Exhibit 4.3
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RECEIVABLES TRANSFER AGREEMENT
by and among
CARCORP, INC.,
as Transferor,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ PRODUCTS CO.,
individually and as Collection Agent,
The Persons Parties hereto as
CP Conduit Purchasers,
Committed Purchasers
and Funding Agents
and
JPMORGAN CHASE BANK,
as Administrative Agent
Dated as of December 20, 2001
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TABLE OF CONTENTS
Page
ARTICLE I Definitions .........................................................1
SECTION 1.01. Certain Defined Terms .........................................1
SECTION 1.02. Other Terms ...................................................1
SECTION 1.03. Computation of Time Periods ...................................2
ARTICLE II Purchases and Settlements ..........................................2
SECTION 2.01. Facility; Termination .........................................2
SECTION 2.02. Transfers; Certificates. ......................................2
SECTION 2.03. Selection of Tranche Periods and Tranche Rates. ...............5
SECTION 2.04. Discount, Fees and Other Costs and Expenses ...................6
SECTION 2.05. Non-Liquidation Settlement and Reinvestment Procedures ........7
SECTION 2.06. Liquidation Settlement Procedures. ............................8
SECTION 2.07. Reduction of Commitments .....................................10
SECTION 2.08. Fees .........................................................10
SECTION 2.09. Protection of Ownership Interest of the CP Conduit
Purchasers and the Committed Purchasers ....................10
SECTION 2.10. Deemed Collections; Application of Payments. .................11
SECTION 2.11. Payments and Computations, etc. ..............................12
SECTION 2.12. Reports ......................................................12
SECTION 2.13. Collection Accounts. .........................................13
SECTION 2.14. Right of Setoff ..............................................14
SECTION 2.15. Sharing of Payments, etc. ....................................14
SECTION 2.16. Broken Funding ...............................................15
SECTION 2.17. Conversion and Continuation of Outstanding Tranches
Funded by the Committed Purchasers .........................15
SECTION 2.18. Illegality. ..................................................16
SECTION 2.19. Inability to Determine Eurodollar Rate .......................16
SECTION 2.20. Indemnities by the Transferor ................................17
SECTION 2.21. Indemnity for Reserves and Expenses. .........................20
SECTION 2.22. Indemnity for Taxes. .........................................21
SECTION 2.23. Other Costs, Expenses and Related Matters. ...................22
SECTION 2.24. Funding Agents. ..............................................23
SECTION 2.25. Use of Historical Data .......................................24
SECTION 2.26. Expiration or Extension of Commitments. ......................24
SECTION 2.27. Exchange of Canadian Dollars into United States Dollars ......25
SECTION 2.28. Receivables Situated in the Province of Quebec. ..............26
ARTICLE III Representations and Warranties ...................................26
SECTION 3.01. Representations and Warranties of the Transferor .............26
SECTION 3.02. Reaffirmation of Representations and Warranties by the
Transferor .................................................30
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ARTICLE IV Conditions Precedent ..............................................30
SECTION 4.01. Conditions to Effectiveness ..................................30
SECTION 4.02. Conditions to Each Transfer ..................................33
ARTICLE V Covenants ..........................................................34
SECTION 5.01. Affirmative Covenants of the Transferor ......................34
SECTION 5.02. Negative Covenants of the Transferor .........................40
ARTICLE VI Administration and Collections ....................................43
SECTION 6.01. Appointment of Collection Agent ..............................43
SECTION 6.02. Duties of Collection Agent. ..................................43
SECTION 6.03. Rights After Designation of New Collection Agent .............45
SECTION 6.04. Representations and Warranties of the Collection Agent .......46
SECTION 6.05. Covenants of the Collection Agent ............................47
SECTION 6.06. Negative Covenants of the Collection Agent and/or C&A ........48
SECTION 6.07. Collection Agent Default .....................................49
SECTION 6.08. Responsibilities of the Transferor and the Sellers ...........50
SECTION 6.09. Grant of License .............................................50
ARTICLE VII Termination Events ...............................................51
SECTION 7.01. Termination Events ...........................................51
SECTION 7.02. Remedies Upon the Occurrence of a Termination Event. .........53
SECTION 7.03. Reconveyance Under Certain Circumstances .....................54
ARTICLE VIII The Administrative Agent ........................................54
SECTION 8.01. Appointment ..................................................54
SECTION 8.02. Delegation of Duties .........................................55
SECTION 8.03. Exculpatory Provisions .......................................55
SECTION 8.04. Reliance by Administrative Agent .............................55
SECTION 8.05. Notice of Collection Agent Default ...........................56
SECTION 8.06. Non-Reliance on the Administrative Agent and Other
Purchasers .................................................56
SECTION 8.07. Indemnification ..............................................57
SECTION 8.08. The Administrative Agent in Its Individual Capacity ..........57
SECTION 8.09. Resignation of Administrative Agent; Successor
Administrative Agent .......................................57
ARTICLE IX Additional Representations, Warranties and Covenants of the
Transferor and Collection Agent .................................58
SECTION 9.01. Additional Representations, Warranties and Covenants. ........58
ARTICLE X Miscellaneous ......................................................59
SECTION 10.01. Term of Agreement ...........................................59
SECTION 10.02. Waivers; Amendments. ........................................59
SECTION 10.03. Notices .....................................................60
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SECTION 10.04. Governing Law; Submission to Jurisdiction; Integration. .....61
SECTION 10.05. Severability; Counterparts ..................................62
SECTION 10.06. Successors and Assigns. .....................................62
SECTION 10.07. Confidentiality. ............................................65
SECTION 10.08. No Bankruptcy Petition Against the CP Conduit Purchasers ....66
SECTION 10.09. Limited Recourse ............................................66
SECTION 10.10. Characterization of the Transactions Contemplated by
the Agreement. ............................................66
SECTION 10.11. Waiver of Setoff ............................................67
SECTION 10.12. JPMorgan Chase Conflict Waiver ..............................67
SECTION 10.13. Canadian Taxes ..............................................67
SECTION 10.14. Limitation on the Termination of Sellers ....................68
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SCHEDULE A Definitions
SCHEDULE B Schedule of CP Conduit Purchasers, Committed
Purchasers and Funding Agents
SCHEDULE C Schedule of Special Obligors
SCHEDULE D Schedule of Match Funding CP Conduit Purchasers
SCHEDULE E List of Equipment and Software
SCHEDULE F List of C&A Fiscal Periods for the Years 2001 and 2002
EXHIBIT A Credit and Collection Policies
EXHIBIT B List of Lockbox Banks and Accounts
EXHIBIT C Form of Lockbox Agreement
EXHIBIT D-1 Form of Daily Report
EXHIBIT D-2 Form of Weekly Report
EXHIBIT D-3 Form of Settlement Statement
EXHIBIT E Form of Transfer Certificate
EXHIBIT F [Reserved]
EXHIBIT G Location of Records
EXHIBIT H List of Subsidiaries, Divisions, Trade Names and Other Matters
EXHIBIT I Form of Secretary's Certificate
EXHIBIT J [Reserved]
EXHIBIT K Form of Transfer Supplement
EXHIBIT L Form of Required Currency Hedge Assignment
EXHIBIT M Form of Limited Guaranty
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RECEIVABLES TRANSFER AGREEMENT (as amended, supplemented or otherwise
modified and in effect from time to time, this "Agreement"), dated as of
December 20, 2001, by and among CARCORP, INC., a Delaware corporation, as
transferor (in such capacity, the "Transferor"), ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ PRODUCTS CO.,
a Delaware corporation, individually ("C&A") and as collection agent (in such
capacity, the "Collection Agent"), the several commercial paper conduits
identified on Schedule B and their respective permitted successors and assigns
(the "CP Conduit Purchasers"; each, individually, a "CP Conduit Purchaser"), the
several financial institutions identified on Schedule B as "Committed
Purchasers" and their respective permitted successors and assigns (the
"Committed Purchasers"; each, individually, a "Committed Purchaser"), the agent
bank set forth opposite the name of each CP Conduit Purchaser and Committed
Purchaser on Schedule B and its permitted successor and assign (the "Funding
Agent" with respect to such CP Conduit Purchaser and Committed Purchaser), and
JPMORGAN CHASE BANK (formerly The Chase Manhattan Bank), a New York state
banking corporation ("JPMorgan Chase"), as administrative agent for the benefit
of the CP Conduit Purchasers, the Committed Purchasers and the Funding Agents
(in such capacity, the "Administrative Agent").
PRELIMINARY STATEMENTS
WHEREAS the Transferor may desire to convey, transfer and assign, from time
to time, undivided percentage interests in certain accounts receivable, and the
CP Conduit Purchasers may desire to, and the Committed Purchasers, if requested
by the CP Conduit Purchasers or the Transferor, shall, accept such conveyance,
transfer and assignment of such undivided percentage interests, subject to the
terms and conditions of this Agreement.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Certain Defined Terms. Capitalized terms used herein shall
have the meanings assigned to such terms in, or incorporated by reference into,
Schedule A attached hereto, which Schedule A is incorporated by reference
herein.
SECTION 1.02. Other Terms. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP; provided that, if the
Transferor notifies the Administrative Agent that the Transferor requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Transferor that any Funding Agent requests an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith and provided,
further, that if such change in GAAP would have resulted in non-compliance with
the definitions of
"Interest Coverage Ratio" or "Leverage Ratio" but for such notice, the
Transferor agrees to enter into negotiations with the Administrative Agent to
effectuate an amendment.
SECTION 1.03. Computation of Time Periods. Unless otherwise stated in this
Agreement, in the computation of a period of time from a specified date to a
later specified date, the word "from" means "from and including," the words "to"
and "until" each means "to but excluding," and the word "within" means "from and
excluding a specified date and to and including a later specified date."
ARTICLE II
Purchases and Settlements
SECTION 2.01. Facility; Termination. On the terms and conditions set forth
in this Agreement, the parties hereto establish a receivables financing
facility.
The Committed Purchasers' several obligations to make purchases from the
Transferor hereunder shall terminate on the applicable Termination Date.
Notwithstanding anything to the contrary contained herein or in the other
Transaction Documents, no Committed Purchaser shall be obligated to provide the
Transferor with funds in an amount that would exceed such Committed Purchaser's
unused Commitment then in effect, and the failure of any Committed Purchaser to
make its Pro Rata Share of such purchase available to the Transferor (subject to
the terms and conditions set forth herein) shall not relieve any other Committed
Purchaser of its obligations hereunder.
SECTION 2.02. Transfers; Certificates.
(a) Incremental Transfers. Prior to the Termination Date, upon the terms
and subject to the conditions set forth herein and in the other Transaction
Documents, (x) the Transferor may, at its option from time to time, convey,
transfer and assign to each CP Conduit Purchaser (prior to the occurrence of a
CP Conduit Purchaser's Termination Event with respect to such CP Conduit
Purchaser) or to the Committed Purchaser with respect to such CP Conduit
Purchaser, and (y) each CP Conduit Purchaser may, at its option from time to
time prior to the occurrence of a CP Conduit Purchaser's Termination Event with
respect to such CP Conduit Purchaser, and the Committed Purchasers with respect
to such CP Conduit Purchaser shall, accept such conveyance, transfer and
assignment from the Transferor, without recourse except as provided herein, of
undivided percentage ownership interests in the Receivables, together with
Related Security and Collections and Proceeds with respect thereto (each, an
"Incremental Transfer") in exchange for the Transfer Price from time to time
prior to the Termination Date; provided that the conditions set forth in Section
4.02 shall be satisfied with respect thereto.
If the Transferor determines as provided in the preceding paragraph to make
an Incremental Transfer, the Transferor shall, by notice to the Administrative
Agent given by telecopy, offer to convey, transfer and assign to each CP Conduit
Purchaser (prior to the occurrence of a CP Conduit Purchaser's Termination Event
with respect to such CP Conduit Purchaser) or the Committed Purchasers undivided
percentage ownership interests in the Receivables and Related Security,
Collections and Proceeds with respect thereto at least two (2)
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Business Days prior to the proposed date of any Incremental Transfer. Each such
notice shall specify (x) the desired Transfer Price (which shall be at least
$1,000,000 per CP Conduit Purchaser or integral multiples of $100,000 in excess
thereof) or, to the extent that the then available unused portion of the
Facility Limit is less than such amount, such lesser amount equal to such
available portion of the Facility Limit; (y) the desired date of such
Incremental Transfer which shall be a Business Day; and (z) the desired Tranche
Period(s) and allocations of the Net Investment of such Incremental Transfer
thereto as required by Section 2.03 of this Agreement. The Administrative Agent
will promptly notify the Funding Agent for each CP Conduit Purchaser and the
Committed Purchasers, as applicable, of the Administrative Agent's receipt of a
request for an Incremental Transfer to be made to such Person. At its option,
each CP Conduit Purchaser shall accept or reject any such offer by prompt
written notice given to the Transferor, the Administrative Agent and the Funding
Agent with respect to such CP Conduit Purchaser by telephone or telecopy.
Each notice of proposed Incremental Transfer shall be irrevocable and
binding on the Transferor, and the Transferor shall indemnify the CP Conduit
Purchasers and the Committed Purchasers against any loss or expense incurred by
the CP Conduit Purchasers and the Committed Purchasers, either directly or
indirectly, as a result of any failure by the Transferor to complete such
Incremental Transfer, including, without limitation, any loss or expense
incurred by the CP Conduit Purchasers and the Committed Purchasers by reason of
the liquidation or reemployment of funds acquired by the CP Conduit Purchasers
or the Committed Purchasers (including, without limitation, funds obtained by
issuing Commercial Paper or promissory notes, obtaining deposits as loans from
third parties and reemployment of funds) to fund such Incremental Transfer.
On the date of the initial Incremental Transfer, the Administrative Agent,
on behalf of the CP Conduit Purchasers and the Committed Purchasers, shall
deliver written confirmation to the Transferor of the Transfer Price, the
Tranche Period(s) and the Tranche Rate(s) relating to such Transfer as required
by Section 2.03 of this Agreement, and the Transferor shall deliver to the
Administrative Agent the Transfer Certificate in the form of Exhibit E hereto
(the "Transfer Certificate"). The Transfer Price for the initial Incremental
Transfer shall be $72,570,000. The Administrative Agent shall indicate the
amount of the initial Incremental Transfer together with the date thereof on the
grid attached to the Transfer Certificate; provided, however, that the failure
by the Administrative Agent to make the foregoing notations shall not in any way
affect the Transferor's obligations hereunder. On the date of each subsequent
Incremental Transfer, the Administrative Agent shall send written confirmation
to the Transferor of the Transfer Price, the Tranche Period(s), the Transfer
Date and the Tranche Rate(s) applicable to such Incremental Transfer. The
Administrative Agent shall indicate the amount of the Incremental Transfer
together with the date thereof as well as the Net Investment after giving effect
to such Incremental Transfer on the grid attached to the Transfer Certificate.
The Transfer Certificate shall evidence the Incremental Transfers. On the day of
such Incremental Transfer, the CP Conduit Purchasers or the Committed
Purchasers, as applicable, shall deposit to the Transferor's account, in
immediately available funds, an amount equal to the Transfer Price for such
Incremental Transfer made to the CP Conduit Purchasers or the Committed
Purchasers, as applicable.
(b) Reinvestment Transfers. On each Business Day occurring after the
initial Incremental Transfer hereunder and prior to a CP Conduit Purchaser's
Termination Event (in the
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case of the CP Conduit Purchasers) and the Termination Date, the Transferor
hereby agrees to convey, transfer and assign to each CP Conduit Purchaser (prior
to the occurrence of a CP Conduit Purchaser's Termination Event with respect to
such CP Conduit Purchaser) or the Committed Purchasers, and each CP Conduit
Purchaser may agree to purchase and each Committed Purchaser shall purchase from
the Transferor, undivided percentage ownership interests in each and every
Receivable, together with Related Security, Collections and Proceeds with
respect thereto, to the extent that Collections are available for such Transfer
in accordance with Section 2.05 hereof. The Transferor agrees to maintain, at
all times prior to the Termination Date, a Net Receivables Balance in an amount
at least sufficient to maintain the Percentage Factor at an amount not greater
than the Maximum Percentage Factor. Accordingly, the maximum amount of funding
that the Transferor may obtain on the Closing Date or at any time thereafter
shall be equal to the maximum Net Investment that would not exceed the Facility
Limit and would not cause the Percentage Factor to exceed the Maximum Percentage
Factor.
(c) All Transfers. Each Transfer shall constitute a purchase of undivided
percentage ownership interests in each and every Receivable, together with
Related Security, Collections and Proceeds with respect thereto, then existing,
as well as in each and every Receivable, together with Related Security,
Collections and Proceeds with respect thereto, which arises at any time after
the date of such Transfer. The CP Conduit Purchasers' (and, following the
occurrence of a CP Conduit Purchaser's Termination Event with respect to any CP
Conduit Purchaser, the Committed Purchasers') aggregate undivided percentage
ownership interest in the Receivables, together with the Related Security,
Collections and Proceeds with respect thereto, shall equal the Percentage Factor
in effect from time to time. Such purchases from the Transferor by the CP
Conduit Purchasers and the Committed Purchasers shall be made in accordance with
their respective Pro Rata Shares. By accepting any conveyance, transfer and
assignment of ownership interests in the Receivables hereunder, none of the CP
Conduit Purchasers, the Committed Purchasers, the Funding Agents or the
Administrative Agent assumes or shall have any obligations or liability under
any of the applicable Contracts, all of which shall remain the obligations and
liabilities of the Sellers.
(d) Percentage Factor. The Percentage Factor shall be initially computed as
of the opening of business of the Collection Agent on the date of the initial
Incremental Transfer hereunder. Thereafter, until the Termination Date, the
Percentage Factor shall be recomputed upon the date of any Incremental Transfer
and (if there is not otherwise an Incremental Transfer on such day) on the date
of delivery of each Weekly Report (or, if Daily Reports are then required to be
delivered pursuant to Section 2.12, the next Daily Report), and shall remain
constant during any period between recomputations. At all times on and after the
Termination Date until the date on which the Net Investment has been reduced to
zero and all accrued Discount, Servicing Fees and all other Aggregate Unpaids
have been paid in full, the Percentage Factor shall equal 100%. Following any
assignment of any portion of the Transferred Interest to the Committed
Purchasers pursuant to the Asset Purchase Agreements, the Funding Agent for each
CP Conduit Purchaser and Committed Purchaser shall, at all times and from time
to time, calculate such CP Conduit Purchaser's and such Committed Purchaser's
Pro Rata Share in the Percentage Factor and regularly report thereon to the
Administrative Agent (with copies thereof to the Transferor).
SECTION 2.03. Selection of Tranche Periods and Tranche Rates.
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(a) Transferred Interest Held by CP Conduit Purchasers Prior to CP Conduit
Purchaser's Termination Event. At all times hereafter, but prior to the
Termination Date and not with respect to any portion of the Transferred Interest
held by any of the Committed Purchasers, the Transferor may, subject to each
Match Funding CP Conduit Purchaser's approval and the limitations described
below, request Tranche Periods and allocate a portion of the Net Investment to
each selected Tranche Period, so that the aggregate amounts allocated to
outstanding Tranche Periods at all times shall equal the Pro Rata Share(s) of
the Net Investment held by the Match Funding CP Conduit Purchasers. The
Transferor shall give the Administrative Agent and the Funding Agent with
respect to each Match Funding CP Conduit Purchaser irrevocable notice by
telephone of the new requested Tranche Period(s) at least two (2) Business Days
prior to the expiration of any then existing Tranche Period; provided, however,
that each Match Funding CP Conduit Purchaser may select, in its reasonable
discretion, any such new Tranche Period if (i) the Transferor fails to provide
such notice on a timely basis or (ii) the Funding Agent with respect to such
Match Funding CP Conduit Purchaser, on behalf of such Match Funding CP Conduit
Purchaser, determines, in its sole discretion, that the Tranche Period requested
by the Transferor is unavailable or for any reason commercially undesirable.
