EXHIBIT 10.9
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PURCHASE AND CONTRIBUTION AGREEMENT
Dated as of November 24, 1999
Among
FMC CORPORATION,
as Seller,
FMC WYOMING CORPORATION,
as Seller,
and
FMC FUNDING CORPORATION,
as Purchaser
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TABLE OF CONTENTS
Page
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PURCHASE AND CONTRIBUTION AGREEMENT
ARTICLE I
DEFINITIONS
SECTION 1.01. Definition ...................................................... 1
SECTION 1.02. Rules of Construction; Other Terms .............................. 3
ARTICLE II
SALES AND CONTRIBUTIONS
SECTION 2.01. Sales and Contributions ......................................... 4
SECTION 2.02. Agreement to Contribute ......................................... 4
SECTION 2.03. Timing of Purchases and Contributions ........................... 4
SECTION 2.04. Initial Purchase Price Payment .................................. 5
SECTION 2.05. Subsequent Purchase Price Payments .............................. 5
SECTION 2.06. General Settlement Procedures ................................... 6
SECTION 2.07. Payments and Computations, Etc .................................. 7
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.01. Conditions Precedent to Effectiveness of this Agreement ......... 7
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Sellers ................... 8
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Sellers ........................................ 11
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. Designation of Collection Agent ................................. 17
SECTION 6.02. Certain Rights of the Purchaser ................................. 17
SECTION 6.03. Rights and Remedies ............................................. 18
SECTION 6.04. Transfer of Records to Purchaser ................................ 18
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ARTICLE VII
INDEMNIFICATION
SECTION 7.01. Indemnities by the Seller ....................................... 19
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc ................................................. 21
SECTION 8.02. Notices, Etc .................................................... 21
SECTION 8.03. Binding Effect; Assignability ................................... 21
SECTION 8.04. Costs, Expenses and Taxes ....................................... 22
SECTION 8.05. Fees ............................................................ 22
SECTION 8.06. No Proceedings .................................................. 22
SECTION 8.07. Waiver of Set-Off, Etc .......................................... 22
SECTION 8.08. Confidentiality ................................................. 23
SECTION 8.09. Intent of Agreement ............................................. 23
SECTION 8.10. Governing Law ................................................... 24
SECTION 8.11. Third-Party Beneficiary ......................................... 24
SECTION 8.12. Execution in Counterparts ....................................... 24
SECTION 8.13. Survival of Termination ......................................... 24
SECTION 8.14. Addition of FMCW ................................................ 24
EXHIBITS
Exhibit A Form of Non-Negotiable Promissory Note
Exhibit B List of Trade Names
ii
PURCHASE AND CONTRIBUTION AGREEMENT
Dated as of November 24, 1999
FMC CORPORATION, a Delaware corporation (together with its permitted
successors and assigns, "FMC"), FMC WYOMING CORPORATION, a Delaware corporation
(together with its successors and assigns, "FMCW") and FMC FUNDING CORPORATION,
a Delaware corporation (the "Purchaser"), agree as follows:
PRELIMINARY STATEMENTS. Each of FMC and FMCW has originated and will
continue to originate Receivables that it desires to sell to the Purchaser from
time to time, and the Purchaser is prepared to purchase such Receivables on the
terms set forth herein.
FMC may also wish to contribute Receivables to the capital of the
Purchaser on the terms set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Unless otherwise defined herein capitalized terms used
herein shall have the meanings assigned to such terms in the Second-Tier
Agreement (as defined herein). As used in this Agreement, the following terms
shall have the following meanings:
"Agreement" means this Purchase and Contribution Agreement, as the same
may from time to time be amended, waived, supplemented or otherwise modified.
"Available Funds" shall have the meaning assigned to such term in
Section 2.05.
"Closing Date" means the date of the first transfer of an interest in
any Receivable pursuant to the Second-Tier Agreement.
"Contributed Receivable" shall have the meaning assigned to such term
in Section 2.03(b).
"Discount" means, in respect of the Receivables to be purchased on any
day, 0.70% of the Outstanding Balance of such Receivables; provided, however,
that the foregoing Discount may be revised prospectively by request of any of
the parties hereto to reflect changes in recent experience with performance of
the Receivables or funding costs, provided that such revision is consented to by
each of the parties hereto (it being understood that each of the parties hereto
agrees to duly consider such request but shall have no obligation to give such
consent).
"Indemnified Amounts" shall have the meaning assigned to such term in
Section 7.01.
"Initial Contributed Receivables" shall have the meaning assigned to
such term in Section 2.02.
"Initial Cut-Off Date" means (i) with respect to FMC, the Business Day
immediately preceding the Closing Date, and (ii) with respect to FMCW, the
Business Day immediately preceding the FMCW Effective Date.
"Initial Purchase Date" means (i) with respect to FMC, the Closing
Date, and (ii) with respect to FMCW, the first Business Day after the FMCW
Effective Date.
"Promissory Note" shall have the meaning assigned to such term in
Section 2.04.
"Purchase Date" means each day on which a purchase of Receivables is
made pursuant to Article II.
"Purchase Price" for the Receivables to be purchased on any day under
this Agreement means an amount equal to the Outstanding Balance of such
Receivables, minus the Discount for such Receivables.
"Purchased Receivable" means any Receivable which has been sold to the
Purchaser pursuant to this Agreement.
"Related Security" means with respect to any Receivable:
(i) all of the Seller's interest in any merchandise
(including returned merchandise) relating to any sale giving rise to
such Receivable;
(ii) all security interests or liens and property subject thereto
from time to time purporting to secure payment of such Receivable,
whether pursuant to the Contract related to such Receivable or
otherwise, together with all financing statements signed by an obligor
describing any collateral securing such Receivable;
(iii) all guaranties, insurance and other agreements or
arrangements of whatever character from time to time supporting or
securing payment of such Receivable whether pursuant to the Contract
related to such Receivable or otherwise;
(iv) the Contract and all other books, records and other
information (including, without limitation, computer programs, tapes,
disks, punch cards, data processing software and related property and
rights) relating to such Receivable and the related Obligor;
(v) all of the Seller's rights, remedies and interest in, to and
under the Deposit Agreements, the Contracts, including without
limitation, the right to receive all payments thereunder and all claims
for damages arising out of a breach or default thereunder;
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(vi) the Lock-Boxes and the Deposit Accounts and all other
accounts to which the proceeds of the foregoing are remitted, and all
cash and investments therein; and
(vii) the proceeds (as defined in the UCC) of the foregoing
and of such Receivable.
"Sale Indemnified Party" shall have the meaning assigned to such term
in Section 7.01.
"Second-Tier Agreement" means the Receivables Purchase Agreement, dated
as of the date hereof, among the Purchaser, as seller, XXXXXX, X.X., Citibank,
N.A., the other banks from time to time parties thereto, Citicorp North America,
Inc., as agent, and FMC, as initial servicer, as the same may from time to time
be amended, waived, supplemented or modified.
"Sellers" means FMC and FMCW.
"Transferred Receivable" means a Purchased Receivable or a Contributed
Receivable.
SECTION 1.01. Rules of Construction; Other Terms.
-----------------------------------
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
Singular words shall connote the plural as well as the singular, and
vice versa (except as indicated), as may be appropriate.
The words "herein," "hereof" and "hereunder" and other words of similar
import used herein refer to this Agreement as a whole and not to any particular
appendix, article, schedule, section, paragraph, clause, exhibit or other
subdivision.
The headings, subheadings and table of contents set forth in this
Agreement are solely for convenience of reference and shall not constitute a
part of this Agreement nor shall they affect the meaning, construction or effect
of any provision hereof.
References in this Agreement to "including" shall mean including
without limiting the generality of any description preceding such term, and for
purposes hereof the rule of ejusdem generis shall not be applicable to limit a
general statement, followed by or referable to an enumeration of specific
matters, to matters similar to those specifically mentioned.
Each of the parties to this Agreement and their respective counsel have
reviewed and revised, or requested revisions to, this Agreement, and the usual
rule of construction that any ambiguities are to be resolved against the
drafting party shall be inapplicable in the construction and interpretation of
this Agreement.
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All accounting terms not specifically defined herein shall be construed
in accordance with GAAP. All terms used in Article 9 of the UCC in the State of
New York, and not specifically defined herein, are used herein as defined in
such Article 9.
ARTICLE II
SALES AND CONTRIBUTIONS
SECTION 2.01. Sales and Contributions.
-----------------------
On the terms and subject to the conditions set forth in this Agreement,
and in consideration of the Purchase Price, payable on the Initial Purchase Date
until the Program Termination Date, each Seller agrees to sell, assign and
transfer, and does hereby sell, assign and transfer to the Purchaser, and the
Purchaser agrees to purchase, and does hereby purchase, from each such Seller,
all of each such Seller's right, title and interest in, to and under (i) each
Receivable (other than in the case of FMC, Initial Contributed Receivables) of
each such Seller that existed and was owing to each such Seller as of the close
of the Seller's business on the Initial Cut-Off Date; (ii) each Receivable
(other than in the case of FMC, Contributed Receivables) created or originated
by each such Seller from the close of business on the Initial Cut-Off Date to
the Program Termination Date, (iii) all Related Security with respect to such
Receivables, and (iv) all Collections in respect of, and other proceeds of, any
of the foregoing.
