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Last updated: January 11th, 2024
This Outgo Factoring Agreement (this “Factoring Agreement”) is entered into by and between Outgo Inc., its subsidiaries, affiliates, agents, successors and assigns (“Outgo”, “we”, “us”, or “our”) and you, on behalf of yourself as a sole proprietor or on behalf of a business entity (“you”, or “your”, or “Carrier”), that sets forth the terms and conditions for your use of the service whereby Outgo purchases unpaid invoices from you (the “Factoring Service”). The Factoring Service allows qualified Carriers who have unpaid commercial invoices to sell Outgo the right to payment owed to such Carrier by a “Broker”. This Factoring Agreement is incorporated into and made a part of the agreement between you and Outgo available at: [https://www.outgo.co/legal/platform-agreement] (the “Outgo Platform Agreement”). Undefined initially capitalized terms used in this Factoring Agreement shall have the meanings ascribed to them in the Outgo Platform Agreement.
- ACCEPTANCE OF TERMSBy accessing and/or using the Factoring Service on behalf of yourself or the entity that you represent, you acknowledge that you have read, understood, and agree to be bound by the terms of this Factoring Agreement and to comply with all applicable laws and regulations. The terms and conditions of this Factoring Agreement form an essential basis of the bargain between you and Outgo, and this Factoring Agreement governs your use of the Factoring Service.
- Incorporation of Other AgreementsYou acknowledge that additional agreements may also govern your relationship with Outgo, including but not limited to, the Outgo Platform Agreement, the Outgo Banking Rewards Agreement, and the Outgo Invoice Agreement. Any such additional agreements shall continue to apply in full force. For the avoidance of doubt, the Factoring Service are a “Service” as defined by the Outgo Platform Agreement and subject to all relevant provisions governing Services in the Outgo Platform Agreement, including but not limited to, the Disclaimer of Representation and Warranties, Limitation of Liability, and Choice of Law and Forum; Jury Trial WaiverIn the event of a conflict between this Factoring Agreement, on the one hand, and the Outgo Platform Agreement or any other agreement with Outgo on the other hand, this Factoring Agreement shall control.
- Purchase of InvoicesThere are some differences in the Factoring Service available to Carriers resident in Florida, Maryland, New Hampshire, or Washington D.C., and the Factoring service in all other U.S. states. As noted below, Carriers in these specified states agree to sell all Unpaid Invoices to Outgo through the Factoring Service. Please ensure you refer to the correct Factoring Service terms that apply to you based on the location of your principal business headquarters.
- Appointment as AgentEach Carrier hereby appoints Outgo as its payment collection agent for the limited purpose of receiving, holding, and settling payments from Brokers other than payments for Purchased Unpaid Invoices (including Overpayments and Misdirected Payments). Each Carrier further agrees and understands that any such payment received by Outgo from a Broker, on Carrier’s behalf, shall be considered the same as payment made directly to the Carrier. Such payment shall be deemed to satisfy the Broker’s obligation to pay Carrier, and the Carrier will provide its services to the Broker in the agreed-upon manner as if the Carrier had received the payment directly from the Broker. Each Carrier understands that Outgo’s obligation to pay the Carrier is subject to, and conditional upon, successful receipt of the associated payments from the Broker. Carrier further agrees that Outgo is not required to settle such payment to Carrier in the event that Broker initiates a chargeback, ACH return, or otherwise disputes the payment. In the event that Outgo does not make a payment to Carrier as required by this Factoring Agreement, Carrier will have recourse against only Outgo and not against Broker. In accepting appointment as the limited payment collection agent of the Carrier, Outgo assumes no liability for any acts or omissions of the Carrier.
