Advances and Terms of Payment Clause Samples

Advances and Terms of Payment. 2.1 So long as no Event of Default, or an event which through the passage of time or the giving of notice or both would constitute an Event of Default, has occurred, Newtek may in its discretion make loans against the Client’s Eligible Inventory in an aggregate amount outstanding at any time up to the lesser of (i) fifty percent (50%) of the Inventory Value or (ii) the Inventory Advance Limit. If, at any time and for any reason, the aggregate amount of the outstanding Advances under this Agreement exceeds the Inventory Advance Limit or percentage limitation contained in the preceding sentence, then Client shall, upon demand by Newtek, immediately pay to Newtek, in cash, the amount of such excess, or at Newtek’s option Newtek may charge such excess against any reserves held by Newtek. Newtek shall maintain reserves against Client’s availability for Advances and may maintain reserves against Accounts and/or ineligible Inventory as well, or maintain a cash collateral deposit account, which NEWTEK in its discretion deems appropriate, and may increase such reserves or reduce its advance percentages based on Eligible Inventory without declaring an Event of Default and without prior notice, if it determines, in its discretion, that such increase in reserves or reduction is necessary, including, without limitation, to protect its interest in the Collateral and/or against diminution in the value of any Collateral, and/or to insure the prospect of payment or performance by Client of its Obligations to Newtek are not impaired.