All purchases and capital contributions hereunder shall be made without
recourse to the Sellers; provided, that each Seller will be liable to the
Purchaser and its assigns for all representations, warranties, covenants and
indemnities made by the Seller pursuant to the terms of the Program Documents.
SECTION 2.02. Agreement to Contribute.
-----------------------
In consideration of the capital stock of the Purchaser issued to FMC,
FMC agrees to contribute, and does hereby contribute to the Purchaser, and the
Purchaser agrees to accept, and does hereby accept, from FMC, on the Closing
Date, all of FMC's right, title and interest in, to and under the Receivables
and the Related Security and Collections with respect thereto, existing on the
Initial Cut-Off Date, which have been specified to the Purchaser on or prior to
the Closing Date (the "Initial Contributed Receivables").
SECTION 2.03. Timing of Purchases and Contributions.
-------------------------------------
(a) On the Initial Purchase Date each Seller shall sell to the
Purchaser and the Purchaser shall purchase from each Seller, pursuant to this
Agreement, all of the Sellers' right, title and interest in, to and under (i)
each Receivable (other than in the case of FMC, the Initial Contributed
Receivables) that existed and was owing to each such Seller as of the close of
business on the Initial Cut-Off Date, and (ii) all Related Security and
Collections with respect thereto.
(b) After the Initial Purchase Date, and continuing until the Program
Termination Date, each Receivable created or originated by each Seller, and all
the Related Security and Collections with respect thereto, shall be sold or
contributed by each such Seller to
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the Purchaser (without any further action) upon the creation or origination of
such Receivables. All such Receivables, other than those Receivables which FMC
has indicated by notice to the Purchaser as having been contributed by FMC to
the Purchaser (such other contributed Receivables, together with the Initial
Contributed Receivables, the "Contributed Receivables") and other than the
Foreign Receivables, shall be sold to the Purchaser on such date and all
Contributed Receivables shall be contributed by FMC to the Purchaser on such
date. Each Originator agrees that upon the occurrence of a Special Event all
outstanding Foreign Receivables and the Related Security and Collections with
respect thereto shall be contributed to the Purchaser on the date of such
occurrence and thereafter upon the creation or origination of any such Foreign
Receivable such Foreign Receivable, together with the Related Security and
Collection with respect thereto, shall be contributed to the Purchaser on the
date of such creation or origination without any further action by the parties
hereto. Notwithstanding anything to the contrary set forth herein until the
occurrence of a Special Event, no Seller shall be obligated to sell or
contribute any Foreign Receivable to the Purchaser.
SECTION 2.04. Initial Purchase Price Payment.
------------------------------
On the terms and subject to the conditions set forth in this Agreement,
the Purchaser agrees to pay to each Seller on the Initial Purchase Date the
Purchase Price for the Receivables purchased from such Seller existing on or
prior to the Initial Cut-Off Date (other than in the case of FMC, the Initial
Contributed Receivables) in cash, as agreed to by the Purchaser and such Seller,
and by the issuance of a promissory note in the form of Exhibit A hereto to such
Seller (each such promissory note, as it may be amended, supplemented, indorsed
or otherwise modified from time to time in substitution therefor or renewal
thereof in accordance with the Program Documents, being herein called the
"Promissory Note") in the initial principal amount equal to the balance of the
Purchase Price owing to such Seller on the Initial Purchase Date after
subtracting the amount paid to such Seller in cash.
SECTION 2.05. Subsequent Purchase Price Payments.
----------------------------------
On each Business Day after the Initial Purchase Date until the Program
Termination Date, the Purchaser shall pay to each Seller a portion of the
Purchase Price due to such Seller by depositing into such account as such Seller
shall designate immediately available funds from monies then held by or on
behalf of the Purchaser solely to the extent that such monies do not constitute
Collections that are required to be set aside or segregated and held by the
Servicer pursuant to the Second-Tier Agreement or to be distributed to the
Agent, any Investor or any Bank pursuant to the Second-Tier Agreement on the
next Settlement Date or which are required to be paid to the Servicer as the
Servicer Fee on the next Settlement Date, or which are otherwise necessary to
pay current expenses of the Purchaser (in its reasonable discretion) (such
available monies, the "Available Funds") and provided that each Seller has paid
all amounts then due and payable by it hereunder; provided, however, that the
term Available Funds does not include available monies to the extent that after
making all such distribution to the Sellers on a given day the Tangible Net
Worth of the Purchaser shall be less than the greater of (i) three percent (3%)
of the Outstanding Balance of the Transferred Receivables, and (ii) $1,000,000.
To the extent that the portion of the Available Funds remitted to any Seller are
insufficient to pay the Purchase Price then due to such Seller in full, the
remaining portion of
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such Purchase Price shall be paid by increasing the principal amount of the
Promissory Note issued to such Seller, effective as of the last day of the
related Settlement Period.
SECTION 2.06. General Settlement Procedures.
-----------------------------
(a) If on any day:
(i) the Outstanding Balance of a Transferred Receivable is
reduced, adjusted or cancelled as a result of any billing adjustment,
renegotiation, application of credit balances, rebates, discounts,
charge-backs, exchanges, returns or other similar credits, allowances,
net-outs, set-offs, offsets, defenses (including any failure by any
Seller or any other Person to deliver any goods, provide any service or
otherwise perform its obligations under any Contract) or other dilution
factors; or
(ii) the Outstanding Balance of a Transferred Receivable is
reduced or cancelled as a result of a set-off or offset in respect of
any claim by the Obligor thereof against any Seller, any Affiliate of
any Seller or any other Person (whether such claim arises out of the
same or a related transaction or an unrelated transaction); or
(iii) any of the representations or warranties in clause (e),
(j), or (p) of Section 4.01 is not true with respect to any Transferred
Receivable; or
(iv) any amount received by the Purchaser or its successors and
assigns in respect of any Transferred Receivable is rescinded or must
otherwise be returned by the Purchaser or its successors and assigns
for any reason;
then the applicable Seller shall be deemed to have received on such day, a
Collection of such Transferred Receivable in an amount equal to (A) the amount
of such reduction or cancellation, in the case of an event of the type described
in clause (i) or (ii) above, (B) the full Outstanding Balance of such
Transferred Receivable, in the case of an event of the type described in clause
(iii) above, or (C) such amount so rescinded or returned, in the case of an
event of the type described in clause (iv) above. The applicable Seller shall on
such day pay to the Purchaser the amount of such deemed Collection by remitting
such amount to such account of the Purchaser as the Purchaser shall designate.
(b) For the purposes of this Agreement:
(i) except as provided in Section 2.06 or as otherwise required
by applicable law or the relevant Contract, all Collections received
from an Obligor of any Receivable shall be applied to the Receivables
of such Obligor in the order of the age of such Receivables, starting
with the oldest such Receivable, unless such Obligor designates its
payment for, or the Contract requires, application to specific
Receivables; and
(ii) if and to the extent the Purchaser or any of its
successors or assigns shall be required for any reason to pay over to
an Obligor any amount received on its
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behalf hereunder, such amount shall be deemed not to have been so
received but rather to have been retained by the applicable Seller and,
accordingly, the Purchaser shall have a claim against the applicable
Seller for such amount, payable when and to the extent that any
distribution from or on behalf of such Obligor is made in respect
thereof.
SECTION 2.07. Payments and Computations, Etc.
-------------------------------
(a) All amounts to be paid or deposited by the Sellers hereunder shall
be paid or deposited in accordance with the terms hereof no later than 11:00
A.M. (New York City time) on the day when due in lawful money of the United
States in same day funds as directed by the Purchaser in writing.
(b) The Seller shall, to the extent permitted by law, pay to the
Purchaser interest on any amount not paid or deposited by the Seller when due
hereunder, at an interest rate of two percent (2%) per annum above the Alternate
Base Rate, payable on demand.
(c) All computations of interest and fees hereunder shall be made on
the basis of a year of 360 days for the actual number of days elapsed. Whenever
any payment or deposit to be made hereunder shall be on a day other than a
Business Day, such payment or deposit shall be made on the next succeeding
Business Day, and such extension of time shall be included in the computation of
such payment and deposit.
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.01. Conditions Precedent to Effectiveness of this Agreement.
-------------------------------------------------------
The effectiveness of this Agreement is subject to the conditions
precedent that the Purchaser shall have received the following, in form and
substance satisfactory to the Purchaser:
(a) acknowledgment copies or time-stamped receipt copies of proper
financing statements, duly filed on or before the date of the initial purchase
of Receivables hereunder, naming FMC as the seller/debtor and the Purchaser as
the purchaser/secured party, or other similar instruments or documents, as the
Purchaser may deem necessary or desirable under the UCC of all appropriate
jurisdictions or other applicable law to perfect the Purchaser's ownership of
the Transferred Receivables and Related Security and Collections with respect
thereto;
(b) acknowledgment copies or time-stamped receipt copies of proper
financing statements, if any, necessary to release all security interests and
other rights of any Person in the Transferred Receivables, Contracts or Related
Security previously granted by FMC;
(c) completed requests for information, dated on or before the date
of such initial purchase of Receivables hereunder, listing the financing
statements referred to in subsection (a) above and all other effective financing
statements filed in the jurisdictions referred
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to in subsection (a) above that name FMC, as debtor, together with copies of
such other financing statements (none of which shall cover any Transferred
Receivables, Contracts or Related Security); and
(d) the executed fee agreement referred to in Section 8.05.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Sellers.