- BuyoutsAt your request and in Outgo’s discretion, Outgo may purchase Unpaid Invoices that you have previously sold to another factor (each, a “Buyout”). In connection with a proposed or contemplated Buyout, Carrier represents and warrants that it shall provide true, accurate and complete information in connection with any existing factoring arrangement, including information about disputed Unpaid Invoices, credit balances or reserves posted with the other factor. Carrier agrees that Outgo may verify all documentation related to such existing factoring arrangement, including contacting the relevant Broker and factor. Carrier further agrees that it shall take all actions necessary to reasonably facilitate the Buyout, including without limitation, executing a Buyout agreement that indemnifies and/or releases Outgo from various costs and losses associated with the Buyout, and releases required by the other factor. Once a Buyout has been effected, any Unpaid Invoices purchased by Outgo from the other factor will be considered a Purchased Unpaid Invoice.
- Cessation Of Factoring ServiceYou may terminate your use of the Factoring Service at any time, provided that your termination will in no way affect any outstanding Obligations or Outgo’s right to enforce such Obligations. In addition to any other termination rights set forth in this Factoring Agreement, your use of the Factoring Service may be terminated by Outgo: (i) at any time (whether or not an Event of Default has occurred) effective fourteen (14) days after written notice of termination is given by us to you; or (ii) at any time after the occurrence of an Event of Default, without notice, effective immediately. No release of lien will be provided until Carrier executes a general release in form and substance acceptable to Outgo.
- On Demand Purchase Of InvoicesCarrier may also enroll in Outgo’s “On Demand Factoring Service.” The On Demand Factoring Service enables a Carrier to sell Unpaid Invoices in real-time to cover transactions for which Carrier does not have sufficient funds in its Bank Account. CARRIER UNDERSTANDS AND AGREES THAT IF CARRIER ENROLLS IN THE ON DEMAND FACTORING SERVICE AND OUTGO DECIDES TO PURCHASE ELIGIBLE UNPAID INVOICES, FACTORING SHALL OCCUR AUTOMATICALLY WHENEVER CARRIER DOES NOT HAVE SUFFICIENT FUNDS IN ITS CHECKING ACCOUNT TO COVER A PURCHASE MADE USING THE OUTGO CARD. Carrier may view Unpaid Invoices eligible for the On Demand Factoring Service through the Services. However, when On Demand Factoring has been turned on, Carrier agrees that Outgo may, in its discretion, select the eligible Unpaid Invoices to purchase to cover a given transaction. Outgo will generally select Unpaid Invoices for purchase through the On Demand Factoring Service that are closest to maturity. Carrier will only be eligible to receive Factorable Balance from the On Demand Factoring Service when Carrier has a sufficient amount of Unpaid Invoices that Outgo determines are eligible for purchase. Carrier further agrees that Outgo may purchase both whole and partial Unpaid Invoices through the On Demand Factoring Service. The On Demand Factoring Service cannot be used to cover ATM withdrawals; instead, Carrier may use the standard Factoring Service, receive funds to its Bank Account and then withdraw such funds through an ATM. Any Unpaid Invoices that Outgo chooses to purchase will be identified to Carrier through the Services.
- Funding TimelinesOutgo will endeavor to purchase and make payments for the purchase of Unpaid Invoices for which you have requested prompt funding pursuant to any timelines provided to you through the Services. You may request the prompt funding through the Outgo Services, by email to firstname.lastname@example.org, or by any other means that Outgo authorizes, subject to the terms of this Factoring Agreement. Outgo will generally make payments more promptly for pre-approved Brokers. Outgo will indicate whether a Broker is pre-approved through the Outgo Services. For Brokers who are not pre-approved by Outgo (i.e. “New Brokers”), Outgo may, in its sole discretion, decline to factor the Unpaid Invoice.Outgo will indicate whether a Broker is an Approved Broker through the Outgo Services. Outgo may, in its sole discretion, decline to factor Unpaid Invoices issued to non-Approved Brokers. Outgo also reserves the right to refuse to purchase any Unpaid Invoice in its discretion; please see Section 3 for additional details. Outgo will endeavor to purchase and make payments for the purchase of Unpaid Invoices that require rate verification from the broker or were issued to Approved Brokers who have not been issued Unpaid invoices that Outgo has previously purchased from you within two (2) business days, or as otherwise indicated on our rates and fee page.Funding may be delayed if your invoice requires rate verification with the broker, Outgo suspects fraudulent activity, is unable to determine that the Unpaid Invoice is unencumbered by claims of other parties, your account is not in good standing, and Event of Default has occurred, or for any or no reason.Additionally, as described above, Outgo will provide payment for Unpaid Invoices approved for funding in real-time to cover transactions for purchases of Unpaid Invoices through the On Demand Factoring Service.
