FUND20 CUSTOMER AGREEMENT

TERMS AND CONDITIONS

1. INTRODUCTION

 

• Customer Agreement. Fund20 (Fund20 Limited) provides revenue-based financing services via Fund20.com (the “Fund20 Platform”). Customer is a self-employed individual which provides freelance services (the “Services”) to a number of companies (“Companies”).

 

• These Terms and Conditions together with the Commercial Terms Sheet as executed by the Customer comprise the Fund20 Customer Agreement. The Fund20 Customer Agreement is also subject to the terms of the Fund20 Platform Terms.

 

• Customer agrees, during the Term (as defined in clause 7.1), to offer to Fund20, on an exclusive basis, the option to purchase from the Customer any invoice with associated net terms for Services issued to Companies during the term of this Agreement (“Invoices”), and Fund20 may agree to purchase such invoices in its sole discretion.

 

2. OFFER AND PURCHASE CONFIRMATION PROCESS

 

• Using the Fund20 Platform, Customer will provide Fund20 with the required details of its contracts for Services with a Company (“Company Agreement”), including a copy of the relevant Company Agreement details of (i) the Company (ii) the value of the Services to be delivered (“Invoice Face Value”) (iii) the payment terms (iv) the applicable services provided, (v) all other relevant legal, commercial and performance terms and requirements relating to the Services (“Deliverables”) and (vi) any additional information reasonably required by Fund20 for the purposes of its internal review process. Customer agrees to provide any such additional information in a timely manner and will procure any such information from Company if reasonably required by Fund20 to do so.

 

• Where, acting in its sole discretion, the relevant Company Agreement has been initially approved by Fund20, it will notify Customer of such initial approval by email at the Customer Contact Email.

 

• Customer agrees to provide confirmation of Deliverables to Fund20 and, provided that Fund20 is satisfied with such confirmation, Fund20 may confirm its agreement to purchase the Invoice associated with the relevant Company Agreement by sending a purchase confirmation email substantially in the form set out at Exhibit A hereto (“Purchase Confirmation”).

 

3. PURCHASE AND SALE OF INVOICES

 

• Purchase and Sale. Upon completion of the process described in clause 2, and in consideration of the Purchase Price, Customer hereby sells, assigns and transfers to Fund20, making Fund20 the absolute owner of, the Invoice identified in such Purchase Confirmation having the Invoice Face Value due and owing to Customer from Companies. Fund20 agrees to accept the assignment of the Invoice and agrees that as of the Invoice date, the Invoice will be irrevocably, unconditionally and absolutely assigned to, owned and controlled by and vested solely in Fund20. Fund20 shall remit the relevant Purchase Price to Customer account.

 

• Purchase Price. The price at which Fund20 will purchase the Invoice (“Purchase Price”) will be calculated as a percentage of the Invoice Face Value and based on the number of days by which payment is required to be made by a Company pursuant to the particular Company Agreement (“Invoice Payment Terms”). The Purchase Price for a particular Invoice will be the Purchase Price corresponding to the relevant Invoice Payment Terms of that particular Invoice as set out on the table in the Commercial Terms Sheet.

 

• Company Invoicing. Upon Fund20’s purchase of the Invoice, Customer authorizes Fund20 to issue such Invoices directly to Company in the form agreed between the parties. Customer agrees to cooperate with all reasonable requests to effectuate this communication that the payment of the Invoice Face Value shall be made directly to Fund20 as instructed by Fund20. Should payments be made inadvertently to Customer or to any other third party, Customer shall promptly forward such payments to Fund20 within no less than two (2) calendar days of receipt.

 

• Company payments: In the event that a Company is entitled, pursuant to the terms of the Company Agreement or a breach thereof, to retain or claim a refund of any or all the Invoice Face Value following the date of remittance of the Purchase Price by Fund20 to Customer, Fund20 will be entitled to a refund of the shortfall between the funds received from the Company and the Invoice Face Value by (at its option) either (i) exercising its right to set-off of the shortfall against the next Purchase Price remitted to Customer pursuant to a Purchase Confirmation or (ii) requiring Customer to repurchase the Invoice at an amount equal to the shortfall.

