Terms of service

Terms of service

1. Selling of Debts

1.1 Upon signing the Agreement you will be able to use the Penny App to notify us that you wish us to purchase a Debt. If we choose to purchase the Debt we will within approximately 1 Working Day pay you in full and final settlement the agreed amount as described in condition 3.2.

1.2 We will not make a payment unless we are satisfied the Goods and Services have been Delivered to the satisfaction of the Debtor and the Debtor will not withhold any payment of the Debt. You will promptly provide all information and documents regarding the Debts as we require.

1.3 You are not aware of any Adverse Event having occurred with the Customer within the previous 3 calendar months.

2. Ownership of Debts

2.1 We shall own a Debt as soon as it is purchased via the Penny App. If we ask, you will promptly provide a formal written assignment of any Debt and its Related Rights.

2.2 If the ownership of any Debt shall fail to be transferred effectively to us you will hold that Debt (and its proceeds) in trust for us and separately from your own property and, upon their receipt, you shall immediately pay the proceeds to us.

3. Accounts and Payments to You

3.1 The Purchase Price of each Debt shall be an amount equivalent to the amount we receive from the Customer in payment of the Debt less our Charges.

3.2 We will make the payment of the Purchase Price to the bank account nominated by you in the Penny App. You will be able to access your transactional history by using the Penny App, but we may at any time alter, suspend or withdraw such access without notice or liability.

3.3 Upon its notification to us:

3.3.1 we will provide you with a quote of our charges to purchase the Debt at its notified value. If our quote is accepted and you enter a contract with us to purchase the Debt, we will seek to validate the Debt with the Debtor within the timescale set out in condition 1.1; and

3.3.2 subject to validation of the Debt by us, we shall make a payment of the Purchase Price in respect of such Debt.

3.4 We shall not be obliged to make any payment to you if we become entitled under condition 9 to withhold payments to you.

3.5 You will not at any time seek to set off any money you owe to us against any money we may owe to you.

3.6 Any sums due to us upon repurchase of Debts by you may be off-set against any and all sums due from you to us under the Agreement.

4. Payment of our Service Charge

4.1 You will pay to us (or we may deduct the same from any payment to be made to you at any time) the Service Charge together with any other amounts due by you to us and which are included in your Obligations.

4.2 All Charges are quoted inclusive of Value Added Tax, where applicable.

5. Sales Ledger Administration and Collection of Debts

5.1 You will not attempt to collect any Debt unless we ask you to. We have the sole right to enforce payment of any Debt and its Related Rights.

5.2 Your single invoice finance facility is disclosed to your Customers and each of your invoices must be raised on thePenny App and contain a notice of assignment in terms approved by us.

5.3 All payments received from your Customers in part or full payment of any Debt must be paid to us or to a bank account as identified by us, and pending such payment held in trust for us and kept separate from your own monies.

5.4 Notwithstanding condition 5.1 above we may appoint you as our agent in relation to any Debt in order to (i) render statements of accounts or demand letters, (ii) procure the collection of such Debts, and (iii) handle the realisation of any Related Right for our benefit.

5.5 As soon as you are aware of any dispute regarding any Debt you will tell us all about it and attempt to resolve it. If this is unsuccessful we may elect to resolve it and you will accept the outcome including any reduced Purchase Price.

5.6 You will not issue any Credit Note without first discussing it with us.

6. Warranties and Undertakings

6.1 You warrant that every Debt notified to us (i) will be accepted by the Customer as a legally binding obligation and paid without deduction or set-off and (ii) is free from any charges or other adverse rights or interest.

6.2 You warrant that, in respect of each Debt, you have no obligations to the Customer other than under the Contract of Sale giving rise to the Debt and you have no agreement with the Customer, whether under the Contract of Sale or otherwise, whereby the amount of the Debt may be reduced.

6.3 You warrant that, in relation to any Personal Data that you may pass on to us concerning any living individual who is, without limitation, a Customer, shareholder, director or employee, you have strictly complied and will, until the termination of this Agreement and the discharge of your Obligations, strictly comply with, the provisions of all relevant Data Protection Laws.

