North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable is a legally binding contract used in the state of North Dakota for businesses engaged in the practice of factoring, which involves selling their accounts receivable to a third party known as a factor in exchange for immediate cash. This form of agreement outlines the terms and conditions between the business (known as the "Assignor") and the factor (known as the "Assignee"). It governs the assignment of accounts receivable, including the transfer of ownership and rights to the assigned invoices or receivables. Some key details covered in the North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable include: 1. Parties involved: The agreement identifies the legal names and addresses of both the Assignor (business) and Assignee (factor). 2. Definitions: It includes clear definitions of important terms used throughout the agreement, such as "accounts receivable," "invoice," "purchase price," and "recourse." 3. Assignment of accounts receivable: This section specifies the Assignor's transfer of ownership rights to the Assignee for the identified invoices or accounts receivable. It details the scope and limitations of the assignment. 4. Purchase price and fees: It outlines the agreed-upon purchase price that the Assignee will pay to the Assignor for the assigned accounts receivable. Additionally, it may cover any fees or charges related to the factoring services provided by the Assignee. 5. Recourse and non-recourse: This clause establishes the level of liability the Assignor bears in the event of non-payment by the debtors of the assigned accounts receivable. It differentiates between recourse, where the Assignor is responsible for any losses, and non-recourse, where the Assignee assumes all the risk. 6. Representations and warranties: Both the Assignor and Assignee make certain representations and warranties regarding their authority, ownership, and the validity of the accounts receivable being assigned. 7. Confidentiality and non-compete: This section may include provisions that safeguard the confidentiality of the agreement and impose restrictions on the Assignor from engaging in activities that compete with the Assignee's factoring services during the term of the agreement. 8. Termination and default: The North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable specifies the events that may lead to termination, such as breach of contract, insolvency, or failure to perform obligations. It also outlines the steps and remedies available to the parties in case of default. There may be variations or customized forms of Factoring Agreements as per specific requirements of the parties involved. For example, some agreements may include provisions regarding invoice verification and approval processes. Others may tailor the recourse or non-recourse clauses to the risk appetite and preferences of the parties. In conclusion, the North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable is a comprehensive contract that provides a framework for businesses seeking to convert their accounts receivable into immediate cash. Its purpose is to establish a clear understanding between the Assignor and Assignee, outlining their rights, obligations, and remedies throughout the factoring relationship.
North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable is a legally binding contract used in the state of North Dakota for businesses engaged in the practice of factoring, which involves selling their accounts receivable to a third party known as a factor in exchange for immediate cash. This form of agreement outlines the terms and conditions between the business (known as the "Assignor") and the factor (known as the "Assignee"). It governs the assignment of accounts receivable, including the transfer of ownership and rights to the assigned invoices or receivables. Some key details covered in the North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable include: 1. Parties involved: The agreement identifies the legal names and addresses of both the Assignor (business) and Assignee (factor). 2. Definitions: It includes clear definitions of important terms used throughout the agreement, such as "accounts receivable," "invoice," "purchase price," and "recourse." 3. Assignment of accounts receivable: This section specifies the Assignor's transfer of ownership rights to the Assignee for the identified invoices or accounts receivable. It details the scope and limitations of the assignment. 4. Purchase price and fees: It outlines the agreed-upon purchase price that the Assignee will pay to the Assignor for the assigned accounts receivable. Additionally, it may cover any fees or charges related to the factoring services provided by the Assignee. 5. Recourse and non-recourse: This clause establishes the level of liability the Assignor bears in the event of non-payment by the debtors of the assigned accounts receivable. It differentiates between recourse, where the Assignor is responsible for any losses, and non-recourse, where the Assignee assumes all the risk. 6. Representations and warranties: Both the Assignor and Assignee make certain representations and warranties regarding their authority, ownership, and the validity of the accounts receivable being assigned. 7. Confidentiality and non-compete: This section may include provisions that safeguard the confidentiality of the agreement and impose restrictions on the Assignor from engaging in activities that compete with the Assignee's factoring services during the term of the agreement. 8. Termination and default: The North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable specifies the events that may lead to termination, such as breach of contract, insolvency, or failure to perform obligations. It also outlines the steps and remedies available to the parties in case of default. There may be variations or customized forms of Factoring Agreements as per specific requirements of the parties involved. For example, some agreements may include provisions regarding invoice verification and approval processes. Others may tailor the recourse or non-recourse clauses to the risk appetite and preferences of the parties. In conclusion, the North Dakota General Form of Factoring Agreement — Assignment of Accounts Receivable is a comprehensive contract that provides a framework for businesses seeking to convert their accounts receivable into immediate cash. Its purpose is to establish a clear understanding between the Assignor and Assignee, outlining their rights, obligations, and remedies throughout the factoring relationship.
