Brex Instant Payouts Program Agreement
April 16, 2021
- Factoring of Receivables
- Beta Services
- Representations and Warranties
- Adjustments and Chargebacks of Purchased Receivables
- Other Covenants
- Authorization to Debit Linked Accounts; ACH Authorization
- Security Interest
- Other Provisions
This Brex Instant Payouts Program Agreement (" Agreement") is a supplement to the Brex Platform Agreement and is entered into between the company applying for entry to the Brex Instant Payouts Program and its representatives (" Company" or " you") and Brex Finance I LLC (" Brex Finance" or " we").
This Instant Payouts Agreement and the Securities Account Control Agreement (together, the " Program Agreements"), set forth the requirements for your participation in the Brex Instant Payouts Program and the terms and conditions that govern your sale to Brex Finance of certain commercial receivables (" Receivables") you generate through one or more Selling Platforms in the ordinary course of your business. By entering into this Agreement, you confirm that you wish to make one or more offers to sell Accounts to Brex Finance as a means to create liquidity for Company. Brex Finance will determine in its sole discretion whether and on what terms to purchase the Accounts as described in this Agreement.
Capitalized terms that are not defined in Section 11 have the definitions provided in the Platform Agreement.
We may update this Agreement at any time by delivering Notice, and your continued use of the Brex Instant Payouts Program will constitute acceptance of the updated terms.
Section 7 of this Agreement includes an authorization for Brex Finance to automatically restrict balances, debit your Brex Cash Account, or debit other Linked Accounts for amounts you may owe to Brex Finance or its affiliates.
1. Factoring of Receivables
1.1 Offers to Sell Receivables
From time to time, you may extend an offer to Brex Finance to purchase Receivables that you have generated through one or more Selling Platforms. This Agreement applies to each Receivable that you offer to sell to us and that we agree to purchase. Your decision to join the Brex Instant Payouts Program does not require that you sell all future Receivables to Brex Finance. Receivables that you offer to us and that we purchase pursuant to the terms of this Agreement are referred to as " Purchased Receivables."
You agree that we may review information available to us about Company or Company's Beneficial Owners, Control Persons, Administrators, or Users from multiple sources, including information provided to us by our affiliates and service providers, or information you provide by connecting to Selling Platforms or Linked Accounts, to determine whether you are eligible to make offers or enter into Transactions under this Agreement, and the applicable quantity of Receivables and purchase price for any Transaction.
Subject to any prior authorizations you may provide, in connection with any proposed sale, you will be provided with details specifying the Receivables that are eligible for purchase, the purchase price that you will receive, applicable fees, and other relevant information (" Transaction Details"). Please review the Transaction Details carefully. The Transaction Details will be based on information provided to us by you, or which we obtain from Third-Party Service Providers or the applicable Selling Platform. By entering into this Agreement, you agree that we may obtain and review information about Company from such sources as we believe to be relevant. If requested, you will provide us with such documentation or additional information as we may reasonably request in connection with proposed Transactions. You agree to provide accurate and complete information to us in connection with each proposed Transaction.
By entering into any Transaction through your Brex Account dashboard whether through advance authorization in the context of agreeing to Daily Payouts or by clicking "deposit now" on the Transaction Details confirmation screen with respect to specific Transaction Details, you acknowledge that you have reviewed the Transaction Details provided through your dashboard in respect of such Transaction and confirm that all such information, together with information from other sources that you have provided or authorized us to review, is correct, complete, and acceptable. You will promptly update previously provided information that is no longer correct or complete.
You acknowledge and agree that upon our receipt and acceptance of this Agreement your default setting within your Brex Account dashboard will reflect your advance approval and authorization for Daily Payouts functionality, which will allow us to proceed with the sale of all Purchased Receivables identified in the Transaction Details delivered by us from time to time. You may revoke such prior authorization for Daily Payouts as to future Purchased Receivables at any time through your Brex Account dashboard; provided that any such revocation shall only be effective as to Receivables identified in Transaction Details delivered by Brex Finance following the effective time of such revocation of approval of Daily Payouts functionality. Before each day’s Daily Payout purchase, the Transaction and Transaction Details will appear in a pending state which you can review and cancel before the purchase occurs. Brex Finance reserves the right at any time to suspend Daily Payouts functionality, including any advance approval and authorization process, and require that you approve specific Transaction Details for any further sales of Receivables.
1.2 Payment of Purchase Price by Brex Finance
The purchase price will be calculated by taking the aggregate face value of the Purchased Receivables, net of returns, credits, reserves, interchange fees or other allowances owing to the Selling Platform, and applying a discount (which will be shown in the form of a fee in the Transaction Details (the " Transaction Fee")). You should review the Transaction Fee for each Transaction— which will be displayed prominently in your Brex Account dashboard and in the Transaction Details—before agreeing to sell any Receivables. The Transaction Fee discount applicable to each Purchased Receivable may vary from time to time and from transaction to transaction, including due to factors related to the Selling Platform, the Purchased Receivables, or Brex Finance internal policy.
