Debt Repayment Agreement
ENTERED INTO BY AND BETWEEN:
ON THE FIRST PART,
_____ [identity of the physical or legal person],
hereafter referred to as the “Creditor”,
AND ON THE SECOND PART,
_____ [identity of the physical or legal person],
hereafter referred to as the “Debtor”,
and
_____ [identity of the physical or legal person],
hereafter referred to as the “Buyer”.
The Creditor, the Debtor and the Buyer may be individually referred to as a “Party” or collectively as the “Parties”.
WHEREAS:
The Debtor distributes the products of the Creditor in _____ [territory] (the “Territory”). The Debtor is indebted towards the Creditor in the aggregate amount of _____ [amount of the debt] as at the date of this agreement (the “Debt”).
The Buyer intends to purchase the Debtor’s distribution rights, subject to the Creditor’s approval.
The Creditor may accept to appoint the Buyer in the Territory instead of the Debtor, provided that 1) the Debtor and the Buyer agree on the terms and conditions of this operation and hold the Creditor harmless against any action or claim whatsoever in this respect, 2) the Buyer commits to repay the Debt and 3) the Creditor and the Buyer enter into a new franchising agreement.
Thus, the Parties decided to enter into this debt repayment agreement, which, including its recitals and its appendices that incorporate into it and are indivisible, is hereafter referred to as the “Agreement”.
NOW THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Repayment of the Debt
The Buyer irrevocably agrees to repay the Debt to the Creditor in _____ [number of instalments] as follows:
– first instalment amounting to _____ [amount and currency], to be paid on or before the _____ [date of payment];
– second instalment amounting to _____ [amount and currency], to be paid on or before the _____ [date of payment];
– third instalment amounting to _____ [amount and currency], to be paid on or before the _____ [date of payment];
– _____ [to be completed if appropriate] (the “Schedule of Repayments”).
In case of any late payment, the above Schedule of Repayments shall automatically become null and void and the total outstanding amount due to the Creditor shall therefore become again immediately payable. In addition, the Buyer shall automatically pay the Creditor late payment penalties at a rate amounting to _____ [rate at least equal to three times the annual legal interest rate in force in France] and a minimum flat recovery costs indemnity of 40 (forty) Euros, due as of right, without a reminder being necessary. The Creditor will also be entitled to terminate the new distribution agreement entered into with the Buyer, notwithstanding any other provision in the said franchising agreement.
Payments will be made by _____ [wire transfer for example] as indicated in writing by the Creditor.
2. Representations, guarantees and undertakings
The Debtor and the Buyer hereby represent and guarantee to the Creditor that:
– they have full power to enter into this Agreement, which is perfectly legal, valid and binding as far as they are concerned;
– they will hold the Creditor harmless against any action or claim whatsoever in relation with the agreement entered into between the Debtor and the Buyer.
The Debtor and the Buyer shall remain jointly and severally liable towards the Creditor.
Any successor or beneficiary of either the Debtor or the Buyer, anyhow and notably by way of merger, split, contribution, investment or liquidation, shall be jointly and severally liable towards the Creditor. Any successor or beneficiary of the Creditor shall be substituted to him and shall benefit from the Agreement as if he initially entered it into.
3. Rules Governing the Agreement
3.1 Law and Jurisdiction
The Agreement shall be governed by and interpreted in accordance with French law.
In case of any litigation arising in relation with the Agreement, the Parties hereby grant an exclusive jurisdiction to rule the case to French Courts, and specifically the Courts of _____ [city] (France).
3.2 Entirety of the Agreement
The Parties expressly state that the Agreement expresses the entirety of their agreement as regards its subject matter, and invalidates and replaces any previous agreements entered into between them in relation with its subject matter.
3.3 Severability, Adaptation and Amendment
In case any provision whatsoever of the Agreement is deemed void, this provision shall not apply but the other provisions of the Agreement shall remain into force.
The Parties will do their best efforts to negotiate in good faith and in due time any potential modifications of the Agreement that may be necessary, particularly pursuant to mandatory legal or regulatory provisions or the binding decision of a Court.
In any case, notably where mandatory provisions apply, the purpose and the useful effect of the Agreement shall be taken into account as far as possible.
The Agreement may not be amended except by express and written mutual agreement of the Parties, in which case any amendment or waiver of any provision hereof shall be attached to the Agreement and shall incorporate to it.
3.4 Renunciation
The fact that a Party abstains from requesting application of any provision whatsoever of the Agreement, shall not be considered as a renunciation to request said application.
3.5 Official Domicile
For the purpose of this Agreement, the Parties take up residence in their respective domicile or registered office as indicated in the headings hereto. Any modification shall be notified to the other Party by letter with acknowledgement of receipt, in order to be valid.
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The Agreement is drafted in English and printed in three original copies, signed on this page and initialled on each other page, one original copy being provided to each Party. No word, figure or sign was crossed, invalidated, modified or added, either handwritten or by any means, between the printing and the signing of the original copies.
The Creditor
On behalf of: _______________ [legal person]
Name of the signatory: _______________ [signatory duly authorized]
Title: _______________ [title or capacity of the signatory]
Date: _______________ [signing date]
Place: _______________ [place where the agreement is signed]
Signature:
The Debtor
On behalf of: _______________ [legal person]
Name of the signatory: _______________ [signatory duly authorized]
Title: _______________ [title or capacity of the signatory]
Date: _______________ [signing date]
Place: _______________ [place where the agreement is signed]
Signature:
The Buyer
On behalf of: _______________ [legal person]
Name of the signatory: _______________ [signatory duly authorized]
Title: _______________ [title or capacity of the signatory]
Date: _______________ [signing date]
Place: _______________ [place where the agreement is signed]
Signature:
