Exhibit 10.2
BIBBY FINANCIAL SERVICES
STANDARD CONDITIONS FOR
THE PURCHASE OF DEBTS
(EDITION A/2004) INCORPORATED
INTO THE CONFIDENTIAL
INVOICE DISCOUNTING
AGREEMENT MADE WITH
SIGNATURE INDUSTRIES LIMITED

 

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CONTENTS

         
1. Introduction
    3  
 
       
2. Duration of this Agreement
    3  
 
       
3. Notification and ownership of Debts
    3  
 
       
4. Purchase Price of Debts
    4  
 
       
5. Credit Limits
    5  
 
       
6. Your accounts
    7  
 
       
7. Factor’s Discount, Fees and other charges
    10  
 
       
8. Collection of Debts
    14  
 
       
9. Provision of information and documentation
    18  
 
       
10. Your undertakings
    19  
 
       
11. Your warranties
    22  
 
       
12. Computerised Services
    24  
 
       
13. Communications with third parties
    28  
 
       
14. Unlimited partnerships and sole traders
    28  
 
       
15. Termination of this Agreement
    33  
 
       
16. Variation, assignment and novation of this Agreement
    37  
 
       
17. Liability and waivers
    37  
 
       
18. Power of attorney
    38  
 
       
19. Service of notices
    39  
 
       
20. Governing law
    40  
 
       
21. Definitions
    40  
 
       

 

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1.  
Introduction

  1.1  
In this Agreement words defined in condition 21 shall have the meanings set out
in that condition.

  1.2  
Terms set out in any Special Conditions or Schedule to this Agreement shall
prevail over any inconsistent term in these Standard Conditions.

  1.3  
References to numbered conditions are to conditions in these Standard
Conditions.

2.  
Duration of this Agreement

  2.1  
This Agreement shall begin on the Commencement Date and continue for the Minimum
Period. It shall endure thereafter until terminated by either of us giving to
the other notice in writing of at least the Minimum Notice Period to expire on
the last day of a calendar month. Such notice may only be given after the expiry
of the Minimum Period.

  2.2  
We shall have the right at any time following a Termination Event to terminate
this Agreement by written notice to you.

3.  
Notification and ownership of Debts

  3.1  
This Agreement shall apply to the categories of Debts referred to in clause 4 of
the Particulars and such other categories of Debts as we may agree in writing
with you.

  3.2  
By this Agreement you assign to us with full title guarantee all Debts together
with their Related Rights which are Outstanding on the Commencement Date or
which come into existence after the Commencement Date until this Agreement is
terminated. The ownership of each Initial Debt and its Related Rights shall vest
in us on the Commencement Date. The ownership of each Debt coming into existence
after the Commencement Date and its Related Rights shall vest in us
automatically upon the Debt coming into existence.

 

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  3.3  
Initial Debts shall be Notified to us on an Invoice Schedule on the Commencement
Date. Debts coming into existence after the Commencement Date shall be Notified
to us on Invoice Schedules within 2 days of the issue of an invoice evidencing
the Debt to your Customer or within such other period as we may stipulate in
writing.

  3.4  
The Notifications referred to in condition 3.3 will constitute specific
assignments by you to us of each Debt and shall be in addition to the general
assignment of all Debts effected by condition 3.2 so that, at our option, we can
obtain a legal assignment of each Debt.

  3.5  
If any Debt shall fail to vest in us, you will hold the Debt and its Related
Rights on trust for us.

  3.6  
Unless stated in the Special Conditions or we tell you in writing to the
contrary, you will send to us with each Invoice Schedule a copy of each invoice
and such other documents which evidence the complete performance of the Contract
of Sale as we require.

  3.7  
Unless we tell you in writing, your obligation to Notify Debts under condition
3.3 does not apply to Non-notifiable Debts.

  3.8  
We may require you at your expense to execute a written assignment to us of a
Debt and its Related Rights. You will pay all stamp duty (if any) on such
assignment or on any reassignment of a Debt by us to you.

  3.9  
Any credit note will be raised immediately when due and Notified to us on a
Credit Note Schedule together with, if we tell you, a copy of the credit note
within 2 days of its issue.

4.  
Purchase Price of Debts

  4.1  
The Purchase Price of each Debt vesting in us shall be the amount paid to us in
or towards discharge of the Debt less:

  4.1.1  
any Allowance due to or taken by the Customer; and

  4.1.2  
Factor’s Discount, Fees and any other amounts due from you to us under this
Agreement or any other agreement.

 

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  4.2  
Unless otherwise agreed by us, the Purchase Price shall be payable in Sterling.
If a Debt is expressed in a currency other than Sterling:

  4.2.1  
we may provisionally calculate the Purchase Price at the rate of exchange quoted
by our bankers for them to purchase the relevant currency on the date we credit
the Debt to the Sales Ledger Control Account;

  4.2.2  
when converting any Collection to Sterling we may calculate the Purchase Price
at the rate of exchange quoted by our bankers for them to purchase the relevant
currency on the date we debit the Collection to the Sales Ledger Control
Account; and

  4.2.3  
you will indemnify us for any exchange rate losses which we suffer and the
amount of such losses shall be debited to your Client and Sales Ledger Control
Accounts.

5.  
Credit Limits

  5.1  
We may establish a Credit Limit for each of your Customers for the purpose of
calculating the amount of Prepayments that may be made to you. Debts coming into
existence after the establishment of a Credit Limit may be Approved Debts to the
extent that they are within such Credit Limit. Debts in excess of a Credit Limit
and Debts for which no Credit Limit has been established shall be Disapproved
Debts.

  5.2  
If we decide not to establish Credit Limits for any of your Customers, in our
sole discretion we may treat some or all Debts which are Disapproved Debts as
Approved Debts.

  5.3  
If the total of Outstanding Debts due from a Customer is in excess of any Credit
Limit for that Customer, the Debts shall be treated as Approved or Disapproved
in the order in which the relevant invoices are dated. Upon payment of an
Approved Debt, Disapproved Debts which then come within the Credit Limit may
become Approved Debts.

 

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  5.4  
We may establish, increase, reduce or cancel a Credit Limit entirely at our
discretion and shall not be obliged to give you any reason for our decision. We
shall advise you of Credit Limits and changes to them in such manner as we shall
decide.

  5.5  
Your application for a Credit Limit or any variation to a Credit Limit may be
made verbally or in writing and you must provide all information about the
Customer which we may require together with an indication of the Credit Limit
you want. Such information must be true and accurate.

  5.6  
We are not a credit reference agency and the establishment of a Credit Limit is
not to be treated as an indication of the creditworthiness of a Customer. You
will not tell anyone, including your Customers, the amount or absence of any
Credit Limit.

  5.7  
An Approved Debt will immediately and without notice become a Disapproved Debt:

  5.7.1  
upon expiry of the Approval Period;

  5.7.2  
upon termination of this Agreement, at which time all Credit Limits will
automatically be reduced to zero; or

  5.7.3  
upon the occurrence of a Termination Event (whether or not we exercise our right
to terminate this Agreement).

  5.8  
We may designate all or part of an Approved Debt as a Disapproved Debt
immediately and without notice if you are in breach of any undertaking or
warranty relating to the Debt or the Debt is disputed by your Customer.

  5.9  
If an Approved Debt becomes a Disapproved Debt, you will forthwith repay any
Prepayment made in respect of such Debt.

  5.10  
At any time we may treat as a Disapproved Debt such percentage or amount of an
Approved Debt as in our absolute discretion we shall decide to cover the risk of
non-payment of the full amount of any Approved Debt.

 

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  5.11  
In so far as a Debt in excess of a Credit Limit or a Debt for which no Credit
Limit has been established is designated as an Approved Debt on any report or
account provided by us to you, including (without limitation) on a Customer Aged
Debt Analysis, for the purpose of calculating the Available Funds, such Debt
will only be an Approved Debt to the extent that it is within the relevant
Credit Limit and does not exceed the Customer Concentration Percentage.

  5.12  
We may exercise our right of Recourse or reassign a Debt to you at any time
after any of the events specified in conditions 5.7 and 5.8. Recourse shall be
effected by your paying to us any Prepayment paid in respect of the Debt.
Reassignment shall be effected by debiting the Notified Value of the Debt to
your Client and Sales Ledger Control Accounts.

6.  
Your accounts

  6.1  
We shall maintain such accounts as we consider necessary to record details of
the Debts purchased by us, amounts received from you or your Customers, the
Available Funds, the Factor’s Discount, Fees and other sums due to or from us
including a Client Account, a Current Account and a Sales Ledger Control
Account.