After you confirm the Transaction Details, whether individually or based on a prior standing approval for Daily Payouts, Brex Finance will deposit the total purchase price into your Brex Cash Account. This payment will usually take place on the same day the Transaction is confirmed.
1.3 Collection of Purchased Receivables from Selling Platform
You agree to service the Purchased Receivable on our behalf utilizing the same level of care and process that you apply to Receivables that are not Purchased Receivables. Without limiting the foregoing, you agree that you will continue to utilize the services of the Selling Platform to support such servicing activities. You further acknowledge that (a) as our servicer you are only authorized to receive Selling Platform Collections to your Brex Cash Account, or Linked Account for the limited Expedited Access Period, in the ordinary course, and will not pursue additional collection activities on Purchased Receivables, and (b) notification of the sale of the Purchased Receivables will generally not be provided to the Purchased Receivables Obligor for administrative convenience, but we reserve the right to provide such Notice in our sole discretion. You agree that you will not otherwise modify, amend or deal in the Purchased Receivables in your capacity as our servicer without our prior written approval.
If the Selling Platform provides or otherwise makes available to Company data or other information regarding the Selling Platform Collections (i) you will promptly deliver such information to Brex Finance, or otherwise enable Brex Finance to access such information directly from the Selling Platform, and (ii) you agree that Brex Finance may rely on such information in tracking Selling Platform Collections.
To the extent that the Selling Platform does not provide or otherwise make available data or other information regarding Selling Platform Collections, Brex Finance will deem amounts deposited in your Brex Cash Account, or Linked Account for the Expedited Access Period, to be Selling Platform Collections upon the earlier of (i) the latest date by which the Selling Platform has contractually committed to remitting collections with respect to each transaction effected by you with the Selling Platform or (ii) the average number of days following the related transaction within which the Selling Platform remits collections for transactions effected by you with the Selling Platform. You agree as part of servicing the Purchased Receivables to provide Brex Finance with immediate notice in the event that you become aware of any grounds for which the Selling Platform may not remit collections for the Purchased Receivables (e.g.returns or chargebacks) as of the date such amounts would otherwise be deemed deposited. Upon such notice, and without limiting any other right of Brex Finance under this Agreement, the related Selling Platform Collections will not be automatically debited from your Brex Cash Account or Linked Account until received. Without limiting the right of Brex Finance under this paragraph to deem amounts deposited by the Selling Platform into your Brex Cash Account or Linked Account as Selling Platform Collections upon reasonable information and belief as detailed above, Brex Finance shall have the right to audit and adjust such amounts as appropriate to conform to any transaction settlement information subsequently provided or made available by the Selling Platform.
Other than as expressly permitted by the last paragraph of this Section 1.3 with respect to any applicable Expedited Access Period, you are otherwise required to set and maintain Brex Cash as your Selling Platform Payout Account prior to making any sale offer under this Agreement and for so long as any amounts are owed to Brex Finance by you or the Purchased Receivables Obligors. Upon receipt of any Selling Platform Collections to your Brex Cash Account, you agree that Brex Finance may (directly or through an affiliate) instruct Brex Treasury to restrict such amounts from your available Brex Cash Account balance and may subsequently debit your Brex Cash Account for such funds in an amount equal to the Selling Platform Collections. You also acknowledge that you may not enter into any Transactions without first agreeing to a Securities Account Control Agreement with Brex Finance and Brex Treasury, which memorializes such Brex collection rights in greater detail and which creates a valid, perfected security interest in your Brex Cash Account.
In the event that the Selling Platform Collections are directed to an account other than your Brex Cash Account, you acknowledge that you have no legal title to such funds and agree to hold the amount of such payment in trust for the benefit of Brex Finance. You authorize Brex Finance to initiate an Automated Clearing House (ACH) or direct electronic funds transfer from any such third party account and to take any other steps that may be necessary for Brex Finance to receive the Selling Platform Collections.
Notwithstanding the foregoing requirements relating to maintaining your Brex Cash Account as your Selling Platform Payout Account, you may continue to maintain a separate Linked Account as your Selling Platform Payout Account for an Expedited Access Period as defined by Brex Finance concurrently or prior to the first sale of Purchased Receivables. You represent and warrant that through out such Expedited Access Period your Selling Platform Payout Account will at all times remain a Linked Account that you have identified to us as your Selling Platform Payout Account. You additionally agree to take all necessary actions to cause your Brex Cash Account to be designated as your Selling Platform Payout Account as soon as possible, but in no event later than the expiration of the Expedited Access Period. In the event that your Brex Cash Account is not designated as your Selling Platform Payout Account by the end of such period we may treat that failure as an Event of Default and exercise rights under this Agreement,including requiring that you repurchase of all outstanding Purchased Receivables as contemplated by Section 4.1 hereof. You acknowledge and understand that Brex Finance may modify the Expedited Access Period at its sole discretion and may subsequently require you to designate your Brex Cash Account as your Selling Platform Payout Account, for any reason or for no reason, upon 5 business days’ notice to you.