Each Match Funding CP Conduit Purchaser confirms that it is its intention to
allocate all or substantially all of the portion of the Net Investment held by
it to one or more CP Tranche Periods; provided that each Match Funding CP
Conduit Purchaser may determine, from time to time, in its reasonable
discretion, that funding such portion of the Net Investment by means of one or
more CP Tranche Periods is not possible or is not desirable for any reason.
On any Business Day, a Match Funding CP Conduit Purchaser may elect that
the Transferor no longer be permitted to select CP Tranches in accordance with
the preceding paragraph in respect of the CP Conduit Funded Amount with respect
to such Match Funding CP Conduit Purchaser by giving the Transferor and the
Administrative Agent irrevocable written notice thereof, which notice must be
received by the Transferor and the Administrative Agent at least one Business
Day prior to such election becoming effective. On any Business Day, a Pooled
Funding CP Conduit Purchaser may elect thereafter to allow the Transferor to
select CP Tranches in accordance with the preceding paragraph in respect of the
CP Conduit Funded Amount with respect to such Pooled Funding CP Conduit
Purchaser by giving the Transferor and the d the Administrative Agent
irrevocable written notice thereof, which notice must be received by the
Transferor and the Administrative Agent at least one Business Day prior to such
election becoming effective. On any Business Day, a Pooled Funding CP Conduit
Purchaser may elect thereafter to allow the Transferor to select CP Tranches in
accordance with the preceding paragraph in respect of the CP Conduit Funded
Amount with respect to such Pooled Funding CP Conduit Purchaser by giving the
Transferor and the d the Administrative Agent irrevocable written notice
thereof, which notice must be received by the Transferor and the Administrative
Agent at least one Business Day prior to such election becoming effective.
amount of its CP Conduit Funded Amount funded on a pooled basis during the
related CP Tranche Period.
(b) Transferred Interest Held by CP Conduit Purchasers Following the
Termination Date. At all times on and after the Termination Date, with respect
to any portion of the Transferred Interest which shall not have been transferred
to the Committed Purchasers (or any of them), each CP Conduit Purchaser or the
Funding Agent with respect to such CP Conduit Purchaser, as applicable, shall
select all Tranche Periods and Tranche Rates applicable thereto upon the
expiration of Tranche Periods in effect on the Termination Date.
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(c) Transferred Interest Held by the Committed Purchasers Prior to the
Termination Date. With respect to any portion of the Transferred Interest which
is owned by or transferred to a Committed Purchaser pursuant to this Agreement
or an Asset Purchase Agreement prior to the Termination Date, the initial
Tranche Period applicable to such portion of the Net Investment allocable
thereto shall be a period of at least three (3) Business Days, and such Tranche
shall be a BR Tranche. Thereafter (but prior to the Termination Date or the
occurrence and continuation of a Potential Termination Event), with respect to
such portion, and with respect to any other portion of the Transferred Interest
held by any Committed Purchaser, the Tranche Period applicable thereto shall be,
at the Transferor's sole option, either a BR Tranche or a Eurodollar Tranche.
The Transferor shall give the Administrative Agent and the Funding Agents with
respect to the applicable Committed Purchasers irrevocable notice by telephone
of the new Tranche Period (i) if the applicable Tranche is to be a Eurodollar
Tranche, at least three (3) Business Days prior to the expiration of any then
existing Tranche Period, and (ii) if the applicable Tranche is to be a BR
Tranche, at least one (1) Business Day prior to the expiration of any then
existing Tranche Period. Any Tranche Period maintained by the Committed
Purchasers which is outstanding on the Termination Date shall end on the
Termination Date.
(d) After the Termination Date; Transferred Interest Held by Committed
Purchasers. At all times on and after the Termination Date, with respect to any
portion of the Transferred Interest which shall have been owned by, or
transferred to, the Committed Purchaser, the Funding Agents with respect to the
applicable Committed Purchasers shall select all Tranche Periods and Tranche
Rates applicable thereto.
SECTION 2.04. Discount, Fees and Other Costs and Expenses. The Transferor
shall pay, as and when due in accordance with this Agreement and the other
Transaction Documents, all Discount, Servicing Fees, Fees and other Aggregate
Unpaids to the extent not otherwise provided for by the provisions of this
Agreement. As provided in Section 2.05 and 2.06, the Transferor shall pay to the
Administrative Agent, on behalf of the CP Conduit Purchasers and/or the
Committed Purchasers, as applicable, an amount equal to the accrued and unpaid
Discount for such Tranche Period together with, in the event any portion of the
Transferred Interest is held by the CP Conduit Purchasers, an amount equal to
the Discount (without duplication) accrued on the CP Conduit Purchasers'
Commercial Paper to the extent such Commercial Paper was issued in order to fund
the Transferred Interest in a face amount in excess of the Transfer Price of an
Incremental Transfer; provided that (i) in the event of any repayment or
prepayment of a BR Tranche or a Eurodollar Tranche, accrued Discount on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (ii) in the event of any conversion of a BR Tranche
or a Eurodollar Tranche, accrued interest on such BR Tranche or Eurodollar
Tranche shall be payable on the effective date of such conversion. Discount
shall accrue with respect to each Tranche on each day occurring during the
Tranche Period related thereto.
Nothing in this Agreement or the other Transaction Documents shall limit in
any way the obligations of the Transferor to pay the amounts set forth in this
Section 2.04.
SECTION 2.05. Non-Liquidation Settlement and Reinvestment Procedures. On
each day after the date of any Incremental Transfer but prior to the Termination
Date, and provided that Section 2.06 shall not be applicable, the Collection
Agent shall, out of the
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Percentage Factor of Collections received on or prior to such day and not
previously set aside or paid:
(i) set aside and hold in trust for the CP Conduit Purchasers or the
Committed Purchasers, as applicable (or deposit into the Collection Account
if so required pursuant to Section 2.13 hereof) an amount equal to all
Discount, Fees and the Servicing Fee accrued through such day and not so
previously set aside or paid;
(ii) set aside the amount payable on such day with respect to the
purchase price of, the Required Currency Hedge (if applicable);
(iii) apply the balance of such Percentage Factor of Collections
remaining after application of Collections as provided in clauses (i) and
(ii) of this Section 2.05, for the benefit of the CP Conduit Purchasers
and/or the Committed Purchasers, as applicable, to the purchase of
additional undivided percentage interests in each Receivable from the
Transferor pursuant to Section 2.02(b) hereof; and
(iv) remit the balance, if any, of such Collections remaining after
the applications provided in clauses (i), (ii) and (iii) to the Transferor.
Such Collections remitted to the Transferor shall be available for the
ordinary business purposes of the Transferor or otherwise, subject to the
provisions of the Transaction Documents.
On each Weekly Settlement Date, from the amounts set aside as described in
clause (i) above, the Collection Agent shall transfer to an account maintained
by the Administrative Agent (the "Deposit Account"), for the benefit of the CP
Conduit Purchasers and/or the Committed Purchasers, as applicable, an amount
equal to the accrued and unpaid Discount and Fees for the immediately preceding
calendar week and shall deposit to its own account an amount equal to the
accrued and unpaid Servicing Fee for such Settlement Period; provided that
accrued and unpaid Discount with respect to any Eurodollar Tranche shall be
deposited at the end of the related Tranche Period. On each Settlement Date, the
Administrative Agent shall distribute from such amounts transferred during the
previous Settlement Period to the Funding Agents for the CP Conduit Purchasers
and/or the Committed Purchasers the amount of accrued and unpaid Discount and
Fees for such preceding Settlement Period as calculated by the Funding Agents in
accordance with the Transaction Documents; provided that if the Administrative
Agent shall have insufficient funds to pay all of the above amounts in full on
any such date, the Administrative Agent shall notify the Transferor and the
Transferor shall immediately pay to the Administrative Agent, from funds
previously paid to the Transferor, an amount equal to such insufficiency. The
Administrative Agent shall pay the Funding Agents in accordance with the records
maintained by the Funding Agents pursuant to Section 2.24.
SECTION 2.06. Liquidation Settlement Procedures.
(a) If at any time on or prior to the Termination Date, the Percentage
Factor is greater than the Maximum Percentage Factor, then the Transferor shall
immediately pay to the Administrative Agent, for the benefit of the CP Conduit
Purchasers and/or the Committed Purchasers, as applicable, from previously
received Collections, an amount that, when applied to reduce the Net Investment,
will result in a Percentage Factor less than or equal to the Maximum
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Percentage Factor. Such amount shall be applied to reduce the Net Investment of
Tranche Periods selected by the Funding Agents.
(b) On the Termination Date or the day on which a Potential Termination
Event occurs, the Collection Agent shall transfer to the Administrative Agent,
for the benefit of the CP Conduit Purchasers or the Committed Purchasers, as
applicable, any amounts set aside pursuant to Section 2.05 above.
(c) Subject to Section 2.26(a) with respect to each Non-Extending Committed
Purchaser that is not required to transfer and assign its Commitment pursuant to
Section 2.26(b)(ii) of this Agreement, the Collection Agent shall implement the
procedures set forth in this clause (c)(a "Partial Liquidation"). On each
Business Day until such Liquidating Purchaser Group's Net Investment is reduced
to zero, and provided that no Termiantion Event has been declared or has
occurred and that no Potential Termination Event has occurred and is continuing,
the Collection Agent shall apply, out of the Percentage Factor of Collections
received and not previously applied, funds in the following manner:
(i) transfer to the Administrative Agent for the benefit of the CP
Conduit Purchasers and the Commited Purchasers an amount equal to all
Discount on all Tranches, Fees and the Servicing Fee, in each case accrued
through such day and not so previously set aside or paid. The
Administrative Agent shall then pay to the Funding Agent for the CP Conduit
Purchasers and the Committed Purchasers the amount of Fees and Discount on
all Tranches that has accrued during such calendar week on the Weekly
Settlement Date;
(ii) pay to the Funding Agent for such Liquidating Purchaser Group an
amount equal to such Liquidating Purchaser Group's Liquidation Share of all
remaining Collections, up to the amount of such Liquidating Purchaser
Group's Net Investment, in payment of such Liquidating Purchaser Group's
Net Investment; and
(iii) apply the balance of such Collections to the purchase of
additional undivided percentage interests pursuant to Section 2.02(b)
hereof.
(d) On the Termination Date and on each Business Day thereafter, and on
each Business Day on which a Potential Termination Event has occurred and is
continuing, the Collection Agent shall transfer to the Administrative Agent, for
the benefit of the CP Conduit Purchasers and the Committed Purchasers, as
applicable, the Percentage Factor of all Collections received on such day, to be
applied to the payment in full of (i) the accrued Discount for such Tranche
Period, (ii) the portion of the Net Investment allocated to such Tranche Period,
and (iii) all other Aggregate Unpaids not covered in clauses (i) and (ii). On
each such day, the Collection Agent shall deposit to its account, from the
amounts set aside for the CP Conduit Purchasers and the Committed Purchasers
pursuant to the preceding sentence which remain after payment in full of the
aforementioned amounts, the accrued Servicing Fee for such Tranche Period. If
there shall be insufficient funds on deposit for the Collection Agent to
distribute funds in payment in full of the aforementioned amounts, the
Collection Agent shall distribute funds in the following order of priority:
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(i) first, in payment in full of the accrued Discount and all Fees
payable by the Transferor;
(ii) second, if C&A or any Affiliate of C&A is not then the Collection
Agent, to the Collection Agent's account, payment in full of the Servicing
Fee payable to the Collection Agent;
(iii) third, in reduction of the Net Investment to zero;
(iv) fourth, payment in full of all other Aggregate Unpaids not
covered in clauses (i) through (iii) above; and
(v) fifth, if C&A or any Affiliate of C&A is the Collection Agent, to
its account as Collection Agent, in payment of the Servicing Fee payable to
such Person as Collection Agent.
The Administrative Agent, upon its receipt of such amounts, shall
distribute such amounts to the Funding Agents for the CP Conduit Purchasers
and/or the Committed Purchasers entitled thereto in accordance with the records
maintained by the Funding Agents pursuant to Section 2.24; provided that if the
Administrative Agent shall have insufficient funds to pay all of the above
amounts in full on any such date, the Administrative Agent shall pay such
amounts in the order of priority set forth above and, with respect to any such
category above for which the Administrative Agent shall have insufficient funds
to pay all amounts owing on such date, ratably (based on the amounts in such
categories owing to such Persons) among all such Persons entitled to payment
thereof.
(e) Following the date on which the Net Investment has been reduced to zero
and all accrued Discount, Fees, Servicing Fees and all other Aggregate Unpaids
have been paid in full, (i) the Percentage Factor shall equal zero, (ii) the
Administrative Agent, on behalf of the CP Conduit Purchasers and the Committed
Purchasers, shall be considered to have reconveyed to the Transferor all of the
CP Conduit Purchasers' and the Committed Purchasers' right, title and interest
in, to and under the Receivables and Related Security, Collections and Proceeds
with respect thereto, (iii) the Administrative Agent, on behalf of the CP
Conduit Purchasers and the Committed Purchasers, shall execute and deliver to
the Transferor, at the Transferor's expense, such documents or instruments as
are necessary to terminate the CP Conduit Purchasers' and the Committed
Purchasers' respective interests in the Receivables and Related Security,
Collections and Proceeds with respect thereto, and (iv) the Collection Agent
shall remit to the Transferor such portion of Collections set aside for the
Transferor pursuant to this Section 2.06. Any such documents shall be prepared
by or on behalf of the Transferor.
SECTION 2.07. Reduction of Commitments. Upon ten (10) Business Days written
notice to the Administrative Agent, the Transferor may reduce the Commitments of
the Committed Purchasers in an amount equal to $5,000,000 or a whole multiple of
$500,000 in excess thereof; provided that no such termination or reduction shall
be permitted if, after giving effect thereto, the Net Investment would exceed
98.04% of the Aggregate Commitment. Upon any such reduction, the Commitment of
each Committed Purchaser shall be reduced in an amount equal to such Committed
Purchaser's Pro Rata Share of the amount of such reduction, and the Facility
Limit shall be recalculated to equal 98.04% of the Aggregate Commitment.
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Once reduced, the Commitments shall not be subsequently reinstated. The
Commitment of each Committed Purchaser shall be automatically reduced to zero on
its Commitment Expiry Date and the Commitment of all Committed Purchasers shall
be automatically reduced to zero on the Termination Date.
SECTION 2.08. Fees. To the extent not otherwise provided for by the
provisions of the Agreement, the Transferor shall pay to the Administrative
Agent, for its own account and the account of each CP Conduit Purchaser, Funding
Agent and Committed Purchaser, the Fees specified in the Fee Letter.
SECTION 2.09. Protection of Ownership Interest of the CP Conduit Purchasers
and the Committed Purchasers.
(a) The Transferor will, and will cause each Seller to, from time to time,
at its expense, promptly execute and deliver all instruments and documents and
take all actions as may be necessary or as the Administrative Agent may
reasonably request in order to perfect or protect the Transferred Interest or to
enable the Administrative Agent, the CP Conduit Purchasers or the Committed
Purchasers to exercise or enforce any of their respective rights hereunder.
Without limiting the foregoing, the Transferor will, and will cause each Seller
to, upon the request of the Administrative Agent, in order to accurately reflect
this purchase and sale transaction, (x) execute and file such financing or
continuation statements or amendments thereto or assignments thereof as may be
requested by the Administrative Agent for the benefit of the CP Conduit
Purchasers and the Committed Purchasers and (y) ▇▇▇▇ its respective master data
processing records and other documents with a legend describing the conveyance
to the Transferor (in the case of the Sellers) and the Administrative Agent for
the benefit of the CP Conduit Purchasers and the Committed Purchasers, of the
Transferred Interest. The Transferor shall, and shall cause the Sellers to,
obtain such additional search reports as the Administrative Agent, for the
benefit of the CP Conduit Purchasers and the Committed Purchasers, shall
reasonably request. To the fullest extent permitted by applicable law, the
Administrative Agent shall be permitted to sign and file continuation statements
and amendments thereto and assignments thereof without the Transferor's or any
Seller's signature. Carbon, photostatic or other reproduction of this Agreement
or any financing statement shall be sufficient as a financing statement. The
Transferor shall not, and shall not permit any Seller to, change its respective
name, the state of its formation, its structure or the location of its chief
executive office, or relocate any office where Records are kept unless it shall
have: (i) given the Administrative Agent at least thirty (30) days' prior notice
thereof and (ii) prepared at the Transferor's expense and delivered to the
Administrative Agent all financing statements, instruments and other documents
necessary to preserve and protect the Transferred Interest or reasonably
requested by the Administrative Agent in connection with such change or
relocation. Any filings under the Relevant UCC or otherwise that are occasioned
by such change in name or location shall be made at the expense of Transferor or
the related Seller.
(b) The Collection Agent shall instruct, and shall cause the other Sellers
to instruct, all Obligors to cause all Collections to be deposited directly with
a Lockbox Bank. Any Lockbox Account maintained by a Lockbox Bank pursuant to the
related Lockbox Agreement shall be owned by the Transferor; provided, however,
that any such Lockbox Account shall be under the exclusive dominion and control
of the Administrative Agent which is hereby granted to the Administrative Agent
by C&A and the Transferor. The Collection Agent shall be permitted
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to give instructions to the Lockbox Banks except, so long as C&A or any
Affiliate thereof is the Collection Agent, during the occurrence of a Collection
Agent Default or any other Termination Event. The Collection Agent shall not add
any bank as a Lockbox Bank to those listed on Exhibit B attached hereto unless
such bank has entered into a Lockbox Agreement. The Collection Agent shall not
terminate any bank as a Lockbox Bank unless the Administrative Agent shall have
received thirty (30) days' prior notice of such termination. If the Transferor,
any Seller or the Collection Agent receives any Collections, the Transferor or
the Collection Agent, as applicable, shall, or shall cause such Seller to, remit
such Collections to a Lockbox Account within one (1) Business Day of receipt
thereof.
(c) The Transferor hereby pledges, assigns and transfers to the
Administrative Agent, for the benefit of the CP Conduit Purchasers and the
Committed Purchasers, and hereby creates and grants to the Administrative Agent,
for the benefit of the CP Conduit Purchasers and the Committed Purchasers, a
security interest in the Lockbox Accounts and all cash, checks and other
negotiable instruments, funds and other evidences of payment held therein.
SECTION 2.10. Deemed Collections; Application of Payments.
(a) If on any day a Receivable becomes a Diluted Receivable or is otherwise
reduced as provided in Section 6.2 of the Receivables Purchase Agreement, the
Transferor shall be deemed to have received on such day a Collection of such
Receivable in the amount of the applicable reduction or cancellation, and the
Transferor shall pay to the Administrative Agent an amount equal to such
reduction or cancellation. Any such amount shall be treated as a Collection of a
Receivable in accordance with the provisions of the Transaction Documents.