  6.2  
The anticipated Purchase Price of all Debts will be credited to your Sales
Ledger Control Account. The amount credited may be equivalent to the Notified
Value before deduction of the items referred to in conditions 4.1.1 and 4.1.2
and may be adjusted as necessary at any time.

  6.3  
We shall debit to your Sales Ledger Control Account:

  6.3.1  
the Notified amount of any credit note issued by you;
    6.3.2  
the amount of any Allowance due to or taken by a Customer;

  6.3.3  
any adjustment to the value of a Debt to which we consider the Customer is
entitled; and

  6.3.4  
any Collection.

 

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  6.4  
The net amount of all credits and debits made to your Sales Ledger Control
Account under conditions 6.2 and 6.3, excluding Collections, shall be applied to
your Client Account.

  6.5  
The amount of all payments made by us to you and all Factor’s Discount, Fees and
other charges payable by you under this Agreement shall be debited to your
Client Account.

  6.6  
The balance on your Current Account at any time will be calculated by deducting
the balance on your Client Account from the balance on your Sales Ledger Control
Account.

  6.7  
You may request payments from us in or towards the Purchase Price of Debts.
Subject to the terms of this Agreement and the amount of your Available Funds
and the Funding Limit, we may make a:

  6.7.1  
Prepayment to you in respect of all Outstanding Approved Debts on the Working
Day following the receipt of your Invoice Schedule relating to such Debts;

  6.7.2  
payment to you of the amount or balance of the Purchase Price of Debts equal to
any Collection less any Prepayment made in respect of such Debts on the Working
Day following receipt of such Collection.

  6.8  
We shall not be obliged to make any payments to you:

  6.8.1  
in excess of the Available Funds;

  6.8.2  
if, having made such payment, the balance on your Current Account would exceed
the Funding Limit;

  6.8.3  
against the Outstanding Approved Debts of a Customer to the extent that such
Debts are in excess of the Customer Concentration Percentage;

  6.8.4  
if you are Insolvent; or

  6.8.5  
after the occurrence of a Termination Event.

 

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  6.9  
In our absolute discretion, we may make Prepayments to you in excess of the
Available Funds or Funding Limit on such terms and subject to the payment of
such additional charges as we may specify.

  6.10  
You will repay to us on demand any amount by which:

  6.10.1  
the balance on your Current Account exceeds the value of Approved Debts after
applying the Approved Funding Percentage and Customer Concentration Percentage;
or

  6.10.2  
any Prepayment exceeds the relevant Purchase Price.

  6.11  
Unless otherwise agreed by us, all payments by us to you shall be made to your
account through the Bankers Automated Clearing System or Clearing Houses
Automated Payment System, except payments in Approved Currencies which shall be
made to you through the Society for Worldwide Interbank Telecommunication
system.

  6.12  
No interest shall be payable by us to you in respect of credit balances on your
Current Account.

  6.13  
We shall have the right at any time to debit to your Client Account all amounts
owing by you to us, whether under this Agreement or any other agreement or on
any other account and whether payable presently, prospectively or contingently,
or by reason of an assignment to us, and/or to set off such amounts against sums
due from us to you. In our absolute discretion, we may make a reasonable
estimate of an amount payable where it cannot be determined at the relevant
time. All such amounts shall be combined into a single account. Any debit
balance shall be immediately payable to us and any credit balance may be payable
to you.

  6.14  
We may at any time debit to your Client Account the amount of any liability owed
by you to any Bibby Group Company. We are authorised by you to guarantee payment
of such liability to such company and you agree to indemnify us against all sums
paid under such guarantee.

 

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  6.15  
We shall send you statements of the Sales Ledger Control Account and Client
Account at such intervals as we shall decide and a Client Statement at the end
of each month or we shall provide you with access to such Accounts through our
Computerised Services. Such Accounts shall be treated as correct and binding
upon you except for obvious errors or those of which you tell us within 15 days
of the date of our sending such Accounts to you or of their publication though
our Computerised Services.

  6.16  
In any proceedings, you agree that any account maintained by us and certified by
our company secretary or a director of ours as to the balance on such account or
any loss or damage suffered by us shall be conclusive evidence of the amount so
certified in the absence of obvious error or error in law.

  6.17  
All payments to be made by you under this Agreement shall be made immediately
without deduction or set off. If any deduction is required by law, you will:

  6.17.1  
deduct the minimum amount you are required to deduct;

  6.17.2  
promptly account to the relevant authority for such amount and deliver to us on
demand such documents as we may reasonably request in respect of that payment;
and

  6.17.3  
pay to us such additional amount as shall ensure that we shall receive the full
amount payable under this Agreement as if no deduction had been made.

7.  
Factor’s Discount, Fees and other charges

  7.1  
You will pay to us:

  7.1.1  
the Retrospective Fee, which we shall debit to your Client Account at any time
on or after the Commencement Date;

  7.1.2  
the Fee, which we shall debit to your Client Account either at the percentage
rate shown in the Particulars on receipt of each Invoice Schedule or monthly on
the first Working Day of each month commencing with the month following the
Commencement Date at a rate equivalent to one-twelfth of the annual rate shown
in the Particulars (as appropriate);

 

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  7.1.3  
the Refactoring Fee, which we shall debit to your Client Account on or at any
time after the first Working Day of the month following the month during which
the Refactoring Fee accrues;

  7.1.4  
all Disbursements, which we shall debit to your Client Account at the time the
relevant expense is incurred or payable.

  7.2  
The Fee and Retrospective Fee cover:

  7.2.1  
a licence to use our Computerised Services (if we have agreed to provide them to
you);

  7.2.2  
the provision of statements of your Sales Ledger Control, Client and Current
Accounts and other reports;

  7.2.3  
establishing and monitoring Credit Limits and Customer Limits (Non-recourse
facilities only); and (in the case of factoring, but not invoice discounting,
agreements)

  7.2.4  
the management of your sales ledger; and

  7.2.5  
actions taken by us to collect Debts.

  7.3  
If the total of the Fees (excluding the Retrospective and Refactoring Fees)
debited to your Client Account in the period shown in clause 10 of the
Particulars (starting from the first day of the month following the Commencement
Date) is less than the Minimum Fees for such period, you will pay to us the
amount of such deficit. If we anticipate that there will be a deficit in any
subsequent period, we may debit your Client Account with the estimated amount of
such deficit.

  7.4  
If a Debt is expressed in a currency other than Sterling but we have agreed with
you to pay the Purchase Price of each Debt vesting in us in Sterling, the
Retrospective Fee, Fee and Refactoring Fee (if payable as a percentage of the
Notified Value of the Debt) shall be converted to the Sterling equivalent of the
Debt calculated at the rate of exchange quoted by our bankers for them to
purchase the relevant currency on the date we credit the Debt to the Sales
Ledger Control Account.

 

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  7.5  
If this Agreement ends for any reason before the expiry of the Minimum Period or
without you giving us notice of at least the Minimum Notice Period or if we
exercise any of our rights under condition 15.3 following a Termination Event,
you will pay to us the greater of either:

  7.5.1  
a sum equivalent to the balance of the Minimum Fees (after deduction of the Fees
already debited to your Client Account during the relevant period) which would
have been payable had this Agreement continued from the date of termination or
the occurrence of the Termination Event (as appropriate) for, as appropriate,
the remainder of the Minimum Period and the Minimum Notice Period; or

  7.5.2  
a sum equivalent to the Fees which would have accrued had this Agreement
continued from the date of termination or the occurrence of the Termination
Event (as appropriate) for, as appropriate, the remainder of the Minimum Period
and the Minimum Notice Period on the assumption that such Fees would have
accrued proportionally at a rate equivalent to the monthly average of the Fees
charged to you during the six months immediately preceding the ending of this
Agreement or the occurrence of the Termination Event (as appropriate).

  7.6  
You will not be entitled to any refund of the Retrospective Fee, Fee or
Refactoring Fee upon termination of this Agreement, the Recourse or reassignment
of a Debt or the issue of any credit note.

  7.7  
If we agree in writing that this Agreement may end without you giving us the
full period of notice to which we are entitled, you will pay to us such sum as
we may specify as consideration for our agreement to waive our entitlement to
receive such notice.

 

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  7.8  
You will pay to us an arrangement fee for any variation of this Agreement or any
additional service or facility requested by you, including our processing of
Invoice Schedules or Collections so that we may make payments to you the same
day as the receipt of such items, the making of payments to you in excess of the
Available Funds or Funding Limit and the provision of additional reports, our
charges for which will be provided to you from time to time.