1.4 Using Rewards Points to Pay for Transaction Fees
You may be presented with the option to redeem Rewards Points, earned subject to the Rewards Terms, instead of paying the Transaction Fee. This feature will not alter the purchase price for the Purchased Receivables. Instead, when your Selling Platform Collections from the Purchased Receivables are deposited into your Brex Cash Account, Brex Finance will collect a figure equal to the Selling Platform Collections minus the Transaction Fee. Your available Rewards Points balance will decrease in an amount equal to the redemption value of the Transaction Fee.
If the total redemption value of your Rewards Points is less than the Transaction Fee, your Rewards Points balance will be reduced to zero and Brex Finance will collect a figure equal to the Selling Platform Collections minus the difference between the Transaction Fee and the redemption value of your total Rewards Points.
You should review the Rewards Terms before electing to redeem Rewards Points in connection with Instant Payouts Transactions, as they may be subject to periodic updates.
1.5 No Obligation to Purchase or Sell
Creating a Brex Account or a Brex Cash Account, entering into this Agreement, or offering any Receivables to Brex Finance for purchase Transactions does not obligate Brex Finance to engage in any Transaction with you. This applies whether or not we have previously engaged in Transactions with you under this Agreement or if you have provided a standing approval for Daily Payouts with respect to ongoing Transaction Details. If you have elected to utilize Daily Payouts functionality, the Transaction and Transaction Details will appear in a pending state which you can review and cancel before the purchase occurs.
With respect to any Transaction, we may, in our sole and absolute discretion, decline to purchase Receivables for any reason (including factors related to you, your Selling Platform Account, or the Receivables in question, or if we determine that such a Transaction would pose an unacceptable risk to Brex) or for no reason. We are not required to provide a reason if we decline to purchase Receivables or suspend any standing approval you have provided for Daily Payouts with respect to ongoing Transaction Details.
You are not obligated to engage in any Transaction with us. If you choose to make an offer to enter into a Transaction, you are not obligated to accept the purchase price, Transaction Details, or Transaction Fee. If you choose to enter into a Transaction, you acknowledge and agree that the Transaction Details reflect the fair market value of the Purchased Receivables.
1.6 Relationship of Parties
The relationship of the parties is intended to be that of purchaser and seller of Receivables. Following any Transaction, Brex Finance will have the absolute right to collect on Purchased Receivables, and may sell, factor, pledge, initiate collections, or settle any dispute relating to the Purchased Receivables in its sole discretion. Company will mark its books and records to show that it has sold the Purchased Receivables to Brex Finance. You acknowledge that upon your receipt of the purchase price for any Transaction, subject to any Chargeback rights we may exercise, you will have no right to reacquire the related Purchased Receivable or to otherwise receive any Selling Platform Collections with respect thereto.
2. Beta Services
You acknowledge that the Instant Payouts Program is a Beta Service (as defined in the Platform Agreement). By using this Beta Service, you agree to keep confidential all information you obtain about the service until it is publicly announced. The Beta Service is provided to you without warranty. You further agree that we may use any Feedback about the Services or Beta Services freely and without restriction or compensation.
3. Representations and Warranties
By submitting an application to participate in the Brex Instant Payouts Program or offering any Receivables for purchase hereunder, Company and the natural person taking such action each makes the following representations and warranties for itself or as an authorized representative of Company, as applicable.
The representations and warranties in this Section 3 are ongoing and will survive both each Transaction date and the termination of this Agreement.
3.1 Representations and Warranties Relating to the Company
- Each of the representations and warranties contained in Section 1.2 of the Platform Agreement is accurate and complete.
- The natural person requesting access to the Brex Instant Payouts Program on Company's behalf or offering any Receivables for purchase Transactions hereunder is authorized to bind Company to this Agreement.
- Company is fully authorized to enter into this Agreement and to perform its obligations hereunder, and this Agreement constitutes a legal, valid, and binding obligation of Company.
- Company will use all funds that it may receive as a result of its participation in the Brex Instant Payouts Program solely for commercial purposes in connection with Company's business and not for personal, family, or household use.
- All information provided by Company to Brex Finance, including information related to Company's business and the Receivables, is true and correct. There is no fact or circumstance that could adversely affect the business, assets, or financial condition of Company or a Purchased Receivables Obligor, any of the Receivables, the Company's ability to perform its obligations under this Agreement, or the accuracy and completeness of Company's representations and warranties, that has not been disclosed in writing.