- Inquiries Related to Factoring Service EligibilityCarrier authorizes Outgo, its agents and representatives and any third party engaged by Outgo, to investigate any references given or any other statements or data obtained from or about Carrier for the purpose of this Factoring Agreement so long as Carrier continues to have any obligation to deliver Unpaid Invoices to Outgo as a consequence of this Factoring Agreement or for Outgo’s ability to determine Carrier’s eligibility to enter into any future agreement with Outgo.
- Right to Unpaid InvoicesOutgo may use the Services or other means to provide notice and instructions regarding the proper remittance location for Unpaid Invoices purchased by Outgo from Carrier. Once Outgo purchases an Unpaid Invoice, Carrier acknowledges and agrees that Outgo’s rights to collect amounts due under such Unpaid Invoices include without limitation the full right and power (a) to notify the Broker that the amounts unpaid on said Purchased Unpaid Invoice have been assigned to Outgo, (b) to contact the Broker (and, for Buyouts, the factor) to verify the amounts owing upon and the validity of said Purchased Unpaid Invoice, and (c) to collect, compromise, sue for, assign, or to enforce collection of said Purchased Unpaid Invoice in any manner, in the name of Outgo, or in the name of any assignee of Outgo, without limitation.With respect to each Purchased Unpaid Invoice, Carrier agrees to provide such documentation supporting and evidencing the Purchased Unpaid Invoice as Outgo shall from time to time request.
- Factoring FeeUnpaid Invoices that Outgo purchases will be purchased at a discount relative to the face amount of invoices giving rise to such Unpaid Invoices communicated by Outgo to Carrier at the time of purchase (the “Factoring Fee”). Such Factoring Fee will be displayed through the Services and Carrier may accept such Factoring Fee prior to Outgo’s purchase of such Unpaid Invoices.At any time prior to Outgo’s purchase of an Unpaid Invoice, Outgo may change the Factoring Fee based on the credit risk of the Broker, as determined by Outgo in Outgo’s sole discretion. Changes in the Factoring Fee will be communicated to Carrier through the Services prior to purchase. If you do not agree with the Factoring Fee then you do not have to participate in the Factoring Service.
- Overpayments & Misdirected PaymentsCarrier agrees that it will notify Outgo of all funds Carrier receives for Purchased Unpaid Invoices (whether from a Broker or, in connection with a Buyout, from a factor) (each, a “Misdirected Payment”) within two days of receipt. Carrier further agrees to transfer such funds to Outgo within two (2) days of receipt of a Misdirected Payment.Carrier further acknowledges that it has no right to payments made by a Broker that Outgo determines are in excess of any Purchased Unpaid Invoice (each, an “Overpayment”). Carrier accordingly authorizes Outgo to initiate debit entries to Carrier’s Bank Account to collect Overpayments and refund such Overpayments to the Broker. Outgo will make commercially reasonable efforts to seek confirmation from Carrier or Broker that a payment is an Overpayment prior to refunding a payment to a Broker. Carrier acknowledges that it, not Outgo, is solely responsible for resolving any dispute directly with a Broker in the event that an Overpayment is disputed as between Carrier and Broker. Outgo will not be liable for any loss or damage arising from any mistakenly refunded Overpayments.Outgo acknowledges that it has no right to payments made to Outgo by a Broker for Unpaid Invoices that Outgo has not purchased, other than as an agent for Carrier in accordance with Carrier’s appointment herein. In the event that Outgo inadvertently receives payment by a Broker for an unpurchased Unpaid Invoice, Outgo shall provide such funds to Carrier.Outgo is not responsible for any overdrafts or rejected transactions that may result from Outgo ACH debits authorized by this Factoring Agreement. The parties agree to be bound by the terms of the NACHA Operating Rules with respect to all electronic fund transfers made via ACH transaction.