(b) If on any day any of the representations or warranties in Article III
was or becomes untrue with respect to a Receivable or the nature of the
Administrative Agent's interest therein (whether on or after the date of any
transfer of an interest therein to the CP Conduit Purchasers and the Committed
Purchasers, or an assignment therein by the CP Conduit Purchasers to the
Committed Purchasers under the Asset Purchase Agreements), the Transferor shall
be deemed to have received on such day a Collection of such Receivable in full
and the Transferor shall, on such day, pay to the Collection Agent an amount
equal to the Outstanding Balance of such Receivable and such amount shall be
allocated and applied by the Collection Agent as a Collection allocable to the
Transferred Interest in accordance with Section 2.05 or 2.06 hereof, as
applicable. The Net Investment shall be reduced by the amount of such payment
actually received by the Administrative Agent. Simultaneously with any such
payment by the Transferor, each of the CP Conduit Purchasers and the Committed
Purchasers, as the case may be, shall convey all of its right, title and
interest in such Receivable and Related Security to the Transferor, and the
Administrative Agent, on behalf of the CP Conduit Purchasers and the Committed
Purchasers, shall take all action reasonably requested by the Transferor to
effectuate such conveyance.
(c) Any payment by an Obligor in respect of any indebtedness owed by it to
the Transferor or the Seller shall, except as provided in paragraphs (a) and (b)
of this Section 2.10 or as otherwise specified by such Obligor or identified by
the Collection Agent as relating to a Receivable due to the exact dollar amount
of such payment being identical to the exact dollar amount of the invoice
relating to such Receivable, or otherwise required by contract or law and unless
otherwise instructed by the CP Conduit Purchasers, be applied as a Collection of
any
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Receivable of such Obligor included in the Transferred Interest (in order of the
age of such Receivable, starting with the oldest such Receivable) to the extent
of any amounts then due and payable thereunder before being applied to any other
receivable or other indebtedness of such Obligor.
SECTION 2.11. Payments and Computations, etc. All amounts to be paid or
deposited by the Transferor or the Collection Agent hereunder shall be paid or
deposited in accordance with the terms hereof no later than 12:00 p.m. (New York
time) on the day when due in immediately available funds; if such amounts are
payable to any CP Conduit Purchaser (or any Committed Purchaser), they shall be
paid or deposited to an account (with such account number as the Administrative
Agent shall advise the Transferor and the Collection Agent) in the name of the
Administrative Agent and maintained at JPMorgan Chase's offices at ▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇, ▇▇, until otherwise notified by the Administrative Agent.
Any payments to be made by the Transferor or the Collection Agent pursuant to
Section 2.05 or 2.06 shall be made by withdrawing funds from any or all of the
Collection Accounts at the option of the Collection Agent, or in the event of a
Potential Termination Event or Termination Event, at the option of the
Administrative Agent. No later than 3:00 p.m. (New York time) on the date of any
Incremental Transfer hereunder, the CP Conduit Purchasers or the Committed
Purchasers, as applicable, will make available to the Transferor, in immediately
available funds, the Transfer Price for such Incremental Transfer on such day by
remitting such amount to an account of the Transferor specified in the related
notice of Transfer. The Transferor shall, to the extent permitted by law, pay to
the Administrative Agent, for the benefit of the CP Conduit Purchasers and/or
the Committed Purchasers upon demand, interest on all amounts not paid or
deposited by it when due hereunder at a rate equal to 2.00% per annum plus the
Base Rate. All computations of interest hereunder shall be made on the basis of
a year of 360 days (or, in the case of a Tranche as to which Discount is
calculated at the Base Rate, 365 or 366 days, as applicable) for the actual
number of days (including the first but excluding the last day) elapsed.
Whenever any payment or deposit to be made hereunder shall be due 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 or deposit. Any computations by the Administrative
Agent of amounts payable by the Transferor hereunder shall be binding upon the
Transferor absent manifest error.
SECTION 2.12. Reports. The Collection Agent shall prepare and forward to
the Administrative Agent (i) on each Settlement Date, a Settlement Statement as
of the end of the last day of the immediately preceding Settlement Period, (ii)
on each Weekly Settlement Date, a Weekly Report as of the end of the last day of
the immediately preceding calendar week, (iii) on each Business Day (prior to an
Incremental Transfer on such day) (A) after C&A shall have permitted either (1)
the Interest Coverage Ratio during any period set forth in the definition of
"Interest Coverage Ratio" to be less than the ratio set forth in such definition
for such period or (2) the Leverage Ratio during any period set forth in the
definition of "Leverage Ratio" to be greater than the ratio set forth in such
definition for such period, and continuing until the Administrative Agent shall
have notified C&A otherwise (at the direction of all of the Committed Purchasers
and CP Conduit Purchasers) and (B) on which Collections received by the
Transferor, the Sellers or the Collection Agent or deposited into a Lockbox
Account or the Collection Accounts on such Business Day equal or exceed
$12,500,000, if the Transferor wishes to have funds released to it pursuant to
Section 2.05(iv) prior to the delivery of the next Weekly Report, a Daily
Report, and (iv) as soon as reasonably practicable, from time to time,
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such other information as the Administrative Agent may reasonably request. With
respect to Section 2.12(iii)(A) herein, the Collection Agent may again provide a
Weekly Report after C&A has complied with the Interest Coverage Ratio or
Leverage Ratio for two (2) consecutive fiscal quarters; unless such requirement
shall have been waived by the Administrative Agent with the prior consent of the
Funding Agents.
SECTION 2.13. Collection Accounts.
(a) There shall be established on or before the day of the initial
Incremental Transfer hereunder and maintained, for the benefit of the
Administrative Agent on behalf of the CP Conduit Purchasers and the Committed
Purchasers, three segregated accounts (collectively, the "Collection Accounts"),
each bearing a designation clearly indicating that the funds deposited therein
are held for the benefit of the CP Conduit Purchasers and the Committed
Purchasers. The Collection Agent shall deposit all Collections into the
Collection Accounts within one Business Day of (i) deposit thereof into a
Lockbox Account or (ii) receipt thereof by the Transferor, a Seller or the
Collection Agent as follows: (i) an account in the United States to hold all
Collections received in the United States (the "U.S. Dollar Collection
Account"), (ii) an account in Canada to hold all Collections received in Canada
that are paid in United States dollars (the "Canada/U.S. Dollar Collection
Account") and (iii) an account in Canada to hold all Collections received in
Canada that are paid in Canadian Dollars (the "Canada/Canadian Dollar Collection
Account"). All funds which are deposited in the United States, shall be
deposited into the U.S. Dollar Collection Account; all funds which are deposited
in Canada in United States dollars, shall be deposited into the Canada/U.S.
Dollar Collection Account; and all funds which are deposited in Canada in
Canadian Collars, shall be deposited into the Canada/Canadian Dollar Collection
Account. All such deposits to the U.S. Dollar Collection Account and the
Canada/U.S. Dollar Collection Account shall be made in United States dollars.
All such deposits to the Canada/Canadian Dollar Collection Account shall be made
in Canadian Dollars. Funds on deposit in the Collection Accounts (other than
investment earnings) shall be invested by the Administrative Agent in Permitted
Investments that will mature so that such funds will be available prior to each
Settlement Date, following such investment. On each Settlement Date, all
interest and earnings (net of losses and investment expenses) on funds on
deposit in the Collection Accounts shall be retained in the Collection Accounts
and be available to make any payments required to be made hereunder (including
Discount) by the Transferor. On the date on which the Net Investment is zero and
all accrued Discount, Servicing Fees, Fees and all other Aggregate Unpaids have
been paid in full, any funds remaining on deposit in the Collection Accounts
shall be paid to the Transferor.
(b) For so long as any amounts remain due and owing to the CP Conduit
Purchasers or the Committed Purchasers hereunder or under the Transaction
Documents, the Administrative Agent shall distribute all payments received by it
in respect of the Transaction Documents immediately after receipt thereof by (i)
transferring to the CP Conduit Purchasers and the Committed Purchasers, on a pro
rata basis, based on the amounts thereof owing to each CP Conduit Purchaser and
each Committed Purchaser, respectively, all payments of Discount, (ii)
transferring to the CP Conduit Purchasers and the Committed Purchasers, on a pro
rata basis, based on the CP Conduit Purchaser's Interest and the Committed
Purchaser Funded Amount, respectively, on the date of payment, all payments in
reduction of the Net Investment and (iii) transferring to the CP Conduit
Purchasers and/or the Committed Purchasers, any other amounts owing to the CP
Conduit Purchasers and/or the Committed Purchasers under this Agreement.
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Such transfers shall be made by the Administrative Agent by withdrawing funds on
deposit in the Collection Accounts and remitting such funds to the accounts of
the CP Conduit Purchasers and the Committed Purchasers specified by each of them
from time to time. The Administrative Agent shall remit any such funds to the
Committed Purchasers ratably in accordance with their Pro Rata Shares.
SECTION 2.14. Right of Setoff. Each of the CP Conduit Purchasers and the
Committed Purchasers is hereby authorized (in addition to any other rights it
may have) at any time after the occurrence of the Termination Date, or during
the continuation of a Potential Termination Event, to set off, appropriate and
apply (without presentment, demand, protest or other notice which are hereby
expressly waived) any deposits and any other indebtedness held or owing by such
CP Conduit Purchaser or such Committed Purchaser to, or for the account of, the
Transferor against the amount of the Aggregate Unpaids owing by the Transferor
to such Person.
SECTION 2.15. Sharing of Payments, etc. If any CP Conduit Purchaser or any
Committed Purchaser (for purposes of this Section 2.15 only, a "Recipient")
shall obtain any payment (whether voluntary, involuntary, through the exercise
of any right of setoff, or otherwise) on account of any interest in the
Transferred Interest owned by it in excess of its Pro Rata Share of payments on
account of any interest in the Transferred Interest obtained by the CP Conduit
Purchasers and/or the Committed Purchasers entitled thereto, such Recipient
shall forthwith purchase from the CP Conduit Purchasers and/or the Committed
Purchasers entitled to a share of such amount participations in the percentage
interests owned by such Persons as shall be necessary to cause such Recipient to
share the excess payment ratably with each such other Person entitled thereto;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such Recipient, such purchase from each such other
Person shall be rescinded and each such other Person shall repay to the
Recipient the purchase price paid by such Recipient for such participation to
the extent of such recovery, together with an amount equal to such other
Person's Pro Rata Share (according to the proportion of (a) the amount of such
other Person's required payment to (b) the total amount so recovered from the
Recipient) of any interest or other amount paid or payable by the Recipient in
respect of the total amount so recovered.
SECTION 2.16. Broken Funding. In the event of (a) the payment of any
principal of any Eurodollar Tranche other than on the last day of the Eurodollar
Tranche Period applicable thereto (including as a result of the occurrence of
the Termination Date or an optional prepayment of a Eurodollar Tranche), (b) the
conversion of any Eurodollar Tranche other than on the last day of the related
Eurodollar Tranche Period, or (c) any failure to borrow, convert, continue or
prepay any Eurodollar Tranche on the date specified in any notice delivered
pursuant hereto, then, in any such event, the Transferor shall compensate the
Committed Purchasers for the loss, cost and expense actually incurred by such
Committed Purchasers attributable to such event. Such loss, cost or expense to
any Committed Purchaser shall include an amount determined by such Committed
Purchaser to be the excess, if any, of (i) the amount of Discount which would
have accrued on the principal amount of such Eurodollar Tranche had such event
not occurred, at the Eurodollar Rate that would have been applicable to such
Eurodollar Tranche, for the period from the date of such event to the last day
of the Eurodollar Tranche Period (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the related Eurodollar
Tranche Period), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Committed
Purchaser would bid
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were it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the interbank Eurodollar
market. Within forty-five (45) days after any Committed Purchaser hereunder
receives actual knowledge of any of the events specified in this Section 2.16, a
certificate of such Committed Purchaser setting forth any amount or amounts that
such Committed Purchaser is entitled to receive pursuant to this Section 2.16
and the reason(s) therefor shall be delivered to the Transferor (with a copy to
the Administrative Agent) and shall be conclusive absent manifest error. The
Transferor shall pay each such Committed Purchaser the amount shown as due on
any such certificate within ten (10) days after receipt thereof.
SECTION 2.17. Conversion and Continuation of Outstanding Tranches Funded by
the Committed Purchasers. Prior to the occurrence of the Termination Date or a
Potential Termination Event, (a) each BR Tranche hereunder may, at the option of
the Transferor, be converted to a Eurodollar Tranche and (b) each Eurodollar
Tranche may, at the option of the Transferor, be continued as a Eurodollar
Tranche or converted to a BR Tranche. If the Termination Date has occurred or a
Potential Termination Event has been declared by the Administrative Agent and is
continuing, then (i) no outstanding Tranche funded by the Committed Purchasers
may be converted to, or continued as, a Eurodollar Tranche and (ii) unless
repaid, each Eurodollar Tranche shall be converted to a BR Tranche on the last
day of the Tranche Period related thereto. For any such conversion or
continuation, the Transferor shall give the Administrative Agent irrevocable
notice in the form of part B of Exhibit E of such request not later than 12:30
p.m. (New York City time) (i) in the case of a conversion of a BR Tranche into a
Eurodollar Tranche, or a continuation of a Eurodollar Tranche as a Eurodollar
Tranche, three (3) Business Days before the date of such conversion or
continuation, as applicable, and (ii) following the Termination Date or the
declaration by the Administrative Agent and continuation of a Potential
Termination Event, in the case of a conversion of a Eurodollar Tranche into a BR
Tranche or a continuation of a BR Tranche as a BR Tranche, on the Business Day
of such conversion or continuation, as applicable. If notice has not been timely
delivered with respect to any BR Tranche or Eurodollar Tranche, such Tranche
shall be automatically continued as, or converted to, a BR Tranche.
SECTION 2.18. Illegality.
(a) Notwithstanding any other provision herein, if, after the Closing Date,
the adoption of any Law or bank regulatory guideline or any amendment or change
in the interpretation of any existing or future Law or bank regulatory guideline
by any Official Body charged with the administration, interpretation or
application thereof, or the compliance with any directive of any Official Body
(in the case of any bank regulatory guideline, whether or not having the force
of Law), shall make it unlawful for any Committed Purchaser to acquire or
maintain a Eurodollar Tranche as contemplated by this Agreement, (i) such
Committed Purchaser shall, within forty-five (45) days after receiving actual
knowledge thereof, deliver a certificate to the Transferor (with a copy to the
Administrative Agent) setting forth the basis for such illegality, which
certificate shall be conclusive absent manifest error, (ii) the commitment of
such Committed Purchaser hereunder to make a portion of a Eurodollar Tranche,
continue any portion of a Eurodollar Tranche as such and convert a BR Tranche to
a Eurodollar Tranche shall forthwith be canceled, and such cancellation shall
remain in effect so long as the circumstance described above exists, and (iii)
such Committed Purchaser's portion of any Eurodollar Tranche
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then outstanding shall be converted automatically to a BR Tranche on the last
day of the related Eurodollar Tranche Period, or within such earlier period as
required by law.
If any such conversion of a portion of a Eurodollar Tranche occurs on a day
which is not the last day of the related Eurodollar Tranche Period, then
pursuant to Section 2.16 the Transferor shall pay to such Committed Purchaser
such amounts, if any, as may be required to compensate such Committed Purchaser.
If circumstances subsequently change so that it is no longer unlawful for an
affected Committed Purchaser to acquire or to maintain a portion of a Eurodollar
Tranche as contemplated hereunder, such Committed Purchaser will, as soon as
reasonably practicable after such Committed Purchaser knows of such change in
circumstances, notify the Transferor and the Administrative Agent, and upon
receipt of such notice, the obligations of such Committed Purchaser to acquire
or maintain its acquisition of portions of Eurodollar Tranches or to convert its
portion of a BR Tranche into portions of Eurodollar Tranches shall be
reinstated.
(b) Each Committed Purchaser agrees that, upon the occurrence of any event
giving rise to the operation of Section 2.18(a) with respect to such Committed
Purchaser, it will, if requested by the Transferor and to the extent permitted
by law or by the relevant Official Body, endeavor in good faith to change the
office at which it books its portions of Eurodollar Tranches hereunder if such
change would make it lawful for such Committed Purchasers to continue to acquire
or to maintain its acquisition of portions of Eurodollar Tranches hereunder;
provided, however, that such change may be made in such manner that such
Committed Purchaser, in its sole determination, suffers no unreimbursed cost or
expense or any other disadvantage whatsoever.
SECTION 2.19. Inability to Determine Eurodollar Rate. If, prior to the
first day of any Eurodollar Tranche Period:
(i) the Administrative Agent shall have determined (which
determination in the absence of manifest error shall be conclusive and
binding upon the Transferor) that, by reason of circumstances affecting the
interbank Eurodollar market, either (a) dollar deposits in the relevant
amounts and for the relevant Tranche Period are not available, or (b)
adequate and reasonable means do not exist for ascertaining the Eurodollar
Rate for such Eurodollar Tranche Period; or
(ii) the Administrative Agent shall have received notice from the
Required Committed Purchasers that the Eurodollar Rate determined or to be
determined for such Eurodollar Tranche Period will not adequately and
fairly reflect the cost to such Committed Purchasers (as conclusively
certified by such Committed Purchasers) of purchasing or maintaining their
affected portions of Eurodollar Tranches during such Eurodollar Tranche
Period;
then, in either such event, the Administrative Agent shall give telecopy or
telephonic notice thereof (confirmed in writing) to the Transferor and the
Committed Purchasers as soon as practicable (but, in any event, within ten (10)
days after such determination or notice, as applicable) thereafter. Until such
notice has been withdrawn by the Administrative Agent, no further Eurodollar
Tranches shall be made. The Administrative Agent agrees to withdraw any
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such notice as soon as reasonably practicable after the Administrative Agent is
notified of a change in circumstances which makes such notice inapplicable.
