OR INTO THE
ACCOUNT OF ANY BORROWER AND REMITTED BY SUCH BORROWER OR ANOTHER PERSON AT THE
DIRECTION OF SUCH BORROWER TO OR FOR THE ACCOUNT OF WORLD BANK, NEVADA FACTORING
OR ANY OTHER PERSON; AND
(VI)
SUCH OTHER REPORTS AS TO THE COLLATERAL AS AGENT SHALL REASONABLY
REQUEST FROM TIME TO TIME.
(B)
IF ANY BORROWER'S OR GUARANTOR'S RECORDS OR REPORTS OF THE
COLLATERAL ARE PREPARED OR MAINTAINED BY AN ACCOUNTING SERVICE, CONTRACTOR,
SHIPPER OR OTHER AGENT, SUCH BORROWER OR GUARANTOR HEREBY IRREVOCABLY AUTHORIZES
SUCH SERVICE, CONTRACTOR, SHIPPER OR AGENT TO DELIVER SUCH RECORDS, REPORTS, AND
RELATED DOCUMENTS TO AGENT AND TO FOLLOW AGENT'S INSTRUCTIONS WITH RESPECT TO
FURTHER SERVICES AT ANY TIME THAT AN EVENT OF DEFAULT EXISTS OR HAS OCCURRED AND
IS CONTINUING.
7.2
ACCOUNTS COVENANTS.
(A)
EACH BORROWER AND GUARANTOR SHALL NOTIFY AGENT PROMPTLY OF THE
ASSERTION OF ANY MATERIAL CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS BY ANY
ACCOUNT DEBTOR, CREDIT CARD ISSUER OR CREDIT CARD PROCESSOR OR ANY MATERIAL
DISPUTES WITH ANY OF SUCH PERSONS OR ANY SETTLEMENT, ADJUSTMENT OR COMPROMISE
THEREOF AND ALL MATERIAL ADVERSE INFORMATION RELATING TO THE FINANCIAL CONDITION
OF ANY ACCOUNT DEBTOR, CREDIT CARD ISSUER OR CREDIT CARD PROCESSOR. NO CREDIT,
DISCOUNT, ALLOWANCE OR EXTENSION OR AGREEMENT FOR ANY OF THE FOREGOING SHALL BE
GRANTED TO
72
any account debtor, Credit Card Issuer or Credit Card Processor except in the
ordinary course of such Borrower's or Guarantor's business in accordance with
the current practices of such Borrower or Guarantor as in effect on the date
hereof. So long as an Event of Default exists or has occurred and is continuing,
no Borrower or Guarantor shall, without the prior consent of Agent, settle,
adjust or compromise any material claim, offset, counterclaim or dispute with
any account debtor, Credit Card Issuer, Credit Card Processor. At any time that
an Event of Default exists or has occurred and is continuing, Agent shall, at
its option, have the exclusive right to settle, adjust or compromise any claim,
offset, counterclaim or dispute with account debtors, Credit Card Issuers or
Credit Card Processors or grant any credits, discounts or allowances.
(B)
WITH RESPECT TO EACH ACCOUNT: NO PAYMENTS SHALL BE MADE THEREON
EXCEPT PAYMENTS DELIVERED TO AGENT PURSUANT TO THE TERMS OF THIS AGREEMENT,
THERE SHALL BE NO MATERIAL SETOFFS, DEDUCTIONS, CONTRAS, DEFENSES, COUNTERCLAIMS
OR DISPUTES EXISTING OR ASSERTED WITH RESPECT THERETO EXCEPT AS REPORTED TO
AGENT IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT AND NONE OF THE
TRANSACTIONS GIVING RISE THERETO WILL VIOLATE ANY APPLICABLE STATE OR FEDERAL
LAWS OR REGULATIONS, ALL DOCUMENTATION RELATING THERETO WILL BE LEGALLY
SUFFICIENT UNDER SUCH LAWS AND REGULATIONS AND ALL SUCH DOCUMENTATION WILL BE
LEGALLY ENFORCEABLE IN ACCORDANCE WITH ITS TERMS.
(C)
EACH BORROWER AND GUARANTOR SHALL NOTIFY AGENT PROMPTLY OF: ANY
NOTICE OF A MATERIAL DEFAULT BY SUCH BORROWER OR GUARANTOR UNDER ANY OF THE
CREDIT CARD AGREEMENTS OR OF ANY DEFAULT WHICH HAS A REASONABLE LIKELIHOOD OF
RESULTING IN THE CREDIT CARD ISSUER OR CREDIT CARD PROCESSOR