- Credit RiskOutgo will assume the Credit Risk on each Unpaid Invoice purchased by Outgo, and Outgo will have no recourse to Carrier if any Unpaid Invoice purchased by Outgo is not collected due solely to the occurrence of an event of assumed Credit Risk occurring, as to any Unpaid Invoice purchased by Outgo. For this purpose, “Credit Risk” means the failure of Broker to pay the Purchased Unpaid Invoice in full when due on its longest maturity solely because of Broker’s Insolvency or financial inability to pay; otherwise Outgo will have full recourse to Carrier for the repurchase and payment of uncollected or disputed Purchased Unpaid Invoices. A Purchased Unpaid Invoice shall be deemed to be “disputed” if (i) the Broker disputes the Purchased Unpaid Invoice based on Carrier’s alleged error or non-performance, including the amount owing, timely delivery of the goods, conformity of the goods or services to the order, or any other aspect of the sale giving rise to the Purchased Unpaid Invoice whatsoever, even if the dispute has no merit, is in bad faith, is unsupported, or is unreasonable; (ii) the Purchased Unpaid Invoice contains mistakes, is not correct, or was sent in error; (iii) the Broker claims a set-off, recoupment, or counterclaim with respect to the Purchased Unpaid Invoice; (iv) the Purchased Unpaid Invoice is not paid due to an Act of God, war, civil strife, or political unrest or impediment; (v) Carrier fails to produce to Outgo, within a reasonable time period of its request, good and sufficient evidence that nonpayment of the Purchased Unpaid Invoice, at or after its maturity, in whole or in part, arose solely from the Broker’s Insolvency or financial inability to pay; or (vi) any other failure to pay not rooted solely in the Insolvency or financial inability to pay of the Broker.
- Notice of AssignmentUpon approval by Outgo of an Unpaid Invoice for purchase, Carrier agrees, if so instructed by Outgo, to notify the Broker of the contemplated sale, to execute and deliver any document necessary to notify the Broker of the assignment, and to procure, if requested, an acknowledgment and acceptance of the contemplated assignment from the Broker. Outgo may in its sole discretion notify any Broker of Carrier instruction to make payments directly to Outgo. Carrier agrees to fully comply with Outgo’s Notice of Assignment and will not pursue direct payment from Broker in any way.
- Security InterestIn the event that this Factoring Agreement does not constitute a valid sale, assignment, transfer and conveyance of all right, title and interest of Carrier in the Unpaid Invoices, despite the intent of the parties hereto, Carrier hereby grants Outgo a continuing security interest (“Security Interest”) in and to the following, whether now owned or hereafter acquired or arising and wherever located, as security for the performance by Carrier of its covenants and other obligations to Outgo under this Factoring Agreement: (a) the Unpaid Invoices; (b) all other accounts, chattel paper, documents, inventory, equipment, payment intangibles, rights to payment, general intangibles and instruments as those terms are defined in Article 9 of the Uniform Commercial Code as in effect in any applicable jurisdiction (the “UCC”); and (c) all proceeds as such term is defined in Article 9 of the UCC and products, whether tangible or intangible, with respect to the foregoing (the “Collateral”). In such scenario, Carrier agrees to execute any documents or take any action in connection with this Factoring Agreement as Outgo deems necessary to perfect or maintain Outgo’s first priority security interest in the Collateral. Carrier further authorizes Outgo to, from time-to-time, file such UCC Financing Statements and other documents as we may deem necessary or appropriate with respect to the sales, assignments and grant of security interests provided for herein or in connection with the transactions contemplated hereby, without your signature thereon.