SECTION 2.20. Indemnities by the Transferor. Without limiting any other
rights which the Administrative Agent, the CP Conduit Purchasers or the
Committed Purchasers may have hereunder or under applicable law, the Transferor
hereby agrees to indemnify the CP Conduit Purchasers, the Committed Purchasers,
the Funding Agents and the Administrative Agent and any successors and permitted
assigns and their respective officers, directors, agents and employees
(collectively, "Indemnified Parties") from and against any and all damages,
losses, claims, liabilities, costs and expenses, including, without limitation,
reasonable attorneys' fees and disbursements (all of the foregoing being
collectively referred to as "Indemnified Amounts") awarded against or incurred
by any of them in any action or proceeding between the Transferor, the
Collection Agent in such capacity or the Sellers and any of the Indemnified
Parties or between any of the Indemnified Parties and any third party or
otherwise arising out of or as a result of this Agreement, the other Transaction
Documents, the ownership or maintenance, either directly or indirectly, by the
Administrative Agent, the CP Conduit Purchasers or any Committed Purchaser of
the Transferred Interest or any of the other transactions contemplated hereby or
thereby, excluding, however, (i) Indemnified Amounts to the extent relating to
or resulting from (x) gross negligence or willful misconduct on the part of an
Indemnified Party or (y) recourse (except as otherwise specifically provided in
this Agreement) for uncollectible Receivables or (ii) all taxes (other than
Indemnified Taxes). Without limiting the generality of the foregoing, the
Transferor shall indemnify each Indemnified Party for Indemnified Amounts
(without duplication of amounts for which any Indemnified Party is effectively
held harmless under any other provision hereof) relating to or resulting from:
(a) any representation or warranty made in writing by the Transferor, the
Collection Agent or the Sellers or any Responsible Officer of the Transferor,
the Collection Agent or the Sellers under or in connection with this Agreement,
any of the other Transaction Documents, any Deposit Report, any Settlement
Statement or any other information or report delivered by any of them pursuant
hereto or thereto, which shall have been false or incorrect in any material
respect when made or deemed made;
(b) the failure by the Transferor, the Collection Agent or the Sellers to
comply with any applicable law, rule or regulation with respect to any
Receivable or the related Contract, or the nonconformity of any Receivable or
the related Contract with any such applicable law, rule or regulation;
(c) the failure to either (x) vest and maintain vested in the
Administrative Agent, for the benefit of the CP Conduit Purchasers and the
Committed Purchasers, an undivided first priority, perfected percentage
ownership interest, to the extent of the Transferred Interest, in the
Receivables and Related Security, Collections and Proceeds with respect thereto,
free and clear of any Adverse Claim (other than Permitted Encumbrances) or (y)
to create or maintain a valid and perfected first priority security interest in
favor of the Administrative Agent, for the benefit of the CP Conduit Purchasers
and the Committed Purchasers, in the Transferor's interest in the Receivables
and Related Security, Collections and Proceeds with respect thereto, free and
clear of any Adverse Claim (other than Permitted Encumbrances);
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(d) the failure to file, or any delay in filing, financing statements,
continuation statements, or other similar instruments or documents under the
Relevant UCC or other applicable laws with respect to any of the Receivables or
Related Security, Collections and Proceeds with respect thereto;
(e) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
(including, without limitation, a defense based on such Receivable or the
related Contract not being 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 merchandise or services related to such Receivable or
the furnishing or failure to furnish such merchandise or services (if such
collection activities were performed by the Transferor or any of its Affiliates
acting as the Collection Agent);
(f) any products liability claim or personal injury or property damage suit
or other similar or related claim or action of whatever sort arising out of or
in connection with merchandise or services which are the subject of any
Receivable;
(g) the transfer of an ownership interest in any Receivable other than an
Eligible Receivable;
(h) the failure by any of the Transferor, the Collection Agent or the
Sellers to comply with any term, provision or covenant contained in this
Agreement or any of the other Transaction Documents to which it is a party or to
perform any duty or obligation in accordance with the provisions hereof or
thereof or to perform any of its duties or obligations under the Contracts;
(i) the Percentage Factor exceeding the Maximum Percentage Factor at any
time on or prior to the Termination Date;
(j) the failure of the Sellers to pay when due any taxes, including without
limitation, sales, excise or personal property taxes payable in connection with
any of the Receivables with respect to which an Indemnified Party may be held
liable as a transferee of such Receivables;
(k) any repayment by any Indemnified Party of any amount previously
distributed in reduction of Net Investment which such Indemnified Party believes
in good faith is required to be made;
(l) the commingling by the Transferor, the Sellers or the Collection Agent
of Collections of Receivables at any time with other funds;
(m) any investigation, litigation or proceeding related to this Agreement,
any of the other Transaction Documents, the use of proceeds of Transfers by the
Transferor or the Sellers, the ownership of Transferred Interests, or any
Receivable, Related Security or Contract;
(n) the failure of any Lockbox Bank to remit any amounts held in the
Lockbox Accounts pursuant to the instructions of the Collection Agent, the
Transferor, the Sellers or the Administrative Agent (to the extent such Person
is entitled to give such instructions in
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accordance with the terms hereof and of any applicable Lockbox Agreement)
whether by reason of the exercise of set-off rights or otherwise;
(o) any inability to obtain any judgment in or utilize the court or other
adjudication system of, any state in which an Obligor may be located as a result
of the failure of the Transferor or the Sellers to qualify to do business or
file any notice of business activity report or any similar report;
(p) any failure of the Transferor to give reasonably equivalent value to
the Sellers in consideration of the purchase by the Transferor from the Sellers
of any Receivable, or any attempt by any Person to void, rescind or set aside
any such transfer under statutory provisions or common law or equitable action,
including, without limitation, any provision of the Bankruptcy Code; or
(q) any action taken by the Transferor, the Sellers or the Collection Agent
in the enforcement or collection of any Receivable;
provided, however, that the Transferor shall not be liable for Indemnified
Amounts attributable to the fraud, gross negligence, breach of fiduciary duty or
willful misconduct of any Collection Agent in the enforcement or collection of
any Receivable if such Collection Agent is not C&A or an Affiliate of C&A;
provided, further, that if any CP Conduit Purchaser enters into agreements for
the purchase of interests in receivables from one or more Other Transferors,
such CP Conduit Purchaser shall equitably allocate such Indemnified Amounts to
the Transferor and each Other Transferor; and provided, further, that if such
Indemnified Amounts are attributable solely to the Transferor, the Transferor
shall be solely liable for such Indemnified Amounts, and if such Indemnified
Amounts are attributable solely to Other Transferors, such Other Transferors
shall be solely liable for such Indemnified Amounts.
SECTION 2.21. Indemnity for Reserves and Expenses.
(a) If after the date hereof, the adoption of any Law or bank regulation or
regulatory guideline or any amendment or change in the interpretation of any
existing or future Law or bank regulation or regulatory guideline by any
Official Body charged with the administration, interpretation or application
thereof, or the compliance with any directive of any Official Body (in the case
of any bank regulation or regulatory guideline, whether or not having the force
of Law), other than Laws, interpretations, guidelines or directives relating to
taxes:
(i) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System) against assets of, deposits with or for the account of, or credit
extended by, any Indemnified Party or shall impose on any Indemnified Party
or on the United States market for certificates of deposit or the London
interbank market any other condition affecting this Agreement, the other
Transaction Documents, the ownership, maintenance or financing of the
Transferred Interest, the Receivables or payments of amounts due hereunder
or its obligation to advance funds hereunder or under the other Transaction
Documents; or
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(ii) imposes upon any Indemnified Party any other expense (including,
without limitation, reasonable attorneys' fees and expenses, and expenses
of litigation or preparation therefor in contesting any of the foregoing)
with respect to this Agreement, the other Transaction Documents, the
ownership, maintenance or financing of the Transferred Interest, the
Receivables or payments of amounts due hereunder or its obligation to
advance funds hereunder or otherwise in respect of this Agreement, the
other Transaction Documents, the ownership, maintenance or financing of the
Transferred Interests or the Receivables;
and the result of any of the foregoing is to increase the cost to such
Indemnified Party with respect to this Agreement, the other Transaction
Documents, the ownership, maintenance or financing of the Transferred Interest,
the Receivables, the obligations hereunder, the funding of any Purchases
hereunder or under the other Transaction Documents, by an amount reasonably
deemed by such Indemnified Party to be material, then, within ten (10) Business
Days after demand by such Indemnified Party through the Administrative Agent,
the Transferor shall pay to the Administrative Agent, for the benefit of such
Indemnified Party, such additional amount or amounts (other than with respect to
taxes) as will compensate such Indemnified Party for such increased cost or
reduction; provided that no such amount shall be payable with respect to any
period commencing more than two hundred seventy (270) days prior to the date the
Administrative Agent first notifies the Transferor of its intention to demand
compensation therefor under this Section 2.21; provided further that if such
change in Law, rule or regulation giving rise to such increased costs or
reductions is retroactive, then such 270-day period shall be extended to include
the period of retroactive effect thereof. In making demand hereunder, the
applicable Indemnified Party shall submit to the Transferor a certificate as to
such increased costs incurred which shall provide in reasonable detail the basis
for such claim.
(b) If any Indemnified Party shall have determined that after the date
hereof, the adoption of any applicable Law or bank regulation or regulatory
guideline regarding capital adequacy, or any change therein, or any change in
the interpretation thereof by any Official Body, or any directive regarding
capital adequacy (in the case of any bank regulatory guideline, whether or not
having the force of law) of any such Official Body, has or would have the effect
of reducing the rate of return on capital of such Indemnified Party (or its
parent) as a consequence of such Indemnified Party's obligations hereunder or
with respect hereto to a level below that which such Indemnified Party (or its
parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount reasonably deemed by such Indemnified Party to be material, then from
time to time, within ten (10) Business Days after demand by such Indemnified
Party through the Administrative Agent, the Transferor shall pay to the
Administrative Agent, for the benefit of such Indemnified Party, such additional
amount or amounts (other than with respect to taxes) as will compensate such
Indemnified Party (or its parent) for such reduction; provided that no such
amount shall be payable with respect to any period commencing more than two
hundred seventy (270) days prior to the date the Administrative Agent first
notifies the Transferor of its intention to demand compensation therefor under
this Section 2.21(b); provided further that if such change in Law, rule or
regulation giving rise to such increased costs or reductions is retroactive,
then such 270-day period shall be extended to include the period of retroactive
effect thereof. In making demand hereunder, the applicable Indemnified Party
shall submit to the Transferor a certificate as to such increased costs incurred
which shall provide in reasonable detail the basis for such claim.
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(c) Anything in this Section 2.21 to the contrary notwithstanding, if any
CP Conduit Purchaser enters into agreements for the acquisition of interests in
receivables from one or more Other Transferors, such CP Conduit Purchaser shall
equitably allocate the liability for any amounts under this Section 2.21
("Section 2.21 Costs") to the Transferor and each Other Transferor; provided,
however, that if such Section 2.21 Costs are attributable to the Transferor and
not attributable to any Other Transferor, the Transferor shall be solely liable
for such Section 2.21 Costs or if such Section 2.21 Costs are attributable to
Other Transferors and not attributable to the Transferor, such Other Transferors
shall be solely liable for such Section 2.21 Costs.
SECTION 2.22. Indemnity for Taxes.
(a) All payments made by the Transferor or the Collection Agent to the
Administrative Agent for the benefit of the CP Conduit Purchasers and the
Committed Purchasers under this Agreement and any other Transaction Document
shall be made free and clear of, and without deduction or withholding for or on
account of any Indemnified Taxes. If any such Indemnified Taxes are required to
be withheld from any amounts payable to the Administrative Agent or any other
Indemnified Party hereunder, (i) the amounts so payable to the Administrative
Agent or such other Indemnified Party shall be increased to the extent necessary
to yield to the Administrative Agent or such other Indemnified Party (after
payment of all Indemnified Taxes) all amounts payable hereunder at the rates or
in the amounts specified in this Agreement and the other Transaction Documents
and (ii) the Transferor or the Collection Agent, as the case may be, shall make
such deductions or withholdings and shall pay the amount so deducted or withheld
to the applicable Official Body in accordance with the applicable law. The
Transferor shall indemnify the Administrative Agent or any other Indemnified
Party for the full amount of any Indemnified Taxes paid by the Administrative
Agent or such other Indemnified Party within ten (10) Business Days after the
date of written demand therefor by the Administrative Agent or such other
Indemnified Party if the Administrative Agent or such other Indemnified Party,
as the case may be, has delivered to the Transferor a certificate signed by an
officer of the Administrative Agent or such other Indemnified Party, as the case
may be, setting forth in reasonable detail the amount so paid and the
computations made to determine such amount. Such certificate shall be conclusive
absent manifest error.
(b) Each Indemnified Party that is not a United States person (within the
meaning of Section 7701(a)(30) of the Code) (a "United States Person") shall:
(i) at the time such Indemnified Party becomes a party to this
Agreement or the Transaction Documents, deliver to the Transferor and the
Administrative Agent (A) two duly completed copies of IRS Form W-8ECI, or
successor applicable form, as the case may be, and (B) an IRS Form W-8BEN,
or successor applicable form, as the case may be;
(ii) deliver to the Transferor and the Administrative Agent two (2)
further copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Transferor or the Administrative Agent;
and
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(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the Transferor or
the Administrative Agent;
unless, in the case of (ii) and (iii) above, any change in treaty, law
regulation, governmental rule, guideline order, or official application or
official interpretation thereof has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Indemnified Party from duly completing and
delivering any such form with respect to it, and such Indemnified Party so
advises the Transferor and the Administrative Agent. Each Person that is a
Purchaser or Participant hereunder, or which otherwise becomes a party to this
Agreement and the other Transaction Documents as an Committed Purchaser, shall,
prior to the effectiveness of such assignment, participation or addition, as
applicable, be required to provide all of the forms and statements required
pursuant to this Section 2.22.
SECTION 2.23. Other Costs, Expenses and Related Matters.
(a) The Transferor agrees, upon receipt of a written invoice, to pay or
cause to be paid, and to save the Administrative Agent, the CP Conduit
Purchasers, the Committed Purchasers and each Funding Agent harmless against
liability for the payment of, all reasonable out-of-pocket expenses (including,
without limitation, reasonable attorneys', accountants' and other third parties'
fees and expenses, any filing fees and expenses incurred by officers or
employees of the Administrative Agent, the CP Conduit Purchasers, the Committed
Purchasers and/or the Funding Agents) or intangible, documentary or recording
taxes incurred by or on behalf of the Administrative Agent, the CP Conduit
Purchasers, the Committed Purchasers and the Funding Agents (i) in connection
with the negotiation, execution, delivery and preparation of this Agreement, the
other Transaction Documents and any documents or instruments delivered pursuant
hereto and thereto and the transactions contemplated hereby or thereby
(including, without limitation, the perfection or protection of the Transferred
Interest) and (ii) (A) relating to any amendments, waivers or consents under
this Agreement, any Asset Purchase Agreement and the other Transaction
Documents, (B) arising in connection with the Administrative Agent's, the CP
Conduit Purchasers', the Committed Purchasers' or the Funding Agents'
enforcement or preservation of rights (including, without limitation, the
perfection and protection of the Transferred Interest under this Agreement), or
(C) arising in connection with any audit, dispute, disagreement, litigation or
preparation for litigation involving this Agreement or any of the other
Transaction Documents (all of such amounts, collectively, "Transaction Costs").
All Transaction Costs owed by the Transferor pursuant to this subsection 2.23(a)
shall be payable in accordance with Section 2.05 and 2.06.
(b) The Transferor shall pay the Administrative Agent, for the account of
the CP Conduit Purchasers and the Committed Purchasers, as applicable, on demand
any Early Collection Fee due on account of the reduction of a Tranche on any day
prior to the last day of its Tranche Period.
(c) The Administrative Agent will within forty-five (45) days after receipt
of notice of any event occurring after the date hereof which will entitle an
Indemnified Party to compensation pursuant to this Article II, notify the
Transferor (with a copy to C&A) in writing of such event. Any notice by the
Administrative Agent claiming compensation under this Article
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II and setting forth the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of manifest error, provided that such claim
is made in good faith and on a reasonable basis. In determining such amount, the
Administrative Agent or any applicable Indemnified Party may use any reasonable
averaging and attributing methods.
(d) If the Transferor is required to pay any additional amount to any
Committed Purchaser pursuant to Sections 2.21 or 2.22, then such Committed
Purchaser shall use reasonable efforts (which shall not require such Committed
Purchaser to incur an unreimbursed loss or unreimbursed cost or expense or
otherwise take any action inconsistent with its internal policies or legal or
regulatory restrictions or suffer any disadvantage or burden reasonably deemed
by it to be significant) (A) to file any certificate or document reasonably
requested in writing by the Transferor or (B) to assign its rights and delegate
and transfer its obligations hereunder to another of its offices, branches or
affiliates, if such filing or assignment would reduce amounts payable pursuant
to Sections 2.21 or 2.22, as the case may be, in the future.
SECTION 2.24. Funding Agents.
(a) The Funding Agent with respect to each CP Conduit Purchaser and
Committed Purchaser is hereby authorized to record on each Business Day the CP
Conduit Funded Amount with respect to such CP Conduit Purchaser and the
aggregate amount of Discount and Fees accruing with respect thereto on such
Business Day and the Committed Purchaser Funded Amount with respect to such
Committed Purchaser and the amount of Discount and Fees accruing with respect
thereto on such Business Day. Any such recordations by a Funding Agent, absent
manifest error, shall constitute prima facie evidence of the accuracy of the
information so recorded. The Funding Agents will report the aggregate amounts
due to the CP Conduit Purchasers and the Committed Purchasers for the prior
calendar month to the Transferor, the Collection Agent and the Administrative
Agent not later than two (2) Business Days prior to the related Settlement Date.
Furthermore, the Funding Agent with respect to each CP Conduit Purchaser and
Committed Purchaser will maintain records sufficient to identify the percentage
interest of such CP Conduit Purchaser and such Committed Purchaser in the
Receivables and any amounts owing thereunder.
(b) Upon receipt of funds from the Administrative Agent on each Settlement
Date pursuant to Sections 2.05 and 2.06, each Funding Agent shall pay such funds
to the related CP Conduit Purchaser and/or the related Committed Purchaser owed
such funds in accordance with the recordations maintained by it in accordance
with Section 2.24(a). If a Funding Agent shall have paid to any CP Conduit
Purchaser or Committed Purchaser any funds that (i) must be returned for any
reason (including bankruptcy) or (ii) exceed that which such CP Conduit
Purchaser or Committed Purchaser was entitled to receive, such amount shall be
promptly repaid to such Funding Agent by such CP Conduit Purchaser or Committed
Purchaser.
SECTION 2.25. Use of Historical Data. Where necessary to calculate any
ratios or other amounts under this Agreement with reference to periods prior to
the Closing Date, historical data shall be used.
SECTION 2.26. Expiration or Extension of Commitments.
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(a) The Transferor may request the extension of any Committed Purchaser's
Commitment Expiry Date for an additional three hundred sixty four (364) days
from time to time by providing the Administrative Agent with a written request
for such extension no fewer than sixty (60) days prior to such Committed
Purchaser's Commitment Expiry Date then in effect. Each CP Conduit Purchaser,
each related Funding Agent and each related Committed Purchaser shall provide
written notice to the Administrative Agent on or prior to the thirtieth (30th)
day (the "Consent Date") before the Committed Purchaser's Commitment Expiry Date
then in effect of its desire to extend (any such Committed Purchaser an
"Extending Committed Purchaser") or not to so extend (any such Committed
Purchaser a "Non-Extending Committed Purchaser") such date.
(b) If Committed Purchasers holding less than 100% of the Aggregate
Commitment consent to such extension, then the Transferor may elect by written
notice to the Administrative Agent and Committed Purchasers to either:
(i) continue the receivables financing facility for such additional
period with an Aggregate Commitment equal to the then effective Aggregate
Commitment less the Commitment of the Non-Extending Committed Purchaser(s);
or
(ii) require any such Non-Extending Committed Purchaser(s) and the
related CP Conduit Purchaser(s) to execute a Transfer Supplement in
accordance with Section 10.06 hereof with respect to all of such
Non-Extending Committed Purchaser(s)' Commitment and their other interest,
rights and obligations under this Agreement to a Purchaser who consents
thereto and shall assume such obligations upon its consent to assume such
obligations; provided that (x) no such assignment shall conflict with any
law, (y) such assignment shall be at the Transferor's cost and expense, and
(z) the purchase price to be paid to such Non-Extending Committed Purchaser
shall be an amount equal to the Net Investment and accrued and unpaid
Discount and Fees attributable to such Non-Extending Committed Purchaser
and/or CP Conduit Purchaser. The Administrative Agent shall provide a
written list of the Extending Committed Purchasers and Non-Extending
Committed Purchasers to the Transferor and Committed Purchasers promptly
(but in no event more than three (3) Business Days) following the Consent
Date. Notwithstanding anything in this Agreement to the contrary, such a
transfer of a Non-Extending Committed Purchaser's interest and the related
CP Conduit Purchaser's interest pursuant to a Transfer Supplement shall be
subject to the consent of the Administrative Agent.
