1. Applicability

1.1.
“Parties” as referred to in these General Terms and Conditions are FactorPlus (the
“Factor”), the statutory name of which is mentioned in the Factoring Agreement, and the
entity to which the Factor provides its services (the “Client”), each separately called a
“Party”.

1.2.
These General Terms and Conditions are applicable to every Client that agrees to sell Accounts Receivable of its debtors and has transferred the ownership of these Accounts Receivable to FactorPlus by means of a Purchase and Sale Agreement as well as a deed of assignment of the right to collect from the debtors concerned.

1.3.
These General Terms and Conditions are also applicable to fee proposals, other agreements and all other related transactions from or with the (potential) Client that concern services provided by the Factor.

1.4.
In case there are contradictions between the Factoring Agreement and the General Terms and Conditions, the provisions of the Factoring Agreement will prevail.

1.5.
The Factor has the right to unilaterally amend and augment the General Terms and Conditions. Adjustments of the General Terms and Conditions are binding for the Client starting on the thirtieth day after the written notification of the adjustments, or notification by any other manner.

2. Offers and Acceptance

2.1.
Fee proposals and offers made by the Factor are not binding with regards to pricing or content and expire after 30 days.

2.2.
An agreement is final at the moment the Factor receives the signed Factoring Agreement from the Client.

2.3.
Changes and additions to the Factoring Agreement can be made only by mutual consent. For changes and/or additions which consist of an amendment or augmentation of the General Terms and Conditions, article 1.5 of these General Terms and Conditions applies.

3. Definitions

3.1. Accounts Receivable
Also called Invoices, the money owed by the Debtors to the Client (before the factoring transaction, and owed to the Factor after the factoring transaction), including taxes where applicable, as listed in Schedules provided by the Client and accepted for purchase by the Factor.

3.2. Advance
The Advance paid by the Factor to the Client for the purchased Accounts Receivable. The Advance will be equal to a percentage of the nominal value of the Accounts Receivable.

3.3. Advance Percentage
The Advance Percentage is established in each Purchase and Sale Agreement and will typically be equal to the percentage agreed upon in the Factoring Agreement.

3.4. Debtors
The companies or entities that purchased goods and services from the Client and have an obligation to pay the Factor as a result of the factoring transaction.

3.5. Deed of Assignment
The deed in which the Client assigns the Factor all rights it has or has had with regards to Receivables resulting from the Invoices addressed to its Debtors, also called the “Assignment”.

3.6. Factoring Agreement
The agreement in which the Client and Factor agree to factor.

3.7. Invoices
See Accounts Receivable.

3.8. Notification
The letter in which the Debtor is notified that the Client has assigned its rights to the Factor.

3.9. Payout
Payouts are the weekly payments, if applicable, that are made by the Factor to the Client, to transfer excess funds in the Reserve Account when the amount held in the Reserve Account, compared to the total of the factored Invoices that have not yet been paid, exceeds the Reserve Percentage.

3.10. Purchase Amount
The nominal value of the Accounts Receivable less the purchase discount, further offset by other fees and charges as applicable.

3.11. Purchase and Sale
The agreement executed for each Schedule of Invoices purchased
Agreement

3.12. (Purchase) Discount
The Discount or discount percentage as mentioned in the Term Sheet. This is the discount at which the Invoices will be purchased.

3.13. Purchase Date
The date on which the ownership of the Accounts Receivable is transferred from the Client to the Factor. This date is specified in the Purchase and Sale Agreement.

3.14. Qualifying Debtors
Those debtors offered by the Client that meet the Factor’s qualifications for factoring. It is at the discretion of the Factor to classify a Debtor as qualified or un-qualified.

3.15. Reserve Account
The balance due to the Client after the Advance payment is made for purchased Invoices, minus fees and charges. The amount of the Reserve Account is equal to the Reserve Percentage of the Unpaid Receivable Balance. The Reserve Account is an amount owed by the Factor to the Client.

3.16. Reserve Percentage
The difference between 100% and the Advance Percentage is called the Reserve Percentage.

3.17.Schedule
The group or batch of Invoices as presented for sale to the Factor by the Client (Offered Schedule), or as accepted for sale by the Factor (Purchased Schedule), after rejection of non-qualifying Invoices, if any.

