# Factor's Lien Agreement
**This Factor's Lien Agreement** ("Agreement") is made and entered into as of [Insert Date], by and between:
**[Factor's Name]**
Address: [Factor's Address]
Email: [Factor's Email]
Phone: [Factor's Phone Number]
**AND**
**[Business Owner's Name]**
Business Name: [Business Name]
Business Address: [Business Address]
Email: [Business Owner's Email]
Phone: [Business Owner's Phone Number]
**WHEREAS**, the Factor wishes to provide financing to the Business Owner in exchange for a lien on certain accounts receivable; and
**WHEREAS**, the Business Owner wishes to grant a lien to the Factor for the purpose of securing the financing provided by the Factor.
**NOW, THEREFORE**, in consideration of the mutual promises and covenants contained herein, the parties agree as follows:
## 1. Definitions
1.1 **Accounts Receivable**: All accounts, notes, and other receivables, including but not limited to, all rights to receive payment for goods sold or services rendered.
1.2 **Factor**: The party providing funds to the Business Owner in exchange for the rights to the Accounts Receivable.
1.3 **Business Owner**: The party receiving funds from the Factor and granting the lien on the Accounts Receivable.
## 2. Loan Amount
The Factor agrees to provide the Business Owner with a loan in the amount of **[Insert Loan Amount]** (the "Loan Amount").
## 3. Grant of Lien
The Business Owner hereby grants to the Factor a security interest (the "Lien") in all Accounts Receivable, whether now existing or hereafter created, as collateral for the payment and performance of all obligations arising under this Agreement.
## 4. Representations and Warranties
The Business Owner represents and warrants that:
4.1 The Business Owner has the full right and authority to enter into this Agreement and to grant the Lien.
4.2 The Accounts Receivable are valid, legally enforceable, and are not subject to any encumbrance other than the Lien granted herein.
## 5. Covenants
5.1 The Business Owner shall deliver to the Factor, upon request, a schedule of all Accounts Receivable and any other information the Factor may require.
5.2 The Business Owner shall notify the Factor of any disputes or claims related to the Accounts Receivable within [Insert Time Period].
## 6. Default
6.1 The occurrence of any of the following shall constitute an event of default ("Event of Default"):
- a. Failure to pay any amount due under this Agreement within [Insert Grace Period] of the due date.
- b. A material breach of any covenant, representation, or warranty contained herein.
- c. The Business Owner becomes insolvent or admits in writing its inability to pay its debts.
6.2 Upon the occurrence of an Event of Default, the Factor may declare the entire Loan Amount immediately due and payable and may exercise any rights or remedies available under law or equity, including but not limited to, taking possession of the Accounts Receivable.
## 7. Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of [Insert State].
## 8. Miscellaneous
8.1 This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings.
8.2 This Agreement may be amended only by a written agreement signed by both parties.
8.3 If any provision of this Agreement is found to be invalid or unenforceable, the remaining provisions shall continue in full force and effect.
## IN WITNESS WHEREOF
The parties have executed this Factor's Lien Agreement as of the date first above written.
**[Factor's Name]**
Signature: ________________________
Name: [Factor's Name]
Title: [Factor's Title]
**[Business Owner's Name]**
Signature: ________________________
Name: [Business Owner's Name]
Title: [Business Owner's Title]
---
*Note: This document is a template and should be reviewed by a legal professional before use.*