SECTION 2.27. Exchange of Canadian Dollars into United States Dollars.
All amounts transferred from the Canada/Canadian Dollar Collection Account
to the U.S. Dollar Collection Account shall be exchanged by the Collection Agent
or the Administrative Agent into United States dollars, and if by the
Administrative Agent, then only at the written direction of the Collection
Agent. Subject to the penultimate paragraph in this Section 2.27, the Collection
Agent shall solicit offer quotations from at least two Authorized Foreign
Exchange Dealers for effecting such exchange and shall compare such offer
quotations to the Required Currency Hedge and select the execution which will
require the least amount of Canadian Dollars to purchase one (1) U.S. Dollar.
The Collection Agent shall then direct the
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Administrative Agent in writing to effect such exchange with the Authorized
Foreign Exchange Dealer or the Eligible Counterparty as soon thereafter as is
reasonably practicable.
The Collection Agent shall notify the Administrative Agent in writing of
the name and payment instructions of the Authorized Foreign Exchange Dealer or
Eligible Counterparty, and shall direct the Administrative Agent in writing to
execute the trade. The Administrative Agent shall withdraw the portion of the
Canadian Dollars from the Canada/Canadian Dollar Collection Account required to
be paid pursuant to such agreement or agreements and make the payments described
in the payment instructions provided pursuant to the preceding sentence, all in
accordance with the written instructions of the Collection Agent.
The Collection Agent shall maintain written records of any quotations
received in response to any solicitations made pursuant to this Section 2.27 and
shall make the same available to the Administrative Agent promptly upon request.
If, as a result of changes in customary market practice in, or other
changes relating to, the currency exchange markets in Canada, the Collection
Agent is unable to comply with the terms hereof in respect of the purchase of
United States dollars with Canadian Dollars, then the parties hereto will use
all reasonable efforts to agree on the terms of an amendment hereto and to amend
the terms hereof in order to permit such compliance with the terms hereof or to
reflect such customary market practice.
The foregoing shall be the exclusive method by which amounts may be
transferred by the Administrative Agent from the Canada/Canadian Dollar
Collection Account to the U. S. Dollar Collection Account; provided, however, as
an alternate transfer method, the Collection Agent may transfer the required
amount of United States dollars, calculated in accordance with the Canadian
Exchange Percentage, to the U.S. Dollar Collection Account and upon completion
of such transfer, the Administrative Agent shall distribute from the
Canada/Canadian Dollar Collection Account the corresponding amount of Canadian
Dollars to or upon the order of the Collection Agent; and provided further that
the amount of United States dollars transferred is not less than the amount of
United States dollars that would have been transferred using the Valuation
Price.
The Administrative Agent shall in no event whatsoever be responsible for
any loss or damages arising out of or with respect to any currency exchange
pursuant to this Section 2.27 except to the extent provided in Article VIII.
SECTION 2.28. Receivables Situated in the Province of Quebec.
With respect to the Canadian Dollar Receivables, in order to facilitate the
registration in the Register of Personal and Movable Real Rights (Quebec) of the
transfer and assignment of the undivided percentage ownership interests in the
Canadian Dollar Receivables and Related Security, Collections and Proceeds
contemplated by this Agreement, the Transferor hereby sells, assigns, transfers
and conveys to the Administrative Agent on behalf of the CP Conduit Purchasers
and the Committed Purchasers, an undivided percentage ownership interest in the
Canadian Dollar Receivables and related Security, Collections and Proceeds
situated in the Province of Quebec; title to any Transferred Interest shall pass
to the Administrative Agent on
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behalf of the CP Conduit Purchasers and the Committed Purchasers upon each
relevant transfer and each relevant recomputation of the Transferred Interest,
as contemplated in this Agreement.
ARTICLE III
Representations and Warranties
SECTION 3.01. Representations and Warranties of the Transferor. The
Transferor hereby represents and warrants to the Administrative Agent, the
Funding Agents, the CP Conduit Purchasers and the Committed Purchasers that:
(a) Corporate Existence and Power. The Transferor is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware and has all corporate power and all material governmental licenses,
authorizations, consents and approvals required to carry on its business in each
jurisdiction in which its business is now conducted. The Transferor is duly
qualified (or has duly applied for such qualification) to do business in, and is
in good standing in, every other jurisdiction in which the nature of its
business requires it to be so qualified, except where the failure to be so
qualified or in good standing would not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization; Contravention. The execution,
delivery and performance by the Transferor of this Agreement and the other
Transaction Documents to which the Transferor is a party are within the
Transferor's corporate powers, have been duly authorized by all necessary
corporate action, require no action by or in respect of, or filing with, any
Official Body or official thereof (other than as has been taken or filed), and
do not contravene any provision of applicable law, rule or regulation or of the
Articles of Incorporation or Bylaws of the Transferor or constitute a default
under any agreement or any judgment, injunction, order, writ, decree or other
instrument binding upon the Transferor or result in the creation or imposition
of any Adverse Claim on the assets of the Transferor (except as contemplated by
Section 2.09 hereof).
(c) Binding Effect. Each of this Agreement and the other Transaction
Documents to which the Transferor is a party constitutes, and the Transfer
Certificate, upon payment of the Transfer Price set forth therein, will
constitute the legal, valid and binding obligation of the Transferor,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws affecting the rights of creditors generally and general
equitable principles (whether considered in a proceeding at law or in equity).
(d) Perfection. Immediately preceding each Transfer hereunder, the
Transferor shall be the owner of all of the Receivables, free and clear of all
Adverse Claims(other than Permitted Encumbrances). On or prior to each Transfer
and each recomputation of the Transferred Interest, all financing statements and
other documents required to be recorded or filed in order to perfect and protect
the Transferred Interest against all creditors of, and purchasers from, the
Transferor and the Sellers will have been duly filed in each filing office
necessary for such purpose, and all filing fees and taxes, if any, payable in
connection with such filings shall have been paid in full.
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(e) Accuracy of Information. All information heretofore furnished by or on
behalf of the Transferor or the Collection Agent on its behalf (including,
without limitation, the Deposit Reports, the Settlement Statements, any other
reports delivered pursuant to the terms of this Agreement and the Transferor's
financial statements) to any CP Conduit Purchaser, any Committed Purchaser, any
Funding Agent or the Administrative Agent for purposes of, or in connection
with, this Agreement and the other Transaction Documents are, and all such
information hereafter furnished by or on behalf of the Transferor to any CP
Conduit Purchaser, any Committed Purchaser, any Funding Agent or the
Administrative Agent will be, true and accurate in every material respect, on
the date such information is stated or certified.
(f) Tax Status. The Transferor has filed all material tax returns (Federal,
state and local) required to be filed and has paid or made adequate provision
for the payment of all material taxes, assessments and other governmental
charges other than taxes or filings contested in good faith or taxes which are
not yet due and payable, and for which adequate reserves have been established
in accordance with GAAP consistently applied.
(g) Actions, Suits. There are no actions, suits or proceedings pending or,
to the knowledge of the Transferor threatened, against or affecting the
Transferor or its properties, in or before any court, arbitrator or other
Official Body, which could reasonably be expected to, individually or in the
aggregate, have a Material Adverse Effect on the performance by the Transferor
of its obligations under the Agreement or the validity and enforceability of
this Agreement, the Receivables, the Contracts or any other Transaction
Document.
(h) Use of Proceeds. No proceeds of any Transfer will be used by the
Transferor to acquire any security in any transaction which violates Regulation
T, U or X of the Federal Reserve Board.
(i) Jurisdiction of Formation; Place of Business. The Transferor is a
Delaware corporation and is located for purposes of the UCC in the State of
Delaware. The principal place of business and chief executive office of the
Transferor are located at the address of the Transferor indicated in Section
10.03 hereof and always have been located in ▇▇▇▇▇ County, Nevada, and the
offices where the Transferor keeps all its Records, are located at the
address(es) described on Exhibit G or such other locations notified to the
Administrative Agent in accordance with Section 2.09 hereof in jurisdictions
where all action required by Section 2.09 hereof has been taken and completed.
(j) Good Title. Upon each Transfer and each recomputation of the
Transferred Interest, the Administrative Agent, on behalf of the CP Conduit
Purchasers and the Committed Purchasers, shall acquire (A) a valid and perfected
first priority undivided percentage ownership interest to the extent of the
Transferred Interest or (B) a first priority perfected security interest in each
Receivable that exists on the date of such Transfer and recomputation and in the
Related Security, Collections and Proceeds with respect thereto, in either case
free and clear of any Adverse Claim (other than Permitted Encumbrances).
(k) Trade Names, etc. As of the date hereof: (i) the Transferor's chief
executive office is located at the address for notices set forth in Section
10.03 hereof, (ii) the Transferor has no subsidiaries or divisions, and the
Transferor has operated under its own name within the last five (5) years, (iii)
within the last five (5) years, the Transferor has not changed its name, merged
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with or into or consolidated with any other corporation or been the subject of
any proceeding under Title 11, United States Code (Bankruptcy), and (iv) the
exact legal name of the Transferor is Carcorp, Inc.
(l) Nature of Receivables. Each Receivable (x) represented by the
Transferor or the Collection Agent to be an Eligible Receivable (including in
any Settlement Statement or other report delivered pursuant to Section 2.12
hereof) or (y) included in the calculation of the Net Receivables Balance in
fact satisfies at such time the definition of "Eligible Receivable."
(m) Coverage Requirement. The Percentage Factor does not exceed the Maximum
Percentage Factor.
(n) Credit and Collection Policy. Since January 1, 2001, there have been no
material changes in the Credit and Collection Policy, other than as permitted
hereunder. Since such date, no material adverse change has occurred in the
overall rate of collection of the Receivables.
(o) Collections and Servicing. Since September 30, 2001, there has been no
material adverse change in the ability of the Collection Agent, the Sellers, the
Transferor or any Subsidiary or Affiliate of any of the foregoing to service and
collect the Receivables.
(p) No Termination Event. No event has occurred and is continuing and no
condition exists which constitutes a Termination Event or a Potential
Termination Event.
(q) Not an Investment Company. The Transferor is not, and is not controlled
by, an "investment company" within the meaning of the Investment Company Act of
1940, as amended, or is exempt from all provisions of such Act.
(r) ERISA. (i) Each of the Transferor and its ERISA Affiliates is in
compliance in all material respects with ERISA and (ii) no lien exists in favor
of the Pension Benefit Guaranty Corporation on any of the Receivables. No ERISA
Event has occurred with respect to Title IV Plans of the Transferor or its ERISA
Affiliates that have an aggregate Unfunded Pension Liability equal to or greater
than $10,000,000.
(s) Lockbox Accounts. The names and addresses of all the Lockbox Banks,
together with the account numbers of the Lockbox Accounts at such Lockbox Banks,
are specified in Exhibit B hereto (or at such other Lockbox Banks and/or with
such other Lockbox Accounts as have been notified to the Administrative Agent
and the Funding Agents for the CP Conduit Purchasers and the Committed
Purchasers and for which Lockbox Agreements have been executed in accordance
with Section 2.09(b) hereof and delivered to the Collection Agent). All Obligors
have been instructed to make payment to a Lockbox Account, and except to the
limited extent otherwise provided in this Agreement, only Collections are
deposited into a Lockbox Account.
(t) Bulk Sales. No transaction contemplated hereby or by the Receivables
Purchase Agreement requires compliance with any "bulk sales" act or similar law.
(u) Transfers Under Receivables Purchase Agreement. Each Receivable which
has been transferred to the Transferor by any Seller on or after this Closing
Date has been
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purchased by the Transferor from such Seller pursuant to, and in accordance
with, the terms of the Receivables Purchase Agreement.
(v) Preference; Voidability. The Transferor shall have given reasonably
equivalent value to each Seller in consideration for the transfer to the
Transferor of the Receivables and Related Security, Collections and Proceeds
with respect thereto from such Seller, and each such transfer shall not have
been made for or on account of an antecedent debt owed by the Seller to the
Transferor, and no such transfer is or may be voidable under any Section of the
Bankruptcy Reform Act of 1978 (11 U.S.C.ss.ss.101 et seq.), as amended (the
"Bankruptcy Code").
(w) Material Adverse Effect. Between the date of its formation and the
Closing Date, (i) the Transferor has not incurred any obligations, contingent or
non-contingent liabilities, liabilities for charges, long-term leases or unusual
forward or long-term commitments except with respect to receivables financing
and that, alone or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, (ii) no contract, lease or other agreement or
instrument has been entered into by the Transferor or has become binding upon
the Transferor's assets except with respect to receivables financing and no law
or regulation applicable to the Transferor has been adopted, in each case that
has had or could reasonably be expected to have a Material Adverse Effect, and
(iii) the Transferor has not, except with respect to receivables financing,
entered into, and is not in default, and no third party is in default under any
material contract, lease or other agreement or instrument to which the
Transferor is a party that alone or in the aggregate could reasonably be
expected to have a Material Adverse Effect. Between the date of the formation of
the Transferor and the Closing Date, no event has occurred that alone or
together with other events could reasonably be expected to have a Material
Adverse Effect.
(x) Solvency. Both before and after giving effect to (i) the transactions
contemplated by this Agreement and the other Transaction Documents and (ii) the
payment and accrual of all Transaction Costs in connection with the foregoing,
the Transferor is and will be Solvent.
(y) Full Disclosure. No information contained in this Agreement, any of the
other Transaction Documents, the Rating Agency Confidential Information
Memorandum or any registration statement or annual, quarterly, monthly or other
regular report which the Transferor or any of its Affiliates filed with the
Securities and Exchange Commission since January 1, 2001 contains any untrue
statement of a material fact (taken as a whole) nor has the Transferor or its
Affiliates failed to provide to the Administrative Agent, the CP Conduit
Purchasers, the Committed Purchasers or the Funding Agents any material
information necessary to make the information provided by the Transferor or its
Affiliates in such documents or filings (taken as a whole) not misleading in any
material respect in light of the circumstances under and for the purposes for
which such information was provided; provided, however, that this representation
or warranty shall not relate to any projections or forward looking statements in
any such documents provided by the Transferor or its Affiliates.
(z) Separate Corporate Existence. The Transferor has, at all times since
its formation to the date hereof, complied with the covenants set forth in
Section 5.01(n).
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Any document, instrument, certificate or notice delivered to the
Administrative Agent or any Funding Agent by the Transferor or any agent of the
Transferor hereunder shall be deemed a representation and warranty by the
Transferor.
SECTION 3.02. Reaffirmation of Representations and Warranties by the
Transferor. On each day that a Transfer is made hereunder, the Transferor, by
accepting the proceeds of such Transfer, whether delivered to the Transferor
pursuant to Section 2.02(a) or Section 2.05 hereof, shall be deemed to have
certified that all representations and warranties described in Section 3.01
hereof are true and correct on and as of such day as though made on and as of
such day.
ARTICLE IV
Conditions Precedent
SECTION 4.01. Conditions to Effectiveness. This Agreement shall become
effective on the first day on which the Administrative Agent shall have received
the following documents, instruments and Fees, all of which shall be in a form
and substance acceptable to the Administrative Agent:
(a) A Certificate of the Secretary or Assistant Secretary of the Transferor
in substantially the form of Exhibit I hereto certifying (i) the names and
signatures of the officers and employees authorized on its behalf to execute
this Agreement and any other documents to be delivered by it hereunder (on which
Certificate the Administrative Agent, the CP Conduit Purchasers and the
Committed Purchasers may conclusively rely until such time as the Administrative
Agent shall receive from the Transferor a revised Certificate meeting the
requirements of this clause (a)(i)), (ii) a copy of the Transferor's Articles of
Incorporation, certified by the Secretary of State of the State of Delaware,
(iii) a copy of the Transferor's By-Laws, (iv) a copy of resolutions of the
Board of Directors of the Transferor approving this transaction and (v) a
certificate of the Secretary of State of the State of Delaware certifying the
Transferor's good standing under the laws of the State of Delaware.
(b) A Certificate of the Secretary or Assistant Secretary or other
Responsible Officer, as applicable, of each Seller in substantially the form of
Exhibit I hereto certifying (i) the names and signatures of the officers and
employees authorized on its behalf to execute the Receivables Purchase Agreement
and any other documents to be delivered by it (on which Certificate the
Administrative Agent, the CP Conduit Purchasers and the Committed Purchasers may
conclusively rely until such time as the Administrative Agent shall receive from
such Seller a revised Certificate meeting the requirements of this clause
(b)(i)), (ii) a copy of such Seller's articles or certificate of incorporation
or limited liability company certificate of formation, as applicable, certified
by the Secretary of State of the state of such Seller's formation, (iii) a copy
of such Seller's By-Laws or limited liability company agreement, as applicable,
(iv) a copy of resolutions of the Board of Directors of each corporate Seller
approving this transaction and (v) certificates of the Secretary of State of the
state of such Seller's formation, certifying such Seller's good standing under
the laws of such state.
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(c) Acknowledgment copies evidencing the filing in the appropriate filing
offices of proper financing statements (Form UCC-1), naming the Transferor as
the debtor and the Administrative Agent as secured party, and of such other
similar instruments or documents as may be necessary or, in the reasonable
opinion of the Administrative Agent, desirable under the Relevant UCC of all
appropriate jurisdictions or any comparable law to perfect the Administrative
Agent's security interest in all Receivables, Related Security, Collections and
Proceeds with respect thereto.
(d) Acknowledgment copies evidencing the filing in the appropriate filing
offices of proper financing statements (Form UCC-1), naming each Seller as
debtor, the Transferor as secured party, and the Administrative Agent, as
assignee of the secured party, and of such other similar instruments or
documents as may be necessary or, in the reasonable opinion of the
Administrative Agent, desirable under the Relevant UCC of all appropriate
jurisdictions or any comparable law to perfect the Transferor's ownership or
security interest in all Receivables, Related Security, Collections and Proceeds
with respect thereto.
(e) Acknowledgment copies evidencing the filing in the appropriate filing
offices of proper financing statements (Form UCC-3), if any, necessary to
terminate all security interests and other rights of any person in Receivables
and Related Security previously granted by the Transferor.
(f) Acknowledgment copies evidencing the filing in the appropriate filing
offices of proper financing statements (Form UCC-3), if any, necessary to
terminate all security interests and other rights of any person in Receivables
and Related Security previously granted by the Sellers.
(g) Certified copies of request for information or copies (Form UCC-11) (or
a similar search report certified by parties acceptable to the Administrative
Agent), dated a date reasonably near the Closing Date, listing all effective
financing statements which name the Transferor and any Seller (under their
respective present names and any previous names) as debtor and which are filed
in jurisdictions in which the filings were made pursuant to item (c), (d), (e)
or (f) above together with copies of such financing statements (none of which,
except for those filed pursuant to item (c) or (d) or those terminated pursuant
to item (e) or (f), shall cover any Receivables, Related Security or Contracts).
(h) Executed copies of the Lockbox Agreements relating to each of the
Lockbox Banks and the Lockbox Accounts.
(i) An opinion of Stroock & Stroock & ▇▇▇▇▇ LLP, special counsel to the
Transferor and the Sellers (excluding the Canadian Sellers), addressed to the
Administrative Agent, the CP Conduit Purchasers, the Committed Purchasers, the
Funding Agents and the Rating Agencies, regarding substantive consolidation in
the event of a bankruptcy of C&A or any Seller and true sale between each Seller
and the Transferor.