---------------------------------------------
Each Seller represents and warrants as to itself, its assets and
properties and its obligations as of the Initial Purchase Date and on each date
a Receivable becomes a Transferred Receivable:
(a) Such Seller has been duly organized and is validly existing and in
good standing under the laws of the State of its respective organization, and is
duly qualified to do business, and is in good standing in every jurisdiction
where the nature of its business requires it to be so qualified, except where
the failure to so qualify does not give rise to a reasonable possibility of a
Material Adverse Effect. Such Seller had at all relevant times, and now has, all
necessary power, authority and legal right to originate and own the Receivables
generated by it and the Related Security with respect thereto and to sell
(and/or in the case of FMC, contribute) such Receivables and Related Security to
the Purchaser.
(b) The execution, delivery and performance by such Seller of this
Agreement and the other Program Documents to which it is a party, including such
Seller's sale (and in the case of FMC, contribution) of Receivables hereunder
and such Seller's use of the proceeds of purchases, (i) are within such Seller's
powers, (ii) have been duly authorized by all necessary action, (iii) do not
contravene (1) such Seller's certificate of incorporation, by-laws or other
organizational documents, (2) any law, rule or regulation applicable to such
Seller, (3) any contractual restriction binding on or affecting such Seller or
its property or assets, or (4) any order, writ, judgment, award, injunction or
decree binding on or affecting such Seller or its property or assets, and (iv)
do not result in or require the creation of any Adverse Claim. This Agreement
has been duly executed and delivered by such Seller.
(c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required for
the due execution, delivery and performance by such Seller of this Agreement or
any other Program Document to which it is a party, including, without
limitation, the sale (and in the case of FMC,the contribution) and assignment of
the Receivables as contemplated hereby, except for the filing of UCC financing
statements which are referred to herein.
(d) Each of this Agreement and each other Program Document to which
such Seller is a party constitutes the legal, valid and binding obligation of
such Seller, enforceable against such Seller in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
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creditors' rights generally and by general principles of equity, regardless or
whether such enforcement is considered in a proceeding in equity or at law.
(e) Sales and contributions made pursuant to this Agreement will
constitute a valid True Sale of the Transferred Receivables to the Purchaser,
enforceable against creditors of, and purchasers from, such Seller and its
Affiliates and such Seller shall have no remaining property interest in any
Transferred Receivable.
(f) Each Investor Report (including, without limitation, each E-Mail
Report), information, exhibit, financial statement, document, book, record or
report furnished or to be furnished at any time by or on behalf of such Seller
or any of its Affiliates to the Purchaser or its successors or assigns, in
connection with any Program Documents is or will be accurate in all material
respects as of its date or (except as otherwise disclosed to the Purchaser and
the Agent at such time) as of the date so furnished, and no such document
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary in order to make the statements
contained therein (when considered as a whole), in the light of the
circumstances under which they were made, not misleading.
(g) Except for the Schedule IV Claim and the claims and proceedings
relating to or arising out of the Schedule IV Claim, there are no actions, suits
or proceedings current or pending, or to its knowledge threatened before any
court, governmental agency or arbitrator of any kind which may give rise to the
reasonable possibility of a Material Adverse Effect.
(h) No proceeds of any purchase of Receivables hereunder will be used
in a manner which conflicts with or contravenes any of Regulations T, U or X
promulgated by the Board of Governors of the Federal Reserve System from time to
time.
(i) No transaction contemplated hereby requires compliance with any
bulk sales act or similar law.
(j) Immediately prior to the sale or contribution of a Receivable to
the Purchaser by such Seller pursuant to this Agreement, such Seller is the
legal and beneficial owner of such Receivable and the Related Security and
Collections with respect thereto free and clear of any Adverse Claims. This
Agreement is effective to, and shall transfer to the Purchaser (and the
Purchaser shall acquire) from such Seller all right, title and interest of such
Seller in each Receivable and in the Related Security and Collections with
respect thereto on the Initial Purchase Date, with respect to the Receivables
outstanding on the Initial Cut-Off Date, and thereafter upon the creation and
origination of each such Receivable free and clear of any Adverse Claim.
(k) The principal place of business and chief executive office (for
purposes of the UCC) of such Seller and the office where such Seller keeps its
records concerning the Transferred Receivables are located at the address or
addresses referred to in Section 5.01(b).
(l) Prior to the occurrence of a Special Event, all Obligors and only
Obligors of Transferred Receivables and Foreign Receivables have been instructed
or, upon the creation of Receivables owed by them, will be instructed to make
payments only to FMC Deposit
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Accounts and Lock-Boxes and such instructions have not been modified or revoked
by any Seller and such instructions that have been given are in full force and
effect.
(m) Except as set forth in Exhibit B hereto, such Seller is not known
by and does not use any trade name or doing-business-as name.
(n) With respect to any programs used by such Seller in the servicing
of the Receivables, no sublicensing, approvals or agreements are necessary in
connection with the designation of a new Servicer pursuant to the Second-Tier
Agreement or for the Purchaser or its assignees use of such programs so that the
Purchaser, its assignees and such new Servicer shall have the benefit of such
programs.
(o) The transfers of Transferred Receivables by such Seller to the
Purchaser pursuant to this Agreement, and all other transactions between such
Seller and the Purchaser, have been and will be made in good faith and without
intent to hinder, delay or defraud creditors of such Seller.
(p) Each Receivable, on the date of the purchase or contribution
thereof and on the date such Receivable is identified as an Eligible Receivable
by such Seller or the Servicer on the date any Investor Report or an E-Mail
Report is delivered, is an Eligible Receivable on each such date.
(q) Such Seller is not, and is not controlled by, an "investment
company" registered or required to be registered under the Investment Company
Act of 1940, as amended.
(r) FMC owns all of the issued and outstanding common stock of the
Purchaser.
(s) Each of the Transferred Receivables constitutes an "account" as
such term is defined in the UCC, or if such Transferred Receivable constitutes
and Inventory Protection Receivable, such Transferred Receivable constitutes
either an "account" or a "general intangible" as such terms are defined in the
UCC.
(t) Such Seller has (i) initiated a review and assessment of all areas
within its business and operations (including those affected by suppliers and
vendors) that could be adversely affected by the Year 2000 Problem; (ii)
developed a plan and time line for addressing the Year 2000 Problem on a timely
basis, and (iii) implemented such plan in accordance with such timetable. Such
Seller is exercising commercially reasonable efforts to enable the computer
hardware and software within the critical business systems of such Seller to
perform properly date-sensitive functions for all dates before and after January
1, 2000. Such Seller has no reason to believe that such critical business
systems will not function on any given date or that the ability of such Seller
to perform its obligations under the Program Documents will be impaired.
(u) After giving effect to this Agreement and each sale and
contribution by such Seller of Receivables under this Agreement and the use of
proceeds of each such sale, (i) the fair market value of its assets exceeds its
total liabilities (including contingent, subordinated, matured and unliquidated
liabilities), (ii) it has sufficient presently salable assets and sufficient
cash flow to enable it to meet its debts as they mature (in each case as such
concepts are defined
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in applicable bankruptcy and related laws), and (iii) it does not have
unreasonably small capital (within the meaning of Section 548(a)(2) of the
Federal Bankruptcy Code).
(v) The consideration received by the Sellers for the Transferred
Receivables constitutes fair consideration and reasonably equivalent value. Each
such sale and contribution of Receivables hereunder shall not have been made for
or on account of an antecedent debt owed by it to the Purchaser and no such sale
or contribution is or may be voidable or subject to avoidance under any section
of the Federal Bankruptcy Code.
(w) Except to the extent that such Seller has delivered to the Agent a
direction letter addressed to the warehouseman of any off-site facility, such
Seller does not maintain books and records relating to the Transferred
Receivables originated by it at off-site data processing or storage facilities.
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Sellers.
------------------------
From the date hereof until the first day following the Program
Termination Date:
(a) Compliance with Laws, Etc. Each Seller, only as to itself and its
respective assets and properties and its obligations, will comply in all
material respects with all applicable laws, rules, regulations and orders and
preserve and maintain its corporate existence, rights, franchises,
qualifications and privileges, except to the extent that the failure to so
comply with such laws, rules and regulations or the failure to so preserve and
maintain such existence, rights, franchises, qualifications, and privileges
could not give rise to a reasonable possibility of a Material Adverse Effect.