  7.9  
You will indemnify us against:

  7.9.1  
all costs and expenses payable by us as a result of appointing accountants,
lawyers, other professional advisers or debt collection agencies to:

  7.9.1.1  
enforce this Agreement;
    7.9.1.2  
resolve disputes with Customers; and
    7.9.1.3  
issue proceedings to collect Debts;

  7.9.2  
all costs and expenses payable to any Customer or third party in any
proceedings;

  7.9.3  
any claim against us by a Customer;

  7.9.4  
all bank charges of whatever nature for which we are liable in respect of any
Debt or Collection;

  7.9.5  
any loss caused directly or indirectly by your breach of this Agreement;

  7.9.6  
any increase from time to time in the cost to us of the funds we obtain to
provide Prepayments to you under this Agreement including, without limitation,
to the discount or interest rate or other costs, charges, fees and expenses
relating to such funds (whether such Prepayments are in existence at the time
of, or made after, such increase); and

 

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  7.9.7  
any costs and expenses incurred by us in carrying out any of your obligations
under this Agreement or anything which we reasonably request you to do in
connection with the proper performance of this Agreement.

  7.10  
The Factor’s Discount shall accrue from day to day and shall be calculated at
the rate specified in the Particulars on the balance on your Current Account
from time to time. Any amount debited to the Client Account will be treated as a
Prepayment to which the Factor’s Discount applies. The Factor’s Discount shall
be debited daily to your Client Account. Whilst we shall debit all Collections
to your Sales Ledger Control Account on the date of receipt of the relevant
Collection, for the purpose of calculating Factor’s Discount, value for
Collections will only be credited to your Sales Ledger Control Account 6 Working
Days after the date of receipt of the Collection by us or, if later, on the date
we receive cleared funds in our account.

  7.11  
Where applicable, Value Added Tax will be payable on all Fees and other amounts
payable by you to us under this Agreement.

8.  
Collection of Debts

  8.1  
We shall have the sole and exclusive right of collecting and enforcing payment
of any Debt in such manner as we consider appropriate. You have no right to
collect Debts unless condition 8.6 applies or you have our written authority.

  8.2  
Except where provided to the contrary in this Agreement:

  8.2.1  
you will give written notice to each Customer of the assignment of Debts to us
on all invoices, statements of account and other documents in such format and at
such times as we shall tell you; and

  8.2.2  
we shall be entitled to give notice to your Customers of the assignment of Debts
to us at any time and in such format as we shall in our complete discretion
determine.

 

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  8.3  
We shall have the right to:

  8.3.1  
appropriate any Collection, credit or Allowance in or towards the satisfaction
of Approved Debts in priority to Disapproved Debts even though the Customer may
have allocated the Collection, credit or Allowance against invoices evidencing
specified Disapproved Debts;

  8.3.2  
accept payment from a Customer of a sum less than the Notified Value of the Debt
in satisfaction of such Debt ;

  8.3.3  
commence, conduct, defend or compromise any proceedings in your and/or our name
for the recovery of a Debt or resolve any dispute with a Customer on such terms
as we consider appropriate;

  8.3.4  
make payment to a Customer of any credit balance on the Customer’s account; and

  8.3.5  
take possession of any Returned Goods and to sell them on such terms as we shall
decide. The net proceeds of sale, after deduction of all costs and expenses
incurred in securing possession of and selling the goods, shall be treated as a
Collection and applied by us in or towards payment of the relevant Debt.

  8.4  
You will be bound by our decisions even if the Purchase Price of a Debt is
reduced as a consequence.

  8.5  
If requested by us, you will:

  8.5.1  
fully co-operate with us to collect Debts and resolve disputes with Customers;

  8.5.2  
provide us free of charge with all evidence required by us;

  8.5.3  
ensure the attendance at any hearing of all witnesses required in connection
with any proceedings; and

  8.5.4  
exercise your rights under a Contract of Sale to enforce any Related Rights.

 

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  8.6  
If we appoint you as our agent to collect Debts:

  8.6.1  
you will act as our agent solely for the purpose of collecting and enforcing
payment of Debts and enforcing and protecting all Related Rights relating to
Debts;

  8.6.2  
you undertake to act promptly and efficiently at your expense in carrying out
your duties as our agent;

  8.6.3  
you will not hold yourself out as our agent for any other purpose;

  8.6.4  
you will not appoint any other person to collect payment of Debts without our
prior written consent;

  8.6.5  
condition 8.2 will not apply unless we terminate your agency under condition
8.7;

  8.6.6  
you will manage the accounts of Customers, render statements to Customers and
maintain such accounts and records in respect of the Debts as we shall from time
to time stipulate and will conspicuously mark your ledgers to show that the
Debts have been assigned to us;

  8.6.7  
we may open a bank account in your name and you will deliver to the relevant
bank an irrevocable mandate under which officers of ours are appointed as the
only authorised signatories. You will pay into such bank account all payments
tendered by Customers in or towards the discharge of Debts purchased by us under
this Agreement (excluding Non-notifiable Debts);

  8.6.8  
no Prepayments shall be made in respect of Debts payable by standing order or
direct debit until you have provided us with satisfactory evidence that payment
under such standing order or direct debit will be made to the bank account
identified in condition 8.6.7;

  8.6.9  
we may communicate with Customers in our or your name for the purpose of
verifying the existence and amount of Debts;

 

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  8.6.10  
you will provide us with the following documents completed to the month end by
the 12th day of the following month:

  8.6.10.1  
a reconciliation of your sales ledger to your Sales Ledger Control Account in a
format specified by us;

  8.6.10.2  
an open item aged Customer listing, including the Customer’s name, address and
telephone number;

  8.6.10.3  
copies of all Customer statements;

  8.6.10.4  
an aged creditors’ listing; and

  8.6.10.5  
copies of your bank statements for all accounts maintained by you (procuring
your bankers to send such statements direct to us);

  8.6.11  
you will provide us with monthly management accounts for each month by the end
of the calendar month following the month to which the accounts relate; and

  8.6.12  
you will allow us to audit your sales ledger and inspect your accounting records
at your premises at such frequency and cost to you as we shall stipulate.

  8.7  
We may at any time terminate your agency to collect Debts. Upon termination of
such agency:

  8.7.1  
we may ask you to comply with condition 8.2.1, if previously you have not been
required to do so;

  8.7.2  
you will not hold yourself out as our agent for any purpose;
    8.7.3  
we shall collect all Debts or supervise their collection by a third party;
    8.7.4  
you will ensure that Customers pay all Debts directly to us;

  8.7.5  
you will immediately deliver to us such accounts, documents and records relating
to the Outstanding Debts as we specify; and

 

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  8.7.6  
we shall be entitled to charge you a collection fee of 10% of the Notified Value
of all Debts Outstanding at the date of the termination of the agency (which we
may debit to your Client Account at any time after such date) and of all Debts
Notified to us after such date (which we may debit to your Client Account at any
time after each Debt is Notified). Such collection fee is to cover the
additional work we will be required to perform to carry out the obligations you
agreed to undertake under the terms of your agency. You acknowledge that such
collection fee represents a genuine pre-estimate of the loss we are likely to
sustain in consequence of the termination of your agency to collect Debts.

9.  
Provision of information and documentation

  9.1  
You agree to allow any representative or agent of ours at all reasonable times
to enter any premises at which you carry on business to inspect goods (including
Returned Goods) and check Contracts of Sale and all books, accounts, computer or
other records, orders, correspondence and such other documents as we may require
and to copy such documents and computer disks at your expense.

  9.2  
You will supply us with a signed copy of your balance sheet and accounts and (if
you are a limited company or LLP) directors’ report for each of your accounting
reference periods either audited (if you are a limited company or LLP) or
certified as true and correct by a firm of chartered or certified accountants
(if you are a partnership or sole trader) as soon as they are available and in
any event within 7 months from the end of each such accounting period.

  9.3  
You will provide us with your management accounts and such other financial
reports showing your financial position and the results of your operations as we
may require for such periods and at such intervals as we may specify.

