Receivables Pledge Agreement Template for England and Wales

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Key Requirements PROMPT example:

Receivables Pledge Agreement

"I need a Receivables Pledge Agreement for a UK manufacturing company pledging its trade receivables to secure a £5 million facility from ABC Bank, with specific provisions for automatic collection rights upon default and monthly reporting requirements."

Document background
A Receivables Pledge Agreement is commonly used in financing transactions where a company needs to provide security over its receivables to secure its obligations under facility agreements or other financing arrangements. The document sets out the terms under which the security is created, maintained, and enforced under English and Welsh law. It typically includes detailed provisions regarding the nature of the pledged receivables, collection mechanisms, enforcement rights, and required perfection steps. This type of agreement is particularly relevant in working capital finance, asset-based lending, and structured finance transactions where receivables form a key part of the security package.
Suggested Sections

1. Parties: Identification of pledgor and pledgee/security agent

2. Background: Context of the pledge agreement and related facilities

3. Definitions and Interpretation: Key terms and interpretation provisions

4. Creation of Security: Core pledge provisions and security creation

5. Perfection and Further Assurance: Requirements for perfecting security and maintaining its validity

6. Representations and Warranties: Standard pledgor representations regarding receivables

7. Covenants: Ongoing obligations of the pledgor

8. Enforcement: Rights and remedies upon default

9. Power of Attorney: Appointment of security agent as attorney

Optional Sections

1. Collection Account Provisions: Required when specific account arrangements are needed for collections

2. Trust Provisions: Trust arrangements for received amounts when amounts received need to be held on trust

3. Data Protection Provisions: Specific data protection requirements when personal data is involved in receivables

Suggested Schedules

1. Form of Notice to Debtors: Template notice to inform debtors of the pledge

2. Form of Acknowledgment: Template acknowledgment from debtors

3. List of Receivables: Details of pledged receivables

4. Collection Account Details: Specifics of designated collection accounts

5. Power of Attorney: Form of power of attorney document

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries
Relevant Teams
Relevant Roles
Industries

Law of Property Act 1925: Key legislation for creating and enforcing security interests, including requirements for legal assignments of property rights

Companies Act 2006: Governs registration requirements for company charges, filing obligations at Companies House, and related disclosure requirements

Financial Collateral Arrangements (No.2) Regulations 2003: Regulations concerning financial collateral, including specific enforcement and perfection requirements for qualifying receivables

Insolvency Act 1986: Addresses the impact of insolvency on security interests, including provisions for preferential creditors and anti-avoidance measures

Consumer Credit Act 1974: Legislation governing consumer credit arrangements and associated consumer protection provisions that may affect receivables

Late Payment of Commercial Debts (Interest) Act 1998: Legislation concerning statutory interest provisions for commercial receivables and late payments

Financial Services and Markets Act 2000: Regulatory framework for financial services, including provisions affecting regulated activities and compliance requirements

Data Protection Act 2018 and UK GDPR: Legislative framework for handling personal data, including requirements for processing data related to receivables

Bills of Exchange Act 1882: Legislation governing negotiable instruments and bills of exchange that may form part of receivables

Contract Law principles: Common law and equitable principles affecting assignments and security interests in receivables

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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