Pursuant to the terms of this agreement we, 4Syte Funding Limited and 4Syte Trade Limited, will agree to offer you a factoring facility including the sale and purchase of your Debts subject to these Standard Conditions. Pursuant to these Standard Conditions we will fund the purchase of certain Debts that you notify to us which will be transferred to 4Syte Limited (the “Security Trustee”) whereupon the Security Trustee will hold those Debts on trust for the Secured Parties.
Capitalised terms which are used in these Standard Conditions but are not defined in this document will have the meaning given to those terms in the Factoring Agreement.
1.1 You will promptly notify us, in such form and manner as we may from time to time require, of every Debt relating to Goods Delivered which has not previously been notified or offered to us under clause 2.1 as soon as the invoice for that Debt is raised.
1.2 With every Notification you will furnish us with such documents evidencing the Debts included in the Notification as we may require by oral or written notice to you.
1.3 You will notify us separately of every Debt in respect of which you are unable to give us every warranty and undertaking included in the Standard Conditions and on that separate Notification you will mark clearly the reason that you are unable to do so.
2.1 You will promptly at our request at any time (and at your expense including any applicable stamp duty) complete, execute and deliver to us a formal written assignment of any Debt Purchased by us and give written notice of that assignment (in such form as we may direct) to the Debtor by whom that Debt is owing.
2.2 You will hold in trust for us and separately from your own property any Debt Purchased or purported to be Purchased by us of which the ownership shall fail to be transferred effectively pursuant to the Standard Conditions or the Factoring Agreement.
2.3 You will hold in trust for us and keep separate from your own property any Goods in your possession at any time which are included in the Related Rights. You will mark all such Goods plainly with the Security Trustee’s name as owner and deal with any such Goods as we or the Security Trustee may require or direct.
2.4 We shall have the right by oral or written notice to you to have transferred to the Security Trustee the ownership of any Goods (other than those referred to in condition 2.3) which are the subject of a Contract of Sale and of which the ownership has not passed to the Debtor. You will deal with such Goods as instructed by us or the Security Trustee.
3.1 Every Debt that is Purchased will rank as Approved (except any Related Rights included in it) upon us notifying to you that it is Approved, save that the following Debts will be Unapproved:
(a) any Debt which has become and continues to be Unapproved under condition 3.2(a) or under condition 3.3;
(b) any Debt included in a separate notification under condition 1.3; and
(c) any Debt which at any time, when aggregated with all other Debts owing by the same Debtor at that time, is and continues to be outside a Credit Limit established under condition 3.2(c).
For the purposes of condition 3.1(a) Debts will be deemed to fall into a Credit Limit in the order in which they are respectively notified.
3.2 We may at any time (without giving any reason) with immediate effect:
(a) by oral or written notice to you classify any Debt as Unapproved;
(b) by written notice to you classify any Unapproved Debt (except any Related Rights included in it) as Approved;
(c) by written notice to you at any time establish a Credit Limit in relation to any Debtor or increase an established Credit Limit or reduce (including a reduction to nil) any established Credit Limit and such increases.
3.3 Any Approved Debt, which remains Outstanding at the end of its Recourse Period or is at any time the subject of legal proceedings for its recovery or is at any time the subject of a breach of any representation, warranty or undertaking given by you to us, will then immediately and automatically rank as Unapproved without the need for notice or any other formality.
3.4 You undertake not to disclose to the Debtor or any other party the status of any Debt as Approved or Unapproved or the amount of or the existence or absence of any Credit Limit.
4.1 The Purchase Price of every Debt funded by us and transferred by you to the Security Trustee shall be equivalent to the amount payable by the Debtor according to the Contract of Sale giving rise to that Debt after deducting from that amount any discount or other allowance allowed or allowable by you to the Debtor and the Discount Charge and any other fees or charges payable under this Agreement (including, without limitation, the Limited Recourse Discount Charge, if applicable, the Service Fee and any other such charges) in respect of that Debt.
4.2 Subject to conditions 4.3, 4.4 and 12.2:
(a) at any time after the Business Day on which we receive a Notification we may make a Prepayment in respect of any Debt included in that Notification, and should we make a Prepayment in respect of any Debt which has not formally been notified to you as an Approved Debt, then that Debt shall be deemed Approved and shall be governed by the terms of this Agreement (including, without limitation, the representations, warranties and covenants contained herein);
(b) we will pay to you the Purchase Price of any Debt transferred by you to the Security Trustee (less any Prepayment made in respect of it) on its Collection Date.
We will debit to the Client Account the amount of every payment made in accordance with this condition.
4.3 We will not be obliged to make any Prepayment:
(a) before all the security documentation specified in clause 11.17 has been completed to our or the Security Trustee’s satisfaction; or
(b) whilst any other condition contained in clause 11.17 remains unsatisfied.
4.4 We will not be obliged to make any payment to you at any time in excess of the balance in your favour on the Available Funds Account at that time or if the effect of that payment would be that:
(a) the debit balance on the Current Account would exceed the Funding Limit (as specified in clause 11.13) at that time; or
(b) the total of Prepayments made in respect of Outstanding Debts owing by any one Debtor would exceed the percentage specified in clause 11.14 of the total amount of all Approved Debts Outstanding at the time of the payment.
4.5 Unless otherwise agreed by us at your request all payments to you shall be made by CHAPS and you will pay to us our standard charge for such payments as notified by us to you from time to time.
4.6 We may debit to the Client Account the amount of any of the monetary liabilities included in your Obligations and apply any such amount in the discharge of any amount payable by us to you. For this purpose, we may make a reasonable estimation of any of your Obligations the amount of which cannot be immediately ascertained. At any time without the requirement of notice or other formality we or the Security Trustee (as applicable) may combine any two or more accounts held by us in your name. Where (i) any such monetary liability is in a currency other than that of the account to which it is to be debited or (ii) accounts held in different currencies are to be combined (whether under this condition or under condition 12.4(a) then for any such transaction we or the Security Trustee (as applicable) will be entitled to apply the middle spot rate of exchange quoted in London by our bankers at the time of the debit or combination.