(b) Offices, Records and Books of Account. Each Seller will keep its
principal place of business and chief executive office and the office where it
keeps its records concerning the Transferred Receivables originated by it at the
address of such Seller set forth under its name on the signature page to this
Agreement or, upon thirty (30) days' prior written notice to the Purchaser and
the Agent, at any other locations in jurisdictions where all actions required to
protect and perfect the Purchaser's ownership interest in the Transferred
Receivables originated by it shall have been taken and completed. Each Seller
also will maintain and implement administrative and operating procedures
(including, without limitation, an ability to recreate records evidencing
Transferred Receivables originated by it and related Contracts relating to it in
the event of the destruction of the originals thereof), and keep and maintain
all documents, books, records and other information reasonably necessary or
advisable for the collection of all Transferred Receivables originated by it
(including, without limitation, records adequate to permit the daily
identification of each new Transferred Receivable and all Collections of and
adjustments to each existing Transferred Receivable originated by it). Each
Seller shall make a notation in its books and records, including its computer
files, to indicate which Receivables have been sold or contributed to the
Purchaser hereunder.
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(c) Performance and Compliance with Contracts and Credit and Collection
Policy. Each Seller will, at its expense, timely and fully perform and comply
with all material provisions, covenants and other promises required to be
observed by it under the Contracts related to the Transferred Receivables
originated by it, and timely and fully comply in all material respects with the
Credit and Collection Policy in regard to each Transferred Receivable originated
by it and the related Contract.
(d) Sales, Liens, Etc. Except for the sales and contributions of
Receivables contemplated herein, each Seller will not sell, assign (by operation
of law or otherwise) or otherwise dispose of, or create or suffer to exist any
Adverse Claim upon or with respect to, any Transferred Receivable originated by
it, the related Contract or the Collections or Related Security with respect
thereto, or upon or with respect to any account to which any Collections of any
Transferred Receivable are sent, or assign any right to receive income in
respect thereof.
(e) Extension or Amendment of Transferred Receivables. Except as
permitted by the Second-Tier Agreement with respect to certain actions of the
Servicer, no Seller will extend, amend or otherwise modify the terms of any
Transferred Receivable, or amend, modify or waive any term or condition of any
Contract related thereto.
(f) Change in Business or Credit and Collection Policy. No Seller will
make any change in the Credit and Collection Policy to the extent that such
change could impair the collectibility of the Transferred Receivables or
otherwise give rise to a Material Adverse Effect.
(g) Audits. Each Seller will, from time to time during regular business
hours as requested by the Purchaser or its assigns, permit the Purchaser, or its
agents, representatives or assigns, or its agents or representatives (including
independent public accountants which may be such Seller's independent public
accountants), (i) to examine and make copies of and abstracts from all books,
records and documents (including, without limitation, computer tapes and disks)
in the possession or under the control of such Seller relating to the
Transferred Receivables and the Related Security, including, without limitation,
the related Contracts, and (ii) to visit the offices and properties of such
Seller for the purpose of examining such materials described in clause (i)
above, and to discuss matters relating to the Transferred Receivables and the
Related Security or such Seller's performance hereunder or under the Contracts
with any of the officers or employees of such Seller having knowledge of such
matters; provided, however, that such periodic audits shall be
limited to two (2) per calendar year unless an Audit Deficiency has occurred or
unless an Event of Termination, Incipient Event of Termination or a Designated
Event has occurred in such calendar year. In addition, such Seller shall
annually (or more frequently as the Agent may require during the continuance of
an Event of Termination or Incipient Event of Termination), at its expense,
appoint independent public accountants (which may, with the consent of the
Agent, be such Seller's independent public accountants), or utilize the Agent's
representatives or auditors, to prepare and deliver to the Agent a written
report with respect to the Receivables and the Credit and Collection Policy
(including, in each case, the systems, procedures and records relating thereto)
on a scope and in a form reasonably requested by the Agent. Each Seller shall,
on or prior to March 31, 2000, (at the sole cost and expense of such Seller) (i)
cause KPMG LLP or another nationally recognized ("big six") independent
accounting firm to conduct an audit of such Seller's books, records and
accounts, the scope of which has been agreed to by the Sellers and the Agent,
(ii) permit such accounting firm to
12
discuss such Seller's affairs, finances and accounts with employees and
representatives of the Agent, and (iii) cause such accounting firm to provide
the Agent with a report in respect of the foregoing which shall be in form,
scope and substance reasonably satisfactory to the Agent.
(h) Change in Payment Instructions to Obligors. Subject only to Section
3.03 of the Second-Tier Agreement, no Seller shall add or terminate any bank as
a Deposit Bank, make any changes in the Lock-Boxes or Deposit Accounts from
those listed in Schedule III to the Second-Tier Agreement, or make any change in
its instructions to Obligors regarding payments to be made to any Lock-Box or
Deposit Account, unless the requirements set forth in Section 6.05(c) of the
Second-Tier Agreement have been fully complied with.
(i) Deposits to Deposit Accounts. Prior to the occurrence of a Special
Event, each Seller shall deposit or cause to be deposited all Collections of
Transferred Receivables into the FMC Deposit Accounts. After the occurrence of a
Special Event and prior to instructing the Obligors to remit all Collections to
a Seller Deposit Account following the occurrence of an Event of Termination or
a Designated Event, each Seller shall deposit or cause to be deposited all
Collections of Transferred Receivables into the FMC Deposit Accounts and shall
cause such amounts to be promptly (and in any event within one (1) Business Day
after receipt) remitted to a Seller Deposit Account. After instructing the
Obligors to remit all Collections to a Seller Deposit Account following the
occurrence of an Event of Termination or a Designated Event each Seller shall
deposit or cause to be deposited all Collections of Transferred Receivables
directly into the Seller Deposit Accounts. No Seller will deposit or otherwise
credit, or cause or permit to be so deposited or credited, to any Deposit
Account cash or cash proceeds other than Collections of Transferred Receivables;
provided, however, that prior to the occurrence of a Special Event, Collections
in respect of Foreign Receivables may be remitted to the FMC Deposit Account.
(j) Marking of Records. At its expense, each Seller shall identify on
its books and records and master data processing records the Transferred
Receivables originated by it and indicate that Receivable Interests related to
such Transferred Receivables have been sold or contributed to the Purchaser in
accordance with this Agreement.
(k) Further Assurances.
(i) Each Seller agrees from time to time, at its expense,
promptly to execute and deliver all further instruments and documents,
and to take all further actions, that may be necessary or desirable, or
that the Purchaser or its assignees may reasonably request, to perfect,
protect or more fully evidence the sale and contribution of Receivables
under this Agreement, or to enable the Purchaser or its assignee to
exercise and enforce its respective rights and remedies under this
Agreement or with respect to the Transferred Receivables. Without
limiting the foregoing, each Seller will, upon the request of the
Purchaser or its assignee, (A) execute and file such financing or
continuation statements, or amendments thereto, and such other
instruments and documents, that may be necessary or desirable to
perfect, protect or evidence such Transferred Receivables; and (B)
deliver to the Purchaser or its assignees copies of all Contracts
relating to the Transferred Receivables originated by it and all
records relating to such Contracts
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and the Transferred Receivables, whether in hard copy or in magnetic
tape or diskette format (which if in magnetic tape or diskette format
shall be compatible with the Purchaser's or its assignee's computer
equipment).
(ii) Each Seller authorizes the Purchaser or its assignee to file
financing or continuation statements, and amendments thereto and
assignments thereof, relating to the Transferred Receivables originated
by it and the Related Security, the related Contracts and the
Collections with respect thereto without the signature of such Seller
where permitted by law. A photocopy or other reproduction of this
Agreement shall be sufficient as a financing statement where permitted
by law.
(iii) Each Seller shall perform its obligations under the
Contracts related to the Transferred Receivables originated by it to
the same extent as if such Transferred Receivables had not been sold or
transferred. No other Person (other than the relevant Obligor therein)
shall have any obligation or liability with respect to any Transferred
Receivable or related Contract, nor shall any such Person be obligated
to perform the obligations of any Seller thereunder.
