VMI Account definition
VMI Account means, as of any date of determination, a Receivable owing from an account debtor of a Loan Party arising from the sale of inventory on a “sale or return” basis to such account debtor under such Loan Party’s “vendor managed inventory” program so long as (a) such sale was originated from an order placed by such account debtor or by such Loan Party in good faith on behalf of such account debtor under the authority provided to such Loan Party by such account debtor under such Loan Party’s “vendor managed inventory” program and (b) such Loan Party has in good faith established an adequate return reserve in respect of such VMI Account; provided that Receivables otherwise described above in this definition shall not be VMI Accounts to the extent the Inventory giving rise to such Receivables is Inventory that is more than six-months old and such Inventory constitutes more than 10% of all inventory giving rise to Receivables that would otherwise qualify as VMI Accounts as of the date of the determination thereof.
VMI Account means, as of any date of determination, an Account owing from an Account Debtor of the Borrower or a Guarantor arising from the sale of inventory on a “sale or return” basis to such Account Debtor under the Borrower’s “vendor managed inventory” program so long as (i) such sale was originated from an order placed by such Account Debtor or by the Borrower in good faith on behalf of such Account Debtor under the authority provided to the Borrower by such Account Debtor under the Borrower’s “vendor managed inventory” program and (ii) the Borrower has in good faith established an adequate return reserve in respect of such VMI Account, which has been included in the calculation of “Return Reserve” as defined in this Agreement; provided that Accounts otherwise described above in this definition shall not be VMI Accounts to the extent the inventory giving rise to such Accounts is inventory that is more than 6 months old (i.e. six months has past since the initial retail release date for the movie or other content embodied in such inventory) (“Library Product”) and such Library Product comprises more than 10% of all inventory giving rise to Accounts that would otherwise qualify as VMI Accounts as of the date of the determination thereof.