4.7 You will pay or repay to us upon demand:
(a) any Prepayment made in respect of an Approved Debt upon such Debt becoming Unapproved;
(b) any debit balance owing to us on the Client Account at any time and any amount by which the debit balance on the Current Account at any time exceeds either the Funding Limit specified in clause 11.13 or the Approved Funding at that time; and
(c) any amount paid to you by us in respect of any Debt to the extent that payment by the Debtor or any guarantor of the Debt is subsequently recalled for any reason (including, without limitation, under the law of the country of the payer or by reason of any decision of a court or tribunal of competent authority in that country).
4.8 We will make available to you by such means as we consider appropriate (and which may include by way of a web based on-line browser):
(a) statements of your accounts with the Security Trustee and/or the Funder (as applicable); and
(b) except while you are the agent of the Security Trustee for the purpose described in condition 7.7(a), details of all Outstanding Debts and an analysis of their age.
4.9 In the absence of any manifest error or any error in law:
(a) every such account detail and analysis shall be deemed to be correct and binding on you except for any actual error of which you advise us within fourteen days of its despatch;
(b) for the purpose of determining the aggregate amount of the monetary liabilities included in your Obligations at any time you agree to be bound by a certificate signed by our company secretary or auditor.
5.1 Any amount debited to the Client Account (except in respect of credit notes issued by you or in relation to exercise of Recourse by us) shall be treated as a Prepayment. For administrative convenience we may credit the Purchase Price to the Client Account before deduction of any Discount Charge (or any other amounts to be deducted under condition 4.1) and we may thereafter calculate and debit the Discount Charges to the Client Account at such time or times as we consider appropriate. We may debit to the Client Account such other amounts to be deducted as soon as they are ascertained by us.
5.2 You will pay to us (or we may debit to the Client Account):
(a) a charge equivalent to the administrative cost to us from time to time of dealing with cheques and other instruments of payment returned unpaid;
(b) all Disbursements.
5.3 You shall pay to us (or we may debit to the Client Account) the Service Fee specified in clause 11.11. If the total Service Fees received by us in any calendar month starting at Commencement Date shall be less than the Minimum Monthly Service Fee then you shall pay us an amount equal to the shortfall forthwith. If this Agreement is terminated for any reason prior to the expiry of the Notice Period following the end of the Minimum Period, you will pay us the Early Termination Fee.
5.4 The Discount Charges have been determined in accordance with the circumstances prevailing at the time of the date of the Offer Letter and if there should at any time be any increase in the cost of funding to us or any other change in circumstances that may affect the cost of us or the Security Trustee providing services to you under this Agreement then in any such event we may by notice to you make consequential increases in the Discount Charges to take effect immediately upon such notice.
5.5 If at any time there is a debit balance owing to us or the Security Trustee on the Client Account and/or the debit balance on the Current Account that at any time exceeds either the Funding Limit in use specified in clause 11.13 or the Approved Funding at that time, we shall be entitled to increase the Discount Charge by such amount as we consider necessary but by no less than 3%.
5.6 We and the Security Trustee shall be entitled to make a reasonable charge for any expenses incurred by us (including but not limited to any management time expended by us) by reason of or in any way connected with:
(a) any work that you ask the Security Trustee or us to do that is not provided for in the Agreement; or
(b) any task which we or the Security Trustee consider requisite for the reconciliation of your records with ours, for the protection of any security granted to any Secured Party or the perfection of title to the Debts.
5.7 You will pay us an Arrangement Fee of the amount specified in clause 11.9. We may at our discretion debit such fee to your Client Account.
5.8 All charges that may be due to us or the Security Trustee are quoted in the Agreement exclusive of any Value Added Tax.
5.9 We will, at all times keep the Security Trustee informed of all credit and debit balances of the Client with respect to any account of the Client held pursuant to this Agreement.
6.1 If pursuant to clause 11.1 the Agreement includes Debts arising from Contracts of Sales with Debtors situated outside the United Kingdom and we have agreed in Writing to your invoicing those Debtors otherwise than in sterling:
(a) we will calculate the Purchase Price of every Debt represented by an invoice expressed in a currency other than sterling by using the spot selling rate quoted by our bankers on the Collection Date of the Debt; and
(b) for the purpose of calculating the charges under conditions 5.3 and 5.4 in respect of any such Debt and making a provisional entry of its Purchase Price in our records we may apply such selling rate quoted on the date of the Notification of the Debt and make any requisite adjustment to that entry after the Collection Date.
6.2 You undertake to indemnify us and the Security Trustee against any additional loss and expense incurred by us in the collection or attempted collection of any Debt represented by an invoice expressed in a currency other than sterling and of the conversion of the currency of the amount received by us in payment of the Debt and we shall be entitled to debit the Client Account with all bank charges and commission incurred by any of us in such collection or attempted collection.
7.1 We will have the sole right to enforce payment of and collect any Debt so long as we or the Security Trustee are the owner of it or it is held by you on trust for us or the Security Trustee and to institute defend or compromise proceedings in respect of any such Debt in such manner and upon such terms as we may think fit. For such purposes we or the Security Trustee may use your name and (whether or not you are our agent under condition 7.7) you will co-operate to the fullest extent at your expense in any such enforcement collection or proceedings including the production of such documents and the giving of such evidence as may be necessary for such enforcement or collection or proceedings.
7.2 Except during the time in which you are the Security Trustee’s agent for the purposes described in condition 7.7(a) you will not collect or attempt to collect any Debt.
