, in any jurisdiction that may provide Client with a right to attorney’s fees or costs, Client hereby waives any and all rights to hereafter seek attorney’s fees or costs thereunder.
11.15 EACH PARTY WAIVES THE RIGHT TO LITIGATE IN COURT ANY DISPUTE AS A CLASS ACTION, EITHER AS A MEMBER OF A CLASS OR AS A REPRESENTATIVE, OR TO ACT AS A PRIVATE ATTORNEY GENERAL.
WITNESS WHEREOF, the parties have executed this Account Purchase and Factoring Agreement as of the date executed or otherwise accepted by Client.