(j) With respect to each Seller and the Transferor, one or more opinions of
special counsel to each such Seller and to the Transferor, addressed in each
case to the Administrative Agent, the CP Conduit Purchasers, the Committed
Purchasers, the Funding Agents and the Rating Agencies, regarding perfection and
priority of the interest granted by the
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Seller to the Transferor and the security interest granted by the Transferor to
the Administrative Agent.
(k) An opinion of Canadian special counsel to each Canadian Seller,
addressed to the Administrative Agent, the CP Conduit Purchasers, the Committed
Purchasers and each Funding Agent, regarding substantive consolidation in the
event of a bankruptcy of a Canadian Seller and true sale between each Canadian
Seller and the Transferor.
(l) An opinion of Stroock & Stroock & ▇▇▇▇▇ LLP, special counsel to the
Transferor and the Seller, addressed to the Administrative Agent, the CP Conduit
Purchasers, the Committed Purchasers, the Funding Agents and the Rating
Agencies, regarding the enforceability of the Transaction Documents to which
each is a party and other corporate matters.
(m) An opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, General Counsel of C&A, addressed to
the Administrative Agent, the CP Conduit Purchasers, the Committed Purchasers
and the Funding Agents in form and substance satisfactory to the Administrative
Agent and its counsel.
(n) An executed copy of this Agreement and each other Transaction Document
to be executed by the Transferor and the Sellers.
(o) A Settlement Statement for November 2001 and a Weekly Report for the
week ending December 7, 2001.
(p) (i) audited financial statements of the Parent and its Subsidiaries
prepared in accordance with GAAP on a consolidated and consolidating basis
(consolidating statements need not be audited by such accountants) for the
twelve month period ended on December 31, 2000, (ii) consolidated and
consolidating unaudited financial statements for the Parent and its Subsidiaries
for the fiscal quarter ended September 30, 2001, and (iii) a pro forma balance
sheet of the Transferor as of September 30, 2001.
(q) All Fees required to be paid on or prior to the Closing Date in
accordance with the Fee Letter shall have been paid.
(r) The Credit Default Swaps shall be in place and the Required Currency
Hedge shall be in place for the Required Hedge Notional Amount.
(s) Such other documents, instruments, certificates and opinions as the
Administrative Agent shall reasonably request.
SECTION 4.02. Conditions to Each Transfer. The right of the Transferor to
sell Transferred Interests pursuant to Section 2.02 and the obligation, if any,
of the CP Conduit Purchasers and the Committed Purchasers to purchase such
Transferred Interests is subject to the conditions that on the applicable
Transfer Date:
(a) No Termination Event or Potential Termination Event shall have occurred
and then be continuing;
(b) The Termination Date shall not have occurred;
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(c) The representations and warranties set forth in Section 3.01 hereof and
Section 4.1 of the Receivables Purchase Agreement shall be true and correct on
and as of such date (except to the extent such representations and warranties
relate solely to an earlier date, and then as of such earlier date);
(d) A Deposit Report shall have been delivered to the Administrative Agent
dated within five (5) Business Days prior to the desired date of such Transfer;
(e) The Credit Default Swaps shall be in place and the Required Currency
Hedge shall be in place for the Required Hedge Notional Amount;
(f) The Administrative Agent and each Funding Agent shall have received
such other approvals, opinions or documents as it may reasonably request; and
(g) After giving effect to the issuance of Commercial Paper by the CP
Conduit Purchasers or the obtaining of funds by the Committed Purchasers to fund
the Transfer Price and the payment to the Transferor of the Transfer Price, the
Net Investment shall not exceed the Facility Limit.
ARTICLE V
Covenants
SECTION 5.01. Affirmative Covenants of the Transferor. At all times from
the date hereof to the later to occur of (i) the Termination Date or (ii) the
date on which the Net Investment has been reduced to zero, all accrued Discount,
Servicing Fees and all other Aggregate Unpaids shall have been paid in full, in
cash, unless the Administrative Agent shall otherwise consent in writing:
(a) Financial Reporting. The Transferor and C&A will, and C&A will cause
each of C&A's Subsidiaries to, maintain, for itself and each of its respective
Subsidiaries, a system of accounting established and administered in accordance
with GAAP, and furnish to the Administrative Agent (and with respect to clause
(vi) below, each Rating Agency):
(i) Annual Reporting. Within ninety-five (95) days after the close of
the Transferor's and C&A's fiscal year, (x) audited financial statements of
the Parent, prepared in accordance with GAAP on a consolidated and
consolidating basis (consolidating statements need not be audited by such
accountants) for the Parent and its Subsidiaries, including balance sheets
as of the end of such period, related statements of operations,
shareholder's equity and cash flows, accompanied by an unqualified audit
report certified by independent certified public accountants, reasonably
acceptable to the Administrative Agent, prepared in accordance with GAAP
and any management letter prepared by such accountants and by a certificate
of such accountants that, in the course of the foregoing, nothing has come
to their attention to cause such accountants to believe that any
Termination Event or Potential Termination Event has occurred, or if, in
the opinion of such accountants, any Termination Event or Potential
Termination Event shall exist, stating the nature and status thereof and
(y) unaudited financial statements for the
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Transferor, including balance sheets as of the end of such period, related
statements of income and shareholder's equity, certified by its senior
financial officer.
(ii) Quarterly Reporting. Within fifty (50) days after the close of
the first three (3) quarterly periods of each of the Transferor's and C&A's
fiscal years, for (x) the Transferor and (y) for the Parent and its
Subsidiaries, in each case, consolidated and consolidating unaudited
balance sheets as at the close of each such period and consolidated and
consolidating related statements of operations, shareholder's equity and
cash flows for the period from the beginning of such fiscal year to the end
of such quarter, together with such other financial or other information as
the Administrative Agent or any Funding Agent may reasonably request, in
each case certified by its respective senior financial officer.
(iii) Compliance Certificate. Together with the financial statements
required hereunder, a compliance certificate signed by the Transferor's or
C&A's, as applicable, chief financial officer stating that (x) the attached
financial statements have been prepared in accordance with GAAP
consistently applied and accurately reflect the financial condition of the
Transferor or the Parent, as applicable, and (y) to the best of such
Person's knowledge, no Termination Event or Potential Termination Event
exists, or if any Termination Event or Potential Termination Event exists,
stating the nature and status thereof.
(iv) Notice of Termination Events or Potential Termination Events. As
soon as possible and in any event within one Business Day after the actual
knowledge of a Responsible Officer of the Transferor of the occurrence of
each Termination Event or each Potential Termination Event, a statement of
the chief financial officer or chief accounting officer of the Transferor
setting forth details of such Termination Event or Potential Termination
Event and the action which the Transferor has taken or proposes to take
with respect thereto.
(v) Change in Credit and Collection Policy. Within ten (10) Business
Days after the date any material change in or amendment to the Credit and
Collection Policy is made, a copy of the Credit and Collection Policy then
in effect indicating such change or amendment.
(vi) Credit and Collection Policy. Within ninety (90) days after the
close of each of C&A's and the Transferor's fiscal years, a complete copy
of the Credit and Collection Policy then in effect if any changes were made
during such preceding fiscal year.
(vii) ERISA. Promptly after the filing or receiving thereof, copies of
all reports and notices with respect to any reportable event (as defined in
Article IV of ERISA) which the Transferor, C&A, any of the Sellers or any
ERISA Affiliate of the Transferor, C&A or any of the Sellers files under
ERISA with the Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or which the Transferor, C&A,
any of the Sellers or any ERISA Affiliates of the Transferor, C&A or the
Sellers receives from the Internal Revenue Service, the Pension Benefit
Guaranty Corporation or the U.S. Department of Labor.
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(viii) Shareholders Statements and Reports. Promptly upon the
furnishing thereof to the shareholders of the Parent, copies of all
financial statements, reports and proxy statements so furnished.
(ix) Other Information. Such other information (including
non-financial information) as the Administrative Agent may from time to
time reasonably request with respect to the Sellers, the Transferor, C&A or
any Subsidiary of any of the foregoing; provided that after a CP Conduit
Purchaser's Termination Event with respect to any CP Conduit Purchaser such
information shall also be provided to the Committed Purchaser with respect
to such CP Conduit Purchaser.
(b) Conduct of Business. The Transferor will carry on and conduct its
business in substantially the same manner and in substantially the same fields
of enterprise as it is presently conducted and do all things necessary to remain
duly incorporated, validly existing and in good standing as a domestic
corporation in its jurisdiction of incorporation and maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted except any jurisdictions where the failure to maintain such authority
could not reasonably be expected to have a Material Adverse Effect.
(c) Compliance with Laws. The Transferor will, and will cause each Seller
and each of the Transferor's and such Seller's Affiliates to, comply with all
laws, rules, regulations, orders, writs, judgments, injunctions, decrees or
awards to which it or its respective properties may be subject, except to the
extent that the failure to so comply with such laws, rules, regulations, writs,
judgments, injunctions, decrees or awards would not materially adversely affect
the ability of the Transferor to perform its obligations under this Agreement.
(d) Furnishing of Information and Inspection of Records. The Transferor and
C&A will, and will cause each Seller to, furnish to the Administrative Agent
from time to time such information with respect to the Receivables as the
Administrative Agent may reasonably request, including, without limitation,
listings identifying the Obligor and the Outstanding Balance for each
Receivable, together with an aging of Receivables. The Transferor and C&A will,
and will cause each Seller to, at any time and from time to time during regular
business hours and upon reasonable notice and permit the Administrative Agent
(or the Committed Purchasers after a CP Conduit Purchaser's Termination Event
with respect to the CP Conduit Purchasers), or their agents or representatives,
(i) to examine and make copies of and abstracts from all Records and (ii) to
visit the offices and properties of the Transferor, C&A and the Sellers for the
purpose of examining such Records, and to discuss matters relating to
Receivables or the Transferor's, C&A's and the Sellers' performance hereunder
and under the other Transaction Documents to which such Person is a party with
any of the officers or employees of the Transferor, C&A and the Sellers having
knowledge of such matters.
(e) Keeping of Records and Books of Account. The Transferor and C&A will,
and will cause each Seller to, maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing Receivables 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
Receivables (including, without limitation, records adequate to permit the daily
identification of each new Receivable and all Collections of and adjustments to
each existing Receivable). The Transferor
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and C&A will, and will cause each Seller to, give the Administrative Agent, each
of the Funding Agents and each of the Committed Purchasers, prompt notice of any
change in the administrative and operating procedures of the Transferor, C&A or
such Seller, as applicable, referred to in the previous sentence to the extent
such change may have a Material Adverse Effect.
(f) Performance and Compliance with Contracts. The Transferor, at its
expense, will cause each Seller to timely and fully perform and comply with all
material provisions, covenants and other promises required to be observed by the
Transferor or such Seller under the Contracts related to the Receivables.
(g) Credit and Collection Policies. The Transferor will, and will cause
each Seller to, comply in all material respects with the Credit and Collection
Policy in regard to each Receivable and the related Contract.
(h) Collections. The Transferor shall, and shall cause each Seller to,
instruct all Obligors to cause all Collections to be deposited directly to a
Lockbox Account.
(i) Collections Received. The Transferor shall, and shall cause each Seller
to, hold in trust, and deposit immediately (but in any event no later than one
(1) Business Day following receipt thereof) to a Lockbox Account all Collections
received from time to time by the Transferor or any Sellers, as the case may be.
(j) Sale Treatment. The Transferor (i) will not, and will not permit any
Seller to, account for (including for accounting purposes), or otherwise treat,
the transactions contemplated by the Receivables Purchase Agreement in any
manner other than as a sale of Receivables by the Sellers to the Transferor, or
(ii) will not account for (other than for tax purposes) or otherwise treat the
transactions contemplated hereby in any manner other than as a sale of
Receivables by the Transferor to the CP Conduit Purchasers or the Committed
Purchasers, as applicable. In addition, the Transferor shall, and shall cause
each Seller to, disclose (in a footnote or otherwise) in all of its financial
statements (including any such financial statements consolidated with any other
Persons' financial statements) the existence and nature of the transaction
contemplated hereby and by the Receivables Purchase Agreement, as applicable,
and the interest of the Transferor (in the case of each Seller's financial
statements), the CP Conduit Purchasers and the Committed Purchasers (in the case
of the Transferor's financial statements) in the Receivables and Related
Security (other than the Required Currency Hedge in the case of the Sellers'
financial statements), the Required Currency Hedge (in the case of the
Transferor's financial statements), Collections and Proceeds with respect
thereto.
(k) Separate Business. The Transferor shall not engage in any business not
permitted by its Articles of Incorporation as in effect on the Closing Date.
(l) Corporate Documents. The Transferor shall only amend, alter, change or
repeal its Articles of Incorporation or the By-laws with the prior written
consent of the Administrative Agent which shall not be unreasonably withheld.
(m) Net Worth. The Transferor on the Closing Date shall have a net worth,
and shall thereafter maintain at all times a net worth (as defined in accordance
with GAAP), of at least $60,000,000.
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(n) Separate Corporate Existence. The Transferor shall:
(i) Maintain its own deposit account or accounts, separate from those
of any Affiliate, with commercial banking institutions and use its
commercially reasonable efforts to ensure that the funds of the Transferor
will not be diverted to any other Person or for other than corporate uses
of the Transferor and that, except as contemplated by Section 5.02(e), such
funds will not be commingled with the funds of any Seller or any Subsidiary
or Affiliate of the Sellers;
(ii) To the extent that it shares the same officers or other employees
as any of its stockholders or Affiliates, fairly allocate among such
entities the salaries of and the expenses related to providing benefits to
such officers and other employees, and each such entity shall bear its fair
share of the salary and benefit costs associated with all such common
officers and employees;
(iii) To the extent that it jointly contracts with any of its
stockholders or Affiliates to do business with vendors or service providers
or to share overhead expenses, fairly allocate among such entities the
costs incurred in so doing, and each such entity shall bear its fair share
of such costs. To the extent that the Transferor contracts or does business
with vendors or service providers where the goods and services provided are
partially for the benefit of any other Person, the costs incurred in so
doing shall be fairly allocated to or among such entities for whose benefit
the goods or services are provided, and each such entity shall bear its
fair share of such costs;
(iv) Enter into all material transactions between the Transferor and
any of its Affiliates, whether currently existing or hereafter entered
into, only on an arm's length basis, it being understood and agreed that
the transactions contemplated in the Transaction Documents meet the
requirements of this clause (iv);
(v) Maintain office space separate from the office space of the
Sellers and any Affiliates of the Sellers. To the extent that the
Transferor and any of its stockholders or Affiliates have offices in the
same location, there shall be a fair and appropriate allocation of overhead
costs among them, and each such entity shall bear its fair share of such
expenses;
(vi) Issue separate unaudited financial statements prepared not less
frequently than quarterly and prepared in accordance with GAAP consistently
applied;
(vii) Conduct its affairs strictly in accordance with its Articles of
Incorporation and observe all necessary, appropriate and customary
corporate formalities, including, but not limited to, holding all regular
and special stockholders' and directors' meetings appropriate to authorize
all corporate action, keeping separate and accurate minutes of its
meetings, passing all resolutions or consents necessary to authorize
actions taken or to be taken, and maintaining accurate and separate books,
records and accounts, including, but not limited to, payroll and
intercompany transaction accounts;
(viii) Not assume or guarantee any of the liabilities of, or make any
loans to, the Sellers or any Affiliate thereof; provided, that for a period
of not more than three (3)
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months after the Closing Date, the Transferor may have outstanding
short-term loans to C & A;
(ix) Take, or refrain from taking, as the case may be, all other
actions that are necessary to be taken or not to be taken in order to (x)
ensure that the assumptions and factual recitations set forth in the
Specified Bankruptcy Opinion Provisions remain true and correct with
respect to the Transferor and (y) comply with those procedures described in
such provisions which are applicable to the Transferor;
(x) Take such actions as are necessary to ensure that not less than
one member of Transferor's Board of Directors shall be an individual who is
not, and never has been, a direct, indirect or beneficial stockholder,
officer, director, employee, affiliate, associate, material supplier or
material customer of the Collection Agent or any of its Affiliates (an
"Independent Director"). The Articles of Incorporation of the Transferor
shall provide that (i) at least one member of the Transferor's Board of
Directors shall be an Independent Director, (ii) the Transferor's Board of
Directors shall not approve, or take any other action to cause the filing
of, a voluntary bankruptcy petition with respect to the Transferor unless a
unanimous vote of the Transferor's Board of Directors (which vote shall
include the affirmative vote of each Independent Director) shall approve
the taking of such action in writing prior to the taking of such action and
(iii) the provisions requiring an independent director and the provision
described in clauses (i) and (ii) of this clause (x) cannot be amended
without the prior written consent of each Independent Director;
(xi) Take such actions as are necessary to ensure that no Independent
Director shall at any time serve as a trustee in bankruptcy for the
Transferor or any Affiliate thereof;
(xii) Take such actions as are necessary to ensure that the books of
account, financial reports and corporate records of the Transferor will be
maintained separately from those of C&A and each other Affiliate of the
Transferor;
(xiii) Take such actions as are necessary to ensure that any financial
statements of C&A or any Affiliate thereof which are consolidated to
include the Transferor will contain detailed notes clearly stating that (A)
all of the Transferor's assets are owned by the Transferor, and (B) the
Transferor is a separate corporate entity with its own separate creditors
that will be entitled to be satisfied out of the Transferor's assets prior
to any value in the Transferor becoming available to the Transferor's
equity holders; and the accounting records and the published financial
statements of the Sellers will clearly show that, for accounting purposes,
the Receivables and Related Security have been sold to the Transferor;
(xiv) Take such actions as are necessary to ensure that the
Transferor's assets will be maintained in a manner that facilitates their
identification and segregation from those of C&A, the Sellers and other
Affiliates of C & A;
(xv) Take such actions as are necessary to ensure that no Affiliates
of the Transferor shall, directly or indirectly, name the Transferor or
enter into any agreement to
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name the Transferor a direct or contingent beneficiary or loss payee or any
insurance policy covering the property of any such Affiliate; and
(xvi) Take such actions as are necessary to ensure that no Affiliate
of the Transferor will be, nor will hold itself out to be, responsible for
the debts of the Transferor or the decisions or actions in respect of the
daily business and affairs of the Transferor. The Transferor will
immediately correct any known misrepresentation with respect to the
foregoing, and the Transferor and its Affiliates will not operate or
purport to operate as an integrated single economic unit with respect to
each other or in their dealing with any other entity.
(o) Enforcement of Receivables Purchase Agreement. The Transferor shall use
its best efforts to enforce all rights held by it under the Receivables Purchase
Agreement and shall not waive any breach of any covenant contained in Section
5.1 thereunder without the written consent of the Administrative Agent.
(p) Required Currency ▇▇▇▇▇▇. (i) On the Closing Date and on each Transfer
Date thereafter, the Transferor shall have the Required Currency Hedge in place
for the Required Hedge Notional Amount. The Transferor agrees that at any time
that it enters into any Required Currency Hedge, it shall have funds available
to make payment of fees or other amounts due in connection with the purchase of
such Required Currency Hedge at the time that such payments are due and payable
thereunder. The Transferor agrees that it will enter into any Required Currency
Hedge only on a Weekly Settlement Date or on the Closing Date.