7.3 Unless we or the Security Trustee appoint you as our agent under condition 7.7(a) you will ensure that:
(a) on the Business Day next following the Commencement Date a notice is sent to every Debtor by whom any Debt that has been Purchased is then owing; and
(b) every invoice representing a Debt that has been Purchased and issued after the Commencement Date bears a prominent and legible notice;
stating, in each case that the Debt has been Purchased by us and is payable only to the Account . Every such notice shall be in a form specified by us or the Security Trustee.
7.4 You will deliver all monies, cheques and other instruments of payment (duly endorsed where necessary to effect collection) received by you in or on account of payment of any Debt directly to the Account, promptly upon receipt of the same, or to such other bank account as may be specified by us (and meanwhile hold them on trust for the Security Trustee).
7.5 The Security Trustee may appropriate any payment or other benefit received from or credit granted to a Debtor in or on account of the discharge of any Approved Debt owing by that Debtor in priority to any Unapproved Debt so owing in spite of any different appropriation by the Debtor.
7.6 You undertake to give immediate instructions to any banker or other person with whom you maintain an account to pay to us or direct to our bankers the proceeds of any credit transfer, relating to any Debt Purchased pursuant to this Agreement, which shall be received in such account. You will furnish our bankers with such instructions and/or indemnity as they may require in order that they may effect collection of any such cheques made payable to you which are not transferable.
7.7 The Security Trustee may by written notice to you appoint you as its agent for either or both of the purposes of:
(a) maintaining and administering the accounts of Debtors; and
(b) sending statements and demands to Debtors and of enforcing payment of Debts; and
you will accept any such appointment.
7.8 You undertake in the event of an appointment under condition 7.7:
(a) to act promptly and efficiently at your expense in carrying out the tasks for which you have been appointed as the Security Trustee’s agent in accordance with any directions which it may give to you from time to time;
(b) to retain on the Security Trustee’s behalf all records and documents on or by which any Debts Purchased pursuant to this Agreement are recorded or evidenced until the full discharge of all your Obligations or any earlier delivery to the Security Trustee of such records or documents upon the Security Trustee’s demand; and
(c) not to hold yourself out as the Security Trustee’s agent for any purpose other than the tasks for which you have been appointed as the Security Trustee’s agent in condition 7.7 nor to hold yourself out as the Security Trustee’s agent for any purposes except for the period during which the agency remains in effect; and
(d) immediately to give to every Customer, by which any Debt is owing upon the date of that appointment, such notice and to ensure that every invoice issued by you after that bears such prominent and legible notice in each case as is considered requisite by the Security Trustee for the agency.
7.9 The Security Trustee may at any time terminate your appointment as agent for either or both of the purposes for which you have been appointed as the Security Trustee’s agent by written or oral notice to you and, upon such termination, the Security Trustee will immediately send to every Debtor by whom any Debt, funded by the Funder, is then owing or becomes owing such further notice as the Security Trustee considers to be requisite for the termination of the agency.
7.10 So long as you are the Security Trustee’s agent for the purpose described in condition 7.7(a) you will furnish the Funder in Writing with the following:
(a) by the fifteenth day (or such other day as the Funder may direct) of each month and at such other times as the Funder may require by oral or written notice to you:
(i) a list of Debts Outstanding on the last day of the previous month (or such other day as the Funder may specify in Writing) analysed by reference to the dates on which the Debts are due for payment;
(ii) full details of all Debts in respect of which the Debtor fails to accept in full the Goods or the invoice for them and of the reasons for such failure;
(iii) a list of all your creditors and amounts owing to them analysed by reference to the dates on which those amounts are due for payment; and
(iv) such other information relating to your financial affairs as the Funder may at any time request.
(b) a reconciliation of the ledger on which the Debts are recorded by you with any copy of the Funder’s records of the same sent by the Funder to you within seven days of your receipt of that copy.
8.1 Every Notification (except any separate notification in accordance with condition 1.3 to the extent stated on such Notification) will be deemed to constitute a warranty in relation to every Debt included in it that:
(a) the Goods and the invoice for them have been Delivered and the Debt has arisen from a Contract of Sale entered into by you in the normal course of your business as described in clause 11.5 being a Contract of Sale which:
(i) provides for payment to be made in the currency of a state or territory shown in clause 11.6 (or such other currency as the Funder may approve in Writing) on terms not less onerous than those described in clause 11.6;
(ii) is governed by English law or another law approved by the Funder in Writing;
(iii) is otherwise as approved by the Funder;
(b) you have performed all your obligations to the Debtor and the Debtor is obliged to accept the Debt and the invoice for it as a legally binding obligation of the Debtor to pay the full amount as notified of the Debt without any deduction, set-off or counter-claim or any claim for release of liability and, if the Debtor is in liquidation or bankruptcy, the liquidator or trustee (as the case may be) will accept proof of debt for the amount as notified;
(c) the Debt is free from all trusts, charges, liens and other encumbrances including (without limitation) any right or interest of any of your suppliers to or in the Debt or the Goods to which it relates;
(d) you have no obligations to the Debtor other than under any Contract of Sale and you have no agreement with the Debtor for retrospective discounts, rebates or otherwise whereby the amount of the Debt may be reduced except in accordance with the Contract of Sale;
(e) the Debtor has an established place of business and is not an Associate;
(f) there is no restriction on the assignment of the Debt contained in the Contract of Sale.
