AGREEMENT FOR THE PURCHASE OF DEBTS Date: January 29, 2013 HSBC Invoice Finance (UK) Limited (HIF) will provide Lakeland Industries Europe Limited 04500660 (the Client) with the product selected below on the terms of this Agreement (as defined below)...
Exhibit 10.1
AGREEMENT FOR THE PURCHASE OF DEBTS
Date: January 29, 2013
HSBC Invoice Finance (UK) Limited (HIF) will provide Lakeland Industries Europe Limited 04500660 (the Client) with the product selected below on the terms of this Agreement (as defined below) and the Standard Terms & Conditions.
This Agreement for the Purchase of Debts, its Schedule and the Standard Terms & Conditions comprise the entire agreement between the parties (as amended from time to time) (the "Agreement").
An additional copy of the Standard Terms & Conditions can be obtained from the Client's relationship manager. The Standard Terms & Conditions may be changed by a notice sent to the Client.
HIF recommends that the Client seeks independent legal advice before entering into this Agreement.
1. | PRODUCT SELECTED |
The Client accepts the provision of the product(s) selected in the Schedule by HIF from the Commencement Date for the purposes of providing the Client with working capital, upon the terms set out in this Agreement.
2. | ASSIGNMENT |
2.1 | On the Commencement Date, the Client (as beneficial owner in relation to Northern Irish Debts) assigns to HIF (i) all Existing Debts and Future Debts and (ii) all Non-Notifiable Debts. |
2.2 | Each Debt created after the Commencement Date shall automatically belong to HIF the moment it is created. |
2.3 | HIF is not obliged to reassign a Debt to the Client. |
2.4 | HIF will confirm the Commencement Date to the Client when all the relevant conditions have been satisfied and HIF will complete the Commencement Date in the Schedule. |
3. | POWER OF ATTORNEY |
3.1 | The Client, by way of security, irrevocably appoints HIF, and any person to whom HIF transfers rights and/or obligations under this Agreement (with full power of substitution and delegation), to act on the Client's behalf to (a) sign any deeds and documents, (b) complete or endorse any instruments, (c) conduct or defend any proceedings and (d) take such other steps that HIF may consider necessary or appropriate to: |
(i) | obtain payment of, or perfect HIF's ownership of, any Debt; |
(ii) | secure performance of any of the Client's obligations to HIF or to any Customer. |
HIF APD 04/2012 | Page 1 |
3.2 Where the Client is acting as trustee under any Scottish Trust then the words "on its own account and as trustee under any Scottish Trust" are inserted after the word "security" in clause 3.1.
IN WITNESS of which this Agreement has been executed and, on the date set out above, delivered as a deed.
Executed as a deed, but not delivered until the | ) | ||
first date specified on page 1, by: | ) | ||
) | |||
) | |||
) | |||
as Attorney of | ) | ||
HSBC INVOICE FINANCE (UK) LIMITED | ) | ||
in the presence of a witness: | ) | Signature | /s/ Xxxxxx Xxxxxxx Albbores |
Attorney |
Witness signature | ………………………....... |
Witness name | ………………………....... |
Witness address | HSBC Invoice Finance (UK) Limited, |
Xxxxxxxxx Xxxx, | |
Xxxxxxxx, | |
Xxxx Xxxxxx XX00 0XX | |
Address for service: | HSBC Invoice Finance (UK) Limited, |
Xxxxxxxxx Xxxx, | |
Xxxxxxxx, | |
Xxxx Xxxxxx XX00 0XX |
HIF APD 04/2012 | Page 2 |
Executed as a deed, but not delivered until the | ) |
first date specified on page 1, by | ) |
Lakeland Industries Europe Limited | ) |
by two directors or by | ) |
one director and the secretary | ) |
: | Signature | /s/ Xxxxxxxxxxx X. Xxxx |
Name (block capitals) | Xxxxxxxxxxx X. Xxxx | |
Director | ||
Signature | /s/ Xxxxxx Xxxx | |
Name (block capitals) | Xxxxxx Xxxx | |
Director/Secretary |
COPY RESOLUTION
(to be certified by the signature of the Chairman of the meeting of the directors at which the resolution was passed)
Company No. 04500660
Lakeland Industries Europe Limited ("Company")
1. | The Chairman reported that notice of the meeting had been given to all those persons entitled to receive notice and, a quorum being present, the Chairman declared the meeting open. |
2. | There was produced to the meeting a form of agreement for the purchase of debts together with its schedule and accompanying Standard Terms and Conditions to be entered into between HSBC Invoice Finance (UK) Limited and the Company (the "Agreement for the Purchase of Debts"). |
