This Officer Factoring and Security Agreement (“Agreement”) is made as of the date executed, hereby known as the Effective Date, by and between the undersigned (“Officer”) and RollKall Technologies, LLC, a Texas Limited Liability Company, together with its affiliates, successors, and assigns (hereinafter “RollKall”). In connection with the sale of certain accounts receivable of Recipient to RollKall, the parties agree to the following terms and conditions.
1.DEFINITIONS:2. SALE AND PURCHASE OF ACCOUNTS. Officer may offer to assign, transfer, convey, deliver, and sell to RollKall, as absolute owner, all rights and title to any payments and proceeds to the Officer arising from any Service Agreement. RollKall may, in its reasonable sole credit and business judgment, purchase certain invoice(s) presented to it by the Officer and pay the Officer the invoice amount less applicable Fees and Expenses (and any other amounts due from Officer to RollKall, if any), whereby the invoices shall be deemed purchased (“Purchased Invoice”).
Officer shall not, without the prior written consent of RollKall in each instance, take any loan or other advance against or change or modify the terms of the original invoice or invoice documentation relating to any Purchased Invoice. Officer hereby authorizes RollKall to purchase invoices upon notification by the Officer through the RollKall Platform. All Clients will be instructed to make payments directly to RollKall. Each Purchased Invoice is on a non-recourse basis to the Officer for the period beginning with RollKall’s purchase and ending when the invoice is subject to repurchase under Section (6) (Repurchase) (the “Insolvency Period”), meaning RollKall assumes the risk of non-payment by the Client during the Insolvency Period solely because the Client: (a) is the subject of a petition under any state or federal debtor relief or liquidation statute filed with the Insolvency Period, (b) is the subject of a proceeding under Chapters 7, 11, or 13 of the Bankruptcy Code filed on or before RollKall’s purchase and the conversion of said case under Chapter 7 thereunder is within the Insolvency Period, or (c) has given written notice to RollKall that the sole reason for non-payment is an inability to pay its obligations rather than because of any form of dispute, claim, offset, damage, or other similar cause (collectively, (a) through (c), an “Insolvency”). Officer authorizes RollKall to verify any Invoice with the Client prior to or in connection with its purchase.
3. TERM. This Agreement is effective on the date executed by the Officer and will continue until terminated in accordance with the terms hereof (“Term”). If the Officer wishes to terminate the Agreement, the Officer must provide RollKall with fourteen (14) days’ prior notice, in writing at the designated address 600 Las Colinas Blvd. E, Suite 900, Irving TX 75039 or within the RollKall Platform; provided, however, that the Officer’s ability to terminate this Agreement is contingent on the Officer fulfilling any and all past, present, and future obligations by the Officer to Client or the Officer to RollKall (“Obligations”) for any Purchased Invoices.RollKall may terminate this Agreement: (i) at any time upon seven (7) days’ prior written notice to the Officer through the RollKall Platform; or (ii) at any time without notice upon the occurrence of any Default Event.
4. PURCHASE PRICE. The purchase price of any invoice is 7.5% of the face amount of that Invoice due and owing at the time of purchase (the “Purchase Price” but sometimes called the advance rate), and the remaining percentage of the face amount of that Invoice is a fee earned by RollKall (the “Factoring Fee”) on the purchase date.
5. FEES AND EXPENSES. Officer shall pay to RollKall the following per Invoice:
7. SECURITY INTEREST. As collateral securing the Obligations, Officer grants to RollKall a continuing first priority security interest for all of the Officer’s present and future debts, liabilities, and obligations owing to RollKall, whether under this Agreement or any other agreement with RollKall, direct and indirect, contingent or otherwise, and for payment and performance of all obligations owing to RollKall. Officer hereby grants RollKall a security interest in, and hereby assigns to RollKall, all of the following: (a) all Invoices received by the Officer as a result of a Job; (b) all rights and interests and monies due or becoming due on such Invoice, all records and documents relating thereto, and all rights associated with or related to the Invoices, whether purchased or not; (c) all proceeds of any of the foregoing described in this section (collectively, (a) through (c), the “Collateral”). Officer represents to RollKall that this security interest is a valid, continuing, first-position security interest in favor of RollKall. Officer authorizes RollKall to file any documentation necessary, including any financing statements (as well as amendments, corrections, and continuation statements), to perfect this security interest, and Officer grants RollKall all of the rights and remedies of a secured party under Article 9 of the Uniform Commercial Code (“UCC”). RollKall is, and will at all times be, the sole owner of all of the Officer’s Invoices purchased by RollKall.
8. REPRESENTATIONS AND WARRANTIES. Officer represents and warrants that: (a) Officer is fully authorized to enter into this Agreement to perform hereunder and the security agreement contained herein constitutes the Officer’s legal, valid, and binding obligation; (b) Officer is and will continue to be until termination of the Agreement a peace officer or retired peace officer in good standing within the jurisdiction in which the Job is located; (c) Officer has not been charged, convicted, or investigated for any crime not previously disclosed to RollKall; (d) the Purchased Invoice(s) is and will remain the genuine obligation of Clients for services rendered by the Officer in the ordinary course of business, without disputes, offsets, or cancellation; (e) Officer will not impede the normal collection of any Purchased Invoice and all proceed received by Officer will be held and forwarded to RollKall within seven days of receipt; and (f) Officer will not knowingly double encumber any Purchased Invoice(s).
9. CLIENT DISPUTES. Officer shall notify RollKall promptly of all claims by the Client against Officer, of any kind, that reduce the amount collectible on Purchased Invoices (“Client Disputes”). RollKall may, but is not required to, settle any Client Disputes at its discretion at Officer’s expense. RollKall may require the Officer to repurchase any Purchased Invoice that is subject to a Client Dispute.
10. DIRECT PAYMENTS; UNREPORTED ADVANCES. RollKall has the sole and exclusive right to collect any amounts owing on the Officer’s Invoices purchased by RollKall. The foregoing notwithstanding, provided there is no Default Event, RollKall may directly collect amounts owing on an Invoice not purchased by RollKall. To the extent that Officer receives any payment on a Purchased Invoice or any Invoice following a Default Event, Officer will hold that payment for the sole benefit of RollKall, and Officer agrees to remit and deliver that payment to RollKall promptly. Officer agrees to keep an accounting of all payments received for any Purchased Invoice and will give that accounting to RollKall upon RollKall’s request. RollKall may assess Officer a fee equal to 7.5% of the amount of any payment for any Purchased Invoice received by Officer and not delivered to RollKall within seven days of receipt. If Officer has or obtains an advance from a Client relating to any Purchased Invoice without first notifying RollKall and stating the amount of said advance on the invoice, in addition to the resulting deficiency (if any), Officer shall pay to RollKall an amount equal to the greater of 7.5% of the amount of any such advance, as compensation for the administration and collection expense associated with having to collect a deficiency relating thereto.
11. AUTHORIZATION. Officer authorizes RollKall and irrevocably grants its power of attorney to RollKall to exercise any of the following powers until all Obligations have been paid in full: (a) notify any Client that the Purchased Invoice has been assigned to RollKall by Officer and that payment is to be made directly to RollKall; (b) receive, take, and deposit any funds paid by the Client securing the Obligation; (c) obtain credit reports, verifications, and other information on the Officer which RollKall deems appropriate for its continuing credit evaluation, and to release such information RollKall, if requested; and (d) initiate electronic debit or credit entries through the ACH system, RK Pay, or other RollKall Platform maintained by either Officer or RollKall.
12. DEFAULT EVENT. The following events constitute a Default Event: (a) Officer defaults on any Obligation or in the performance of any agreement entered into with RollKall; (b) any of the Representations and Warranties contained herein proves to be false; (c) Officer becomes subject to any debtor-relief proceeding, including but not limited to bankruptcy; (d) RollKall for any reason, based on its good faith determination, deems itself insecure or under secured with respect to the prospect of repayment of the Obligations or Purchased Invoice. Upon the occurrence of any Default Event, in addition to any rights RollKall has under this Agreement or applicable law, RollKall may terminate this Agreement, and all Obligations shall immediately become due and payable without notice.
13. INDEMNIFICATION. Officer agrees to indemnify and hold RollKall harmless from any suits, claims, demands, judgments, settlements, damages, and expenses resulting out this Agreement, or failure by Officer to perform its obligations to Client which may be imposed, asserted, alleged, or awarded against RollKall by a non-party to this agreement, including without limitation, all legal expenses, court costs, and reasonable attorney fees incurred in connection with the nonparty’s suit, claim, demand demands, judgments, settlements, damages, and expenses against RollKall, arising from or relating in any manner to this Agreement, or any document executed in connection with this Agreement, or any transaction contemplated by this Agreement, or the purchase, finance, and collection of Invoices pursuant to this Agreement, but excluding matters which are found in a final judgment by a court of competent jurisdiction to have resulted primarily from the RollKall’s fraud or willful misconduct.