(l) Reporting Requirements. Each Seller will provide to the Purchaser
and the Agent the following:
(i) as soon as available and in any event within forty-five (45)
days after the end of the first three (3) quarters of each fiscal year
of such Seller, balance sheets of such Seller and its consolidated
subsidiaries as of the end of such quarter and statements of income and
retained earnings of such Seller and its subsidiaries for the period
commencing at the end of the previous fiscal year and ending with the
end of such quarter, certified by the chief financial officer,
treasurer or chief accounting officer of such Seller;
(ii) as soon as available and in any event within ninety (90)
days after the end of each fiscal year of such Seller, a copy of the
annual report for such year for such Seller and its consolidated
subsidiaries, containing financial statements for such year audited by
KPMG LLP or such other nationally regognized (big six) independent
public accounting firm;
(iii) as soon as possible and in any event within three (3) days
after the occurrence of each Event of Termination or Incipient Event of
Termination, a statement of the chief financial officer, treasurer or
chief accounting officer of such Seller setting forth details of such
Event of Termination or Incipient Event of Termination and the action
that has been taken and which such Seller proposes to take with respect
thereto;
(iv) promptly after the filing or receiving thereof, copies of
all reports and notices that such Seller or any of its Affiliate files
under ERISA with the Internal Revenue Service or the Pension Benefit
Guaranty Corporation or the U.S. Department of Labor or that such
Seller or any of its Affiliate receives from any
14
of the foregoing or from any multiemployer plan (within the meaning of
Section 4001(a)(3) of ERISA) to which such Seller or any of its
Affiliates is or was, within the preceding five years, a contributing
employer, in each case in respect of the assessment of withdrawal
liability or an event or condition which could, in the aggregate,
result in the imposition of liability on such Seller and/or any such
Affiliate which could reasonably be expected to give rise to a Material
Adverse Effect;
(v) at the time of the delivery of the financial statements
provided for in clauses (i) and (ii) above, a certificate of the chief
financial officer or the treasurer of such Seller, to the effect that,
to the best of such officer's knowledge, no Event of Termination has
occurred and is continuing or, if any Event of Termination has occurred
and is continuing, specifying the nature and extent thereof;
(vi) such other information respecting the Transferred
Receivables originated by it or the condition or operations, financial
or otherwise, of such Seller and its Affiliates as the Purchaser or its
assigns may from time to time reasonably request; and
(vii) as soon as possible and in any event within five (5)
Business Days after any material change after the date hereof in the
status of the Schedule IV Claim or any additional claims or proceedings
relating to or arising out of the subject matter of the Schedule IV
Claim, a statement of an officer of such Seller setting forth in
reasonable detail such change and/or a description of such additional
claims or proceedings.
(m) Collections.
(i) In the event that any Seller receives any Collections of
Transferred Receivables, such Seller agrees to hold all such
Collections in trust and to mail such Collections to a Lock-Box or
deposit such Collections in the appropriate Deposit Account as soon as
practicable, but in no event later than one (1) Business Day after
receipt thereof.
(ii) In the event that any Affiliate of any Seller receives any
Collections of Transferred Receivables, such Seller agrees to cause
such Affiliate to hold all such Collections in trust and to cause such
Affiliate to mail such Collections to a Lock-Box or deposit such
Collections to the appropriate Deposit Account as soon as practicable,
but in no event later than one (1) Business Day after receipt thereof.
(n) Cooperation with Servicer. Each of FMCW and FMC (if not the
Servicer) shall cooperate with the Servicer in collecting amounts due from
Obligors in respect of the Transferred Receivables originated by it. In
addition, each of FMCW and FMC shall cause the Purchaser to be in compliance
with its obligations under Section 3.03 of the Second-Tier Agreement.
15
(o) Transferred Receivables Not to be Evidenced by Promissory Notes.
Each Seller shall not take any action to cause or permit any Transferred
Receivable generated by it to become evidenced by any "instrument" (as defined
in the applicable UCC), except in connection with the collection of overdue
Receivables; provided, that the original of such instrument is delivered to the
Agent, duly endorsed.
(p) Negative Pledges. No Seller shall enter into or assume any
agreement (other than this Agreement or any other Program Documents) prohibiting
the creation or assumption of any Lien upon any Transferred Receivables, Related
Security or Collections relating thereto, whether now owned or hereafter
acquired, except as contemplated by the Program Documents, or otherwise
prohibiting or restricting any transaction contemplated hereby or by the other
Program Documents.
(q) Change in Name. No Seller shall change its name or its corporate
structure, as applicable, unless it shall have given the Purchaser and the Agent
at least thirty (30) days' prior written notice thereof and has taken all steps
necessary to continue the perfection of the Purchaser's ownership interest in
the Transferred Receivables originated by it and the Related Security and
Collections with respect thereto.
(r) Mergers, Acquisitions, Sales, Etc. No Seller will be a party to any
merger or consolidation, or purchase or otherwise acquire all or substantially
all of the assets (whether now owned or hereafter acquired) of any stock of any
class of, or any partnership or joint venture interest in, any other Person, or,
except in the ordinary course of its business, sell, transfer, convey or lease
all or any substantial part of its assets (whether in one transaction or in a
series of transactions), other than the disposition of its assets pursuant to
this Agreement and the other Program Documents; provided that a Seller may
consolidate or merge with or into another Person if (A) such Seller is the
surviving corporation of such consolidation or merger, and (B) immediately after
giving effect to such consolidation or merger, no Event of Termination or
Incipient Event of Termination shall be continuing or shall result therefrom.
(s) Separate Conduct of Business. Each Seller shall take all steps
necessary to ensure the continued identity of the Purchaser as a legal entity
separate from such Seller and its other Affiliates and to make it apparent to
third persons that the Purchaser is an entity with assets and liabilities
distinct from such Seller and its other Affiliates. Each Seller agrees that it
shall not hold itself out to be responsible for the debts of the Purchaser or
the decisions or actions with respect to the daily business and affairs of the
Purchaser, except as provided in the Second-Tier Agreement with respect to the
duties of the Servicer. Without limiting or being limited by the foregoing, each
Seller shall: (i) maintain separate corporate records and books of account from
those of the Purchaser; (ii) maintain its deposit accounts separate from those
of the Purchaser; (iii) conduct its business from an office separate from that
of the Purchaser; (iv) ensure that all oral and written communications,
including without limitation, letters, invoices, purchase orders, contracts,
statements and applications, will be made solely in its own name; (v) have
stationery and other business forms separate from those of the Purchaser; (vi)
not hold itself out as having agreed to pay, or as being liable for, the
obligations of the Purchaser; (vii) not engage in any transaction with the
Purchaser except as contemplated by this Agreement or as permitted by the
Second-Tier Agreement; (viii) continuously maintain as official records the
resolutions, agreements and other instruments underlying the transactions
contemplated by
16
this Agreement and the other Program Documents; (ix) disclose on its financial
statements (A) the effects of the transactions contemplated by this Agreement
and the other Program Documents in accordance with GAAP, and (B) that the assets
of the Purchaser are not available to pay its creditors; and (x) maintain, and
cause its subsidiaries to maintain, arm's-length relationships with the
Purchaser.
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. Designation of Collection Agent.
-------------------------------
The servicing, administration and collection of the Transferred
Receivables shall be conducted by such Person (the "Servicer") designated under
the Second-Tier Agreement from time to time and in accordance with the
Second-Tier Agreement.
SECTION 6.02. Certain Rights of the Purchaser.
-------------------------------
(a) The Purchaser may, at any time during the continuance of any Event
of Termination, give notice of ownership and/or direct the Obligors of
Transferred Receivables and any Person obligated on any Related Security, or any
of them, that payment of all amounts payable under any Transferred Receivable
shall be made directly to the Purchaser or its designee. Each Seller hereby
transfers to the Purchaser the exclusive ownership and control of each Lock-Box
and Deposit Account.
(b) Each Seller shall, at any time upon the Purchaser's request and
at such Seller's expense, give notice of the Purchaser's or its assignee's
ownership of the Transferred Receivables originated by it to each Obligor of
such Transferred Receivables and direct that payments of all amounts payable
under such Transferred Receivables be made directly to the Purchaser or its
designee.
(c) At the Purchaser's request and at the Sellers' expense, each Seller
and the Servicer (if other than the FMC) shall (A) assemble all of the
documents, instruments and other records (including, without limitation,
computer tapes and disks) that evidence or relate to the Transferred
Receivables, and the related Contracts and Related Security, or that are
otherwise necessary or desirable to collect the Transferred Receivables, and
shall make the same available to the Purchaser at a place selected by the
Purchaser or its designee, and (B) segregate all cash, checks and other
instruments received by it from time to time constituting Collections of
Transferred Receivables in a manner acceptable to the Purchaser or its assignees
and, promptly upon receipt, remit all such cash, checks and instruments, duly
indorsed or with duly executed instruments of transfer, to the Purchaser or its
designee. The Purchaser shall also have the right to make copies of all such
documents, instruments and other records at any time.
(d) Each Seller authorizes the Purchaser and its successors and assigns
to take any and all steps in such Seller's name and on behalf of such Seller
that are necessary or desirable, in the determination of the Purchaser, to
collect amounts due under the Transferred Receivables, including, without
limitation, endorsing the Seller's name on checks and other
17
instruments representing Collections of Transferred Receivables originated by it
and enforcing such Transferred Receivables and the Related Security and related
Contracts.
SECTION 6.03. Rights and Remedies.
-------------------
(a) If any Seller fails to perform any of its obligations under this
Agreement, including without limitations, the obligations in respect of Section
3.03 of the Second-Tier Agreement, the Purchaser or its successors and assigns
may (but shall not be required to) itself perform, or cause performance of, such
obligation, and, if any Seller fails to so perform, the costs and expenses of
the Purchaser or its successors and assigns incurred in connection therewith
shall be payable by such Seller.
(b) Each Seller hereby grants to the Servicer, the Purchaser and its
successors and assigns an irrevocable power of attorney, with full power of
substitution, coupled with an interest, to take in the name of such Seller all
steps necessary or advisable to endorse, negotiate or otherwise realize on any
writing or other right of any kind held or transmitted by such Seller or
transmitted or received by the Purchaser or its successors and assigns (whether
or not from such Seller) in connection with any Transferred Receivable
originated by it.