8.2 You undertake in addition to all other undertakings given by you in the Standard Conditions:
(a) not to vary or attempt to vary any Contract of Sale giving rise to any Debt after it has been notified;
(b) to keep proper books and records of account and to make appropriate entries in them to show the sale to the Security Trustee of the Debts transferred to it;
(c) promptly to pay all taxes and carriage and freight charges for which you are liable in relation to any Debt or the Contract of Sale giving rise to it and to effect any insurance required by such Contract of Sale and to pay the premium and to make any claim arising under;
(d) upon first written demand, to pay to the Funder the amount of any Debt which remains unpaid after its Recourse Period so that your liability under this undertaking may be enforced against you as principal debtor without the requirement of any prior demand on the Debtor by whom such Debt is payable;
(e) without the prior written consent of the Funder, not to create any mortgage, charge or other encumbrance or any trust which affects or may affect any of your assets or rights in your undertaking;
(f) without the prior written consent of the Funder, not to assign or create any charge over any of your rights or benefits under the Agreement nor to delegate any of your responsibilities under it;
(g) not to enter into any agreement for the factoring or discounting or otherwise for the sale of any Debts except with the Funder (and entry into any such agreement by any of your Associates will be deemed to be a breach of this undertaking) and, if the Funder should so require by written notice to you, to procure that any Associate will enter into a factoring or invoice discounting agreement with the Funder on terms and conditions similar to those contained in the Agreement;
(h) to indemnify the Security Trustee and the Funder against all claims against them by any Debtor (save any claim arising solely from their default) and against all losses costs charges interest and expenses (including, without limitation, legal costs and stamp duty) incurred by them at any time and arising from or in any way connected with in the case of either the Security Trustee or the Funder:
(i) entering into or enforcing, exercising or protecting their rights under the Agreement or any guarantee or indemnity or security created in relation to your Obligations;
(ii) enforcing or attempting to enforce payment of any Debt or settling or compromising any dispute with or claim by a Debtor or any other person in relation to any Debt;
(iii) the securing of any release of any Debt from any trust charge or other encumbrance;
(iv) any indemnity which may be required to be given to bankers in connection with the collection of any cheque or other instrument made payable to you;
(v) any breach by you of any of your Obligations;
(i) to use your best endeavours as may be required by the Security Trustee and/or the Funder to procure for them a refund of any value added tax included in any bad or doubtful debt in any case in which the regulations of H M Customs and Excise for the recovery of such value added tax apply and for that purpose to accept a reassignment to you of that Debt and to hold any value added tax recovered and any other recoveries in relation to that Debt on trust for the Security Trustee and separate from your own property;
(j) to comply with all procedures for the operation of the Agreement which the Security Trustee or the Funder may make known to you from time to time and to assist them in every way to safeguard their interests under the Agreement and to procure that all your employees and agents and, if you are a company, all your directors and other officers and, if you are an LLP, all your members so assist us.
9.1 You undertake that, if in spite of the warranties given by you in condition 8 a Debtor disputes its liability to pay the full amount of any Debt as notified less any discount allowable in accordance with the relevant Contract of Sale or if the Debtor refuses to accept the Goods or the invoice for any reason, you will;
(a) immediately inform the Funder of all the circumstances of the dispute or refusal;
(b) use your best endeavours promptly to settle such dispute and procure acceptance of the Goods and invoice; and
(c) promptly perform any remaining further or continuing obligations under the relevant Contract of Sale.
9.2 Upon or at any time after any of the events specified in condition 12.1, or at any other time if you fail to perform your obligations under condition 9.1, then the Security Trustee and/or the Funder shall have the right (but shall not be bound), at your expense, to settle or compromise any such dispute on such terms as they may think fit and/or to perform any such further or continuing obligations.
9.3 You will be bound by anything done or omitted to be done by the Security Trustee and/or the Funders under condition 9.2 including any resulting reduction in the Purchase Price of any Debt.
9.4 Upon the Commencement you will furnish the Funder with a copy of every credit note issued before the Commencement relating to any Debt then Outstanding. Thereafter you will deliver to the Funder promptly a copy of each credit note which you issue to any Debtor.
9.5 You irrevocably authorise the Funder to make payment in settlement of or on account of any credit balance appearing on a Debtor’s account in its or the Security Trustee’s records at any time however it may have arisen.
10.1 The Funder shall be entitled to exercise Recourse as follows:
(a) in respect of any Debt included in a separate Notification under condition 1.3 or any other Unapproved Debt, as soon as or at any time after it shall have been notified or, if later, upon or after its becoming Unapproved;
(b) in respect of any Approved Debt, on its becoming Unapproved under condition 3.2(a) or 3.3 or any earlier Insolvency Proceedings in relation to the Debtor by which the Debt is owing;
(c) in respect of any Debt which the Debtor claims to be unable to pay owing to rules or regulations of any Government or civil commotion or the circumstances in the territory in which the Debtor is situated, at any time after the event giving rise to the claim;
(d) in respect of any Debt comprising solely discount or other deduction wrongly claimed or deducted by the Debtor, as soon as the Funder becomes aware of the claim or deduction.
10.2 The Funder may exercise Recourse by written notice to you or by debiting the repurchase price to the Client Account. The Security Trustee shall remain the legal owner of every Debt in respect of which the Funder shall exercise Recourse until the repurchase price has been fully discharged either by your payment of it to the Funder or by the Funder applying it in the discharge of any amount payable by the Funder to you.
10.3 The following conditions 10.3(a) to 10.3(c) inclusive will apply only if it is specified in clause 11.15 that Limited Recourse is to apply:
(a) Subject to your compliance with all your Obligations under the Agreement the Funder shall:
(i) in respect of a Debt Purchased pursuant to this Agreement, treat any payment which may be made by the Insurer to the Funder in settlement of a claim under the Policy as a payment in or on account of settlement of that Debt by a Debtor; and
(ii) provided that the Insurer does not seek repayment of such payment from the Funder, thereafter to the extent of that payment by the Insurer the Funder will refrain from exercising its right of Recourse in respect of that Debt.