14. ASSIGNMENT. Officer may not assign or transfer this Agreement, in whole or part, and any such purported assignment or transfer is void. RollKall may assign all or any part of this Agreement and may, without limitation, assign the rights, benefits, and remedies of RollKall without assigning any of the duties, obligations, or liabilities of RollKall.
15. CHOICE OF LAW. This Agreement and all related transactions shall be governed by, construed under, and enforced in accordance with the laws of the State of Texas. All terms capitalized herein but not defined shall have the meaning set forth in the Uniform Commercial Code as adopted in the State of Texas.
16. DISPUTE RESOLUTION. All Disputes under this Agreement are subject to arbitration. To initiate arbitration, a Party will file a written demand for arbitration pursuant to the Arbitration Rules of the American Arbitration Association within forty-five (45) days following the occurrence of the Dispute. Any Arbitration will be conducted by a sole arbitrator, unless the Parties agree otherwise. All arbitration hearings will occur in Irving, Texas, at a location chosen by RollKall. All arbitrators will be “neutrals” with a required background in factoring agreements.
The arbitration will be governed by the Commercial Arbitration Rules of the American Arbitration Association.
Unless otherwise agreed to by the Parties, all discovery for Disputes shall be governed by the Federal Rules of Civil Procedure. Any issues concerning discovery upon which the parties cannot agree will be submitted to the arbitrator or arbitration panel for determination. Regardless of the Dispute amount, the arbitrator or arbitration panel may grant motions to dismiss or motions for summary judgment, pursuant to the standards outlined in the Federal Rules of Civil Procedure and the Federal Rules of Evidence.
The arbitrator or arbitration panel (upon an agreement of at least two of its three members) will have the authority to render an appropriate decision or award, including the power to grant all legal remedies consistent with the terms of this Agreement and the law of Texas. The arbitrator or arbitration panel shall not award: damages for lost profits, lost savings, loss of employment or employability, or other consequential, incidental, punitive, or special damages of any kind, whether based in tort, contract, or otherwise; or any damages that are prohibited elsewhere in this Agreement. The binding or preclusive effect of any award will be limited to the actual Dispute arbitrated and to the Parties, and will have no collateral effect on any other dispute or claim of any kind whatsoever. Within thirty days of the conclusion of the arbitration, the arbitrator or arbitration panel will prepare in writing and provide to the Parties the award, which shall include findings of fact and the reasons on which the award was based.
Each Party will bear one-half of the costs, fees, and expenses incurred for arbitration. Each Party shall also bear all of its own costs, fees, and expenses incurred for initiating, preparing, and presenting its case during the arbitration.
17. JURY TRIAL WAIVER. Recognizing the higher costs and delay which may result from a jury trial, Officer and RollKall hereto waive any right to trial by jury of any claim, demand, or cause of action arising under this agreement or in any way related or incidental to the dealings of any of the parties hereto, whether based in contract, tort, or otherwise. Further, Officer and RollKall waive any right to consolidate any such action in which a jury trial has been waived with any other action in which a jury trial cannot be or has not been waived. The Parties further waive their rights to participate as a plaintiff or as a class member in any claim on a class or consolidated basis or in a representative capacity. The Parties agree that this Jury Trial Waiver provision shall not imply any right to litigate any Dispute in Court, and the Parties expressly waive its respective rights to litigate any disputes in court, except to the extent that RollKall seeks injunctive relief.
To the extent that the RollKall determines that it may suffer irreparable harm as a result of Officer’s breach, or threatened breach, of this Agreement, then RollKall may, without complying with the Dispute Resolution provision contained in this Agreement, seek injunctive relief from a court of competent jurisdiction.
18. NOTICE. All notices to Officer shall be deemed given upon dispatch through the RollKall Platform, to Officer’s designated email address as entered in the RollKall Platform, or upon deposit with the U.S. Postal Service. All notices to RollKall shall be deemed received upon actual receipt and RollKall’s confirmation of receipt through the RollKall Platform. Notices shall be sent per the terms outlined within this provision unless the Officer or RollKall indicates otherwise in writing to the other party.
19. SEVERABILTY. The provisions of this Agreement are independent and severable, and if any provision is deemed invalid, void, or unenforceable in whole or in part for any reason, the remaining provisions shall remain in full force and effect.
20. ENTIRE AGREEMENT. This Agreement, together with the addenda, other agreements, and instruments mentioned herein or executed by Officer contemporaneously herewith, constitutes the entire agreement of the parties, and RollKall shall not be charged with any agreement, statement, or representation not contained in a writing executed by RollKall as provided in this Agreement.
The parties, in their own right or by and through their duly authorized representatives, agree to the terms and conditions for the faster service payment option.
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