SECTION 6.04. Transfer of Records to Purchaser.
--------------------------------
Each Purchase and contribution of Receivables hereunder shall include
the transfer to the Purchaser and its successors and assigns of all of each of
the Seller's right and title to and interest in the records relating to such
Receivables and shall include an irrevocable non-exclusive license to the use of
each Seller's computer software system to access and create such records. Such
license shall be without royalty or payment of any kind, is coupled with an
interest, and shall be irrevocable until all of the Transferred Receivables
originated by it are collected in full.
Each Seller shall take such action requested by the Purchaser or its
successors and assigns, from time to time hereafter, that may be necessary or
appropriate to ensure that the Purchaser has an enforceable ownership interest
in the records relating to the Transferred Receivables originated by it and
rights (whether by ownership, license or sublicense) to the use of such Seller's
computer software system to access and create such records.
In recognition of the Sellers' need to have access to the records
transferred to the Purchaser hereunder, the Purchaser hereby grants to each
Seller an irrevocable license to access such records in connection with any
activity arising in the ordinary course of such Sellers' business or in
performance by FMC of its duties as Servicer, provided that (i) no Seller shall
disrupt or otherwise interfere with the Purchaser's use of and access to such
records during such license period and (ii) each Seller consents to the
assignment and delivery of the records (including any information contained
therein relating to such Seller or its operations) to any assignees or
transferees of the Purchaser provided they agree to hold such records
confidential.
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ARTICLE VII
INDEMNIFICATION
SECTION 7.01. Indemnities by the Seller.
-------------------------
Without limiting any other rights which the Purchaser may have
hereunder or under applicable law, each Seller, severally and not jointly,
hereby agrees to indemnify the Purchaser and its successors, assigns and
transferees and their respective directors, partners, officers, employees and
agents, including without limitation, each Indemnified Party (as defined in the
Second-Tier Agreement) (each of the foregoing, a "Sale Indemnified Party") from
and against any and all damages, claims, losses, liabilities (other than taxes
on the overall net income of a Sale Indemnified Party and franchise taxes
imposed on a Sale Indemnified Party by any taxing authority in any jurisdiction
which asserts jurisdiction to impose such taxes on the basis of the contacts
which such Sale Indemnified Party maintains with such jurisdiction other than
the contacts arising from the execution, performance and delivery of, or receipt
of payments under, this Agreement or any other Program Document) and related
costs and expenses, including reasonable attorneys' fees and disbursements (all
of the foregoing being collectively referred to as "Indemnified Amounts"),
awarded against or incurred by any Sale Indemnified Party arising out of or as a
result of:
(i) any Receivable originated by such Seller identified as an
Eligible Receivable by such Seller or the Servicer on the date of
purchase or contribution thereof, or in any Investor Report or other
statement that is not an Eligible Receivable on such date of transfer
or the date of such report or statement;
(ii) any representation or warranty or statement made or deemed
made by such Seller (or any of its officers) under or in connection
with this Agreement, which shall have been incorrect in any material
respect when made;
(iii) the failure by such Seller to comply with any applicable
law, rule or regulation with respect to any Transferred Receivable or
the related Contract; or the failure of any Transferred Receivable or
the related Contract to conform to any such applicable law, rule or
regulation;
(iv) the failure to vest in the Purchaser absolute ownership of
the Receivables that are, or that purport to be, the subject of a
purchase from such Seller or contribution by FMC under this Agreement
and the Related Security and Collections in respect thereof, free and
clear of any Adverse Claim;
(v) the failure of such Seller to have filed, or any delay in
filing, financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable laws
with respect to any Receivables that are, or that purport to be, the
subject of a purchase from such Seller or contribution by FMC under
this Agreement and the Related Security and Collections in respect
thereof, whether at the time of any such Purchase or contribution or at
any subsequent time;
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(vi) any dispute, claim, offset or defense (other than discharge
in bankruptcy of the Obligor) of the Obligor to the payment of any
Receivable that is, or that purports to be, the subject of a purchase
from such Seller or contribution by FMC under this Agreement including,
without limitation, a defense based on such Receivable or the related
Contract not being a legal, valid and binding obligation of such
Obligor enforceable against it in accordance with its terms, or any
other claim resulting from the sale of the merchandise or services
related to such Receivable or the furnishing or failure to furnish such
merchandise or services or relating to collection activities with
respect to such Receivable;
(vii) any failure of such Seller to perform its duties or
obligations in accordance with the provisions hereof or any other
Program Document or to perform its duties or obligations under any
Contract related to a Transferred Receivable;
(viii) any products liability or other claim arising out of or
in connection with merchandise or services which are the subject of any
of its Contracts;
(ix) the commingling of Collections of Transferred Receivables
by such Seller or a designee of such Seller at any time with other
funds of such Seller or an Affiliate of such Seller;
(x) any investigation, litigation or proceeding related to this
Agreement or the use of proceeds of Purchases by such Seller or the
ownership of Receivables sold or contributed by such Seller, the
Related Security, or Collections with respect thereto or in respect of
any Receivable originated by such Seller, Related Security or Contract
relating thereto;
(xi) any Transferred Receivable originated by such Seller
becoming a Diluted Receivable;
(xii) any failure of such Seller to comply with its covenants
or obligations contained in this Agreement;
(xiii) any Servicer Fees or other costs and expenses payable to
any replacement Servicer, to the extent in excess of the Servicer Fees
payable to FMC hereunder;
(xiv) any claim brought by any Person other than a Sale
Indemnified Party arising from any activity by such Seller in
servicing, administering or collecting any Transferred Receivable; or
(xv) any inability to litigate any claim against any Obligor in
respect of any Receivable originated by such Seller as a result of such
Obligor being immune from civil and commercial law and suit on the
grounds of sovereignty or otherwise from any legal action, suit or
proceeding.
20
Notwithstanding the foregoing (and with respect to clause (ii) below, without
prejudice to the rights that the Purchaser may have pursuant to the other
provisions of this Agreement or the provisions of any other Program Document),
in no event shall any Sale Indemnified Party be indemnified for any Indemnified
Amounts to the extent (i) resulting from the gross negligence or willful
misconduct on the part of such Sale Indemnified Party, or (ii) to the extent the
same include, losses, in respect of Transferred Receivables that would
constitute credit recourse to any Seller for the amount of any Transferred
Receivable not paid by the related Obligor as a result of the bankruptcy or
financial inability to pay by such Obligor.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc.
----------------
No amendment or waiver of any provision of this Agreement or consent to
any departure by any Seller therefrom shall be effective unless in a writing
signed by the Purchaser and the Agent and, in the case of any amendment, also
signed by each Seller, and then such amendment, waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given. No failure on the part of the Purchaser to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right.
SECTION 8.02. Notices, Etc.
-------------
All notices and other communications hereunder shall, unless otherwise
stated herein, be in writing (which shall include facsimile communication) and
be faxed or delivered, to each party hereto, at its address set forth under its
name on the signature pages hereof or at such other address as shall be
designated by such party in a written notice to the other parties hereto.
Notices and communications by facsimile shall be effective when sent (and shall
be followed by hard copy sent by regular mail), and notices and communications
sent by other means shall be effective when received.
SECTION 8.03. Binding Effect; Assignability.
-----------------------------
(a) This Agreement shall be binding upon and inure to the benefit of
the Sellers, the Purchaser and their respective successors and assigns;
provided, however, that no Seller may assign its rights or obligations hereunder
or any interest herein without the prior written consent of the Purchaser and
the Agent. In connection with any sale or assignment by the Purchaser of all or
a portion of the Transferred Receivables, the buyer or assignee, as the case may
be, shall, to the extent of its purchase or assignment, have all rights of the
Purchaser under this Agreement (as if such buyer or assignee, as the case may
be, were the Purchaser hereunder).
(b) This Agreement shall create and constitute the continuing
obligations of the parties hereto in accordance with its terms, and shall remain
in full force and effect until the Program Termination Date.
21
SECTION 8.04. Costs, Expenses and Taxes.
-------------------------
(a) In addition to the rights of indemnification granted under Section
7.01, each Seller, jointly and severally, agrees to pay on demand all costs and
expenses in connection with the preparation, execution, delivery and
administration (including periodic auditing and other activities contemplated in
Section 5.01(g)), including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Purchaser and its assignees and their
respective Affiliates with respect thereto and with respect to advising the
Purchaser and its assignees (including the Agent, CNAI, the Investors and the
Banks) and their respective Affiliates as to their rights and remedies under
this Agreement and the other Program Documents, and all costs and expenses, if
any (including reasonable counsel fees and expenses), of the Purchaser and its
assignees (including the Agent, CNAI, the Investors and the Banks) and their
respective Affiliates, in connection with the enforcement of this Agreement and
the other Program Documents and the other documents and agreements to be
delivered hereunder.
(b) Each Seller, jointly and severally, agrees to pay any present or
future sales, stamp, documentary, excise, property or similar taxes, charges or
levies that arise from any payments made hereunder or deposit from Collections
hereunder or from the execution, delivery or registration of, performing under,
or otherwise with respect to, this Agreement or the other Program Documents
(hereinafter referred to as "Taxes").
(c) Each Seller, jointly and severally, agrees to indemnify the
Purchaser and its assignees for and hold them harmless against the full amount
of Taxes imposed on or paid by the Purchaser or its assignees and any liability
(including penalties, additions to tax, interest and expenses) arising therefrom
or with respect thereto whether or not such Taxes or other Taxes were correctly
or legally asserted. This indemnification shall be made within ten (10) days
from the date the Purchaser or its assignees makes written demand therefor.
SECTION 8.05. Fees.
----
Each Seller agrees to pay the Purchaser the fees in the amounts and on
the dates set forth in a separate fee agreement of even date among the Sellers
and the Purchaser.(1)
SECTION 8.06. No Proceedings.
--------------
Each Seller hereby agrees that it will not institute against the
Purchaser any bankruptcy, insolvency or other similar proceeding so long as
there shall not have elapsed one year plus one day since the Program Termination
Date.
SECTION 8.07. Waiver of Set-Off, Etc.
-------------------------
Each Seller hereby irrevocably and unconditionally waives and
relinquishes to the fullest extent it may legally do so (i) any express or
implied lien, security interest, charge or encumbrance, which would otherwise be
imposed on or affect any Receivable, Related Security or Collections with
respect thereto on account of any unpaid amount of any Purchase Price therefor
or on account of any other unpaid amounts otherwise payable by the Purchaser
under or
(1) Should cover "Structuring Fee" only.
22
in connection with this Agreement or otherwise, and (ii) with respect to the
obligations of any Seller to make payments or deposits under this Agreement, any
set-off, counterclaim, recoupment, defense and other right or claim which such
Seller may have against the Purchaser as a result of or arising out of the
failure of the Purchaser to pay any amount on account of any Purchase Price or
any other amount payable by the Purchaser to such Seller under this Agreement or
otherwise.
SECTION 8.08. Confidentiality.
---------------
Each Seller agrees that it shall and shall cause each of its Affiliates
(i) to keep this Agreement and the other Program Documents, the proposal
relating to the structure of the facility contemplated by this Agreement and the
other Program Documents (the "Facility"), any analyses, computer models,
information or document prepared by the Agent, Citibank, N.A. or any of their
respective Affiliates in connection with the Facility, the Agent's or its
Affiliate's written reports to any Seller or any of their respective Affiliates
and any related written information (collectively, the "Product Information")
confidential and to disclose Product Information only to those of its officers,
employees, agents, accountants, legal counsel and other representatives
(collectively, the "Company Representatives") who have a need to know such
Product Information for the purpose of obtaining any necessary consents or
approvals (including any internal approvals) and for the purpose of assisting in
the negotiation, completion and administration of the Facility or for any
legitimate business purpose in connection therewith (the "Approved Purposes");
(ii) to use the Product Information only in connection with the Approved
Purposes and not for any other purpose; and (iii) to cause the Company
Representatives to comply with the provisions of this Section 8.08 and to be
responsible for any failure of any Company Representative to so comply.
The provisions of this Section 8.08 shall not apply to any Product
Information that is a matter of general public knowledge or that has heretofore
been made available to the public by any Person other than the Sellers and any
of their respective Affiliates or any Company Representative or that is required
to be disclosed by applicable law or is requested by any governmental authority
with jurisdiction over the Sellers or any of their respective Affiliates.
SECTION 8.09. Intent of Agreement.
-------------------
It is the intention of the parties to this Agreement that each purchase
and contribution of Receivables and the Related Security hereunder shall convey
to the Purchaser an undivided ownership interest in such Receivables and Related
Security and the Collections in respect thereto and that such transactions shall
constitute a True Sale and not a secured loan. If, notwithstanding such
intention, any conveyance of any Receivable, Related Security or the Collections
with respect thereto hereunder shall ever be recharacterized as a secured loan
and not a sale, it is the intention of this Agreement that this Agreement shall
constitute a security agreement under applicable law, and that each Seller shall
be deemed to have granted to the Purchaser a duly perfected first priority
security interest in the Transferred Receivables, the Related Security and the
Collections in respect thereto free and clear of any Adverse Claim.
23
SECTION 8.10. Governing Law.
-------------
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
SECTION 8.11. Third-Party Beneficiary.
-----------------------
Each of the parties hereto hereby acknowledges that the Purchaser has
transferred the Transferred Receivables and the Collections and Related Security
to the Agent, the Investors and the Banks pursuant to the Second-Tier Agreement
and has assigned all of its rights and remedies under this Agreement to the
Agent, the Investors and the Banks pursuant to the Second-Tier Agreement, and
each Seller hereby consents to any such transfers and assignments. The Agent,
the Investors and the Banks shall each be third-party beneficiaries of, and
shall be entitled to enforce the Purchaser's rights and remedies under, this
Agreement to the same extent as if they were parties hereto.
SECTION 8.12. Execution in Counterparts.
-------------------------
This Agreement may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original and all of which when
taken together shall constitute one and the same agreement.
SECTION 8.13. Survival of Termination.
-----------------------
The provisions of Sections 2.06, 7.01, 8.04, 8.06, 8.07, 8.08 and 8.12
shall survive any termination of this Agreement.
SECTION 8.14. Addition of FMCW.
----------------
Prior to the FMCW Effective Date (i) FMCW shall be deemed not to be a
party to this Agreement, (ii) all references to an "Originator" or the
"Originators" set for in the Second-Tier Agreement or the Undertaking and all
references to a "Seller" or the "Sellers" set forth herein shall be deemed to
refer only to FMC and all references to the Receivables shall (other than in
Section 3.02 (b) of the Second-Tier Agreement) be deemed to only refer to the
Receivables originated by FMC. From and after the FMCW Effective Date (i) FMCW
shall be deemed to be a party to this Agreement, (ii) all references to an
"Originator" or the "Originators" set forth in the Second-Tier Agreement and the
Undertaking and all references to a "Seller" or the "Sellers" set forth herein
shall be deemed to also refer to FMCW as applicable and all references to the
Receivables shall be deemed to also include the Receivables originated by FMC.
24
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
FMC CORPORATION,
as Seller
By: /s/ X. X. Xxxxxxx
--------------------------------------
Name: X. X. Xxxxxxx
Title: VP & Treasurer
Address: 000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: X. X. Xxxxxxxxxx
Telephone No.: 312/000-0000
Facsimile No.: 312/861-5797
FMC WYOMING CORPORATION,
as Seller
By: /s/ X. X. Xxxxx
--------------------------------------
Name: X. X. Xxxxx
Title: Assistant Secretary
Address:
Attention: X. X. Xxxxxxxxxx
Telephone No.: 312/000-0000
Facsimile No.: 312/861-5797
FMC FUNDING CORPORATION,
as Purchaser
By: /s/ X. X. Xxxxxxx
---------------------------------
Name: X. X. Xxxxxxx
Title: President
Address: c/o FMC Corporation
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: X. X. Xxxxxxxxxx
Telephone No.: 312/000-0000
Facsimile No.: 312/861-5797
EXHIBIT A
NON-NEGOTIABLE PROMISSORY NOTE
_________, 1999
FOR VALUE RECEIVED, the undersigned, FMC FUNDING CORPORATION (the
"Purchaser"), promises to pay to [INSERT NAME OF SELLER], (the "Seller") on the
terms and subject to the conditions set forth herein and in the Purchase
Agreement referred to below, the principal sum of the aggregate unpaid Purchase
Price of all Receivables originated by it and Related Security purchased from
time to time by the Purchaser from the Seller pursuant to such Purchase
Agreement, as such unpaid Purchase Price is shown in the records of the Seller.
1. Purchase Agreement. This promissory note (this "Promissory Note")
is one of the Promissory Notes described in, and is subject to the terms and
conditions set forth in, that certain Purchase and Contribution Agreement, dated
as of the date hereof (as the same may be amended or otherwise modified from
time to time, the "Purchase Agreement") among the Seller, the Purchaser and
[INSERT NAME OF OTHER SELLER]. Reference is hereby made to the Purchase
Agreement for a statement of certain other rights and obligations of the Seller
and the Purchaser.
2. Definitions. Capitalized terms used (but not defined) herein have
the meanings assigned thereto in the Purchase Agreement and the Second-Tier
Agreement (defined therein). In addition, as used herein, the following terms
have the following meanings:
"Bankruptcy Proceedings" has the meaning set forth in clause
(b) of paragraph 9 hereof.
"Final Maturity Date" means the date that falls ninety-one
days after the Program Termination Date.
"Interest Period" means the period from and including a
Settlement Date (or, in the case of the first Interest Period, the date
hereof) to but excluding the next Settlement Date.