- This Agreement and the performance of Company's obligations hereunder does not violate the terms of any of Company's agreements with Selling Platform or with Purchased Receivables Obligors.
- There are no financing statements now or soon to be on file in any public office relating to any Receivables in which Company is named or has signed as the debtor, except the financing statements filed or which may be filed in respect of this Agreement.
- Company is not an affiliate, agent, or contractor of a Selling Platform or any Purchased Receivables Obligor, nor are any of Company's employees, officers, or directors in any way related to any Purchased Receivables Obligors.
- Company is solvent and has the ability to pay Company's debts as they become due. Company is not entering into any Transaction with the intention to hinder or impair any creditor of Company.
- Company has, or will have by the end of the Expedited Access Period, designated its Brex Cash Account as its sole Selling Platform Payout Account.
- Company has not entered into any financing transaction with a Selling Platform or any other third party based on Company's transactions through the Selling Platform.
3.2 Representations, Warranties, and Covenants Relating to the Receivables
- Company has legal title to the Receivables and is authorized to sell the Receivables to Brex Finance.
- The amount of each Purchased Receivable as reflected in the Transaction Details is due and owing to Company and represents an accurate statement of a bona fide sale, delivery, and acceptance of goods or services by Company to or for a customer of Company in the ordinary course of the Company's business. The goods or services provided for each such Purchased Receivable do not violate any applicable law, regulation, or contractual covenant or any requirements or prohibitions of the Selling Platform.
- Each Purchased Receivable is free and clear of any and all liens, charges, attachments, or security interests (except with respect to any such Liens on behalf of Brex Finance or its affiliates) and is free of, and will be paid to us without, defenses, disputes, offsets, counterclaims, or rights of return or cancellation.
- There is no current dispute between Company and any Purchased Receivables Obligor, and Company has no reason to believe there will be a dispute.
- Company has not and will not transfer, assign, or pledge any Receivables and has not and will not grant a security interest therein to any party other than Brex Finance.
- Company will not grant allowances or credit to any Purchased Receivables Obligor without prior written approval of Brex Finance.
- If Company is using Amazon as its Selling Platform, Company will not offer to sell any Pay by Invoice Receivables to Brex Finance.
- Company will take all steps to enable—and will not at any time disable—any and all Selling Platform functionality to ensure that all Selling Platform Collections are automatically and regularly transferred from Company's Selling Platform Payout Account to Company's Brex Cash Account, or Linked Account for the limited Expedited Access Period.
- Company has not and does not have any dispute with a Purchased Receivables Obligor or a Selling Platform (or with any other online marketplace or selling platform through which Company sells goods or services) related to or alleging fraudulent behavior by Company.
4. Adjustments and Chargebacks of Purchased Receivables
Brex Finance will collect the entire amount owed under any Purchased Receivables in respect of any Transaction (including any fees charged) directly from the next Selling Platform Collection. However, in some cases, Brex Finance may have recourse to assets of Company due to situations in which Company has (i) breached representations, warranties, or covenants made under Sections 3 or 5 of this Agreement or (ii) triggered an Event of Default under Section 9 of this Agreement. This section, in addition to the separate Securities Account Control Agreement, describes the mechanics for such limited recourse.
4.1 Chargebacks of Purchased Receivables
If: (a) Company breaches any representation, warranty or covenant under Section 3.1 or Section 5, (b) Company breaches any representation or warranty under Section 3.2 with respect to one or more specific Purchased Receivables or any Purchased Receivables are subject to an Adjustment (as contemplated in Section 4.2), or (c) Company is subject to an Event of Default, then in each such case Brex Finance may require that Company repurchase either all Purchased Receivables, in case of clauses (a) and (c), or the affected Purchased Receivable, in the case of clause (b) (each, a " Chargeback") at the face amount previously paid by Brex Finance net of any Selling Platform Collections actually received by Brex Finance as of the date of such Chargeback.
Once Company has repurchased any Receivables subject to a Chargeback, those repurchased Receivables will no longer be considered Purchased Receivables. For clarity, a Chargeback will not transfer title or otherwise release Brex Finance's ownership of the relevant Purchased Receivables until all amounts owing in respect of such Chargeback have been fully paid.
4.2 Indemnification for Other Adjustments
Without limiting Section 4.1 above, if a Selling Platform makes any reduction or adjustment to, or takes or retains any credit in respect of, the amount of a scheduled payout in respect of Purchased Receivables (including any setoff, recoupment, or other fee or charge) (each, an " Adjustment"), Company will indemnify Brex Finance for decrease in the recoverable value of the Purchased Receivables in respect of such Adjustment. This includes (a) Adjustments related to any claim of defective or returned goods or services, (b) any discount or adjustment made by Company through the Selling Platform Account, (c) any disputes or claims regarding to the quality, price, or quantity of the goods or services related to the Purchased Receivables, or (d) any other claim by Selling Platform against Company. The amount of any such indemnity by Company will become immediately due and payable.