 

• No Interest or Fees

 

4. GENERAL TERMS AND CONDITIONS

 

• Absolute Sale and Not a Loan. The parties agree that: (i) the Invoices purchased under this Agreement are in exchange for the Purchase Price and that such purchase is an absolute and irrevocable sale and that (ii) Fund20 hereby acquires all right, title and interest in, and the full benefits of ownership of, the Invoices and Customer relinquishes all right, title, interest and control over such Invoices upon such sale hereunder; (iii) such sale is not intended to be, nor shall it be construed as, a loan from Fund20 to the Customer; and (iv) the Purchase Price paid in exchange for the Invoices equals the fair market value of such Invoices.

 

• No Term of Purchase Confirmation; Reservation of Rights Vis-à-vis Companies. Notwithstanding any termination or expiry of this Agreement in accordance with clause 7, each Purchase Confirmation shall be in full force and effect until all amounts owing under each Invoice Face Value (specified in each Purchase Confirmation) from Companies have been delivered to Fund20 pursuant to the terms of this Agreement and in accordance with each Invoice. Except as set forth in this Agreement, this Agreement is without recourse to Customer. Fund20 however reserves all rights vis-à-vis Companies.

 

• Re-Characterization. Notwithstanding the parties’ express intent to the contrary set forth in this Agreement, if Fund20’s purchase of the Invoices is determined by a court of competent jurisdiction to constitute a loan from Fund20, Fund20 shall return to Customer any amounts deemed to have been received by Fund20 in excess of any statutory maximums permitted by applicable law to be received by Fund20.

 

• Grant of Security Interest; Authority to File UCC-1 Financing Statements. For the avoidance of doubt, Customer and Fund20 agree that Fund20 shall be the sole and exclusive owner of the Invoices, and that the Invoices shall not be part of Customer’s estate in the event of a bankruptcy. In the event that, notwithstanding the intent of the parties, the Invoices are determined to be the property of the Customer or its bankruptcy estate, then without derogation of the parties intention that the sale of the Invoices to Fund20 hereunder shall constitute a true sale thereof, then to the extent the Uniform Commercial Code applies: (i) this Agreement also shall be deemed to be and hereby is a security agreement within the meaning of Article 9 of the Uniform Commercial Code; and (ii) the sale by the Customer provided for under this Agreement shall be deemed to be a grant by the Customer to Fund20 and its assigns of, and the Customer hereby grants to the Fund20 and its assigns, a security interest in and to all of the Customer’s right, title and interest in the Invoices, and proceeds thereof, as collateral security to secure the obligations of the Customer hereunder (“Collateral”). The Customer will take, and authorizes Fund20 to take on its behalf, each action as Fund20 shall deem necessary so that the security and ownership interests granted to Fund20 herein shall be a perfected security interest of first priority in favor of Fund20 under applicable law and will be maintained as such throughout the term of this Agreement.  Without limiting the foregoing, Customer hereby authorizes Fund20 at its sole option to file one or more UCC-1 financing statements under the UCC to evidence and perfect the security interest granted to Fund20 herein.

 

• Debtor Status, Accounting Practises. Customer agrees and acknowledges that Customer is not a debtor of Fund20 as of the date of this Agreement. Customer agrees that Customer will treat the sale of any Invoices pursuant to a Purchase Confirmation in a manner consistent with a sale in Customer’s accounting records and on tax returns.