(b) For the avoidance of doubt Funder’s obligations under condition 10.3(a):
(i) shall only apply to the extent of any payment made to the Funder by the Insurer in settlement of a claim under the Policy and the Funder may (in its absolute discretion and without giving any reason) decide whether or not to accept the determination of the Insurer as to the validity of any such claim;
(ii) shall cease immediately upon the occurrence of a termination event under any part of condition 12;
(iii) shall not constitute a waiver of the Funder’s rights against the Debtor or an election not to seek payment from the Debtor.
(c) You agree that:
(i) the Funder may (in its absolute discretion and without giving any reason) decide whether or not to accept the determination of the Insurer as to the validity of any such claim; and
(ii) the Funder shall not in any way be liable to you if the Insurer declines to settle any claim in full on the grounds of any deficiency on the Funder’s part or for any other reason.
(iii) Notwithstanding the above conditions in 10.3 you will accept the deduction determined by the Insurer which is currently the higher of £2,000 or 30% of the net invoice amount on Approved Covered Debts which total up to £20,000 (in certain circumstances Approved Covered Debts below £20,000 may be subject to deduction of the higher of £2,000 or 10% of the net invoice amount) . For Approved Covered Debts which total over £20,000 the higher of £2,000 or 10% of the net invoice amount
(d) You undertake to comply with all instructions given by the Security Trustee and/or the Funder from time to time in respect of Debts Purchased pursuant to this Agreement and which are subject to Limited Recourse.
11.1 You warrant that you have disclosed to the Funder every fact or matter known to you which you knew or should reasonably have known might influence any decision as to the entry by the Security Trustee or the Funder into the Agreement or as to its terms or as to its continuation or as to the acceptance of any person as surety for any of your Obligations or as to the establishment or cancellation of any Credit Limit or the classification of any Debt as Approved or Unapproved including (but not limited to):
(a) any mortgage or charge or other encumbrance on any of your undertaking, property and rights and any trust in relation to any of your assets;
(b) any change or proposed change in your constitution or management or the ownership or control of you or your business;
(c) the name and address of any person who is an Associate;
(d) any Insolvency Proceedings threatened or pending against you.
You undertake to disclose to the Funder promptly any such fact or matter arising in the duration of the Agreement.
11.2 The Funder shall be entitled at any time to inspect, to verify and/or (at your expense) to take copies of any of your records or documents on or by which any Debt is recorded or evidenced and to take possession of any such records or documents included in the Related Rights. The Funder shall have the right to inspect any records or documents relating to your financial position or the results of your operations. For such purpose any of the Funder’s officers or authorised agents may enter upon any premises at which you carry on business or at which any of your property is situated at any time during business hours being not less than eight hours in any Business Day. You undertake to keep the Funder informed at all times of the situation of all such records and documents.
11.3 You will furnish the Funder with a copy of your audited accounts for each year or other financial accounting period ending in the duration of the Agreement within four months of the end of such period or later date as the Funder may allow. You will prepare and furnish the Funder with such management accounts of your business and at such times as the Funder may from time to time prescribe.
11.4 You authorise the Funder:
(a) to furnish your bankers and auditors with such information in the Funder’s possession relating to your affairs and the Debts Purchased pursuant to this Agreement as any of them may require at any time; and
(b) at any time to obtain from any of your bankers and auditors any information in their possession which the Funder may then require regarding the state of your accounts or your financial affairs.
11.5 You warrant and undertake that you have given your existing bankers and auditors, and will give to any banker and auditor whom you may in future appoint, the requisite authority for the purpose of condition 11.4(b) and that, if the Funder so requires, you will instruct your auditors to report at your expense on any audited accounts direct to us.
12.1 On or at any time after the occurrence of any of the following events the Funder shall have the right to terminate the Agreement immediately by notice to you:
(a) for a consecutive period of 28 days you fail to notify the Funder of any Debts or, for the same period, ask the Funder not to Approve any Debts;
(b) you breach or threaten to breach any of the provisions of this Agreement, any other agreement with the Funder or Security Trustee or any related guarantee, indemnity or security;
(c) any Insolvency Proceedings relating to you;
(d) if you are a company or an LLP a resolution of your members for your winding up or, if you are a company, LLP or partnership, its dissolution;
(e) the seizure of the whole or any part of your income or assets under any execution legal process or distress for rent or the making or threat of a garnishee order nisi or other attachment on any Debt owing to you;
(f) the occurrence of any of the events referred to in conditions 12.1(a), 12.1(b) or 12.1(c) in relation to any person who has given or may at any time give a guarantee or indemnity in respect of your Obligations or the death of that person or the termination or attempted termination of any such guarantee or indemnity;
(g) any breach or termination of any covenant or undertaking given by any person in reliance on which the Security Trustee or the Funder entered into or continued the Agreement or the withdrawal or attempted withdrawal of any waiver or release or agreement as to priorities in our favour in respect of any security right over any of your assets;
(h) the cessation of your business or your threat to cease business or any material change in the nature or volume of your business;
(i) your inability to pay your debts, if you are a company or an LLP, as defined in section 123 of the Insolvency Act 1986 or, if you are not a company or an LLP, as defined in section 268 of the said Act;
(j) the Funder considers that there has been a material adverse change in your business, assets, financial condition or operating performance or that your financial position has deteriorated to the point at which repayments of any amount due or to become due from you to the Security Trustee or the Funder as the case may be may be put at risk;
(k) any alteration in your ownership, control or constitution which the Funder considers material;
(m) any breach of any warranty or undertaking given by you in the Agreement or of any of your Obligations which the Funder considers to be material or any such breach not considered by the Security Trust Funder to be material which is not remedied by you within two Business Days of the Funder’s request to you so to do;
(n) any moneys due from you to any Secured Party are not paid within 5 Business Days after they become due;
(o) if any of your directors or partners cease to be a director or partner and is not replaced within 3 months by an individual acceptable to the Funder;
(p) if any person who waived, gave consent, priority or released, in the Funder’s favour, its rights to any Debt withdraws such waiver, consent, priority or release or otherwise asserts a claim to any Debt, its Related Rights, or the proceeds thereof;
(q) any borrowing by you becoming due for repayment before its stated maturity date owing to your breach of any of the conditions of that borrowing.