3.18. Service Fees
The fees charged to the Client by the Factor for services rendered in connection with the Collection Management, as mentioned in the Term Sheet.

3.19. Term Sheet
The addendum to the Factoring Agreement specifying the terms and fees that normally will apply. The Factor has the right to charge other fees in non-standard cases, and these fees will be agreed upon in the Purchase and Sale Agreement.

3.20. Unpaid Receivables
The total of the Invoices purchased by the Factor which have not yet been paid
Balance by the Debtors.

3.21. Validity Guarantee
The Agreement in which the owner of the Client personally guarantees to issue only legally correct Invoices for which the services and goods have been properly delivered.

3.22. Verification
The process of contacting the Debtor prior to purchasing an Invoice to verify the acknowledgement of the Invoice with that Debtor.

4. Sale of the Invoices

4.1.
The Factor and Client will, prior to the purchase of Invoices, determine which Debtors will be factored. When new Debtors are planned to be added to the Schedules offered by the Client to the Factor, the Client will communicate this at least seven days prior to providing the Invoices to the Factor.

4.2.
The Factor has the right to refuse Debtors for purchase at any time and for any reason, even if such Debtors were factored in a previous Schedule.

4.3.
The Client will provide all necessary information for the purchase, such as:

4.3.1.
Digital copies of the Invoices (pdf);

4.3.2.
The physical Invoices;

4.3.3.
A Notification signed by the debtor for receipt. The Notification will be prepared by the Factor and signed by the Client and the Factor.

4.4.
The Factor shall typically verify some Invoices before purchase, by calling Debtors and inquiring as to whether they have received the Invoice and have received the goods and or services.

4.5.
The purchase of each Schedule of Invoices is formalized in a Purchase and Sale Agreement which shall be signed by both Parties.

4.6.
The Factor shall transfer the Advance amount to the bank account of the Client within three business days after the Purchase and Sale Agreement is signed by both Parties.

4.7.
The Factor keeps a Reserve Account, which is calculated by applying the Reserve Percentage to the Unpaid Receivable Balance.

4.8.
All fees and other charges from the Factor to the Client will be deducted from the Reserve Account.

4.9.
Upon receipt of payments by the Debtors, the Factor will make weekly Payouts to the Client such that the balance in the Reserve Account will not exceed the Reserve Percentage times the Unpaid Receivable Balance. The Payouts are non-specific; therefore they cannot be matched with one or more Invoices or payments of Debtors.

4.10.
The Factor has the right to apply a higher Reserve Percentage when disputes which relate to the delivered goods and services occur about the Invoices.

4.11.
The Factor shall stop making Payouts when the Client breaches one or more of the contractual obligations.

4.12.
When a Client needs to pay the Factor because one of the Client’s suppliers has factored an Invoice directed to that Client, the Factor has the right to offset this Invoice to avoid a conflict of interest in a legal procedure. The Factor will not make this offset if the Invoice in question is disputed.

4.13.
The Client shall maintain proper files with correspondence, agreements and discussion between the Client and the Debtor in order to have proof of legal entitlement.

4.14.
If the Client, at any moment, breaches the requirements applicable to the purchased Invoices, the Factor has the right to immediately charge these Invoices back to the Client, and in such case the Client will be obliged to accept and cooperate with this charge back. The charge back amount will be deducted from the Reserve Account to the extent possible, and, if the Reserve Account is not sufficient, the balance shall be paid by the Client to the Factor.

5. Invoices

5.1.
The Client guarantees, by means of signing the Validity Guarantee and the Factoring Agreement, that all Invoices offered by him for purchase by the Factor:

5.1.1.
Comply with all applicable legal requirements;

5.1.2.
Are part of a genuine business transaction and not part of a process to mislead the Factor;

5.1.3.
Shall contain only the payment instruction details of the Factor and may not include any details or instructions to make payment to the Client or anyone other than the Factor;

5.1.4.
Shall contain all relevant payment conditions (at a minimum the payment due date or the number of days after which the Invoice must be paid). The Factor may make suggestions to the Client to extend payment terms based on the collection experience it has with the Debtors. However, the Client is not allowed to increase the payment terms without explicit approval of the Factor if the Client has a fixed fee arrangement;

5.1.5.
Are not subject to any disputes, claims or counterclaims from the Debtor or third parties;

5.1.6.
Are free from knowledge of the Client of factors or circumstances that will affect the transfer of title or rights to the Factor or that will affect the process of collection of the Invoices;

5.1.7.
Shall contain correct and complete tax information (sales or other applicable taxes);

5.1.8.
Are due by Debtors that are not in a state of bankruptcy, insolvency, impending bankruptcy nor did the Debtor file for bankruptcy, or lost the control of its company or assets in any other matter known to the Client.