 

5. REPRESENTATIONS AND WARRANTIES

 

• Compliance with Laws. Customer represents that it complies with all statutes, rules, regulations, orders or restrictions of all applicable governmental authorities. All federal, state, local and foreign tax returns and tax reports, and all taxes due and payable arising therefrom required to be filed by Customer have been or will be filed and paid, on a timely basis, including any extensions. All such returns and reports are and will be true, correct and complete. There is no conflict between (i) Customer entering into or performing this Agreement, and (ii) any laws, regulations or provisions of any of Customer’s incorporation or constitutional documents. Customer acknowledges that Fund20 will carry out due diligence, know-your-client and anti-money laundering checks and other screening activities required by law and its internal policies. Customer agrees to assist as reasonably requested by Fund20 including any information related to KYC/due diligence and sanction screens conducted by Customer, with respect to Companies or any of its affiliates. Customer will also provide notice to Fund20 promptly in the event that (i) Customer has any difficulties in your relationship with a Company or any of its affiliates, (ii) suspect that any Company or any of its affiliates is engaged in any suspicious activities or transactions (including any activities or transactions that may violate any applicable law) or is subject to sanctions, (iii) suspect that Company is experiencing any significant financial difficulty, and/or (iv) Customer becomes aware of any other facts or circumstances that a reasonable business person would expect to be relevant to Fund20 purchasing an Invoice in respect of such Company.

 

• Bona Fide Rendition of Services to Company with No Offsetting Rights. Customer is entering into this Agreement for the purposes of carrying on a business as a commercial entity. Customer represents that the Invoices were generated based upon the bona fide rendition of services by Customer to the Companies  in the ordinary course of business; and any and all obligations required of Customer have been fulfilled and are not subject to any Company’s right of setoff, offsets, counterclaims and/or like rights impacting in any respect the legal obligation of Companies to pay the Invoices in the amount of the Invoice Face Value per their terms.

 

• Clean Title to Invoices. Customer represents that it has good, complete and marketable title to the Invoices, free and clear of any and all liabilities, liens, claims, charges, restrictions, conditions, options, rights, mortgages, security interests, equities, pledges and encumbrances of any kind or nature whatsoever or any other rights or interests that may be inconsistent with the transactions contemplated with, or adverse to the interests of Fund20. Entering into or performing this Agreement will not result in the Invoice being bound by any encumbrances.

 

• Authorization; No Misrepresentation. Customer represents that Customer has the authority to enter into this Agreement and acknowledges that it is legally binding upon Customer to satisfy Customer’s obligations hereunder. Customer acknowledges that the information provided herein is true, accurate and complete in all respects.

 

• Conflicts with Other Agreements; Compliance with Company Agreements. Customer represents that the execution and performance of this Agreement does not and will not conflict with or result in any default, and does not or will not entitle any person or entity to receipt of notice or to a right of consent, or give rise to a right of termination, cancellation or acceleration of any obligation. Customer further represents and warrants that it complies with and undertakes to comply with all provisions of Company Agreements which affect the payment of the Invoice Face Value by the Company and that any breach of the terms of a Company Agreement will be a breach of the Purchase Confirmation relating to the relevant Invoice in respect of such Company Agreement.  

 

• No Pending or Contemplated Proceedings Under Debtor Relief Laws

 

6. COVENANTS

 

• No Changes to Terms of Company Agreements or Invoices. Customer covenants that it will not, without the prior written consent of Fund20, amend, modify or alter any terms of any Company Agreements or Invoices.

 

• Compliance with Company Agreements or Invoices. Customer covenants that it will comply with the terms of Company Agreements and Invoices which affect the payment of the Invoice Face Value by the Company.

 

• No Stacking. Customer shall not enter into any cash advance, loan agreement, factoring agreement or other similar financing agreement that specifically involves the purchase of and/or the granting of a security interest in the Invoices with any party other than the Fund20 for the duration of the Agreement. Fund20 may share information regarding the Agreement with any third party to determine whether Customer complies with this provision.