 

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10.  
Your undertakings
     
You undertake, for the duration of this Agreement and until you have discharged
all monies owing to us, that:

  10.1  
after Notifying a Debt to us:

  10.1.1  
you will not vary the terms of the Contract of Sale, any payment terms or
settlement discounts (if any);

  10.1.2  
you will promptly perform all your obligations to the Customer under the
Contract of Sale and, at our request, provide satisfactory evidence of the
complete performance of the Contract of Sale;

  10.1.3  
you will owe no obligations to the Customer other than under the Contract of
Sale;

  10.1.4  
you will not agree with the Customer to allow any credit against the Debt or
issue a credit note for a sum in excess of the Credit Note Limit; and

  10.1.5  
you will not issue or agree with the Customer to issue any credit note against
the Debt if we have notified you that you must not do so;

  10.2  
you will not agree with a Customer better payment terms or settlement discounts
(if any) than those specified in the Client Particulars without our prior
written consent;

  10.3  
every Contract of Sale is subject to the law of England and Wales, provides for
payment in Sterling (unless we have agreed in writing that your Customers may
make payment of Debts in an Approved Currency) and such Contract of Sale does
not include any prohibition against the assignment of the Debt or the Contract
of Sale under which the Debt arises;

  10.4  
save as provided in condition 10.5, you will not include in any Invoice Schedule
any Debt:

  10.4.1  
until the relevant Contract of Sale has been completely performed;

  10.4.2  
due from an Associate;

  10.4.3  
owed by a Customer from whom you purchase goods or services or with whom you
have any contra accounting agreements;

 

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  10.4.4  
which arises from a Contract of Sale containing terms that entitle the Customer
to return the goods;

  10.4.5  
which is a Non-notifiable Debt;

  10.4.6  
in respect of which a payment has previously been made to you; or

  10.4.7  
which arises under a Contract of Sale providing for the supply of goods in
instalments or provision of services on a periodic basis unless the Contract of
Sale is divisible and the Customer has agreed to pay for each instalment
delivery or period irrespective of the performance of your further obligations
under the Contract of Sale;

  10.5  
you will Notify us separately of each Debt which:

  10.5.1  
does not comply with the undertakings and warranties contained in this Agreement
providing particulars of the relevant undertakings and warranties with which you
are unable to comply;

  10.5.2  
relates to a claim for interest and/or compensation payable either pursuant to
the Contract of Sale or the Late Payment of Commercial Debts (Interest) Act
1998, providing details of how the claim arises and the calculation of the
claim; or

  10.5.3  
is an Export Debt or arises under a Contract of Sale providing for payment in an
Approved Currency;

  10.6  
you will tell us immediately of any:

  10.6.1  
breach by you of any undertaking or warranty given by you in this Agreement;

  10.6.2  
change or proposed change in the Control of your business or that of any
Associate or Guarantor;

  10.6.3  
Insolvency proceedings commenced against you, any Guarantor, Associate or
Customer;

 

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  10.6.4  
security holder enforcing its security over any part of your assets or
undertaking;

  10.6.5  
material information about the creditworthiness of a Customer;

  10.6.6  
dispute between you and a Customer and provide us with full particulars of such
dispute; and

  10.6.7  
Returned Goods which have been delivered into your possession;

  10.7  
you will not create any security, trust, lien or other interest over your
existing or future Debts without our prior written consent;

  10.8  
you will not sell any of your assets except in the ordinary course of your
business, as stated in the Client Particulars, on commercial terms and for full
value;

  10.9  
you will not enter into any other agreement for the factoring or discounting of
Debts and you will procure that no Associate of yours enters into an agreement
for the factoring or discounting of its debts without our prior written consent;

  10.10  
you will comply with any procedures which we communicate to you for the
efficient day-to-day operation of our respective obligations under this
Agreement;

  10.11  
you will sign all documents, including assignments of Debts or Related Rights,
and do anything we reasonably request to exercise or enforce our rights under
this Agreement;

  10.12  
you are properly registered under the Data Act and will ensure that such
registration continues in force;

  10.13  
you will ensure that your processing of information about your sole trader and
unlimited partnership Customers is accurate and complies with the Data Act and,
in particular, the 8 data protection principles set out in the Data Act;

 

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  10.14  
you will advise us immediately if you are notified of any alleged breach of the
Data Act in relation to a Customer;

  10.15  
you will advise us immediately of all communications received from a Data
Subject;

  10.16  
you will communicate to your sole trader and unlimited partnership Customers
that information about them will be disclosed to us and how we will use such
information and you will obtain their consent to your providing such information
to us and our processing of such information for the purposes set out in
condition 14.11 in accordance with the first and second principles set out in
the Data Act;

  10.17  
you will, upon receipt of any form of payment tendered in or towards the
discharge of a Debt purchased by us under this Agreement, hold such payment
absolutely in trust for us and (excluding Non-notifiable Debts unless we tell
you otherwise in writing) you will:

  10.17.1  
immediately deliver to us the identical cash, cheque, bill of exchange or other
remittance or pay it into such bank account as we may stipulate; and

  10.17.2  
keep it separate from your other money and will not, under any circumstances,
pay it into your own account or the account of any other person.

11.  
Your warranties

  11.1  
In relation to each Debt included in an Invoice Schedule, by delivering the
Invoice Schedule you will give all the following warranties to us:

  11.1.1  
the Debt arises under a genuine Contract of Sale made with one of your Customers
in the normal course of your business, as stated in the Client Particulars;

  11.1.2  
you are the true owner of the Debt and have the right to sell the Debt to us and
no other party has any charge, trust, lien, pledge, interest, tracing or other
rights in respect of the Debt, or the goods the subject matter of the Debt,
which would affect our title to the Debt or our right to payment of the Debt;

 

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  11.1.3  
the Debt has not been Notified to us previously;

  11.1.4  
your obligations under the Contract of Sale have been completely performed and
the Customer will pay the Debt without raising any dispute, retention, set off
or counterclaim;

  11.1.5  
you do not owe any obligations to the Customer which may reduce the Notified
Value of the Debt payable by the Customer;

  11.1.6  
the Debt is owed by a Customer who has an established place of business in the
UK or, if we have agreed to purchase your Export Debts, in an Accepted Country;

  11.1.7  
in deciding to extend credit to the Customer, you made all reasonable enquiries
about the creditworthiness of the Customer that a prudent supplier would
undertake and have told us of any adverse information you know about the
Customer’s financial position;

  11.1.8  
the details of the invoice(s) evidencing the Debt as set out in the relevant
Invoice Schedule are accurate;

  11.1.9  
the correct name and address of the Customer are stated on every invoice and
document evidencing the Contract of Sale; and

  11.1.10  
you hold all necessary licences and authorities to enter into the Contract of
Sale and for the Customer to pay the Debt to us.

  11.2  
You warrant to us that:

  11.2.1  
prior to the Commencement Date, you have told us about all material information
that may have influenced our decision to enter into this Agreement with you or
to enter into any guarantee or indemnity with any Guarantor; and

 

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  11.2.2  
all balance sheets, profit and loss accounts, management accounts and other
accounting records relating to your business or that of an Associate or
Guarantor which you provided to us prior to the Commencement Date or which you
supply to us during the duration of this Agreement are accurate and correct.

  11.3  
If you are required by us to assign the benefit of any policy of credit
insurance, you warrant to us that:

  11.3.1  
you have disclosed to the insurer every fact or matter which you know or ought
to know might influence the insurer in relation to the issue or continuance of
cover under the policy;

  11.3.2  
you have fully complied with the terms of the policy;

  11.3.3  
you have not done or omitted to do anything which might invalidate the policy;
and

  11.3.4  
you will promptly submit and recover all claims relating to Debts which you are
entitled to make under the policy;

  11.3.5  
and you undertake to us that you will continue to comply with the warranties set
out in this condition 11.3 for the duration of this Agreement and will pay any
premiums when due, hold any sums received from an insurer in respect of Debts on
trust for us and tell us immediately if the policy shall be cancelled or lapse.

  11.4  
Your compliance with condition 10 and this condition 11 of this Agreement are of
the essence of this Agreement.

12.  
Computerised Services

  12.1  
If we have agreed to provide you with our Computerised Services, the provisions
of this condition 12 will apply.

  12.2  
This condition 12 shall apply to all Messages exchanged between us using the
electronic data interchange network operated by us. We both agree that such
Messages shall be transmitted in accordance with any user manual or procedures
communicated in writing by us to you.

 

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  12.3  
You undertake:

  12.3.1  
at your expense, to make suitable contingency arrangements to cover system,
communication or operating failures or the suspension or withdrawal of the
Computerised Services;

  12.3.2  
to ensure that all Messages you send are correct and complete;

  12.3.3  
to use the Computerised Services only for your own needs and for the purpose of
this Agreement.

  12.4  
You have a non-transferable licence to use the Computerised Services for the
duration of this Agreement or the earlier termination of such Computerised
Services by us.