In the event of an Adjustment that is not associated with a specific Purchased Receivable (e.g. the establishment of a general reserve by the Selling Platform), you agree that in Brex Finance's sole discretion the Adjustment amount may be deemed allocated to first reduce the amount of collections received by Company with respect to Receivables that are not Purchased Receivables prior to application of such Adjustment amounts to the Purchased Receivables.
Brex Finance may also in its sole discretion initiate a Chargeback or exercise its rights under the Securities Account Control Agreement in respect of any or all Purchased Receivables that are subject to an Adjustment.
4.3 Due and Payable on Demand
Funds owing to Brex Finance in respect of any Chargeback or Adjustment are due on demand. Brex Finance may make such demand immediately or periodically on an aggregated basis for administrative convenience. Brex Finance may modify the timing of any periodic or aggregated demands or make demands on an immediate basis in our sole discretion. Brex Finance may debit Company's Brex Cash Account or other Linked Accounts, exercise its rights under the Securities Account Control Agreement, or use other measures as described in Section 6, to recover amounts owed by Company in respect of any Chargeback or Adjustment to the maximum extent permitted by law.
5. Other Covenants
During the term of this Agreement, including any period in which any amounts are owed to Brex Finance by you or the Purchased Receivables Obligors, Company will:
- maintain its Selling Platform Account in good standing and promptly pay any amounts owed to the Selling Platform without recourse to any Purchased Receivables;
- subject to Expedited Access Period, maintain its Brex Cash Account as its sole Selling Platform Payout Account for each Selling Platform that has Receivables subject to this Agreement;
- timely and professionally deliver all goods and perform all services related to the Purchased Receivables with a level of quality commensurate with customer expectations and applicable industry standards, and provide evidence of such performance if requested by Brex Finance; and
- notify Brex Finance in writing immediately after obtaining knowledge from any source of the filing of any lien, claim, levy, or other legal action against any property of Company or a Purchased Receivables Obligor.
During the term of this Agreement, including any period in which any amounts are owed to Brex Finance by you or the Purchased Receivables Obligors, Company will not, without prior written permission from Brex Finance, attempt or purport to:
take any measure to interfere with the ability of Brex Finance to collect amounts owed to it in respect of Purchased Receivables;
conduct its business under another name except as disclosed to Brex Finance;
transfer, assign, or dispose of any part of its business or interest in the Purchased Receivables;
grant any extension of time for payment of any of any Purchased Receivable;
compromise or settle any Purchased Receivable for less than the full amount thereof;
release in whole or in part any Purchased Receivables Obligor or other person liable for the payment of any of the Purchased Receivables;
grant any credits, discounts, allowances, deductions, return authorizations, or the like with respect to any Purchased Receivable;
create, incur, assume, or permit to exist any lien upon or with respect to any Receivable now owned or hereafter acquired by Company;
interfere with the rights of Brex Finance or its affiliates under this Agreement or the Securities Account Control Agreement;
execute nor permit the recording of any financing statements in favor of any other person or entity, except Brex Finance or an affiliate of Brex Finance, during the term of this Agreement;
withdraw any Selling Platform Collections from the account to which Selling Platform deposits them other than at the express direction of Brex Finance;
violate any of its agreements with a Selling Platform or any Selling Platform Policy;
take any action that may materially impair the value of the Purchased Receivables or cause a material dispute with any Purchased Receivables Obligor or a Selling Platform; or
take any action that would (a) terminate the Selling Platform Agreement, (b) be reasonably likely to result in review, suspension, or removal of Company's selling privileges on any Selling Platform; or (c) otherwise result in an Adjustment other than Adjustments occurring in the normal course of business (without limiting Brex's rights under Section 4.2 with respect thereto).
Immediately upon receipt of Selling Platform Collections, we may debit your Brex Cash Account (or other Linked Account to which such Selling Platform Collections were deposited) for such Selling Platform Collections.
We will attempt to collect any other amounts you owe to Brex Finance under this Agreement, and that are due and payable, from your Brex Cash Account (or from the applicable Linked Account during Expedited Access Period, if applicable), including Chargebacks and Adjustments. If we are unable to collect any such amounts owed under this Agreement from your Brex Cash Account (or applicable Linked Account), we may attempt to collect such amounts owed from any other Linked Account that is currently or was previously linked. We may collect partial payments for unpaid amounts from any Linked Account that is currently or was previously linked, but any partial payment is not a waiver of our rights and will not satisfy your obligation to pay in full.
Any amounts owed may be set off against, debited, or collected from a Brex Account that you hold jointly with a third party or open in the future even if your original Brex Account has been closed. We may exercise this right against Company, its affiliates, or any of their respective successors or assigns, or any assignees for the benefit of your creditors, trustees, or receivers of Company assets. This right will exist even if we do not exercise it prior to the making, filing, or issuance of an arbitration demand, court order, or other action.