 

• Notifications to Fund20. Customer will notify Fund20 immediately if it receives notice from a Company or becomes aware, for any reason whatsoever, that:

 

• it has breached or failed to comply with the terms of the Company Agreement,

 

• Customer is exercising any of its remedies under the Company Agreement; and/or

 

• Customer will not discharge the Invoice Face Value on or before the relevant Invoice Due Date.

 

7. TERM AND TERMINATION

 

• Term: This Customer Agreement shall commence on the Commencement Date (as defined in the Commercial Terms Sheet). It shall continue for the Initial Term Date (as defined in the Commercial Terms Sheet) and shall continue for successive terms of one (1) year (“Successive Term”, and together with the Successive Term, the “Term”) unless either party notifies to the other party of its wish to terminate (after the expiry of the Initial Term) at least thirty (30) days in advance of the expiry of the then current Successive Term (such termination to be effective from the end of such Successive Term) or as otherwise terminated in accordance with these terms.

 

• Fund20 and Customer may terminate this Agreement at any time on thirty (30) days’ written notice. Without affecting any other right or remedy available to it, either Party may terminate this Agreement with immediate effect by giving written notice to the other Party if:

 

• the other Party commits a material breach of any term of this Agreement in which the breach is irremediable or (if such breach is remediable) fails to remedy that breach within a period of fourteen (14) days after being notified in writing to do so;
• an encumbrancer takes possession or a receiver is appointed over any of the property or assets of the other Party;
• the other Party enters into any composition or arrangement with its creditors or enters into liquidation whether compulsory or voluntary (other than for the purposes of solvent reconstruction or amalgamation of that other Party different legal person, undertakes to be bound by this Agreement) or any action is taken by any person to appoint a receiver, administrator, administrative receiver, examiner, trustee, or similar officer of the other Party or any property or assets of the other Party or any such receiver, administrator, administrative receiver, examiner, trustee, or similar officer is appointed;
• anything analogous to any of the foregoing under the law of any jurisdiction occurs in relation to that other Party; or
• the other Party suspends or ceases, or threatens to suspend or cease, carrying on all or a substantial part of its business.

 

8. EVENTS OF DEFAULT

 

• Events of Default. The occurrence of any one or more of the following events (herein, “Events of Default”) shall constitute, without notice or demand, a default under this Agreement: (i) Customer fails to comply with and/or promptly, punctually and faithfully perform or observe any term, condition, promise or covenant within this Agreement; (ii) the determination by Fund20 that any representation or warranty heretofore, now or hereafter made by Customer to Fund20, in any document, instrument, agreement, application or paper was not true or accurate when given; (iii) the occurrence of any event that would cause a lien creditor, as that term is defined in Section 9−102 of the Uniform Commercial Code (other than Fund20), to take priority over any Invoices; (iv) any act by, against, or relating to any Invoices, which act constitutes the application for, consent to, or sufferance of the appointment of a receiver, trustee or other person, pursuant to court action or otherwise, over all, or any part of any Invoices; (v) the occurrence of any uninsured loss, theft, damage or destruction to any Invoices; (vi) any act by or against, or relating to any Invoices pursuant to which any creditor of Customer seeks to reclaim or repossess or reclaims or repossesses all or a portion of any Invoices.

 

• Rights and Remedies Upon Event of Default. Subject to applicable law, if an Event of Default occurs under this Agreement, at any time thereafter Customer hereby irrevocably appoints Fund20 as its agent and attorney-in-fact with full authority to accelerate indebtedness or take any action to settle all amounts due to Fund20 from Customer or Companies pursuant to this Agreement pursuant to all rights and remedies granted to Fund20 hereunder and notwithstanding the parties’ intention, in the event the Invoices are claimed or determined to be Customer’s property or bankruptcy estate, then Fund20 shall have all the rights and remedies of a secured creditor under the provisions of the Uniform Commercial Code, as may be amended from time to time and may exercise any or all other rights and remedies it may have available at law, in equity or otherwise.