  12.5  
We shall have the right to alter the extent of the Computerised Services at any
time without notice to you.

  12.6  
Each of us agrees to:

  12.6.1  
notify the other immediately if either of us knows or suspects that there has
been any failure, delay, error, defect, corruption, fraud or breach of security
in sending or receiving any Message or any misuse of or breach of secrecy in
respect of any of the matters referred to in condition 12.6.3 and to co-operate
in resolving such matters;

  12.6.2  
take all appropriate steps and establish and maintain all appropriate procedures
so as to ensure that as far as is reasonably practicable Messages are properly
stored, are not accessible to unauthorised persons, are not altered, lost or
destroyed and are capable of being retrieved only by properly authorised
persons;

  12.6.3  
keep secret and confidential the method of operation of the Computerised
Services, all access telephone numbers, user numbers, passwords, test keys,
access codes and security procedures;

 

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  12.6.4  
accept the integrity of all Messages and to give them the same status as if they
had been in writing unless it can be shown that they have been corrupted as a
result of technical failure;

  12.6.5  
delete any Message that is not intended for either of us and notify the other
party that it has done so; and

  12.6.6  
maintain a Data Log of Messages sent and received and store such Data Log
unmodified for 12 months after the termination of this Agreement. Each Data Log
will be made available to the other party on request. Our Data Log will be
conclusive evidence of the Messages sent and received by us, the constituents of
such Messages and the times at which they were sent and received, in the absence
of manifest error.

  12.7  
Each Message must identify the sender and recipient and include a means of
verifying the authenticity of the Messages either through a technique used in
the Message or provided in any user manual or procedures communicated in writing
by us to you.

  12.8  
The copyright and all other rights in the Computerised Services provided by us
or by our licensors shall at all times remain vested in us or, if the terms of
any contract between us and our licensors so specify, in our licensors.

  12.9  
We may act on any Message ostensibly sent by you even if it did not originate
from you or the person purporting to send such Message had no authority to do
so.

  12.10  
You accept that:

  12.10.1  
information communicated through our Computerised Services may be updated by us
at any time and we shall not be under an obligation to make a payment to you
even if your accounts show that you have Available Funds or we have acknowledged
a Message containing a payment request;

 

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  12.10.2  
we shall not be liable for any delay in performing any of our obligations under
this condition 12 in respect of the Computerised Services which is caused
directly or indirectly by:

  12.10.2.1  
any downtime, unavailability, failure or malfunction of computer hardware,
equipment or software, or of any telephone line or other communication system,
service, link or equipment;

  12.10.2.2  
the alteration, suspension or withdrawal of the Computerised Services;

  12.10.2.3  
any error or discrepancy in any Message received by us; or

  12.10.2.4  
abnormal operating conditions or any unforeseeable event including those set out
in condition 17.1.1.

  12.11  
You will indemnify us against all liabilities, damages and expenses arising out
of the transmission by you or receipt by us of or our relying or acting on
incorrect or inaccurate information or our not receiving a Message from you.

  12.12  
We shall be entitled, without liability to you or giving you notice, at any time
to suspend or withdraw the operation of the Computerised Services after which no
further Messages shall be sent or enquiries shall be made by either of us until
we have agreed to reactivate the Computerised Services.

  12.13  
The Computerised Services will be withdrawn automatically upon termination of
this Agreement. Upon the withdrawal of the Computerised Services, you will
immediately deliver to us all documents, equipment and copies of software
supplied by us to you for use in connection with the Computerised Services.

  12.14  
We reserve the right to charge you for new versions or updates of the
Computerised Services or their reconfiguration due to any misuse of the
Computerised Services by you.

 

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  12.15  
If you upload and send invoice details to us electronically, the Invoice
Schedules shall be treated as containing the following notice to us:
       
“We hereby assign each of the Debts evidenced by the invoices listed below and
confirm that we have complied with all the warranties and undertakings given by
us in the agreement between us for the purchase of Debts and in particular that
the Contract of Sale under which each Debt arises has been fully performed.”

13.  
Communications with third parties

  13.1  
You authorise us to:

  13.1.1  
contact your Customers for the purpose of collecting and verifying Debts;

  13.1.2  
provide your auditors, bankers, accountants and other professional advisers with
such information about your dealings with us as they may request; and

  13.1.3  
obtain from your auditors, bankers, accountants and other professional advisers
such information as we may require.

  13.2  
You confirm that the persons identified in condition 13.1 are or will be
authorised by you at all times to give such information and that you will
provide us with proof that such authority has been given if we request it.

14.  
Unlimited partnerships and sole traders

  14.1  
This condition 14 forms part of this Agreement if you are an unlimited
partnership or sole trader. Conditions 14.2 to 14.8 only apply if you are an
unlimited partnership. Condition 14.9 only applies if you are a sole trader.

  14.2  
Any reference in this Agreement to “you” shall be construed as a reference to
each of your partners or your partnership and “your” shall be construed
similarly. In condition 18.1, the words “and to act as the attorneys of each of
your partners” shall be added after the words “to act as your attorneys”.

 

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  14.3  
The undertakings and warranties contained in this Agreement shall be treated as
being given by each of your partners and the obligations of the partners shall
be joint and several.
    14.4  
You warrant that the partners identified in the Client Particulars comprise all
of your partners and undertake to inform us in writing immediately if:

  14.4.1  
any person intends to join or any partner proposes to cease to be a member of
your partnership;
    14.4.2  
you move your principal place of business to a location outside England and
Wales; or
    14.4.3  
you change the name of your partnership from that stated in the Client
Particulars.

  14.5  
Upon admitting a new partner to the partnership, you will procure that the new
partner executes all documents that are required to make him bound by the terms
of this Agreement.
    14.6  
Any partner who ceases to be a member of the partnership shall remain liable to
us for all liabilities accrued under this Agreement until the service of a
notice under condition 14.4.1 and our acknowledgement of such notice or, if
later, the date on which he ceased to be a partner.
    14.7  
Despite any changes in the membership of your partnership, we may treat this
Agreement as continuing on the same terms and we shall be entitled to account to
you and exercise all rights of set off as if there had been no change.
    14.8  
We shall be entitled to:

  14.8.1  
release or conclude a compromise with any one or more of your partners without
affecting our rights against the others;
    14.8.2  
give a demand to any partner and treat it as being delivered to all your
partners;

 

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  14.8.3  
treat a notice or demand from any of your partners as having been given by all
of your partners;
    14.8.4  
treat this Agreement as binding upon any executor, administrator or personal
representative of any of your partners and upon any committee, receiver,
judicial factor, trustee or other persons lawfully acting on behalf of any of
them; and
    14.8.5  
agree variations to this Agreement with any one or more of your partners.

  14.9  
If you are a sole trader:

  14.9.1  
you must obtain our written consent to your entering into a partnership with
another person;

  14.9.2  
you undertake to inform us in writing immediately if you move your principal
place of business to a location outside England and Wales; and

  14.9.3  
we shall be entitled to treat this Agreement as binding upon any executor,
administrator or personal representative of your estate or upon any committee,
receiver, judicial factor, trustee or other persons acting lawfully on your
behalf.

  14.10  
You will indemnify us against any costs incurred by us in registering this
Agreement in the Register of the Assignments of Book Debts.

  14.11  
You consent to the storing and processing of information about you in any way by
us or any Bibby Group Company, which may be based within or outside the European
Economic Area, for the purpose of providing services and finance to you and the
other purposes set out in this condition 14.11. This information will be used by
us and other Bibby Group Companies for:

  14.11.1  
training purposes;
    14.11.2  
credit or financial assessment;

 

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  14.11.3  
market and product analysis;
    14.11.4  
making payments;
    14.11.5  
recovering monies;
    14.11.6  
preparing statistics;
    14.11.7  
developing, improving and marketing our services to you and other clients;
    14.11.8  
the protection of our interests (including establishing Credit Limits for the
benefit of other clients or obtaining settlement of any liability of yours to
us);
    14.11.9  
the prevention of fraud and money laundering; and
    14.11.10  
to decide whether to continue with this Agreement or to vary its terms.

  14.12  
We will tell you if we make a significant decision about you solely using an
automated decision-making process, such as credit scoring. You may ask us to
review that decision using other means.

  14.13  
We may from time to time make searches of the records relating to you compiled
by the credit reference and fraud prevention agencies which we use. Such
agencies will keep a record of our searches which will be seen by other
organisations that make searches with them and may be used to prevent fraud or
money laundering or make credit decisions about you.