"Senior Interests" means, the obligation of the Purchaser, the
Seller, [INSERT NAME OF OTHER SELLER], the Servicer and their
respective Affiliates to set aside, and to turn over, Collections and
other proceeds of the Receivable Interests acquired by the Investors
and the Banks pursuant to the Second-Tier Agreement, and all other
obligations of the Purchaser and the Seller [INSERT NAME OF OTHER
SELLER] that are due and payable to the Senior Interest Holders under
the Program Documents, together with all interest accruing on any such
amounts after the commencement of any Bankruptcy Proceedings,
notwithstanding any provision or rule of law that might restrict the
rights of any Senior Interest Holder, as against the Purchaser or any
other Person, to collect such interest, including without limitation
all amounts owing to the Senior Interest Holders under the Fee Letter
and under Sections 2.04(b), 2.05, 2.08, 2.09, 6.06, 9.01 and 10.04 of
the Third-Tier Agreement.
"Senior Interest Holders" means, collectively, the Investors,
the Banks, the Agent, the other Affected Persons, Indemnified Parties
(as defined in the Second-Tier Agreement) and Sale Indemnified Parties.
3. Interest. Subject to the provisions set forth below, the Purchaser
promises to pay interest on this Promissory Note as follows:
(a) Prior to the Program Termination Date, the aggregate unpaid
Purchase Price from time to time outstanding during any Interest Period shall
bear interest at a rate per annum equal to [the Eurodollar Rate as in effect
from time to time on the first Business Day of each Settlement Period, as
determined by the Seller, plus .___%]; and
(b) From (and including) the Program Termination Date to (but
excluding) the date on which the entire aggregate unpaid Purchase Price is fully
paid, the aggregate unpaid Purchase Price from time to time outstanding shall
bear interest at a rate per annum equal to [the Eurodollar Rate as in effect
from time to time on the first Business Day of each Settlement Period, as
determined by the Seller, plus ___%],
but in no event in excess of the maximum rate permitted by law. In the event
that, contrary to the intent of the Seller, the Purchaser pays interest
hereunder and it is determined that such interest rate was in excess of the then
legal maximum rate, then that portion of the interest payment representing an
amount in excess of the then legal maximum rate shall be deemed a payment of
principal and applied against the principal then due hereunder.
4. Interest Payment Dates. Subject to the provisions set forth below,
the Purchaser shall pay accrued interest on this Promissory Note on each
Settlement Date, and shall pay accrued interest on the amount of each principal
payment made in cash on a date other than a Settlement Date at the time of such
principal payment.
5. Basis of Computation. Interest accrued hereunder shall be computed
for the actual number of days elapsed on the basis of a 360-day year.
6. Principal Payment Dates. Subject to the provisions set forth below,
payments of the principal amount of this Promissory Note shall be made as
follows:
The principal amount of this Promissory Note shall be reduced from time to
time pursuant to Sections 2.05, 2.06 and 2.07 of the Purchase
Agreement; and
The entire remaining unpaid balance of this Promissory Note shall be paid
on the Final Maturity Date.
2
Subject to the provisions set forth below, the principal amount of, and accrued
interest on, this Promissory Note may be prepaid on any Business Day without
premium or penalty.
7. Payments. All payments of principal and interest hereunder are to
be made in lawful money of the United States of America.
8. Enforcement Expenses. In addition to and not in limitation of the
foregoing, but subject to the provisions set forth below and to any limitation
imposed by applicable law, the Purchaser agrees to pay all expenses, including
reasonable attorneys' fees and legal expenses, incurred by the Seller in seeking
to collect any amounts payable hereunder which are not paid when due.
9. Provisions Regarding Restrictions on Payment. The Purchaser
covenants and agrees, and the Seller, by its acceptance of this Promissory Note,
likewise covenants and agrees on behalf of itself and any holder of this
Promissory Note, that the payment of the principal amount of, and interest on,
this Promissory Note is hereby expressly subject to certain restrictions set
forth in the following clauses of this paragraph 9:
No payment or other distribution of the Purchaser's assets of any kind or
character, whether in cash, securities, or other rights or property,
shall be made on account of this Promissory Note except to the extent
such payment or other distribution is made from Available Funds and is
otherwise permitted under the Purchase Agreement and the Second-Tier
Agreement;
In the event of any dissolution, winding up, liquidation, readjustment,
reorganization or other similar event relating to the Purchaser,
whether voluntary or involuntary, partial or complete, and whether in
bankruptcy, insolvency or receivership proceedings, or upon an
assignment for the benefit of creditors, or any other marshalling of
the assets and liabilities of the Purchaser or any sale of all or
substantially all of the assets of the Purchaser (such proceedings
being herein collectively called "Bankruptcy Proceedings"), the Senior
Interests shall first be paid and performed in full and in cash before
the Seller shall be entitled to receive and to retain any payment or
distribution in respect of this Promissory Note. In order to implement
the foregoing, the Seller hereby irrevocably agrees that Citicorp North
America, Inc., as Agent for the Investors and the Banks (in such
capacity together with its successors and assigns, the "Agent"), in the
name of the Seller or otherwise, may demand, xxx for, collect, receive
and receipt for any and all such payments or distributions, and file,
prove and vote or consent in any such Bankruptcy Proceedings with
respect to any and all claims of the Seller relating to this Promissory
Note, in each case until the Senior Interests shall have been paid and
performed in full and in cash;
In the event that the Seller receives any payment or other distribution of
any kind or character from the Purchaser or from any other source
whatsoever, in respect of this Promissory Note, other than as expressly
permitted by the terms of this Promissory Note, such payment or other
distribution shall be received for the sole
3
benefit of the Senior Interest Holders and shall be turned over by the
Seller to the Agent (for the benefit of the Senior Interest Holders)
forthwith;
Notwithstanding any payments or distributions received by the Senior
Interest Holders in respect of this Promissory Note, while any
Bankruptcy Proceedings are pending the Seller shall not be subrogated
to the then existing rights of the Senior Interest Holders in respect
of the Senior Interests until the Senior Interests have been paid and
performed in full and in cash. Upon the occurrence of the Program
Termination Date, the Seller shall be subrogated to the then existing
rights of the Senior Interest Holders, if any;
The provisions set forth in this Section 9 are intended solely for the
purpose of defining the relative rights of the Seller, on the one hand,
and the Senior Interest Holders on the other hand. Nothing contained in
this Promissory Note is intended to or shall impair, as between the
Purchaser, its creditors (other than the Senior Interest Holders) and
the Seller, the Purchaser's obligation, which is unconditional and
absolute, to pay to the Seller the principal of and interest on this
Promissory Note as and when the same shall become due and payable in
accordance with the terms hereof or to affect the relative rights of
the Seller and creditors of the Purchaser (other than the Senior
Interest Holders);
The Seller shall not, until the Final Maturity Date and all of the Senior
Interests have been paid and performed in full and in cash, transfer,
pledge or assign, or commence legal proceedings to enforce or collect
this Promissory Note or any rights in respect hereof;
The Seller shall not, without the advance written consent of the Agent,
commence, or join with any other Person in commencing, any Bankruptcy
Proceedings with respect to the Purchaser until at least one year and
one day shall have passed since the Program Termination Date shall have
occurred;
If, at any time, any payment (in whole or in part) of any Senior Interest
is rescinded or must be restored or returned by a Senior Interest
Holder (whether in connection with Bankruptcy Proceedings or
otherwise), these provisions shall continue to be effective or shall be
reinstated, as the case may be, as though such payment had not been
made;
The Seller hereby waives: (i) notice of acceptance of these provisions by
any of the Senior Interest Holders; (ii) notice of the existence,
creation, non-payment or non-performance of all or any of the Senior
Interests; and (iii) all diligence in enforcement, collection or
protection of, or realization upon, the Senior Interests, or any
thereof, or any security therefor;
These provisions constitute a continuing offer from the holder of this
Promissory Note to all Persons who become the holders of, or who
continue to hold, Senior Interests; and these provisions are made for
the benefit of the Senior Interest Holders, and
4
the Agent, the Investor or the Banks, may proceed to enforce such
provisions on behalf of each of such Persons.
10. General. No failure or delay on the part of the Seller in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power or right preclude any
other or further exercise thereof or the exercise of any other power or right.
No amendment, modification or waiver of, or consent with respect to, any
provision of this Promissory Note shall in any event be effective unless (i) the
same shall be in writing and signed and delivered by the Purchaser, the Seller
and the Agent and (ii) all consents required for such actions under the Program
Documents shall have been received by the appropriate Persons.
11. No Negotiation. This Promissory Note is not negotiable.
12. Governing Law. THIS PROMISSORY NOTE SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW.
13. Captions. Paragraph captions used in this Promissory Note are for
convenience only and shall not affect the meaning or interpretation of any
provision of this Promissory Note.
FMC FUNDING CORPORATION
By: ______________________________
5
EXHIBIT B
LIST OF TRADE NAMES
Airport Products Systems Division
Agricultural Products Group
Alkili Chemicals Division
Active Oxidants Division
Food Ingredients Division
Pharmaceutical Division
Phosphorus Chemical Division
Peroxide Division
Jetway Systems Division
FMC Biopolymers
Hydrogen Peroxide Division
FMC Wyoming Corporation