 

• Election of Remedies. Except as may be prohibited by applicable law, all of Fund20’s rights and remedies, whether evidenced by this Agreement, any related documents, or by any other writing, shall be cumulative and may be exercised singularly or concurrently. Election by Fund20 to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Customer under the Agreement, after Customer’s failure to perform, shall not affect Fund20’s right to declare a default and exercise its remedies.

 

9. MISCELLANEOUS

 

• Modifications; Agreements. No modification, amendment, waiver or consent of any provision of this Agreement shall be effective unless the same shall be in writing and signed by Fund20.

 

• Assignment. Fund20 may assign, transfer or sell its rights to receive the Purchase Price or delegate its duties hereunder, in whole or in part. Customer shall not assign Customer’s rights hereunder or any interest herein without the prior written consent of Fund20.

 

• Notices. All notices, requests, consents, demands and other communications hereunder shall be delivered to the parties (i) where such communication is in letter form, at the registered addresses or (ii) where such communication is by email, to the Customer Contact Email or Fund20 Contact Email (as applicable).

 

• Waiver of Remedies. No failure on the part of Fund20 to exercise, and no delay in exercising, any right under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right under this Agreement preclude any other or further exercise thereof or the exercise of any other right. The remedies provided hereunder are cumulative and not exclusive of any remedies provided by law or equity.

 

• Survival of Representations. All representations, warranties and covenants herein shall survive the execution and delivery of this Agreement and all Purchase Confirmations, and shall continue in full force until all obligations under this Agreement and all Purchase Confirmations shall have been satisfied in full and this Agreement and all Purchase Confirmations shall have terminated.

 

• Severability. In case any of the provisions in this Agreement is found to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of any other provision contained herein shall not in any way be affected or impaired.

 

• Integration Clause. This Agreement, all attachments and exhibits hereto, including future-executed Purchase Confirmations, embody the entire agreement between Customer and Fund20 and supersede all prior agreements and understandings relating to the subject matter hereof. This Agreement may only be modified by written agreement signed by each of the parties.

 

• Electronic Communications; Electronic Signatures. Customer understands and agrees that it is entering into the Agreement electronically and that certain categories of information (“Communications”) may be provided by Fund20 to Customer by electronic means. Electronic acceptance or signatures reflecting the party’s signature hereto shall be deemed acceptable for all purposes.

 

• Confidentiality. Except as set forth elsewhere in this Agreement, the parties acknowledge and agree that the parties as parties hereto and the existence and terms of this Agreement are and will remain confidential. During the course of this Agreement, the parties may share with each other certain information of a proprietary and/or confidential nature, including, without limitation, (a) the details of this Agreement; (b) any financial, operational or marketing data, lists or strategies of the other Party; or (c) any other information relating to the business of the other Party, irrespective of whether such information is labeled as proprietary, confidential, material, or important (collectively, the “Confidential Information”). The parties will maintain the Confidential Information in strict confidence. The parties agree that, without the other party’s consent, no party will use for its own benefit or divulge, disclose or communicate to any third-party any Confidential Information (except to each party’s respective employees, legal and financial representatives, as and to the extent necessary).  Notwithstanding the foregoing, Fund20 may disclose such Confidential Information as is necessary to meet its obligations herein, The receiving party will not be liable for the disclosure of Confidential Information that: (i) is or becomes known through no fault of the receiving party; (ii) is provided by the disclosing party on a non-restricted basis; (iii) is disclosed with the disclosing party’s consent; (iv) is known to the receiving party prior to receipt thereof, (v) is independently developed by the receiving party; or (vi) is required to be disclosed by law or judicial order, but only to the extent required by such law or judicial order.

 

• No partnership. Nothing in this Agreement shall be construed as giving rise to any relationship of partnership between the parties.

 

• Governing Law, Venue, and Jurisdiction. This Agreement shall be governed by and construed in accordance with UK Law.