 

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  14.14  
It is important that you always give us accurate information. If at any time you
give us or procure the giving of false or inaccurate information and we suspect
fraud, we may record this with our credit reference and fraud prevention
agencies. The agencies to whom such information is provided will use the
information for statistical analysis about fraud and will also share it with
other organisations to:

  14.14.1  
help make decisions on motor, household, credit, life and other insurance
proposals and claims by you, members of your household or any other businesses
associated with you; and
    14.14.2  
prevent fraud.

  14.15  
We may give information about you, the terms of this Agreement, your compliance
with the terms of this Agreement, details of any breaches of this Agreement and
any Debts to:

  14.15.1  
our credit reference and fraud prevention agencies, so that they and other
organisations that search their records may assess applications for credit and
credit-related services made by you or members of your household or by any other
businesses associated with you, trace debtors, recover debts, prevent money
laundering and fraud, manage your accounts or carry out statistical analysis
relating to credit and financial services;

  14.15.2  
our or your insurers, so they can quote for and issue any policy or deal with
any claims;

  14.15.3  
any Guarantor, so they can assess their obligations to us or so we can enforce
such obligations against them under the relevant guarantee and/or indemnity;

  14.15.4  
our bankers or any advisers acting on our or your behalf, so they can carry out
their services to us or you;

  14.15.5  
any business providing factoring or discounting facilities to whom you may wish
to transfer, to facilitate such transfer;

  14.15.6  
any person with whom we may securitise the Debts or to whom we may wish to
transfer the Debts, to facilitate such transactions;

  14.15.7  
anyone else to whom we novate or transfer our rights or duties under this
Agreement, so they can comply with or enforce this Agreement; and

 

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  14.15.8  
any Bibby Group Company, so they can assess your creditworthiness or decide
whether to offer any further financial facilities to you.

  14.16  
From time to time we or other Bibby Group Companies may contact you by letter,
phone, fax or email to:

  14.16.1  
keep you informed about services and products which we consider may be of
interest to you; and

  14.16.2  
carry out market research about our services and products or those of third
parties.

     
If you do not wish to receive such information, then please let us know by
telling our Data Protection Compliance Officer, whose contact details are set
out in condition 14.18. We will not pass information about you to other third
parties for direct marketing purposes.

  14.17  
For training and/or security purposes your phone calls to us may be monitored
and/or recorded.

  14.18  
If you want to have details of the credit reference agencies and other third
parties referred to in this condition 14 from whom we have obtained and to whom
we may give information about you, please contact the Data Protection Compliance
Officer, Bibby Group of Factors, Packington House, 3-4 Horse Fair, Banbury,
Oxfordshire OX16 0AA, telephone 0800 919592. You have a legal right to these
details and, if you apply in writing, to receive a copy of the information we
hold about you. A fee will be payable.

15.  
Termination of this Agreement

  15.1  
We may immediately terminate this Agreement by written notice to you at any time
after any of the following Termination Events:

  15.1.1  
a material breach by you of this Agreement or any other agreement to which we
are both parties or between you and any Bibby Group Company;

 

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  15.1.2  
your failure to deliver an Invoice Schedule to us during a period of 30
consecutive days where such failure is wholly attributable to any deliberate act
or omission on your part;

  15.1.3  
your ceasing or threatening to cease to carry on your business as shown in the
Client Particulars;

  15.1.4  
your Insolvency or the Insolvency of any director, shareholder, member or
partner of yours except for the purpose of any reconstruction , amalgamation or
a reorganisation, provided such reconstruction, amalgamation or reorganisation
is approved in advance by us in writing;

  15.1.5  
the Insolvency or death of any Guarantor or the giving of notice of termination
of a guarantee and/or indemnity given by a Guarantor;

  15.1.6  
any change in the ownership, directors, partners, members, Control,
constitution, or composition of your business or adverse change in your
financial position or performance which in our discretion we consider materially
affects our rights under this Agreement;

  15.1.7  
any application by a creditor of yours for a third party debt order against us;

  15.1.8  
the termination of any waiver, consent, release, or priority arrangement given
to us by any party who holds security over your assets;

  15.1.9  
your failure to discharge when due any material obligations owed by you to a
third party for repayment of borrowed money;

  15.1.10  
the discounting or factoring by an Associate of its debts to a third party
without our prior written consent;

  15.1.11  
the material breach or termination by you or any third party of any
representation, warranty or undertaking in reliance upon which we entered into
this Agreement;

 

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  15.1.12  
the repayment by you of any loan made to you by an Associate without our prior
written consent save for any repayment of principal or interest under the
Destron Fearing Loan;

  15.1.13  
the material breach or termination of any agreement between us and any of your
Associates; or

  15.1.14  
the disqualification of any of your directors from acting as a director or your
conviction or the conviction of any shareholder, director, member of an LLP or
partner of yours of a criminal offence involving dishonesty.

     
For the purposes of this clause 15.1 a “material breach” shall mean a serious or
persistent default by you (or any Associate of yours) in the performance of any
material covenant, condition or obligation binding on you (or any of your
Associates) whether under the terms of this Agreement or under any agreement
between us and any such Associate and the default is either incapable of remedy
or is not remedied within five Working Days of the date upon which you receive
from us a notice requiring you to remedy the relevant default.

  15.2  
The occurrence of a Termination Event may constitute the repudiation by you of
this Agreement. Our acceptance of such repudiation may be communicated to you
expressly in writing or inferred from our exercising our rights under condition
15.3.

  15.3  
Upon or at any time after a Termination Event (whether or not we exercise our
right to terminate this Agreement) we may, with or without giving written notice
to you:

  15.3.1  
reduce the Approved Funding Percentage to zero or to such other figure as in our
discretion we shall decide;

  15.3.2  
cancel all Credit Limits;

  15.3.3  
designate all Approved Debts as Disapproved Debts;

 

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  15.3.4  
require you to pay to us immediately any balance on your Current Account, the
aggregate of all credit balances on your Customers’ accounts and all other sums
which you owe to us under this Agreement or any other agreement;

  15.3.5  
require you to repurchase any Outstanding Debts at a price equivalent to that
payable under condition 15.3.4;

  15.3.6  
increase the Factor’s Discount by 2%;

  15.3.7  
charge you the sum payable pursuant to condition 7.5; and

  15.3.8  
make a reserve against the Sales Ledger Control Account of such amount as we
consider appropriate to cover any liabilities which you may owe to us under this
Agreement or any other agreement.

  15.4  
Upon your Insolvency or ceasing to trade, in the event that any sum charged to
you under condition 7.5 is less than an amount equivalent to 10% of the Notified
Value of all Debts Outstanding at the date of the onset of Insolvency or
cessation of trading, we may charge you a collection fee equivalent to the
difference between (1) the sum charged under condition 7.5 and (2) 10% of the
Notified Value of all Debts Outstanding at the date of the onset of Insolvency
or cessation of trading (which we may debit to your Client Account at any time
after such date). Such collection fee is to cover the additional administrative
work we will be required to undertake to collect Debts after such events. You
acknowledge that such collection fee represents a genuine pre-estimate of the
loss we are likely to sustain in consequence of these events.

  15.5  
Following a notice from you to terminate this Agreement under condition 2.1, we
may, with or without giving notice to you, exercise the same rights as are set
out in condition 15.3.8.
    15.6  
Upon the termination of this Agreement:

  15.6.1  
all Approved Debts shall automatically be Disapproved Debts;

 

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  15.6.2  
you must repurchase all Outstanding Debts from us at a price equivalent to that
payable under condition 15.3.4;

  15.6.3  
the ownership of all Debts coming into existence prior to the date of
termination will continue to vest in us and our respective rights and
obligations under this Agreement shall continue to apply until the repurchase of
the Debts under condition 15.6.2 has been completed.

  15.7  
You will indemnify us against any claim by a Customer to repayment of any sum
paid to us by mistake or for a consideration which has wholly failed or which is
set aside under insolvency law, whether such claim shall be communicated to us
before or after the termination of this Agreement or the making of any payment
under condition 15.6.2.

16.  
Variation, assignment and novation of this Agreement

  16.1  
Except as provided in this Agreement, any variation of this Agreement will only
take effect when it is in writing and signed on our behalf by a director or
authorised officer or attorney and by you or a person acting lawfully on your
behalf.

  16.2  
You agree to the novation and/or assignment by us to any other party of any or
all of our rights and obligations under this Agreement.