- Carrier Representations, Warranties, CovenantsCarrier warrants, represents, covenants, and agrees, as of the date of acceptance of this Factoring Agreement and of the submission of each Ratecon, BOL, or other documentation related to an Unpaid invoice, that:
- Underpayment or No Payment or ClaimIn the event that Outgo fails to receive payment from a Broker or receives an amount that Outgo determines is an insufficient amount of any Purchased Unpaid Invoice, Outgo will make commercially reasonable efforts to determine whether a payment is less than anticipated (based on the documentation submitted by Carrier) for reasons other than solely due to Broker’s Insolvency or financial inability to pay (such event, an “Underpayment”).In the event that an Underpayment arises from Carrier’s breach of Sections 16(o), 16(p) 16(q), 16(s), or 16(t), or Carrier agrees to remit to Outgo an amount equal to any such Underpayment as a partial reimbursement of the purchase price for the Purchased Unpaid Invoice within two business (2) days of receiving notice of an Underpayment from Outgo, provided that Carrier may instead cure the breach, if provided for in such notice.Carrier acknowledges that it, not Outgo, is solely responsible for resolving any dispute directly with a Broker in the event that an Underpayment is disputed as between Carrier and Broker.Carrier may dispute that an event constitutes an Underpayment or that the event was caused by its breach by submitting notice of the dispute and supporting documentation to Outgo within thirty (30) days of receiving Outgo’s notice of Underpayment. In the event that Outgo determines that an event is not an Underpayment, Outgo will reimburse any payment it has received from Carrier under this section, without interest, and Outgo will have no further liability to Carrier.
- Administrative Processing Fee; Authorization to Debit or Set-offCarrier acknowledges that it is responsible for making payments on amounts it owes to Outgo. For example, Carrier may be required to pay Outgo in the event of a Misdirected Payment, No Payment, or Underpayment, such as due to an insurance claim, unless the No Payment or Underpayment is solely due to Broker’s Insolvency or financial inability to pay, as provided for in Section 12 or 17.In the event that Carrier fails to promptly make such payments, Carrier agrees that Outgo may collect such amounts from Carrier as provided for in this section and assess Outgo an administrative processing fee of five hundred dollars ($500) per payment for such collection, in compensation for the accounting, collections and other administrative efforts related to Outgo’s collections of amounts Carrier is obligated to remit.Carrier authorizes Outgo to (i) initiate debit entries to Carrier’s Bank Account and (ii) deduct from payments on the Unpaid Invoices made by the Broker (and, for Buyouts, the factor), to collect, in whole or in part, payment for any amounts due from Carrier arising under this Factoring Agreement (and, for Buyouts, an agreement effectuating the Buyout). Carrier further authorizes Outgo to make adjustments to any ACH credits to the Bank Account made in error or resulting from fraud. Carrier further authorizes Outgo to offset amounts that Carrier owes Outgo under the Agreement from amounts that Outgo owes Carrier.For example, in the event that Carrier owes Outgo amounts associated with Misdirected Payments or Underpayments, Outgo may effectuate the satisfaction of such obligations by debiting Carrier’s Bank Account for such amounts or by reducing the amount Outgo remits to Carrier from payments it receives from Brokers on Unpaid Invoices as Carrier’s agent.
- BankruptcyAs of the date of this Factoring Agreement, Carrier does not contemplate and has not filed any petition for bankruptcy protection under Title 11 of the United States Code and there has been no involuntary petition brought or pending against Carrier. Carrier represents that it has not consulted with a bankruptcy attorney within six months prior to the date of this Factoring Agreement. Carrier further warrants that as of the date of this Factoring Agreement it does not anticipate filing a bankruptcy petition and it does not anticipate that an involuntary petition will be filed against it.
- Events of DefaultThe following events will constitute an “Event of Default” under this Factoring Agreement: (a) Carrier defaults in the payment of any Obligations or in the performance of any provision hereof, or of any other agreement now or hereafter entered into with Outgo, or any warranty or representation contained herein proves to be false in any way, whether material or immaterial; (b) Carrier grants a security interest in the Purchased Unpaid Invoices to a creditor and/or the Purchased Unpaid Invoices are encumbered by a party other than Outgo; or (d) Carrier violates any term or representation, warranty, or covenant in this Factoring Agreement. For avoidance of doubt, a Broker’s Insolvency or financial inability to pay does not constitute an event of default.