Any failure to pay the full amount owed to Brex, or to not cause Selling Platform Collections to be deposited in the Brex Cash Account or permitted Linked Account, when required is a breach of the Platform Agreement and this Agreement. You are responsible for all costs or expenses that we incur in the process of collecting amounts owed but not timely paid, including legal or collections fees, and you are responsible for paying interest on such amounts at the maximum rate permitted under law.
7. Authorization to Debit Linked Accounts; ACH Authorization
THIS SECTION PROVIDES AUTHORIZATION TO AUTOMATICALLY DEBIT YOUR CURRENT AND PREVIOUSLY LINKED ACCOUNTS FOR ALL AMOUNTS YOU OWE UNDER THIS AGREEMENT. PLEASE READ IT THOROUGHLY.
7.1 Your Authorization to Debit Linked Accounts
You authorize Brex Finance, or its respective successors and assigns to collect amounts owed under this Agreement by debiting funds from your current and previously Linked Accounts at financial institutions (including banks and credit unions). If we use the Automated Clearinghouse (ACH) network, the debits will be governed by the rules established by the National Automated Clearinghouse Association (NACHA) for business-related ACH debits. You also authorize Brex Finance to debit your Linked Accounts for verification purposes (through microdeposits or similar means).
7.2 Manner and Timing of Payment
We will debit Linked Accounts for all amounts owed to us in connection with this Agreement. If we cannot collect these amounts via ACH or another method, you agree to immediately pay all amounts owed as directed. We may debit Linked Accounts separately for the payment of fees that you incur.
In the event that we make an error in processing an electronic debit, you authorize us to correct the error by initiating an electronic credit or debit to the Linked Account in the amount of such error on or after the date such error occurs.
This authorization includes the authorization to collect immediately for any Chargeback or Adjustment as described in Section 4.
7.3 Brex Cash Authorization
You agree to designate your Brex Cash Account as a Linked Account under the Platform Agreement and this Agreement. In the Program Agreements you authorize Brex Finance, an entity acting on behalf of Brex Finance, or their respective successors and assigns to instruct Brex Treasury to restrict amounts in and debit your Brex Cash Account:
- Following the deposit of the Selling Platform Collections, such Selling Platform Collections;
- Chargebacks, Adjustments, or other obligations that may be due and payable under Section 4 above;
- Any other amounts that may be owed by Company under this Agreement.
Amounts may be debited through ACH or through another method designated by Brex Finance or its successors or assigns in consultation with Brex Treasury, including by means of a transfer to another Brex Cash account.
7.4 Withdrawing Your Authorization
To withdraw the debit authorization from a Linked Account (including your Brex Cash Account), you must provide us 30 days' notice and pay all amounts owed under this Agreement immediately, including Charges, fees, Fines, and other amounts. Please note that revoking the authorization of your Brex Cash Account as a Linked Account will not take effect until all outstanding obligations have been paid in full, and will mean that you are no longer eligible for future Transactions through this program even if you have paid all of your obligations.
Withdrawal of a debit authorization does not terminate the Platform Agreement or your obligation to pay all amounts owed under this Agreement. Company will be responsible for all costs of collections and damages if amounts owed are not paid in full by Company.
8. Security Interest
8.1 Security Interest in Purchased Receivables
Each of Brex Finance and Company intends the transfer of Purchased Receivables under this Agreement to be a true sale, conveying good title free and clear of any liens, from Company to Brex Finance that is absolute and irrevocable. It is the intention of Brex Finance and Company that the arrangements with respect to the Purchased Receivables will constitute a purchase and sale of such Purchased Receivables and not a loan to Company secured by the Purchased Receivables. At any time and from time to time, Brex Finance and Company will promptly and duly execute and deliver or will promptly cause to be executed and delivered, such further instruments and documents and take such further actions as are reasonably requested by the other party to confirm the sale of the Purchased Receivables and/or for the purpose of obtaining or preserving the full benefits of this Agreement. However, notwithstanding the intent of Brex Finance and Company, if a court of competent jurisdiction holds that the conveyance of the Purchased Receivables is not a true sale of such Purchased Receivables from Company to Brex Finance, this Agreement also will be deemed to be and hereby is a security agreement within the meaning of the UCC, and the conveyance by Company provided for in this Agreement will be deemed to be, and Company hereby grants to Brex Finance, a security interest in and to all of Company's right, title, and interest, in the Purchased Receivables to secure all obligations now or hereafter arising from Company to Brex Finance; provided, however, that if a court of competent jurisdiction holds that the conveyance of such Purchased Receivables is not a true sale, Brex Finance will have the immediate right to terminate this Agreement and treat such event as grounds for Chargeback, thereby requiring Company or its designee to immediately purchase all of the Purchased Receivables. Subject to the foregoing, Company hereby authorizes Brex Finance to file a financing or continuation statement with respect to the limited grant provided in this Section 8.1.