3. | After giving consideration to the requirements set out in sections 171 to 177 of the Companies Xxx 0000, it was unanimously agreed that the entry into and execution of the Agreement for the Purchase of Debts was in the commercial interest of and for the benefit of the Company and was most likely to promote the success of the Company for the benefit of its members as a whole. |
4. | After careful consideration by the directors of the terms of the Agreement for the Purchase of Debts and of the nature and scale of the liabilities undertaken by the Company under the Agreement for the Purchase of Debts, it was unanimously resolved that: |
(a) | it was, in the good faith judgment of all the directors present, for the commercial benefit of the Company and was most likely to promote the success of the Company for the benefit of its members as a whole to enter into the Agreement for the Purchase of Debts; |
(b) | the terms of and the transactions contemplated by the Agreement for the Purchase of Debts be approved; |
HIF APD 04/2012 | Page 3 |
(c) | the Agreement for the Purchase of Debts should be executed on behalf of the Company as a deed; |
(d) | where the Company is a sole director company with no company secretary, that director (in the presence of an attesting witness) or in any other circumstances any two authorised signatories (as defined in section 44(3) of the Companies Act 2006), be authorised to execute and deliver the Agreement for the Purchase of Debts; |
(e) | any one or more authorised signatory (as defined in section 44(3) of the Companies Act 2006) be authorised to approve and execute any further documents, certificates and notices to be signed and/or despatched by the Company under or in connection with the Agreement for the Purchase of Debts; and |
(f) | a copy of this resolution be endorsed on the Agreement for the Purchase of Debts. |
Certified a true copy of this Resolution:
/s/ Xxxxxxxxxxx X. Xxxx |
Signature of Chairman of board meeting
HIF APD 04/2012 | Page 4 |
THE SCHEDULE
1. | Client particulars | |
Nature of business | Wholesale of safety clothing | |
Principal place of business | Jet Park 2, 000 Xxxx Xxxx, Xxxxxxx, Xxxx Xxxxxxxxx, XX00 0XX | |
2. | Product(s) selected | |
Finance | Yes | |
Credit Management | Yes | |
Credit Protection | Yes | |
3. | Commercial terms | |
Approved Countries | (a) United Kingdom, Ireland, the Isle of Man and the Channel Islands | |
(b) Abu Dhabi (UAE), Ajman (UAE), American Samoa, Andorra, Anguilla, Australia, Austria, Bahamas, Belgium, Bermuda, Brazil, British Indian Ocean Territory, Brunei, Canada, Cayman Islands, Chile, China, Cyprus, Czech Republic, Denmark, Dubai (UAE), Xxxxxxx, Xxxxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx, Xxxxxx, French Guiana, French Polynesia, French Southern Territories, Fujairah (UAE), Germany, Gibraltar, Greece, Greenland, Guadeloupe, Guam, Hong Kong, Israel, Italy, Japan, Kuwait, Liechtenstein, Luxembourg, Macau, Malaysia, Malta, Martinique, Mauritius, Mayotte, Mexico, Monaco, Montserrat, Netherlands, New Caledonia, New Zealand, Norway, Northern Mariana Is., Oman, Peru, Poland, Portugal (Madeira), Portugal, Puerto Rico, Qatar, Ras Al-Khaimah (UAE), Reunion, Saint Helena, Sharjah (UAE), Saudi Arabia, St Pierre & Miquelon, San Marino, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain (Canary Islands), Spain, Sweden, Switzerland, Taiwan, Trinidad & Tobago, Turks & Caicos Islands, Umm Al-Qaiwain (UAE), United Arab Emirates, United States of America, US Minor Outlying Islands, Vatican City State, Virgin Islands (US & British) and Wallis & Futuna Islands. | ||
Automatic Funding Limit | United Kingdom, Ireland, the Isle of Man and the Channel Islands: £ 50,000 | |
Other countries: £ 50,000 | ||
Client to give notice of assignment to Customers | Yes | |
Commencement Date | 30 January 2013 |
HIF APD 04/2012 | Page 5 |
Concentration Percentage | 30 per cent | |
Debtor Currencies | Sterling and Euro | |
Debt Turn Target | United Kingdom, Ireland, the Isle of Man and the Channel Islands: 90 days | |
Other countries: 90 days | ||
Facility Limit | £ 1,000,000 | |
Law | English law governs this Agreement | |
Minimum Period | 12 Months | |
Non-Notifiable Debt | The following are additional categories of Non-Notifiable Debt: | |
Debts arising from contracts of sale entered into with your customer Elite Supplies Limited (registration number 06309981) and PPG Clothing Limited (SC386962) | ||
Notice Period | 3 Months | |
