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This Factoring Agreement With Recourse is designed for use in the German market where a business seeks to optimize its working capital through receivables financing while the Factor maintains protection against default risks. The agreement complies with German banking regulations (KWG), civil code provisions (BGB) regarding assignments, and financial services requirements. It is particularly suitable for businesses with established customer bases seeking reliable financing while maintaining customer relationships. The document includes comprehensive provisions for receivables assignment, collection procedures, reporting requirements, and recourse mechanisms, all structured to align with German commercial practices and regulatory requirements. It addresses both the financing aspects and the operational procedures necessary for effective implementation of the factoring program.

1. Parties: Identification of the Factor and the Client (including registration details as required under German law)

2. Background: Context of the agreement and brief description of the factoring arrangement

3. Definitions and Interpretation: Definitions of key terms including Eligible Receivables, Purchase Price, Service Charges, and Recourse Rights

4. Purchase and Assignment of Receivables: Core provisions regarding the purchase and assignment of receivables, including perfection requirements under German law

5. Purchase Price and Payment Terms: Calculation and payment of purchase price, reserves, and service charges

6. Recourse Rights: Conditions and process for exercising recourse rights, including timing and notice requirements

7. Representations and Warranties: Client's representations regarding existence and validity of receivables and compliance with laws

8. Client Undertakings: Ongoing obligations of the client including reporting, notifications, and operational requirements

9. Factor's Rights and Obligations: Factor's services, collection rights, and reporting obligations

10. Collections and Payment Processing: Management of collections and payment allocation procedures

11. Data Protection and Confidentiality: GDPR compliance and confidentiality obligations

12. Events of Default: Circumstances constituting default and consequences

13. Term and Termination: Duration, renewal, and termination provisions

14. Governing Law and Jurisdiction: German law as governing law and jurisdiction provisions