12.2 Upon or at any time after any such event (whether or not the Funder shall have exercised its right to terminate the Agreement) the Funder may exercise any one or more of the following rights:
(a) Recourse by the Funder in respect of all Debts then Outstanding (whether Approved or Unapproved) but so that each such Debt shall continue to belong to the Security Trustee until the repurchase price of all of them has been fully discharged by you;
(b) to withhold all payments to you until the full discharge of all your Obligations or to reduce the Prepayment Percentage specified in clause 11.8 to such percentage as the Funder may decide;
(c) the immediate repayment by you on the Funder’s demand of all Prepayments previously made together with all monetary liabilities included in your Obligations;
(d) increase the Discount Charges by such amount as the Funder considers necessary but by no less than 2%;
(e) require to be paid by you (or to debit to the Client Account) the full cost and expense of any exercise of the Funder’s rights under condition 11.2 including (without limitation) the appointment of accountants or other professional experts for those purposes;
(f) to require that no credit note will be issued by you without the Funder’s prior consent.
12.3 If you should see fit to issue any credit note at any time after the Funder has exercised its rights under condition 12.2(f) you will promptly advise the Funder of that credit note in such manner and with such documents (including the original of the credit note) as the Funder may require. Upon the Funder giving its consent to the issue of any credit note of which the original is in the Funder’s possession the Funder shall despatch it (at your expense) to the Debtor.
12.4 Upon the occurrence of any Insolvency Proceedings in relation to you without any notice or other formality:
(i) notice under condition 2.4 will be deemed to have been given to you to be effective on the day before such occurrence in respect of all Goods then appropriated to any Contract of Sale remaining in your possession; and
(ii) all accounts held by the Funder in your name (other than any memorandum account) will be deemed to have been combined.
12.5 Upon or after the occurrence of any event specified in condition 12.1, and whilst such event continues, the Security Trustee shall be entitled to apply the proceeds of all Debts in the order and priorities set out in clause 8.3 of the Factoring Agreement.
12.6 Upon or after the occurrence of any event specified in condition 12.1, to compensate the Security Trustee for the additional expense of collection of Debts which may arise after such an event, the Security Trustee shall be entitled to a charge, additional to that which is provided in condition 5.3(a), equivalent to 15% of the notified amount of any Debt then Outstanding and of every Debt subsequently becoming Outstanding. The maximum amount that the Security Trustee can charge as a result of an event specified in condition 12.1 is the higher of either 15% of the notified amount of any debt then outstanding or the total of the monthly minimum fees remaining on the Factoring Agreement between the Event and the maturity of the Agreement including notice period
12.7 You unconditionally confirm your agreement that the fees and additional charges referred to above are a fair and reasonable pre-estimate of the Security Trustee’s likely loss of fees, costs and expenses that the Security Trustee would have otherwise received but for the occurrence of an event specified in condition 12.1, and that as such the Security Trustee’s fees and additional charges are not penalties.
13.1 If you are more than one person you agree that:
(a) references to “you” or “your” in condition 12.1 include references to any one or more of you or to events relating to any one or more of you;
(b) all undertakings and warranties given by you in the Agreement and the acknowledgements, appointment and authorities given and made by you in your Factoring Agreement shall be deemed to have been given, incurred and made by every one of you;
(c) all your Obligations shall be joint and several and the Funder may release or compromise with any one or more of you without affecting the Funder’s rights against the others; and
(d) the Funder may (but shall not be obliged to) treat any notice to or demand on any one or more of you as notice to or demand on you all and any notice to the Funder by any of you as notice by you all.
13.2 If you are a partnership all the persons who have signed the Factoring Agreement warrant that all the present persons comprising your partnership are named in the Agreement and you undertake to procure that any partner admitted by you will execute such documents as the Security Trustee and/or the Funder may require to bind him to the terms of this Agreement.
13.3 Except as provided in condition 12, the Agreement and all its terms shall remain in full force and effect in spite of any change in your constitution.
14.1 Any written notice or demand required or permitted to be given or made by the Security Trustee and/or the Funder to or on you shall be validly served or made:
(a) if handed, if you are a company, to any of your officers or, if you are an LLP, to any of your members or, if you are a partnership, to any partner or, if you are a sole trader, to you; or
(b) if delivered or sent by first class prepaid post to your address stated in the Offer Letter or to any address at which you carry on business or, if you are a company or an LLP, to your registered office; or
(c) if transmitted by facsimile or e-mail to any facsimile number or e-mail address of you made known to the Security Trustee and/or the Funder by you at any time.
Any such notice or demand, if served personally, shall take effect upon its service and, if sent by post, shall take effect within two Business Days of the time of its posting and, if transmitted by facsimile, shall take effect upon its transmission.
14.2 Any notice required or permitted to be given by you to the Security Trustee and/or the Funder shall be validly given if sent to them at the relevant registered office by prepaid first class post and shall be effective upon its receipt by them.
15.1 If any act or event would be required to be performed or be due to take place according to the Agreement on or within a period ending on a day which is not a Business Day the act or event shall be deemed to be performed or to take place on or by the next Business Day.
15.2 If any provision of the Agreement shall be held to be invalid or unenforceable no other provision shall be affected and all such other provisions shall remain in full force and effect.
15.3 The Security Trustee and/or the Funder shall be entitled to rely upon any act done or any letter or document signed or any communication sent to it by facsimile or by e-mail by any person purporting to act or sign or send on your behalf despite any defect in or absence of any authority of such person.