  16.3  
This Agreement shall be binding upon and be effective for the benefit of our
successors and assignees and, where appropriate, references to “we” or “us”
shall include such successors and assignees.

  16.4  
You will not without our prior written consent assign or delegate any of your
rights or obligations under this Agreement.

17.  
Liability and waivers

  17.1  
We shall not be liable to you:

  17.1.1  
if we are unable to perform our obligations under this Agreement as a result of
an unforeseen event including any circumstances outside our reasonable control,
exchange control, governmental or legal requirements, an act of God, the
outbreak of war, any terrorist act, resolution, civil insurrection, strike,
industrial action or failure of postal, communications or banking services; or

 

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  17.1.2  
for any consequential or indirect loss of or damage to the goodwill or profits
of your business.

  17.2  
If we decide not to enforce any term of this Agreement against you, we shall not
be precluded from subsequently enforcing that or any other term of this
Agreement against you nor shall any waiver or apparent waiver by us of a breach
by you of your obligations imply our consent to any subsequent breach.

  17.3  
You accept that the terms of this Agreement are reasonable but if any provision
is determined to be invalid, the remainder of this Agreement will not be
affected.

18.  
Power of attorney

  18.1  
To ensure that you perform all your obligations under this Agreement and as
security for all sums due to us, you irrevocably appoint us and our directors,
company secretary and other officers at any time, jointly and each of them
severally, to act as your attorneys as we or they consider necessary to:

  18.1.1  
perfect our title to any Debt, Related Rights or Returned Goods;
    18.1.2  
sign deeds and documents (including Invoice Schedules);
    18.1.3  
endorse or negotiate any cheques or other instruments;
    18.1.4  
obtain payment of Debts;
    18.1.5  
institute, conduct or defend any proceedings;
    18.1.6  
settle any indebtedness owed by you either to us or any Customer;

  18.1.7  
secure the performance of any of your obligations to us or to any Customer;

 

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  18.1.8  
secure the performance of any of your obligations under a policy of credit
insurance in which we have an interest;

  18.1.9  
take any other action which we consider reasonably necessary or expedient.

  18.2  
This appointment shall endure both during and after the termination of this
Agreement until all sums due to us have been paid.

  18.3  
You also irrevocably appoint any assignee of ours or any person to whom we may
novate this Agreement to perform any of the acts set out in this condition 18.

  18.4  
We may appoint and remove a substitute attorney for any of such acts.

  18.5  
You agree to ratify any act performed under these powers.

19.  
Service of notices

  19.1  
Any notice from us to you may be served by delivery at or posting to: 19.1.1
your address stated in the Client Particulars;

  19.1.2  
such other address in the UK as you may have advised us for the purpose of this
condition 19;

  19.1.3  
any address at which you carry on business;

  19.1.4  
your registered office (if you are a company or LLP); or

  19.1.5  
your last known residential or business address (if you are a sole trader or
partner of an unincorporated partnership).

  19.2  
Such notice may also be given by facsimile transmission or by email or handed to
you (if you are a sole trader), any partner (if you are a partnership or LLP) or
director of yours (if you are a limited company).

  19.3  
Any such notice will be treated as served:

  19.3.1  
if delivered, at the time of delivery;

 

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  19.3.2  
if sent by post, 48 hours from the time of posting;
    19.3.3  
if sent by facsimile transmission or email, at the time of transmission; and
    19.3.4  
if handed personally, at the time of handing over.

  19.4  
Any notice in writing by you to us under this Agreement shall be effective at
the time it is received by us at our registered office.

20.  
Governing law

     
This Agreement shall be governed and interpreted by English Law. You will submit
to the exclusive jurisdiction of the English courts.

21.  
Definitions

  21.1  
The following words shall have the meanings as set out after each:

         
 
  “Accepted Country”   All countries other than any country expressly excluded
in the Special Conditions.
 
       
 
  “Allowances”   Any discount, credit, debit or set off claimed by a Customer or
other adjustment which reduces the Notified Value of a Debt.
 
       
 
  “Approval Period”   The period stated in clause 14 of the Particulars at the
end of which we may exercise our right of Recourse.
 
       
 
  “Approved Currency”   The Euro, United States Dollar and any other currencies
that we may tell you in writing.
 
       
 
  “Approved Debt”   A Debt Notified to us:
 
       
 
     
(1) which is within the relevant Credit Limit;
 
       
 
     
(2) which has not become a Disapproved Debt pursuant to conditions 5.7 and 5.8;
and
 
       
 
     
(3) in respect of which we have not exercised our right of Recourse.
 
       
 
  “Approved Funding Percentage”   The percentage specified in clause 5 of the
Particulars which will be applied against the value of Approved Debts to
calculate the Available Funds.

 

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  “Associate”   Means any business or other operation of yours situated in the
United Kingdom which is:
 
       
 
     
(1) Any subsidiary or holding company of yours (as defined in s736 and s736A of
the Companies Act 1985 as amended by the Companies Act 1989);
 
       
 
     
(2) any other form of associate of yours (as defined by s184 of the Consumer
Credit Act 1974);
 
       
 
     
(3) any director, partner, shareholder or employee of yours; and
 
       
 
     
(4) any company, LLP partnership or business in which you or any Associate has a
material interest.
 
       
 
  “Available Funds”   An amount calculated by applying the Approved Funding
Percentage against the aggregate value of Approved Debts and deducting from such
sum the balance on your Current Account, and subject to the restrictions in
condition 6.8.
 
       
 
  “Banking Day”   A day (other than a Saturday or a Sunday) on which banks are
open for business in London.
 
       
 
  “Bibby Group Company”   Bibby Financial Services Limited (registered number
3530461) and any company which is a subsidiary of that company or any subsidiary
of such subsidiary (as defined in s.736 and s.736A the Companies Act 1985, as
amended by the Companies Act 1989).
 
       
 
  “Client Account”   An account maintained by us to record the aggregate value
of all Debts (after deduction of any credit notes and Allowances), payments by
us to you and charges payable pursuant to condition 7.
 
       
 
  “Client Particulars”   The matters referred to in the section of this
Agreement headed “Client Particulars”.
 
       
 
  “Client Statement”   A statement summarising the transactions recorded on your
Client and Sales Ledger Control Accounts which we will send to you at the end of
each month.
 
       
 
  “Collection”   Any form of payment made to us in cleared funds which is
tendered in or towards the discharge of a Debt.

 

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  “Commencement Date”   The date stated in clause 1 of the Particulars on which
this Agreement will begin.
 
       
 
  “Computerised Services”   The services available through our computer system
described in our Computerised Services user manual, including electronic data
interchange.
 
       
 
  “Contract of Sale”   Any contract made by you for the supply or hire of goods
or the provision of services to a Customer.
 
       
 
  “Control”   The ability of the owners of a business to direct how the affairs
of a company, LLP or partnership shall be managed.
 
       
 
  “Credit Limit”   The maximum amount determined by us up to which Debts due
from a Customer may be designated as Approved Debts.
 
       
 
  “Credit Note Limit”   The limit excluding VAT up to which you may issue and
send credit notes to your Customers without obtaining our prior agreement.
 
       
 
  “Credit Note Schedule”   A form by which you will Notify credit notes to us.
 
       
 
  “Current Account”   An account that records the amount due at any time from
you to us or us to you.
 
       
 
  “Customer”   Any person who incurs an obligation to make payment under a
Contract of Sale.
 
       
 
  “Customer Concentration Percentage”   The percentage stated in clause 6 of the
Particulars or which we tell you in writing is the maximum percentage of all
Outstanding Approved Debts against which we may allow Prepayments to be made in
or towards the payment of the Purchase Price of Debts due from the same
Customer.
 
       
 
  “Data Act”   The Data Protection Act 1998.
 
       
 
  “Data Log”   A record of Messages exchanged between you and us.
 
       
 
  “Data Subject”   The corresponding definition set out in the Data Act.
 
       
 
  “Debt”   Any present, future or contingent obligation of a Customer to make
payment under a Contract of Sale (including the right to recover sums due
following the determination, assessment or agreement of such obligation),
interest, Value Added Tax and all duties and charges.

 

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  “Disapproved Debt”   Any Debt which is not an Approved Debt.
 
       
 
  “Disbursements”   All costs, claims, charges and expenses incurred in
connection with this Agreement, including the cost of our employing accountants,
solicitors and other professional advisers, and using credit and fraud
prevention agencies, all bank charges and such other charges as we shall tell
you in writing from time to time.
 
       
 
  “Export Debt”   A Debt evidenced by an invoice addressed to a Customer who is
domiciled or carries on business outside of the UK.
 