5.2.
All offered Invoices will show the Assignment of the Invoice and the instruction to pay the Factor by means of a sticker, stamp, or other way that is visible to the Debtor.

5.3.
None of the offered Invoices are given up as collateral or assigned in any way for any reason to anyone, other than to the interest of the Factor, unless such assignment is explicitly mentioned by the Client to the Factor.

5.4.
If the Invoices are given up as collateral to the Bank, the Factor shall transfer the payments to the Client’s bank account at that Bank only.

6. Collection Management

6.1.
By means of the Factoring Agreement, the Client outsources its Collection Management to the Factor.

6.2.
The Collection Management will be done only for Invoices which are purchased by the Factor, unless otherwise agreed in writing.

6.3.
The Client and the Factor will agree separately from this Agreement how the Client shall provide the Factor with the necessary information about the Invoices and Debtors.

6.4.
The Client is responsible for providing the information to the Factor in a timely manner and free of error.

6.5.
After the purchase of the Invoices, the Factor shall perform the Collection Management for these Invoices. This process will include:

6.5.1.
Contacting Debtors by phone and in writing;

6.5.2.
Receiving and processing payments;

6.5.3.
Submitting Invoices that have not been paid to a credit insurance company where the Factor has re-insured its credit risk; and/or

6.5.4.
Taking, or appointing a firm to take, legal steps to enforce a payment if an Invoice remains unpaid after normal efforts made by the Factor to collect the Invoice.

6.6.
The Factor will do its utmost to perform the Collection process effectively with the objective to have the Invoices settled quickly.

6.7.
The content of the initial payment reminders or summation letters used by the Factor will be formulated to take into consideration any ongoing relationship between the Client and the Debtor. When a Debtor continues to be in arrears, however, the Factor will harden the content and formulation of such letters, with the sole objective to collect.

6.8.
Payment obligations are considered as settled by the Factor only when the Factor receives the payment. If the Debtor pays the Client instead of the Factor, then the Client must inform the Factor immediately and forward the payment to the Factor. The Client is required to instruct the Debtor to make future payments directly to the Factor. The payment-receipt-date recorded in the administration of the Factor and used for the calculation of fees and charges will be the date when the Factor receives the payment and not the date on which the Client receives the payment.

6.9.
If a Client does not inform the Factor within five business days about a payment it has received from a Debtor, the Factor has the right to charge a fee as determined in the Term Sheet.


7. Disputes

7.1.
The Client will offer only those Invoices to the Factor which he does not expect to be disputed by the Debtor.

7.2.
In the case the Debtor raises a dispute, the Client is responsible for solving the dispute and is obliged to do all it can to resolve the dispute with a view to have the disputed Invoice settled as soon as possible.

7.3.
The Factor has the right to remove disputed Invoices from the factoring portfolio, or make a charge back to the Client; in such a case the Client will be bound by the charge back.

7.4.
When a dispute is settled in favor of the Debtor, all costs and risks will be for the account of the Client. If a dispute is settled partly in favor of the Debtor, the costs and risks of that part will be that of the Client and not of the Factor. The Factor will have the right to charge any costs and advances made on disputed Invoices to the Reserve Account.

8. Providing Information

8.1.
The Client and Factor will make clear agreements about the way in which information is provided.

8.2.
The Client is obliged to provide the following information upon request by the Factor:

8.2.1.
Recent financial statements;

8.2.2.
Sales overviews (sales ledgers);

8.2.3.
Ownership details and Identification of owners and key personnel.

8.3.
The Client is obliged, irrespectively of the registration in public registers, to inform the Factor immediately in writing about all changes or withdrawals of representations or directors and other officials of the Client.