(i) The Transferor agrees that at any time that it enters into any Required
Currency Hedge, it shall execute and deliver to the Administrative Agent, for
the benefit of the CP Conduit Purchasers, the Committed Purchasers and the
Funding Agents, an assignment of all amounts payable to the Transferor under
such Required Currency Hedge substantially in the form of Exhibit L (each, a
"Required Currency Hedge Assignment").
(q) Credit Default Swaps. The Transferor agrees that at any time that it
enters into any Credit Default Swap, it shall execute and deliver to the
Administrative Agent, for the benefit of the CP Conduit Purchasers, the
Committed Purchasers and Funding Agents, an assignment of all amounts payable to
the Transferor under such Credit Default Swap.
(r) Counterparties. If at any time the commercial paper or short term
deposit ratings from any Rating Agency assigned to a Counterparty is such that
the Counterparty is no longer an Eligible Counterparty, the Transferor shall (x)
require such Counterparty to secure its obligations under such Required Currency
Hedge or Credit Default Swap or (y) replace the Counterparty with an Eligible
Counterparty within the earlier of (A) 30 days or (B) within 5 days in the event
that such Counterparty's commercial paper rating or short-term deposit rating is
withdrawn or downgraded below A-2 or P-2.
(s) Further Assurances. C&A at the joint and several expense of C&A and the
other Sellers, shall, upon the request of the Administrative Agent (in
consultation with each Funding Agent), from time to time, execute, acknowledge
and deliver, or cause to be executed, acknowledged or delivered, within a
reasonable time period of such request, such amendments or
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supplements to this Agreement and the Receivables Purchase Agreement and, on and
prior to the Closing Date, such further instruments and take such further action
as may be reasonably necessary (as determined by the Funding Agents in
consultation with C&A), to obtain the confirmation of the current ratings
assigned to the Commercial Paper (on an unwrapped basis), to the extent such
ratings are attributable to the transactions contemplated hereby and the other
Transaction Documents. In furtherance of the foregoing and thereafter from time
to time as may be necessary, C&A shall (i) cooperate with each of S&P and/or
▇▇▇▇▇'▇ in connection with any review of the Transaction Documents which may be
undertaken by S&P and/or ▇▇▇▇▇'▇ prior to the Closing Date and (ii) provide each
of S&P and ▇▇▇▇▇'▇ with such information or access to such information as they
may reasonably request in connection with any future review of the ratings
referred to above.
SECTION 5.02. Negative Covenants of the Transferor. During the term of this
Agreement, unless the Administrative Agent shall otherwise consent in writing:
(a) No Sales, Liens, etc. Except as otherwise provided herein and in the
Receivables Purchase Agreement, the Transferor will not sell, assign (by
operation of law or otherwise) or otherwise dispose of, or create or suffer to
exist any Adverse Claim (other than Permitted Encumbrances) upon or with respect
to (or the filing of any financing statement in respect of) (x) any of the
Receivables, Related Security Collections or Proceeds thereof, or (y) any
Lockbox Account or any amounts on deposit therein.
(b) No Extension or Amendment of Receivables. The Transferor will not, and
will not permit any Seller to, extend, amend, discharge or otherwise modify the
terms of any Receivable, or amend, modify or waive any term or condition of any
Contract related thereto, except as contemplated by the Credit and Collection
Policy, without the prior written consent of each Funding Agent (which consent
shall be obtained by the Administrative Agent), and in each case in accordance
with the Transaction Documents.
(c) No Change in Business or Credit and Collection Policy. The Transferor
will not, and will not permit any Seller to, make any change in the character of
its business or in the Credit and Collection Policy, which change would have a
Material Adverse Effect.
(d) No Mergers, etc. The Transferor will not without the prior written
consent of the Administrative Agent, and except as otherwise permitted pursuant
to the Receivables Purchase Agreement, will not permit any Seller to, (i)
consolidate or merge with or into any other Person, or (ii) sell, lease or
transfer all or substantially all of its assets to any other Person, provided,
that a Seller may merge with or into another Seller or with another Person if
(A)(1) such Seller is the corporation surviving such consolidation or merger or
(2) the Person into or with whom the Seller is merged or consolidated is an
Affiliate and the surviving corporation assumes in writing all duties and
liabilities of the Seller under the Transaction Documents, and (B) immediately
after and giving effect to such consolidation or merger, no Termination Event or
Potential Termination Event shall have occurred and be continuing.
(e) Change in Payment Instructions to Obligors; Deposits to Lockbox
Accounts. The Transferor will not, and will not permit any Seller to, add or
terminate any bank as a Lockbox Bank or any account as a Lockbox Account to or
from those listed in Exhibit B hereto or make any change in its instructions to
Obligors regarding payments to be made to any
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Lockbox Account, unless (i) such instructions are to deposit such payments to
another existing Lockbox Account or (ii) the Administrative Agent shall have
received written notice of such addition, termination or change at least thirty
(30) days prior thereto and the Administrative Agent shall have received a
Lockbox Agreement executed by each new Lockbox Bank or an existing Lockbox Bank
with respect to each new Lockbox Account, as applicable. The Transferor will not
deposit or otherwise credit, or cause to be deposited or credited (and will use
reasonable commercial efforts to not permit to be so deposited or credited), to
any Lockbox Account cash or cash proceeds other than Collections of Receivables.
Subject to Section 6.05(g), in the event any Seller deposits or otherwise
credits, or cause or permits to be so deposited or credited, to any Lockbox
Account, cash or cash proceeds other than Collections of Receivables, the
Transferor shall, or shall cause such Seller to, segregate or cause to be
segregated any such cash or cash proceeds from Collections within two (2)
Business Days following the deposit or credit to any Lockbox Account.
(f) Change of Name, etc. The Transferor will not, and will not permit a
Seller to, change its name, the state of its formation, its structure or the
location of its chief executive office, unless at least ten (10) days prior to
the effective date of any such change the Transferor delivers to the
Administrative Agent (i) such documents, instruments or agreements, executed by
the Transferor or the related Seller, as applicable, as are necessary to reflect
such change and to continue the perfection of the Administrative Agent's
ownership interests or security interests in the Receivables and Related
Security, Collections and Proceeds with respect thereto and (ii) new or revised
Lockbox Agreements executed by the Lockbox Banks which reflect such change and
enable the Administrative Agent to continue to exercise its rights contained in
Section 2.09 hereof.
(g) Amendment to Receivables Purchase Agreement. The Transferor will not,
and will not permit any of the Sellers to, amend, modify, or supplement the
Receivables Purchase Agreement, except with the prior written consent of the
Administrative Agent; nor shall the Transferor take, or permit any of the
Sellers to take, any other action under the Receivables Purchase Agreement that
shall have a material adverse affect on the Administrative Agent, any CP Conduit
Purchaser or any Committed Purchaser or which is inconsistent with the terms of
this Agreement.
(h) Other Debt. Except as provided for herein or in the Receivables
Purchase Agreement, the Transferor will not create, incur, assume or suffer to
exist any indebtedness whether current or funded, or any other liability other
than (i) indebtedness of the Transferor representing fees, expenses and
indemnities arising hereunder or under the Receivables Purchase Agreement or for
the purchase price (including the Seller Note) of the Receivables under the
Receivables Purchase Agreement; (ii) other indebtedness incurred in the ordinary
course of its business to the extent permitted by or required under any other
Transaction Document and (iii) additional indebtedness in an amount not to
exceed $9,500 at any time outstanding.
(i) ERISA Matters. The Transferor will not, and will not permit any Seller
to, (i) engage or permit any of its ERISA Affiliates to engage in any prohibited
transaction (as defined in Section 4975 of the Code and Section 406 of ERISA)
for which an exemption is not available or has not previously been obtained from
the U.S. Department of Labor; (ii) permit to exist any "accumulated funding
deficiency" (as defined in Section 302(a) of ERISA and Section 412(a) of the
Code) with respect to any Benefit Plan; (iii) fail to make any payments to any
Multiemployer
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Plan that the Transferor or any ERISA Affiliate of the Transferor is required to
make under the agreement relating to such Multiemployer Plan or any law
pertaining thereto; (iv) terminate any Benefit Plan so as to result in any
liability; or (v) permit to exist any occurrence of any reportable event
described in Title IV of ERISA which represents a material risk of a liability
to the Transferor or any ERISA Affiliate of the Transferor under ERISA or the
Code, if such prohibited transactions, accumulated funding deficiencies, failure
to make payments, terminations and reportable events occurring within any fiscal
year of the Transferor in the aggregate, involve a payment of money or an
incurrence of liability by the Transferor or any ERISA Affiliate of the
Transferor in an amount which would be expected to have a Material Adverse
Effect.
(j) Payment to the Sellers. With respect to any Receivable sold by the
Sellers to the Transferor, the Transferor shall, and shall cause the Sellers to,
effect such sale under, and pursuant to the terms of, the Receivables Purchase
Agreement, including, without limitation, the payment by the Transferor either
in cash or by increase in the amount of the Seller Note of an amount equal to
the purchase price for such Receivable as required by the terms of the
Receivables Purchase Agreement.
ARTICLE VI
Administration and Collections
SECTION 6.01. Appointment of Collection Agent. The servicing, administering
and collection of the Receivables shall be conducted by such Person (the
"Collection Agent") so designated from time to time in accordance with this
Section 6.01. Until the Administrative Agent (at the direction of the Funding
Agents) gives notice to C&A of the designation of a new Collection Agent
pursuant to this Section 6.01, C&A is hereby designated as, and hereby agrees to
perform the duties and obligations of, the Collection Agent pursuant to the
terms hereof. The Collection Agent may not delegate any of its rights, duties or
obligations hereunder, or designate a substitute Collection Agent, without the
prior written consent of the Administrative Agent; provided that C&A shall be
permitted to delegate its duties and obligations as Collection Agent hereunder
to the Sellers or any of C&A's Affiliates, but such delegation shall not relieve
C&A of its duties and obligations as Collection Agent hereunder. The
Administrative Agent may, and upon the direction of the Required Committed
Purchasers the Administrative Agent shall, but only after the occurrence of a
Collection Agent Default or any other Termination Event, designate as Collection
Agent any Person (including itself) to succeed C&A or any successor Collection
Agent, on the condition in each case that any such Person so designated shall
agree to perform the duties and obligations of the Collection Agent pursuant to
the terms hereof. Following a Collection Agent Default or a Termination Event,
the Administrative Agent may notify any Obligor of the designation of a
successor Collection Agent.
SECTION 6.02. Duties of Collection Agent.
(a) The Collection Agent shall take or cause to be taken all such action as
may be necessary or advisable to collect each Receivable from time to time, all
in accordance with applicable laws, rules and regulations, with reasonable care
and diligence, and in accordance with the Credit and Collection Policy. Each of
the Transferor, the CP Conduit Purchasers, the Committed Purchasers, the Funding
Agents and the Administrative Agent, hereby appoints as its
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agent the Collection Agent, from time to time designated pursuant to Section
6.01 hereof, to enforce its respective rights and interests in and under the
Receivables and Related Security, Collections and Proceeds with respect thereto.
To the extent permitted by applicable law, the Transferor hereby grants to any
Collection Agent appointed hereunder an irrevocable power of attorney to take in
the Transferor's name and on behalf of the Transferor any and all steps
necessary or desirable, in the reasonable determination of the Collection Agent,
to collect all amounts due under any and all Receivables, including, without
limitation, endorsing the Transferor's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Contracts. The Collection Agent shall set aside for the account of the
Transferor, on the one hand, and for the account of the CP Conduit Purchasers
and the Committed Purchasers, on the other hand, their respective aggregate
Collections of Receivables in accordance with Sections 2.05 and 2.06 hereof. The
Collection Agent shall segregate and deposit to the Administrative Agent's
account the aggregate Collections of Receivables allocable to the CP Conduit
Purchasers and the Committed Purchasers when required pursuant to Article II
hereof. The Transferor shall deliver to the Collection Agent and the Collection
Agent shall hold in trust for the Transferor, the CP Conduit Purchasers, the
Committed Purchasers, the Funding Agents and the Administrative Agent, in
accordance with their respective interests, all Records which evidence or relate
to Receivables, Related Security or Collections. Notwithstanding anything to the
contrary contained herein, the Administrative Agent shall have the absolute and
unlimited right, during the continuance of a Potential Termination Event and
after the occurrence of a Termination Event, if the Collection Agent is C&A, to
direct the Collection Agent to commence or settle any legal action to enforce
collection of any Receivable or to foreclose upon or repossess any Related
Security. The Collection Agent shall not make the Administrative Agent, any of
the CP Conduit Purchasers, any of the Funding Agents or any of the Committed
Purchasers a party to any litigation without the prior written consent of such
Person.
(b) If the Collection Agent is not the Transferor, C&A, any Seller or an
Affiliate of the Transferor or the Sellers, the Collection Agent, by giving
three (3) Business Days' prior written notice to the Administrative Agent, may
revise the Servicing Fee; provided that such revised Servicing Fee shall be a
reasonable fee agreed upon by the Collection Agent and the Administrative Agent
reflecting rates and terms prevailing at such time as would be negotiated on an
arm's-length basis. The Collection Agent, if other than the Transferor, C&A, any
Seller or an Affiliate of the Transferor or the Sellers, shall as soon as
practicable upon demand, deliver to the applicable Seller all Records in its
possession which evidence or relate to indebtedness of an Obligor which is not a
Receivable.
(c) On or before ninety (90) days after March 31 of each year, beginning
with March 31, 2002, and with respect to the four calendar quarters ended on the
applicable March 31 (the "Applicable Period"), the Collection Agent shall cause
a firm of nationally recognized independent public accountants reasonably
acceptable to the Administrative Agent (who may also render other services to
the Collection Agent, the Transferor, the Sellers or any Affiliates of any of
the foregoing), at the expense of the Transferor, to furnish a report to the
Administrative Agent and the Transferor to the effect that they have:
(i) randomly selected at least one Settlement Statement for each
quarter delivered during the Applicable Period then ended and verified that
the amounts presented on such Settlement Statement relating to sales, total
dilution, net sales,
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collections, net write-offs, concentrations and aging of Receivables agreed
with the information provided to the Collection Agent by each Seller;
(ii) verified that the amounts presented on each Seller's reports to
the Collection Agent for the periods selected in (i) above relating to
sales, total dilution, net sales, collections, promotional allowances, net
write-offs, concentrations and aging of Receivables agreed with the
information contained within such Seller's underlying accounting records
for such Settlement Period;
(iii) randomly selected at least one Deposit Report for each quarter
delivered during the Applicable Period then ended and verified that the
amounts presented on such Deposit Report relating to sales, collections,
concentrations and aging of Receivables agreed with the information
provided to the Collection Agent by each Seller;
(iv) verified that the amounts presented on each Seller's reports to
the Collection Agent for the periods selected in clause (iii) above
relating to sales, collections, concentrations and aging of Receivables
agreed with the information contained within such Seller's underlying
accounting records for such period;
(v) recalculated the Net Receivables Balance as of the end of at least
one Settlement Period and one Deposit Report for each quarter during the
Applicable Period and agreed each such amount to the respective Settlement
Statement or Deposit Report;
(vi) randomly selected a sample of at least 100 Receivables in the
aggregate for all Sellers to perform the verifications referred to in
clauses (ii), (iii) and (iv) above;
(vii) randomly selected a sample of at least 100 Receivables in the
aggregate for all Sellers (which may be the same receivables selected in
clause (vi) above and verified that such Receivables that are treated by
the Collection Agent as Eligible Receivables in fact satisfied the
requirements of clauses (iii), (iv) and (viii) of the definition of such
term;
(viii) randomly selected at least one Settlement Statement for each
quarter during the Applicable Period and conducted a "negative
confirmation" or other alternative procedures of a sample of at least 100
Receivables in the aggregate for all Sellers (which may be the same
Receivables selected in clause (vi) above) and verified that each Seller's
records and computer system used in servicing the Receivables contained
correct information with regard to outstanding balances;
(ix) randomly selected at least one Settlement Statement for each
quarter during the Applicable Period and selected a sample of at least 100
Receivables in the aggregate for all Sellers (which may be the same
Receivables selected in clause (vi) above) and verified that such
Receivables were included in the proper aging category on such Settlement
Statement based on the dates listed on the original invoices for such
Receivables; and
(x) such other reasonable procedures identified by the Funding Agents
and for which notice of such additional procedures shall have been given to
the Collection Agent no later than 30 days after the end of such fiscal
year.
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except, in each case for (a) such exceptions as such firm shall believe to be
immaterial (which exceptions need not be enumerated) and (b) such other
exceptions as shall be set forth in such statement.
(d) Notwithstanding anything to the contrary contained in this Article VI,
the Collection Agent, if not the Transferor, C&A, any Seller or any Affiliate of
the Transferor or the Sellers, shall have no obligation to collect, enforce or
take any other action described in this Article VI with respect to any
indebtedness that is not included in the Transferred Interest other than to
deliver to the Transferor the collections and documents with respect to any such
indebtedness as described in Section 6.02(b) hereof.
SECTION 6.03. Rights After Designation of New Collection Agent. At any time
following the designation of a Collection Agent other than C&A, any Seller or
the Transferor pursuant to the penultimate sentence of Section 6.01 hereof:
(i) The Administrative Agent may, at its option, or shall, at the
direction of the Required Committed Purchasers, direct that payment of all
amounts payable under any Receivable be made directly to the Administrative
Agent or its designee for the benefit of the CP Conduit Purchasers and the
Committed Purchasers.
(ii) The Transferor shall, at the Administrative Agent's request and
at the Transferor's expense, give notice of the CP Conduit Purchasers', the
Transferor's and/or the Committed Purchasers' ownership of Receivables to
each Obligor and direct that payments be made directly to the
Administrative Agent or its designee.
(iii) The Transferor shall, at the Administrative Agent's request, (A)
assemble all of the Records, and shall make the same available to the
Administrative Agent or its designee at a place selected by the
Administrative Agent or its designee, and (B) segregate all cash, checks
and other instruments received by it from time to time constituting
Collections of Receivables in a manner acceptable to the Administrative
Agent and shall, promptly upon receipt, remit all such cash, checks and
instruments, duly endorsed or with duly executed instruments of transfer,
to the Administrative Agent or its designee.
(iv) The Transferor hereby authorizes the Administrative Agent to take
any and all steps in the Transferor's name and on behalf of the Transferor
necessary or desirable, in the determination of the Administrative Agent,
to collect all amounts due under any and all Receivables, including,
without limitation, endorsing the Transferor's name on checks and other
instruments representing Collections and enforcing such Receivables and the
related Contracts.
SECTION 6.04. Representations and Warranties of the Collection Agent. The
Collection Agent represents and warrants (solely as to itself) to the
Administrative Agent, each CP Conduit Purchaser, each Committed Purchaser and
each Funding Agent as of the date it becomes a Collection Agent hereunder that:
(a) Corporate Existence and Power. The Collection Agent is a corporation
duly organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation and has all corporate power and all
material governmental licenses, authorizations,
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consents and approvals required to carry on its business in each jurisdiction in
which its business is now conducted, except where the failure to obtain such
licenses, authorizations, consents and approvals would not have a Material
Adverse Effect. The Collection Agent is duly qualified to do business in, and is
in good standing in, every other jurisdiction in which the nature of its
business requires it to be so qualified, except where the failure to be so
qualified or in good standing would not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization, Contravention. The execution,
delivery and performance by the Collection Agent of this Agreement (i) are
within the Collection Agent's corporate powers, (ii) have been duly authorized
by all necessary corporate action on the Collection Agent's part, (iii) require
no action by or in respect of, or filing with, any Official Body or official
thereof (except for the filing of UCC financing statements as required by this
Agreement or as have been taken or filed and, with respect to filings other than
UCC financing statements, filings where the failure to file will not have a
Material Adverse Effect), (iv) do not contravene, or constitute a default under,
any provision of applicable Law or of the organizational documents of the
Collection Agent or of any agreement or other material instrument binding upon
the Collection Agent, except where such contravention or default would not have
a Material Adverse Effect, and (v) do not result in the creation or imposition
of any Adverse Claim (other than Permitted Encumbrances) on the assets of the
Collection Agent or any of its Affiliates.