6.4 Each of your warranties in conditions 6.1 and 6.2 shall be deemed repeated each time you sell any Debt to us.

6.5 You undertake:

6.5.1 not to vary or attempt to vary any Contract of Sale giving rise to any Debt purchased by us after it has been notified to us;

6.5.2 to keep proper books and records of account and to make appropriate entries in them to show the sale to us of the Debts;

6.5.3 promptly to supply to us such financial or other information relating to your business as we may from time to time request;

6.5.4 promptly to pay all taxes, insurance, carriage and freight charges for which you are liable in relation to any Debt or the Contract of Sale giving rise to it;

6.5.5 not to assign or create any charge over any of your rights or benefits under the Agreement, or any of the Debts.

6.5.6 promptly to deliver to us a copy of every credit note issued in connection with any Debt notified to us;

6.5.7 to indemnify us against all losses costs claims charges interest and expenses incurred by us at any time and arising from or in any way connected with (i) our entering into or registering,

enforcing, exercising or protecting our rights under the Agreement (ii) enforcing or attempting to enforce payment of any Debt or settling or compromising any dispute with or claim by a Customer or any other person in relation to any Debt (whether such action is taken by us or by you as our agent) (iii) the securing by us of any release of any Debt from any trust charge or other encumbrance (iv) any indemnity which we may be required to give to our bankers in connection with the collection on our behalf of any cheque or other instrument made payable to you (v) any breach by you of any of your Obligations;

6.5.8 to procure for us a refund of any value added tax included in any bad or doubtful Debt;

6.5.9 to tell us promptly if a Debtor becomes subject to Insolvency Proceedings;

6.5.10 to comply with all procedures for the operation of the Agreement which we may make known to you from time to time.

7. Repurchase

In the event that a Debt remains unpaid after its due date for payment we may request that you repay to us the Purchase Price in respect of that Debt including any administration fees and collection fees as detailed below. Once we have received your payment the Debt will belong to you.

• (i) A one time administration fee of £250 will be applied to any unpaid Debt immediately after its due date has passed.
• (ii) A one time debt administration recovery fee calculated at 10% of the unpaid Debt immediately after its due date has passed.
• (iii) Any court or collection costs associated with the collection of the Debt.
• (iv) A late payment interest fee of 8% per annum will be applied immediately to any unpaid Debt after its due date and will accrue daily.

8. Information and your Accounts and Records

We may supply such information in our possession relating to your affairs (including your financial and other obligations to us) and the Debts purchased by us to any of your bankers, auditors or any guarantor/indemnifier of your Obligations.

9. Default

9.1 Upon or at any time after the occurrence of a breach or threatened breach by you of this Agreement, or upon your becoming subject to any Insolvency Proceedings, or where a Debt remains unpaid 7 days after the due date for payment as set out in clause 7 above, we may do any one or more of the following:

9.1.1 terminate the Agreement;

9.1.2 demand that you pay to us the same amount as all the Purchase Payments made by us which have not been recovered;

9.1.3 withhold payments to you;

9.1.4 set-off sums due to you against sums due to us as per condition 3.6;

9.2 Save as expressly provided in the Agreement to the contrary, termination of the Agreement will not affect the rights or obligations of either you or us in relation to Debts assigned to us prior to termination. Without limitation, we will continue to own the Debts, Charges will continue to accrue under the Agreement.

9.3 For the purpose of determining your liability under this Agreement and the amount of your Obligations at any time, you agree that a written certificate from any of our authorised officers or our auditor of the amounts due from you to us under the Agreement shall be binding on you and conclusive evidence (save for manifest error) in any legal proceedings against you.

9.4 You and all Director(s) of the business under which you have created a Penny App account are personally liable and responsible for the repayment of any Debt.

10. General Provisions

10.1 No person other than you or us will have any right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement.

10.2 The Agreement shall be construed and take effect in accordance with English law and you hereby submit to the jurisdiction of the English courts without prejudice to our right to bring proceedings in the courts of any country in which you carry on business.

10.3 We may assign or transfer all or any part of our rights and/or obligations under the Agreement and/or under any related guarantee, indemnity or other security.

10.4 We may vary the Standard Terms at any time. We will tell you when the change comes into effect. If you do not accept the change, you may at any time up to 30 days from the date we tell you about the change, terminate the Agreement without being bound by the change.