8.4.
The Client is obliged to inform the Factor immediately of all facts or circumstances that can be of influence to the fulfillments of its obligations to the Factor.

8.5.
The Client is obliged to inform the Factor immediately about information it comes to know about a Debtor whom is being factored that affects the Debtor’s business continuity; a troubled financial status, inability to make payments and all other information which can be of interest to the Factor.

9. Duration and Termination

9.1.
Unless otherwise agreed upon explicitly, the Factoring Agreement has a duration of 24 months and will be automatically renewed from year to year for 12 months unless the Client has given notice not to renew the Factoring Agreement in accordance with article 9.2.

9.2.
If the Client does not wish to renew the Factoring Agreement automatically, the Client shall deliver written notice that it does not want to automatically renew the Agreement. The notice must be received by the Factor at least 60 days but not more than 90 days prior to the expiration date of the Agreement.

9.3.
The Factor has the right to immediately terminate the Factoring Agreement without notice of default or judicial intervention if the Client is in bankruptcy, has requested or obtained postponement of payments, or has lost the free control of its capital in any other manner. The Client will have no right to compensation in such a case.

9.4.
The Factor has the right to terminate the Factoring Agreement immediately without notice of default or judicial intervention if the Client ceases its activities, stops to pursue its statutory goal, is forced in to bankruptcy or liquidation, is in bad legal standing or is sold to or merged with another entity.

9.5.
If the Client wishes to terminate the Factoring Agreement during the contract period, the Factor has the right to charge an early termination fee and require the Client to repurchase the Unpaid Receivables Balance.

9.6.
Upon termination of the Factoring Agreement the Client has two options:

9.6.1.
The Client re-purchases all Invoices making up the Unpaid Receivables Balance from the Factor. The Factor provides the Client with a letter that must be sent to the Debtors to notify them of the cancellation of the Assignment of the Receivables.

9.6.2.
The Factor remains as the owner of the Unpaid Receivables Balance and will notify the Debtors of the cancellation of the Assignment, subject to the Debtors making all outstanding payments to the Factor. The Client has the obligation to encourage Debtors to honor all their payment obligations towards FactorPlus. The Factor has the right to stop making Payouts until the Unpaid Receivables Balance is paid.

10. Using Third Parties
10.1.
The Client agrees that the Factor can use third parties to perform its services.

10.2.
These services also include transferring the rights of the Invoices purchased from the Client to others or the sale of the purchased Invoices to others.

10.3.
The Factor shall carefully select third parties.

10.4.
The Factor shall not be liable for any shortcoming of third parties.

10.5.
The Factor is authorized by the Client to accept possible responsibility restrictions from third parties on behalf of the Client.

11. Indemnification

11.1.
The Client indemnifies the Factor from all liabilities of third parties, reasonable costs of legal consultation included, which relates in any way to the services performed by the Factor, unless caused by gross negligence or premeditated malfeasance of the Factor.

12. Force Majeure

12.1.
If, one of the Parties is unable to comply with an agreement as a result of force majeure, then that party will have the right to terminate the Factoring Agreement in part or in total, or may temporarily suspend the Agreement, without being liable for any early termination penalties.

12.2.
Under force majeure is understood, but not limited to, the following: threat of war, war, insurrection, strikes, boycott, (company) failure in traffic or transport, malfunction of (data)networks, government measures, raw material shortage, natural disasters, fire, nuclear reactions, failure of critical equipment and all other circumstances under which compliance with the Agreement by one of the Parties cannot reasonably or fairly be expected.

12.3.
If one of the Parties has already complied with all or part of its obligations when force majeure occurs, it will have the right to issue an Invoice for the work that has already been delivered and the other party will be obliged to pay this Invoice as if it were a separate contract.

13. Applicable Laws

13.1.
All the agreements between the Factor and Client are subject to the laws that are applicable in the location of the Factor’s statutory address.

14. Competent court

14.1.
Disagreements and conflicts relating to an agreement between the Parties will be judged upon by the “Court of First Instance” where the Factor is located.

15.2
These General Terms and Conditions are written in the English language and may be translated into other languages by the Factor. In the case of a difference in interpretation in the translated texts, this official English text prevails over the translated versions.