- Effect of DefaultUpon the occurrence of any Event of Default, in addition to any rights Outgo has under this Factoring Agreement or applicable law, Outgo may immediately terminate the Factoring Agreement, at which time the full undelivered Purchased Unpaid Invoices will remain due and payable by Broker to Outgo. All rights, powers and remedies of Outgo in connection with this Factoring Agreement may be exercised at any time by Outgo after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies provided by law or equity.
- Required Notifications
- Account StatedOutgo shall, from time to time make available to Carrier through the Services a statement setting forth the Factoring Service transactions arising under this Factoring Agreement. Each such statement shall be considered correct and binding upon Carrier as an account stated, except to the extent that Outgo receives, within sixty (60) days after the statement is made available to the Carrier, written notice from Carrier of any specific exceptions by Carrier to that statement, and then it shall be binding against Carrier as to any items to which the Carrier has not objected.
- AuthorizationCarrier makes, constitutes and appoints Outgo as Carrier’s true and lawful attorney-in-fact with power of substitution and with power and authority to exercise at any time any of the following powers until all of the Obligations have been paid in full:Carrier’s attorney-in-fact is hereby granted full power to do all necessary things to accomplish the above as fully and effectively as could Carrier. Carrier ratifies all that the attorney-in-fact shall lawfully do or cause to be done by virtue hereof. The power of attorney shall be irrevocable for the term of the Factoring Agreement and until Outgo or its assignee has irrevocably received all payments to which Outgo is or may be entitled from Carrier and Brokers on Purchased Unpaid Invoices. This power of attorney is coupled with an interest.
- Account DisputesCarrier shall notify Outgo immediately of and, if requested by Outgo, will promptly settle (subject to Outgo’s written approval thereof) all disputes concerning any Unpaid Invoice purchased by Outgo related to Carrier’s error or non-performance, at Carrier’s sole cost and expense. Outgo may, but is not required to, attempt to settle, compromise, or litigate (collectively, “Resolve”) the dispute upon such terms, as Outgo in its sole discretion deems advisable, for Carrier’s account and risk and at Carrier’s sole expense. Upon the occurrence of an Event of Default, Outgo may Resolve such issues with respect to any Purchased Unpaid Invoice of Carrier, and any such resolution shall be deemed commercially reasonable and in good faith.
- COVENANT NOT TO SUECarrier agrees that they will never institute, prosecute or in any way aid in the institution or prosecution of any claim, demand, action or cause of action at law or in equity against the Outgo for a claim of usury, a claim that Outgo is required to have any lending license, or any other claim contending that the amount paid by the Outgo in exchange for the Unpaid Invoices is, or should be construed as, a loan from the Outgo to the Carrier. Nothing in this paragraph is intended to prevent Carrier from complying with any lawfully issued subpoena or court ordered discovery.This Section is a covenant not to sue, and not a release. In the event that the Carrier breaches or in any way violates the terms of this Section, Carrier agrees to indemnify the Outgo for all damages arising from that breach, including without limitation the payment of all costs and expenses of every kind for the enforcement of Carrier’s rights and remedies under this section, including any and all attorneys’ fees and costs in any trial court or appellate court proceeding, any administrative proceeding, any arbitration or mediation or any negotiations or consultations in connection with breach of this section.This covenant shall inure to the benefit of Outgo, and shall bind Carrier, its successors and/or assigns, any of their respective affiliated or subsidiary companies, partners, owners, joint ventures and/or any of Carrier’s managers, directors, officers, employers or agents.
- DefinitionsCapitalized terms used herein shall have the following meanings, unless otherwise noted or defined in the UCC:
- DisclosureOutgo is not a bank. Banking services are provided by Blue Ridge Bank N.A., Member FDIC. The Outgo Visa Business Debit Card is issued by Blue Ridge Bank N.A., pursuant to a license from Visa U.S.A. Inc. and may be used anywhere Visa cards are accepted.