11. Entire Agreement

11.1 The Agreement (including the Standard Terms) contains all the terms and conditions agreed between you and us. You warrant to us that you have not relied on any commitment, representation or warranty in entering into this Agreement. Nothing in this condition shall limit or exclude any liability for fraud.

11.2 If we have been introduced to you by a third party we have no responsibility for their actions even though we may pay them a commission for the introduction.

12. Meanings of Capitalised Terms

In the Agreement the following capitalised terms shall have the meanings attributed to them below.

“Adverse Event” (i) being unable to pay it's debts when they fall due; (ii) having failed to honour a bill of exchange or cheque due to lack of available funds; (iii) having admitted cash flow difficulties; (iv) having insolvency or legal proceedings commenced against it for non-payment of an amount owing, or; (v) being insolvent in any event which would give reasonable grounds for the belief that the Customer might not be able to fulfil its contractual obligations to You;

“Charges” the Service Charge and Disbursements;

“Contract of Sale” a contract for the supply of goods or services or for hiring by you;

“Customer” any person who has incurred or may incur an obligation to you under a Contract of Sale;

“Data Privacy Manager” a person appointed by us to manage data privacy matters who can be contacted at dpo@pennyfreedom.co.uk;

“Data Protection Laws” means all statutes, laws, secondary legislation and regulations pertaining to privacy, confidentiality and/or data protection of Personal Data or corporate data, the General Data Protection Regulation (Regulation (EU) 2016/679) the Privacy and Electronic Communications (EC Directive) Regulations 2003 (SI 2003/2426), the Regulation of Investigatory Powers Act 2000, the Telecommunications (Lawful Business Practice) (Interception of Communications) Regulations 2000 (SI 2000/2699) and the Data Protection Act 2018 and any relevant national laws implementing Directives 95/46/EC and 2002/58/EC;

“Debt” the amount (or, where the context allows, a part of such amount) of any obligation or indebtedness, including any tax or duty payable, incurred by a Customer under a Contract of Sale;

“Disbursements” all bank charges and other costs, charges and expenses incurred by us in the operation of, or in connection with, this Agreement including legal costs and our standard rate disbursement charges which we will notify in writing to you on signing and from time to time;

“Group Company” any company of which the relation to us is that of “parent undertaking” or “subsidiary undertaking” or any “subsidiary undertaking” of that “parent undertaking” in accordance with the meanings given to those expressions in section 1162 of the Companies Act 2006;

“Insolvency Proceedings”(i) the issue of a petition for winding up or bankruptcy; or (ii) an application to appoint an administrator under paragraph 12 of Schedule B1 to the Insolvency Act 1986 (“the Act”); (iii) the service of a notice of intention to appoint an administrator; or (iv) a proposal for a voluntary arrangement under the Act; or (v) the calling of any meeting of creditors; or (vi) the appointment of a receiver in respect of any part or the whole of your business or property;

“your Obligations” all your present and future monetary and other actual or contingent or prospective obligations incurred at any time to us, or to any Group Company, whether arising under the Agreement or otherwise;

“Outstanding” in relation to any Debt, purchased by us and remaining unpaid;

“Penny App” the app made available by us to you in order to purchase the finance and services as set out in the app;

“Personal Data” any personal data (including sensitive personal data) that we, our employees, agents or sub-contractors process on our behalf in performing our obligations under or in connection with this Agreement​

“Privacy Policy” a policy as to the manner in which we shall process, and your rights in connection with, Personal Data, in a form supplied by us to you from time to time;

“Purchase Payment” a payment made by us to you on account of the Purchase Price of any Debt as set out in condition 3.2;

“Purchase Price” the price of the Debt as calculated in accordance with condition 3.1;

“Related Rights” in respect of any Debt all of the following: (i) all your rights under the Contract of Sale (other than your rights to any goods) (ii) the benefit of all guarantees indemnities insurances and securities given to or held by you (iii) all cheques bills of exchange and other instruments held by or available to you (iv) all ledgers computer data records and documents on or by which any Debt is recorded or evidenced (v) any goods the subject of a Contract of Sale returned or rejected by the Customer or repossessed by you and any interest to which you become entitled in relation to the Debt as a result of any statutory enactment or any rule or regulation of government;

(Edition 1/2019)