15.4 Subject to conditions 15.4 (a) and 15.4 (b), a person who is not a party to the Agreement shall have no rights under the Contracts (Rights of Third Parties) Act 1999 to enforce or rely upon a provision of this Agreement. No party may hold itself out as trustee of any rights under this Agreement for the benefit of any third party unless specifically provided for in this Agreement. This condition 15.4 does not affect any right or remedy of any person which exists, or is available, otherwise than pursuant to the Contracts (Rights of Third Parties) Act 1999.
(a) Any person to whom the benefit of any provision of this Agreement is assigned in accordance with the terms of this Agreement is entitled under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement which confers (expressly or impliedly) any benefit on any such person.
(b) Any Secured Party, Receiver or Delegate may, subject to the Contracts (Rights of Third Parties) Act 1999 rely on any condition of this Agreement which expressly confers rights on it.
(c) Notwithstanding any other provision of this Agreement the Security Trustee and the Client may, by agreement in writing, rescind, terminate or vary any of the provisions in this Agreement or waive or settle any right or claim under it in any way without the consent of any third party and, accordingly, section 2(1) of the Contracts (Rights of Third Parties) Act 1999 shall not apply.
15.5 The Security Trustee and Funder’s rights under the Agreement shall not be affected in any way by any grant by any of them of any time or indulgence to you or any other person nor by any delay or failure in our exercise of any option under the Agreement or otherwise.
15.6 The Funder shall be entitled to vary the terms of the Agreement by giving you written notice of the proposed variation. If the Funder does not receive your acknowledgement of such variation within 7 days you will be deemed to have accepted the variation.
15.7 The Security Trustee and/or the Funder as the case may be may assign or transfer all or any part of its rights and/or obligations under the Agreement and/or under any related guarantee, indemnity or other security. You shall, immediately upon being requested so to do by the Funder, enter into any documentation that the Funder may require to effect such assignment or transfer. You agree that the Funder may execute any such documentation as your attorney pursuant to clause 12 of the Factoring Agreement.
15.8 The Agreement shall be construed and take effect in accordance with English law and you hereby submit to the jurisdiction of the English courts without prejudice to the Secured Parties’ right to bring proceedings in the courts of any country in which you carry on business.
15.9 Except as specifically provided for in the Agreement, termination of the Agreement (including termination in accordance with condition 12) shall not affect the rights and obligations of the Funder in relation to any transaction having its inception before the date of termination or any Debt in existence on that date and such rights and obligations shall remain in full force and effect until duly extinguished. All licences and authorities given to the Security Trustee and/or the Funder by you in the Agreement are irrevocable and shall continue after the termination of the Agreement until all your Obligations have been fully discharged.
16.1 In these Standard Conditions:
(a) “the Offer Letter” and “the Factoring Agreement” shall mean respectively the offer by the Funder to you of a factoring facility and the deed by which you accepted that offer, both separately executed, which together made the Agreement and incorporated these Standard Conditions in it;
(b) “Funders” means (when taken together) 4Syte Funding Limited (registered number 10258153) whose registered office is at 2nd Floor, Steeple House, Church Lane, Chelmsford CM1 1NH, United Kingdom and 4Syte Trade Limited (registered number 11537104) whose registered office is at 2nd Floor, Steeple House, Church Lane, Chelmsford CM1 1NH, United Kingdom or any other member of the Funders’ group of companies that provide financing for the purchase of the Client’s Debts. References to the Funder, Funders or the Security Trustee shall be construed so as to include their successors in title, permitted assigns and permitted transferees to, or of, their rights and/or obligations under the Finance Documents. References to Funder shall mean either or both of them as the context requires;
(c) “you” means any person for whom the Security Trustee or the Funder provides its factoring services by an agreement of which the Standard Conditions are a part; and
(d) reference to any Act of Parliament is deemed to include such Act as amended or re-enacted from time to time and any order or regulation made under it.
16.2 In the Agreement including these Standard Conditions:
(a) where the context allows, the singular includes the plural and vice versa and any of the three genders includes either of the other two;
(b) references to clauses (except where otherwise specified) are to clauses of the Offer Letter or the Factoring Agreement and to conditions are to the Standard Conditions and the headings of clauses and conditions are for convenience only and do not affect the meaning of any clause or condition;
(c) the meanings of general words introduced by the word “other” are not limited by reference to any preceding word indicating a particular class of acts matters or things;
(d) reference to any Act of Parliament includes such Act as amended or re-enacted from time to time and any order or regulation made under it;
(e) where the Security Trustee or the Funder have a right or option to do anything then the right or option is at their absolute discretion; and
(f) the following words and expressions have the meanings attributed to them below:
the account in the name of the Funder or Funders with bank details as provided to you;
the Insolvency Act 1986;
in relation to any Debt, Approved for Prepayment under conditions 3.1 to 3.3 (inclusive);
an amount equivalent to the percentage specified in clause 11.8 of the total amount of Outstanding Approved Debts;
any director or employee of you or any person whose relationship with you is within the meaning of “associate” in section 435 of the Insolvency Act 1986;
“Available Funds Account”
a memorandum account maintained by the Funder for recording the amount remaining at any time after deducting any debit balance on the Current Account from (or adding any credit balance on it to) the Approved Funding at that time;
Bankers’ Automated Clearing Service;
any day except (other than a Saturday, Sunday or public holiday) during which clearing banks in the City of London are open for normal business;
Clearing House Automated Payments System;
accounts maintained by the Funder in your name on which transactions between you and the Funder are recorded;
in respect of any Debt paid in cash or by credit transfer five Business Days after the date of the advice to the Funder of the receipt of the funds in its bank account and, in respect of any Debt paid by cheque or other instrument, the date when the funds represented by it are collected and received by the Funder’s bankers (for administrative convenience, and in the absence of any disruption to banking procedures, the Funder may allow five Business Days for clearing of cheques or other instruments of payment);