8.2 Security Interest in Brex Cash Account
As security for the repayment of present or future Chargebacks, Adjustments, or other amounts for which Company is obligated to pay us pursuant to this Agreement, you grant us a continuing security interest in, and lien on, and a right of setoff with respect to, the securities, cash, or other property that are, now or in the future, carried or held in or through your Brex Cash Account or are otherwise in the possession or control of Brex Treasury (" Brex Cash Collateral"). You acknowledge and agree that, to your actual knowledge, there are no security interests in any of the Brex Cash Collateral other than security interests created under the Program Agreements or the Brex Cash Agreement. You further acknowledge and agree that you may not in the future pledge any security interest in your Brex Cash Account to any party except Brex without the express written consent of Brex Finance.
8.3 Instructions from Brex Affiliates
You agree that Brex Finance and its affiliates act as agents for each other in respect of the Brex Cash Collateral, the Purchased Receivables, the Selling Platform Collections, and rights associated therewith. You agree that Brex Treasury may act on instructions from Brex Finance as to the Brex Cash Collateral or Selling Platform Collections without your further consent, including all notifications directing Brex Treasury to transfer or redeem any Brex Cash Collateral. We may rehypothecate any Brex Cash Collateral held or carried through your Brex Cash Account or in our possession or control.
You authorize us to take any action necessary to perfect or maintain the perfection of a security interest held by us, to the extent perfection has not already been achieved as a result of your agreeing to the Program Agreements. You agree to pay any fees and costs associated with the perfection or maintenance of such security interests or the satisfaction of amounts owed.
Each of the following events will constitute an " Event of Default":
Company fails to pay any obligation due to Brex Finance under this Agreement, including in respect of Chargebacks or Adjustments, or takes any action to interfere with the ability of Brex Finance to collect obligations owed to it hereunder;
Any representation or warranty is materially false;
Company materially defaults on its obligations to any Purchased Receivables Obligor or any third party that requires such person to make payments in respect of the Purchased Receivables or which may be otherwise due hereunder;
Company changes the Selling Platform Payout Account to an account other than its Brex Cash Account or other permitted Linked Account during the Expedited Access Period;
Company breaches, or defaults in the performance of, any provision or obligation of the Program Agreements;
Company breaches, or defaults in the performance of, any material provision or obligation of any other Agreement between Company and Brex;
the Platform Agreement, the Brex Cash Agreement, or the Securities Account Control Agreement is terminated for any reason;
Company defaults on an obligation to Selling Platform, or Company's agreement with any Selling Platform is terminated or materially impaired;
Company is unable to act as servicer in respect of the Purchased Receivables for any reason;
Brex determines based on its own information or information from third-party sources that the quality or promptness of goods or services provided by Company to Purchased Receivables Obligors does not meet applicable industry standards or customer expectations;
Company becomes subject of any suit, action, or proceeding alleging Misappropriation or infringement of any patent, trademark, trade dress, trade secret, copyright or other right relating to any Merchandise listed on an Order, or any other violation of applicable law, rule, or regulation;
Company, Selling Platform, or any Purchased Receivables Obligor becomes subject to any debtor-relief proceedings;
Company is dissolved; becomes insolvent on a balance sheet basis; becomes unable to pay its debts as they become due; files bankruptcy voluntarily or is the subject of a petition for involuntary bankruptcy; is the subject of an assignment for the benefit of creditors, receivership, execution, or similar action by creditors; or has a material judgment entered against it;
If any person attempts to seize, or purports to create any lien or other security interest in, the Purchased Receivables or the Collateral without the written consent of Brex Finance; or
Brex Finance determines, in its sole discretion, that Company has violated any applicable law, rule or regulation, or that Company is engaging in in fraudulent activity, in accordance with Brex's internal requirements, models or policies then in effect.
Upon the occurrence of any Event of Default, in addition to any rights Brex Finance has under the Program Agreements or applicable law, including any rights Brex Finance has to immediately initiate Chargebacks under Section 4.1, Brex Finance may immediately terminate this Agreement.
COMPANY WAIVES ANY REQUIREMENT THAT BREX FINANCE INFORM COMPANY OF ANY CHARGEBACK OR ADJUSTMENT HEREUNDER. BREX FINANCE'S FAILURE TO CHARGEBACK OR REQUIRE INDEMNIFICATION FOR ADJUSTMENTS AS PERMITTED HEREUNDER IS NOT A WAIVER BY BREX FINANCE OF ANY RIGHT TO CHARGEBACK OR REQUIRE INDEMNIFICATION FOR ADJUSTMENTS TO WHICH IT MAY BE ENTITLED UNDER THIS AGREEMENT.