       
 
  “Factor’s Discount”   A charge calculated at the rate stated in clause 11 of
the Particulars on the balance on your Current Account owing from you to us.
 
       
 
  “Fee”   A charge for the services provided by us to you calculated in the
manner stated in clause 8 of the Particulars.
 
       
 
  “Funding Limit”   The maximum permitted amount, as stated in clause 12 of the
Particulars or which we tell you in writing, on your Current Account at any
time.
 
       
 
  “Guarantor”   A person who has given a guarantee and/or indemnity in respect
of your obligations to us under this Agreement or any other agreement and/or in
respect of your obligations to any Bibby Group Company under any agreement with
such company.
 
       
 
  “Initial Debts”   The Debts Outstanding at the Commencement Date.
 
       
 
  “Insolvent”   (1) In relation to a company or LLP:
 
       
 
     
1.1 the convening of a meeting of creditors for the purpose of winding up the
company or LLP or any other purpose referred to in the Insolvency Act 1986 or
the Enterprise Act 2002;
 
       
 
     
1.2 the presentation of a petition or the making of an order for the winding up
of the company or LLP;
 
       
 
     
1.3 the appointment of an administrator or the presentation of a petition for an
administration order under the Insolvency Act 1986;

 

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1.4 the appointment of a receiver, administrative receiver, liquidator,
provisional liquidator or judicial factor of all or any part of the property of
the company or LLP;
 
       
 
     
1.5 the dissolution of the company or LLP; or
 
       
 
     
1.6 the commencement of a moratorium under the Insolvency Act 2000.
 
       
 
     
(2) In relation to an individual:
 
       
 
     
2.1 the presentation of a petition or the making of an order for his bankruptcy
or sequestration; or
 
       
 
     
2.2 the granting of a trust deed for his creditors.
 
       
 
     
(3) In relation to a partnership:
 
       
 
     
3.1 the presentation of a petition or the making of an order for the winding up
or administration of the partnership; or
 
       
 
     
3.2 the presentation of a petition or the making of an order for the bankruptcy
or sequestration of any partner of the firm.
 
       
 
     
(4) In relation to any person:
 
       
 
     
4.1 the service of a statutory demand under the Insolvency Act 1986;
 
       
 
     
4.2 any creditor attaching, taking possession of, distraining or executing
against, sequestrating, levying on, exercising rights of lien on or enforcing
security rights against or obtaining an order restraining the disposal of any
part of the person’s income or assets;
 
       
 
     
4.3 the entry of judgment or the making of any order or award for the payment of
money to another party which remains unsatisfied for a period of 5 Working Days;
 
       
 
     
4.4 entering into a voluntary arrangement or the appointment of any nominee or
supervisor under the Insolvency Acts 1986 or 2000 or any informal arrangement or
composition in satisfaction of debts with creditors; or

 

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4.5      being deemed insolvent under the Insolvency Act 1986.
 
       
 
      “Insolvency” shall be construed accordingly.
 
       
 
  “Invoice Schedule”   A form by which you will specifically assign each Debt to
us.
 
       
 
  “Letter of Offer”   A letter in which we proposed to you the principal terms
upon which we would enter into this Agreement.
 
       
 
  “LIBOR”   On or after 11.00am on the first Banking Day of each calendar month:
 
       
 
     
(1) the three month Screen Rate; or
 
       
 
     
(2) (if no Screen Rate is available for the relevant currency on the first
Banking Day of any calendar month) the arithmetic mean of the three month rates
(rounded upwards to four decimal places) quoted by the Reference Banks to
leading banks in the London interbank market.
 
       
 
  “LLP”   A limited liability partnership incorporated and registered under the
Limited Liability Partnerships Act 2000.
 
       
 
  “Message”   Data transmitted electronically between you and us.
 
       
 
  “Minimum Fees”   The minimum amount of Fees (excluding Refactoring and
Retrospective Fees) which you will pay to us for each period as stated in clause
10 of the Particulars commencing from the first day of the month following the
Commencement Date.
 
       
 
  “Minimum Notice Period”   The minimum length of notice, as stated in clause 3
of the Particulars, each of us must give to the other to terminate this
Agreement after expiry of the Minimum Period.
 
       
 
  “Minimum Period”   The minimum length of time that this Agreement will endure,
as stated in clause 2 of the Particulars, unless terminated by us pursuant to
condition 15.

 

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  “Non-notifiable Debts”   Debts owned by us under this Agreement which you are
not required to Notify to us until we tell you including those referred to in
the Special Conditions.
 
       
 
  “Notification”   The method (in writing and/or electronically using our
Computerised Services, as we shall agree in writing with you) by which you will
specifically assign each Debt to us and tell us of the existence of credit
notes.
 
       
 
  “Notified Value”   The amount of a Debt including VAT as stated in an Invoice
Schedule and before deducting any Allowances.
 
       
 
  “Notify”   The specific assignment of a Debt by its inclusion in an Invoice
Schedule or the inclusion of a credit note in a Credit Note Schedule. “Notified”
shall be construed accordingly.
 
       
 
  “Outstanding”   A Debt remaining wholly or partly unpaid.
 
       
 
  “Particulars”   The matters referred to in the section of this Agreement
headed “Particulars”.
 
       
 
  “Prepayment”   Any sum paid by us to you on account of the Purchase Price of a
Debt.
 
       
 
  “Purchase Price”   The amount payable by us to you for each Debt calculated in
accordance with condition 4.1.
 
       
 
  “Recourse”   Our right to require you to repay immediately any Prepayment.
 
       
 
  “Refactoring Fee”   A charge calculated in the manner stated in clause 9 of
the Particulars.
 
       
 
  “Reference Banks”   In relation to LIBOR the principal London offices of
Barclays Bank plc, Lloyds TSB Bank plc and Royal Bank of Scotland plc or such
other banks as we may tell you.
 
       
 
  “Related Rights”   In relation to each Debt and all Returned Goods:
 
       
 
     
(1)  all your rights (but not obligations) as an unpaid vendor or under the
relevant Contract of Sale including your rights to the payment of interest, the
return of goods, of lien and stoppage in transit;

 

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(2)  the benefit of all insurances, securities, guarantees and indemnities;
 
       
 
     
(3)  the right to any documents of title to the goods; and
 
       
 
     
(4)  the right to all accounting records relating to the Debt and all documents
evidencing the Contract of Sale and its performance.
 
       
 
  “Retrospective Fee”   A charge, as stated in clause 7 of the Particulars, for
the services to be provided by us in respect of the Initial Debts.
 
       
 
  “Returned Goods”   Any goods relating to a Contract of Sale giving rise to a
Debt which a Customer shall reject or return or intimate a wish to do so or
which you or we shall recover from a Customer.
 
       
 
  “Sales Ledger Control Account”   An account recording the Notified Value of
Outstanding Debts less such Allowances and reserves as we shall apply to the
account.
 
       
 
  “Screen Rate”   In relation to LIBOR, the British Bankers’ Association
Interest Settlement Rate for the relevant currency and period displayed on the
appropriate page of the Reuters screen. If the agreed page is replaced or
service ceases to be available, we may specify another page or service
displaying the appropriate rate.
 
       
 
  “Special Conditions”   The conditions specified in the section of this
Agreement headed “Special Conditions”.
 
       
 
  “Standard Conditions”   The conditions set out in this part of this Agreement.
 
       
 
  “Sterling”   The lawful currency from time to time of the UK.
 
       
 
  “Termination Event”   Each event described in condition 15.1.
 
       
 
  “UK”   The United Kingdom of Great Britain and Northern Ireland, the Channel
Islands and the Isle of Man.
 
       
 
  “UK Debt”   A Debt evidenced by an invoice addressed to a Customer who is
domiciled or carries on business in the UK.
 
       
 
  “Working Day”   Every day except Saturday, Sunday and bank and public
holidays.

 

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  21.2  
Any reference to a statute includes any amendment, replacement or re-enactment
of it and of any code of practice, order, rule or regulation made under it.

  21.3  
The singular includes the plural and vice versa and any reference to any gender
shall include any other gender.

  21.4  
The meaning of general words introduced by the word “other” shall not be limited
by reference to any preceding word or indicating a particular class of acts,
matters or things. The expression “including” shall mean “including without
limitation”.

  21.5  
Where in any place outside England and Wales the meaning of a word or expression
used in this Agreement is to be construed and such word or expression has no
counterpart in that place, it shall, unless the context otherwise requires, have
the meaning of its closest equivalent in that place.

 

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