Prepayment Currencies | Sterling and Euro | |
Prepayment Percentage | 80 per cent | |
Reduction Percentage | N/A | |
Standard Payment Terms | United Kingdom, Ireland, the Isle of Man and the Channel Islands: Not exceeding net 60 days from date of invoice | |
Other countries: Not exceeding net 90 days from date of invoice | ||
4. | Pricing | |
Allowance Margin | 2.50 per cent | |
Arrangement Fee | £ 5,500 | |
Discounting Margin | 3.46 per cent | |
Facility Review Fee | Nil | |
Other fees | Fees will be payable for: | |
(a) any variation to the terms of this Agreement; | ||
(b) the release of any Security Interest; | ||
(c) new Security Interests to be granted to HIF or any third party. |
HIF APD 04/2012 | Page 6 |
Service Charge | For Approved Countries listed in paragraphs (a) and (b) 0.935 per cent of the Notified value of each Debt, subject to a minimum of £ 42,500 per annum calculated in respect of each period of one year starting on the first day of the month following the Commencement Date and each anniversary thereafter | |
5. | Credit Protection | |
Automatic Credit Protection Limit | United Kingdom, Ireland, the Isle of Man and the Channel Islands: £ 3,000 | |
Other countries: N/A | ||
Credit Protection Percentage | United Kingdom, Ireland, the Isle of Man and the Channel Islands: 100 per cent | |
Other countries: 90 per cent | ||
First Loss | United Kingdom, Ireland, the Isle of Man and the Channel Islands: £ 1,000 | |
Other countries: £ 1,000 | ||
Unprotected Debts at the Commencement Date | At the Commencement Date any Debt which is unpaid 60 days or more after the due date for payment and any other Debts of the same Customer | |
6. | Covenants | |
Debt Turn Covenant | N/A | |
Dilution Percentage | N/A | |
Dispute Percentage | N/A | |
Tangible Net Worth | N/A |
Covenant | ||
The covenants listed above shall be tested at the following times: | ||
Testing Day | ||
Debt Turn | Final day of each calendar month | |
Dilution Percentage | Final day of each calendar month | |
Dispute Percentage | Final day of each calendar month |
HIF APD 04/2012 | Page 7 |
7. | Special terms |
(a) | In addition to the undertakings given by the Client in Condition 17, the Client also undertakes: |
(i) | To ensure that: |
(A) | where necessary, the Client and/or the Customer possess all licences required to export/import the relevant goods; and |
(B) | the Client and the Customer comply with all laws and/or regulations applicable to the import or export of the relevant goods including, but not limited to, any exchange control regulations; and |
(ii) | To provide HIF, each year, with a declaration (“Annual Declaration”) of the Client’s total sales to Customers located in each Approved Country in a form specified by HIF, for the period of 12 months (or part thereof) ending 31 March (or for such other period as HIF may specify from time to time). Such declaration to be supplied to HIF within 30 days of the end of the relevant period. |
(b) | Where a Credit Protection Limit is expressed in a currency other than that in which the Debt payable by the relevant Customer is expressed and/or the currency in which the purchase price is payable, then for the purposes of calculating any amount payable by HIF to the Client under the provisions of Condition 11.6, the Spot Rate of Exchange on the date of payment shall be used. Any gains or losses, resulting from fluctuation in exchange rates will be for the account of the Client. |
(c) | HIF will not provide Credit Protection in respect of any particular Debt if: |
(i) | the Debt arose after any expiry date notified by HIF to the Client in respect of the relevant Credit Protection Limit; or |
(ii) | there has been any breach by the Client of any term specified by HIF as being a condition of its approval of the relevant Credit Protection Limit |
The provisions of this special term are in addition to, and not in replacement of, the provisions of Condition 11.4.
(d) | For the purposes of Condition 11.4 (f) events of “force majeure” shall include |
(i) | the ionising, radioactive, toxic, explosive or other hazardous or contaminating properties or effects of any explosive nuclear assembly or component thereto, nuclear fuel, combustion or waste; and |
(ii) | where goods are to be despatched to, or payment is to be made from, a country other than that in which the Customer is located, any event preventing or delaying the issue of a remittance from such third country. |
HIF APD 04/2012 | Page 8 |