10. Other Provisions
10.1 Term and Termination
Please contact us if you wish to discontinue your participation in the Brex Instant Payouts Program or terminate the Program Agreements. You may at any time cease entering into Transactions without Notice to Brex Finance, but you may not terminate the Program Agreements or your appointment as collection agent for Brex Finance if any amounts are owed to Brex Finance by you or the Purchased Receivables Obligors with respect to Purchased Receivables.
Brex Finance may terminate the Program Agreements and your participation in the Instant Payouts Program as described in Section 8.1, if there is an Event of Default under Section 9, or if we determine, in our sole discretion, that your continued participation in the Brex Instant Payouts Program poses an unacceptable risk to Brex. In the event that we terminate your participation in the Brex Instant Payouts Program prior to the Selling Platform Collection or the full collection of amounts due in respect of a Transaction, you may be required maintain your Brex Cash Account (or other Linked Account, as applicable) and act as servicer in the limited capacity described in Section 9 until all amounts due from any Purchased Receivables Obligor have been paid in full and you have discharged any remaining obligations to Brex Finance hereunder.
10.2 Waiver of Automatic Stay
IF COMPANY BECOMES A DEBTOR UNDER ANY CHAPTER OF THE UNITED STATES BANKRUPTCY CODE, TITLE 11, U.S.C., OR UNDER ANY COMPARABLE LAW, SUPPLIER HEREBY AGREES AND WAIVES THE BENEFITS OF THE AUTOMATIC STAY (OF 11 U.S.C. §362 OR UNDER COMPARABLE LAW) TO THE MAXIMUM EXTENT ALLOWED BY APPLICABLE LAW. Supplier agrees that it will not raise any defense to a motion for relief from the automatic stay brought by Brex Finance or any successor or assignee thereof in reliance on this waiver. Supplier has consulted with counsel of its choice before agreeing to this waiver.
Sections 1.3 (Collection of Purchased Receivables from Selling Platform), 3 (Representations and Warranties, 4 (Adjustments and Chargebacks of Purchased Receivables), 5 (Other Covenants), 6 (Collections), 7.1 (Your Authorization to Debit Linked Accounts), 7.2 (Manner and Timing of Payment), 7.3 (Brex Cash Authorization), 8 (Security Interest), 9 (Events of Default), 10.1 (Term and Termination) and all other provisions of this Agreement or the agreements, terms, and policies incorporated herein giving rise to continuing obligations of the parties, will survive termination of this Agreement.
Receivable has the meaning set forth in the Introduction.
Adjustment has the meaning given in Section 4.2.
Brex Instant Payouts Program means the program through which Brex Finance and Company enter into one or more Transactions for the purchase and sale of Receivables.
Chargeback has the meaning given in Section 4.1.
Daily Payouts means the program through which Company agrees to the sale of Purchased Receivables on a daily basis, as identified in the Transaction Details delivered by Brex Finance to Company on a daily basis.
Event of Default has the meaning given in Section 9.
Expedited Access Period means a limited time period as defined by Brex Finance during which Company may be permitted to designate a Linked Account, instead of a Brex Cash Account, as the Selling Platform Payout Account.
Program Agreements has the meaning given in the Introduction.
Purchased Receivable means a Receivable that has been purchased by Brex Finance as part of a Transaction (excluding any Receivable subject to a Chargeback).
Purchased Receivables Obligor means the customer that is party to the purchase of goods or services giving rise to Receivables and/or any other party that may be obligated with respect to the payment of such Receivables as identified by us in the Transaction Details.
Rewards Points has the meaning ascribed to it in the Rewards Terms.
Selling Platform means each ecommerce platform through which eligible Receivables may be generated for purchase by Brex Finance. Available Selling Platforms will be shown in your Brex Account dashboard.
Selling Platform Account means, for each Selling Platform, the account through which Company's goods or services are sold or through which Company receives payment for such sale of goods and services.
Selling Platform Collections means amounts paid by a Selling Platform to Company's Selling Platform Payout Account in respect of collections or other recoveries on the Purchased Receivables.
Selling Platform Payout Account means the bank or financial institution account that Company has designated as the recipient account for payouts of amounts from Company's Marketplace Seller Account.
Selling Platform Payout Date means, for each Transaction, the date on which Selling Platform Collections in respect of Purchased Receivables is scheduled to be deposited into the Selling Platform Payout Account.
Securities Account Control Agreement means the agreement entered into between you, Brex Finance, and Brex Treasury LLC through which you formally grant Brex Finance a perfected security interest in, and control of, your Brex Cash Account to satisfy obligations owed in connection with Purchased Receivable Transactions.
Transaction means each purchase and sale of Receivables under this Agreement.
Transaction Details has the meaning ascribed to it in Section 1.1 of this Agreement.
Transaction Fees has the meaning ascribed to it in Section 1.2 of this Agreement.