the date specified in clause 11.2;
“Contract of Sale”
a contract for the supply of goods or services or for hiring by you;
a limit established under condition 3.2(c) in relation to any Debtor for the purpose of determining which Debts owing by that Debtor may be Approved;
a memorandum account maintained by the Funder to which:
(i) will be credited all payments received by the Funder in respect of Debts or from you or by reason of recoveries or realisation of any of the Related Rights (and for this purpose payments are deemed to be received on their Collection Dates);
(ii) will be debited with the Funder’s payments to you as at their respective Dates of Payment and all other amounts debited by the Funder to you on the Client Account except in respect of credit notes or Recourse;
“Date of Payment”
(i) in relation to any payment (including any Prepayment) made to you by cheque, the date on which that cheque is despatched to you; and
(ii) in relation to any such payment made by BACS or CHAPS the date of the initiation by the Funder’s bankers of the transaction for that payment;
the amount (or, where the context allows, a part of such amount) of any obligation or indebtedness, including any tax or duty payable, incurred by a Debtor under a Contract of Sale together with (where the context allows) any Related Rights pertaining to such obligation or indebtedness;
any person who has incurred or may incur an obligation to you under a Contract of Sale;
in the case of any goods or any invoice, despatched to the Debtor from a place in the United Kingdom and, in the case of services or hiring, completed;
all bank charges and other costs, charges and expenses incurred by the Security Trustee and/or the Funder in the operation of or in connection with this Agreement and which shall include, without limitation, legal and other professional costs and expenses in incurred by them (plus VAT, if applicable), our own administrative costs, and such other charges as shall be notified to you by the Funder in writing from time to time;
the charge for which provision is made in condition 5.1 to be deducted in the calculation of the Purchase Price of any Debt;
“Data Protection Legislation”
all applicable data protection laws including the EU Data Protection Directive 95/46/EC until 25 May 2018, the European Privacy and Electronic Communications 2002/58/EC, the General Data Protection Regulation (EU) 2016/679 (“GDPR”); from 25th May 2018, and any data protection laws substantially amending, replacing or superseding the GDPR following any exit by the United Kingdom from the European Union and any applicable national, international, regional, municipal or other data privacy and data protection laws, standards or regulations;
“Early Termination Fee”
an amount equivalent to (i) the Service Fee and (ii) the Discount Charge that would have been earned by the Funder during the period from the date of termination to the earliest date on which you would have been entitled to terminate this Agreement on expiry of the Notice Period following the end of the Minimum Period;
any goods or services or hiring the subject of a Contract of Sale;
(i) the issue of a petition for winding up or bankruptcy; or
(ii) an administration application under paragraph 12 of Schedule B1 to the Act or the appointment of an administrator under paragraph 14 or paragraph 20 of the said Schedule B1; or
(iii) a proposal for a voluntary arrangement under the Act; or
(iv) the calling of any meeting of creditors; or
(v) the appointment of a receiver in respect of any part or the whole of the undertaking or property of any firm, LLP or company;
the insurer by which the Policy has been issued;
the limitation of the Funder’s right of Recourse in respect of any Debt as set out in condition 10.3;
“Limited Recourse Discount Charge”
the charge for which provision is made in condition 10.3 to be deducted in the calculation of the Purchase Price of any Debt;
a limited liability partnership incorporated under the Limited Liability Partnership Act 2000;
“Minimum Monthly Service Fee”
the minimum monthly service fee specified in clause 11.11;
a form prepared by you and delivered to the Funder in accordance with condition 1.1 or 1.3 and “notify” and “notified” in relation to a Debt will mean respectively include and included in a Notification;
all your present and future monetary and other actual or contingent or prospective obligations incurred at any time to the Secured Parties whether arising under the Agreement or otherwise and whether arising in or by contract tort restitution or assignment;
in relation to any Debt, Purchased pursuant to this Agreement and remaining unpaid;
the policy of credit insurance described in condition 10.3;
a partnership other than an LLP;
a payment by the Funder to you on account of the Purchase Price of any Debt before its Collection Date up to the percentage specified in clause 11.8 of the amount of the Debt as notified;
the price payable by the Funder for a Debt determined in accordance with condition 4.1;
means, with respect to a Debt, that it has been notified, funded by the Funder and that you have assigned the Debt with full title guarantee together with all Related Rights to the Security Trustee to be held on trust for the Secured Parties on the basis set out in the Factoring Agreement;
the Funder’s right to require that you repurchase forthwith any Outstanding Debt at a repurchase price equivalent to the amount of that Debt as notified;
in relation to any Debt, a period of the length specified in clause 11.7 starting on the date when that Debt is due for payment in accordance with the Contract of Sale;
in respect of any Debt all of the following:
(i) all your rights under the Contract of Sale other than your rights to any Goods;
(ii) the benefit of all guarantees indemnities insurances and securities given to or held by you;
(iii) all cheques, bills of exchange and other instruments held by or available to you;
(iv) the right to possession of all ledgers computer data records and documents on or by which any Debt is recorded or evidenced;
(v) any Goods the subject of a Contract of Sale returned or rejected by the Debtor or repossessed by you; and
(vi) our (or the Security Trustee’s) rights to any other Goods under condition 2.4;
(vii) any interest to which you become entitled in relation to the Debt as a result of any statutory enactment or any rule or regulation of government;
any event listed in condition 12.1;
in relation to any Debt, not Approved;
any form of communication that is accessible so that it may be recorded in a permanent form and used at any time after it has been made and “written” is to be construed accordingly.
Second Floor, Steeple House, Church Lane, Chelmsford, Essex, CM1 1NH
01245 377 032 firstname.lastname@example.org
27 Furnival Street, London EC4A 1JQ
01245 377 032 email@example.com
Hub 26, 2nd Floor, Hunsworth Ln, Cleckheaton BD19 4LN
0113 403 3302 firstname.lastname@example.org