(c) Binding Effect. This Agreement constitutes the legal, valid and binding
obligations of the Collection Agent, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, moratorium or other similar laws
affecting the rights of creditors generally and general equitable principles
(whether considered in a proceeding at law or in equity).
(d) Actions, Suits. There are not any actions, suits or proceedings at law
or in equity or by or before any court or Official Body now pending or, to the
knowledge of the Collection Agent, threatened against or affecting the
Collection Agent or any of its Subsidiaries or any property or rights of the
Collection Agent or any of its Subsidiaries as to which there is a reasonable
possibility of an adverse determination and which (i) if adversely determined,
could individually or in the aggregate result in a Material Adverse Effect or
(ii) involve the Transaction Documents or (iii) if adversely determined could
materially adversely affect the transactions contemplated by the Transaction
Documents.
(e) Eligible Receivables. Each Receivable (x) represented by the Collection
Agent to be an Eligible Receivable (including in any Settlement Statement or
other report delivered pursuant to Section 2.12 hereof) or (y) included in the
calculation of the Net Receivables Balance in fact satisfies at such time the
definition of "Eligible Receivable."
SECTION 6.05. Covenants of the Collection Agent. At all times from the date
hereof to the date on which the Aggregate Unpaids shall be equal to zero, unless
the Administrative Agent shall otherwise consent in writing:
(a) Credit and Collection Policy. The Collection Agent will comply in all
material respects with the Credit and Collection Policy in regard to each
Receivable and the related Contract.
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(b) Collections Received. The Collection Agent shall hold in trust, and
deposit as soon as reasonably practicable (but in any event no later than one
Business Day following its receipt thereof) to a Lockbox Account all Collections
received from time to time by the Collection Agent.
(c) Notice of Termination Events, Potential Termination Events or
Collection Agent Defaults. Immediately, and in any event within one (1) Business
Day after the Collection Agent obtains knowledge of the occurrence of each
Termination Event, Potential Termination Event or Collection Agent Default, the
Collection Agent will furnish to the Administrative Agent and each Funding Agent
a statement of a Responsible Officer of the Collection Agent setting forth
details of such Termination Event, Potential Termination Event or Collection
Agent Default, and the action which the Collection Agent, the Transferor or a
Seller proposes to take with respect thereto.
(d) Conduct of Business. The Collection Agent will do all things necessary
to remain duly incorporated, validly existing and in good standing as a domestic
corporation in its jurisdiction of incorporation and maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted to the extent that the failure to maintain such would have a Material
Adverse Effect.
(e) Compliance with Laws. The Collection Agent will comply in all respects
with all Laws with respect to the Receivables to the extent that any
non-compliance would have a Material Adverse Effect.
(f) Further Information. The Collection Agent shall furnish or cause to be
furnished to the Administrative Agent and, after a Termination Event or a
Potential Termination Event, any Funding Agent such other information relating
to the Receivables and readily available public information regarding the
financial condition of the Collection Agent, as soon as reasonably practicable,
and in such form and detail, as the Administrative Agent may reasonably request
and, after a Termination Event or a Potential Termination Event, as any Funding
Agent may reasonably request.
(g) ▇▇▇▇▇▇▇ Controls, Inc. Collections. The Collection Agent will prepare a
daily report which set forth (i) the Collections received by the Collection
Agent or a Seller from, or that are deposited into a Lockbox Account by,
DaimlerChrysler which are to be paid and are owed to ▇▇▇▇▇▇▇ Controls, Inc. (the
"JCI Collections") and (ii) the payment instructions indicating where such JCI
Collections are to be forwarded by the Administrative Agent on behalf of ▇▇▇▇▇▇▇
Controls Inc. Such daily report shall be delivered by the Collection Agent to
the Administrative Agent prior to 3:00 p.m. (New York time) on each day on which
JCI Collections are received by the Collection Agent or a Seller or are
deposited into a Lockbox Account. In addition, (i) the Collection Agent shall
transfer all JCI Collections deposited in the Lockbox Accounts to account
#507-839463 at JPMorgan Chase (the "JCI Collection Account") as soon as
reasonably practicable (but in any event no later than one Business Day
following its receipt thereof) and (ii) the Administrative Agent shall transfer
all JCI Collections deposited into the JCI Collection Account in accordance with
the instructions provided by the Collection Agent pursuant to this Section
6.05(g) no later than (a) if the JCI Collections are deposited into the JCI
Collection Account by 3:00 p.m. (New York time), 5:00 p.m. (New York time) on
the date such funds are deposited into the JCI Collection Account and (b) if the
JCI Collections are deposited
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into the JCI Collection Account after 3:00 p.m. (New York time), 5:00 p.m. (New
York time) on the Business Day immediately following the date such funds are
deposited into the JCI Collection Account. Any funds held in the JCI Collection
Account may, upon the request of the Collection Agent, be invested in a cash
escrow product maintained by the Administrative Agent.
SECTION 6.06. Negative Covenants of the Collection Agent and/or C&A. At all
times from the date hereof to the date on which the Aggregate Unpaids shall be
equal to zero, unless the Administrative Agent shall otherwise consent in
writing:
(a) No Sales, Liens, Etc. Except as otherwise provided herein and in the
Receivables Purchase Agreement, neither the Collection Agent nor C&A will (i)
sell, assign (by operation of law or otherwise) or otherwise dispose of, or
create any Adverse Claim (other than Permitted Encumbrances) upon or with
respect to (or file any financing statement in respect of) (A) any of the
Receivables, Related Security, Collections or Proceeds with respect thereto, or
(B) any Lockbox Account to which any Collections of any Receivable are sent
(including the assignment of any right to receive income in respect thereof), or
(ii) sell, assign (by operation of law or otherwise) or otherwise dispose of, or
create any Adverse Claim (other than Permitted Encumbrances) upon or with
respect to (or file any financing statement in respect of) any inventory or
goods, the sale of which may give rise to a Collection.
(b) Consolidations, Mergers and Sales of Assets. Neither the Collection
Agent nor C&A shall without the prior written consent of the Administrative
Agent, (i) consolidate or merge with or into any other Person or (ii) sell,
lease or otherwise transfer all or substantially all of its assets to any other
Person; provided that the Collection Agent or C&A, as applicable, may
consolidate or merge with another Person if (A)(1) the Collection Agent or C&A,
as applicable, is the corporation surviving such consolidation or merger or (2)
the Person into or with whom the Collection Agent or C&A, as applicable, is
merged or consolidated is an Affiliate and the surviving corporation assumes in
writing all duties and liabilities of the Collection Agent or C&A, as
applicable, hereunder and (B) immediately after and giving effect to such
consolidation or merger, no Termination Event or Potential Termination Event
shall have occurred and be continuing.
(c) Lockbox Accounts. Except as permitted pursuant to Section 2,05, 2.06,
2.09(b), 2.13, 5.02(e) and 6.05(g) of this Agreement or as otherwise permitted
under or required by the Transaction Documents, neither the Collection Agent nor
C&A shall make, or cause or permit any other Person to make any transfer of
funds on deposit in a Lockbox Account.
(d) Modifications of Receivables or Contracts. The Collection Agent shall
not extend, amend, discharge or otherwise modify the terms of any Receivable, or
amend, modify or waive any term or condition of any Contract related thereto,
except as contemplated by the Credit and Collection Policy, without the prior
written consent of each Funding Agent (which consent shall be obtained by the
Administrative Agent), and in each case in accordance with the Transaction
Documents.
SECTION 6.07. Collection Agent Default. The occurrence of any one or more
of the following events shall constitute a Collection Agent default (each, a
"Collection Agent Default"):
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(a) (i) the Collection Agent or, to the extent that the Transferor, C&A,
any Seller or any Affiliate of the Transferor or the Sellers is then acting as
Collection Agent, the Transferor, C&A, such Seller or such Affiliate, as
applicable, shall fail to observe or perform any material term, covenant or
agreement hereunder (other than as referred to in clauses (ii) and (iii) of this
Section 6.07(a)), and such failure shall remain unremedied for ten (10) days,
after a Responsible Officer of the Collection Agent has knowledge thereof or
(ii) the Collection Agent or, to the extent that the Transferor, C&A, any Seller
or any Affiliate of the Transferor or the Sellers is then acting as Collection
Agent, the Transferor, C&A, such Seller or such Affiliate, as applicable, shall
fail to make any payment or deposit required to be made by it hereunder when due
and such failure remains uncured for one (1) Business Day or the Collection
Agent shall fail to observe or perform in any material respect any term,
covenant or agreement on the Collection Agent's part to be performed under
Section 2.09(b) hereof, or (iii) the Collection Agent fails to deliver any
Deposit Report within two (2) Business Days of the date when due or Settlement
Statement within one (1) Business Day of the date when due; or
(b) any representation, warranty, certification or statement made by the
Collection Agent in this Agreement, any other Transaction Document or in any
other document delivered pursuant hereto or thereto shall prove to have been
incorrect in any material respect when made or deemed made; provided that no
such event shall constitute a Collection Agent Default (i) unless such event
shall continue unremedied for a period of ten (10) days from the date a
Responsible Officer of the Collection Agent obtains knowledge thereof, and (ii)
if any such representation and warranty relates to a Receivable for which the
Transferor has paid to the Collection Agent an amount equal to the Outstanding
Balance of such Receivable pursuant to Section 2.10(b); or
(c) the Collection Agent or any of its Subsidiaries shall (i) fail to pay
any principal or interest, regardless of amount, due in respect of Indebtedness
having an aggregate principal or notional amount in excess of $10,000,000, when
and as the same shall become due and payable, or (ii) fail to observe or perform
any other term, covenant, condition or agreement contained in any agreements or
instruments evidencing or governing any Indebtedness having an aggregate
principal amount in excess of $10,000,000 if the effect of any failure referred
to in this clause (ii) is to cause, or to permit the holder or holders of such
Indebtedness or a trustee on its or their behalf to cause, such Indebtedness to
become due prior to its stated maturity; or
(d) an Event of Bankruptcy shall occur and be continuing with respect to
the Collection Agent or any of its direct or indirect Subsidiaries that is a
Seller or the Transferor; or
(e) there shall have occurred any event which, in the commercially
reasonable judgment of the Administrative Agent, materially and adversely
affects the Collection Agent's ability to collect the Receivables under this
Agreement.
SECTION 6.08. Responsibilities of the Transferor and the Sellers. Anything
herein to the contrary notwithstanding, the Transferor shall, and/or shall cause
each Seller to, (i) perform all of such Seller's obligations under the Contracts
related to the Receivables to the same extent as if interests in such
Receivables had not been sold hereunder and under the Receivables Purchase
Agreement and the exercise by the Administrative Agent, the CP Conduit
Purchasers and the Committed Purchasers of their rights hereunder and under the
Receivables Purchase Agreement shall not relieve the Transferor or the Seller
from such obligations and (ii)
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pay when due any taxes, including without limitation, any sales taxes payable in
connection with the Receivables and their creation and satisfaction. Neither the
Administrative Agent, any of the CP Conduit Purchasers nor any of the Committed
Purchasers shall have any obligation or liability with respect to any Receivable
or related Contracts, nor shall it be obligated to perform any of the
obligations of the Seller thereunder.
SECTION 6.09. Grant of License. For the purpose of enabling the
Administrative Agent or a successor Collection Agent to perform the functions of
servicing and collecting the Receivables upon a Collection Agent Default, the
Collection Agent and each Seller hereby (i) assigns, to the extent permitted, to
the Administrative Agent for the benefit of the Funding Agents, the CP Conduit
Purchasers and the Committed Purchasers and shall be deemed to assign to the
Administrative Agent for the benefit of the Funding Agents, the CP Conduit
Purchasers and the Committed Purchasers and any successor Collection Agent all
rights owned or hereinafter acquired by any Seller or the Collection Agent (by
license, sublicense, lease, easement or otherwise) in and to any equipment or
any software (together with a copy thereof) in each case listed on Schedule E
hereto, (ii) agrees to use its best efforts to assist the Administrative Agent
for the benefit of the Funding Agents, the CP Conduit Purchasers, the Committed
Purchasers and any successor Collection Agent to arrange licensing agreements
with all software vendors and other applicable persons in a manner and to the
extent reasonably appropriate to effectuate the servicing of the Receivables,
and (iii) deliver to the Administrative Agent executed copies of any landlord
waivers in a form reasonably acceptable to the Administrative Agent, that may be
necessary to grant to the Administrative Agent access to any leased premises of
the Collection Agent for which the Administrative Agent or any successor
Collection Agent may require access to perform the collection and administrative
functions to be performed by the Administrative Agent under the Transaction
Documents.
ARTICLE VII
Termination Events
SECTION 7.01. Termination Events. The occurrence of any one or more of the
following events shall constitute a Termination Event:
(a) the Transferor, any Seller or the Collection Agent shall fail to make
any payment or deposit to be made by it hereunder or under any of the
Transaction Documents when due hereunder or thereunder and such failure
continues for one (1) Business Day; or
(b) any representation, warranty, certification or statement made by the
Transferor, the Collection Agent or any Seller in this Agreement, any other
Transaction Document to which it is a party or in any other document delivered
pursuant hereto or thereto shall prove to have been incorrect in any material
respect when made or deemed made (and, if any time period is provided for
correcting any representation or warranty in Section 3.01, Section 3.02 or
Section 3.03, has not been corrected within the time period provided in such
Section); provided, however, that (i) no such representation, warranty,
certification or statement relating to a Receivable for which the Transferor has
timely paid to the Collection Agent the Deemed Collection required to be paid as
a result thereof in accordance with Section 2.10(b) shall give rise to a
Termination Event under this paragraph (b), (ii) any such incorrectness with
respect to a
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representation or warranty in Section 3.01(f) or Section 3.01(r)(i) shall not
give rise to a Termination Event under this paragraph (b) if corrected within 15
days from the date a Responsible Officer of the Transferor obtains knowledge
thereof, and (iii) any such incorrectness with respect to a representation or
warranty in Section 3.01(e) or Section 3.01(s) shall not give rise to a
Termination Event under this paragraph (b) if corrected within three (3)
Business Days from the date a Responsible Officer of the Transferor obtains
knowledge thereof; or
(c) the Transferor, any Seller or the Collection Agent shall fail to
observe or perform in any material respect any other term, covenant or agreement
in this Agreement or any other Transaction Document (and, if any time period is
provided for any such observance or performance, such observance or performance
has not occurred within such time period); provided, that any such failure with
respect to the covenant set forth in Section 5.01(f) shall not give rise to a
Termination Event under this paragraph (c) until after giving effect to the cure
period, if any, set forth in the related Contract; or
(d) the Transferor shall fail to make any payment of principal or interest
in respect of any Indebtedness when and as the same shall become due and payable
after giving effect to any applicable grace period with respect thereto; or any
event or condition occurs that results in any such Indebtedness becoming due
prior to its scheduled maturity or that enables or permits the holder or holders
of any such Indebtedness or any trustee or agent on its or their behalf to cause
any such Indebtedness to become due, or to require the prepayment, repurchase,
redemption or defeasance thereof, prior to its scheduled maturity; or
(e) any Event of Bankruptcy shall occur with respect to the Transferor, the
Collection Agent or C&A or any Seller which shall have sold Receivables with an
Outstanding Balance at such time of $10,000,000 or greater pursuant to the
Receivables Purchase Agreement; or
(f) after the filing in the appropriate offices of the financing statements
described in Sections 4.01(c), 4.01(d), 4.01(e) and 4.01(f), the Administrative
Agent, on behalf of the CP Conduit Purchasers and the Committed Purchasers,
shall, for any reason, fail or cease to have a valid and perfected first
priority ownership or security interest in the Receivables and Related Security,
Collections and Proceeds with respect thereto, free and clear of any Adverse
Claims (other than Permitted Encumbrances); or
(g) a Collection Agent Default shall have occurred; or
(h) the Transferor or any Seller shall enter into any corporate transaction
or merger whereby it is not the surviving entity (other than, in the case of any
Seller, a merger or consolidation which does not, in the reasonable opinion of
the Funding Agents, materially adversely affect the collectibility of the
Receivables sold by such Seller or the performance of such Seller's obligations
under the Transaction Documents); or
(i) there shall have occurred any event or condition which would have
material adverse effect on either the collectibility of the Receivables or the
ability of the Transferor or any Seller to perform its respective obligations
under the Transaction Documents to which it is a party since the Closing Date;
or
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(j) the Percentage Factor exceeds the Maximum Percentage Factor and the
Transferor shall not have, by the next Business Day thereafter, reduced the Net
Investment from previously received Collections or other funds available to the
Transferor so as to reduce the Percentage Factor on such Business Day to less
than or equal to 100%; or
(k) the average Dilution Ratio for the three preceding Settlement Periods
exceeds 4.50%; or
(l) the average Default Ratio for the three preceding Settlement Periods
exceeds 14.00%; or
(m) the average Delinquency Ratio for the three preceding Settlement
Periods exceeds 3.75%; or
(n) C&A or any of its Subsidiaries shall default in the observance or
performance of Section 6.14 or Section 6.15 of the Senior Credit Facility or an
Event of Default (as such term is defined in the Senior Credit Facility)
described in clause (m) of Article VII of the Senior Credit Facility shall have
occurred; or
(o) a Responsible Officer of the Transferor or any Seller shall receive
notice or become aware that a notice of lien has been filed against the
Transferor, any Seller or the Collection Agent under Section 412(n) of the Code
or Section 302(f) of ERISA for a failure to make a required installment or other
payment to a plan to which Section 412(n) of the Code or Section 302(f) of ERISA
applies; or
(p) a Purchase Termination Date shall have occurred under the Receivables
Purchase Agreement with respect to all Sellers; or
(q) C&A and the Sellers (in the aggregate) shall fail to maintain 100%
ownership of the Transferor; or
(r) the existence at any time of any litigation, arbitration proceedings or
governmental proceeding involving any Seller or the Transferor or the
Receivables which would be reasonably likely to have a Material Adverse Effect;
or
(s) (i) one or more judgements for the payment of money in an aggregate
amount in excess of $10,000,000 shall be rendered against a Seller, the
Collection Agent, C&A or their Subsidiaries or any combination thereof and the
same shall remain undischarged for a period of thirty (30) consecutive days
during which execution shall not be effectively stayed or to the extent that an
insurance carrier has accepted a claim for coverage thereto; (ii) one or more
judgments for the payment of money shall be rendered against the Transferor and
shall not have been satisfied; or (iii) any action shall be legally taken by a
judgment creditor to attach or levy upon any assets of the Transferor, a Seller,
the Collection Agent, C&A, or their Subsidiaries to enforce any such judgment;
or
(t) the Collection Agent shall fail to deliver to the Administrative Agent
any report required to be delivered by it under the terms of the Transaction
Documents within one (1) Business Day of (i) with respect to any Deposit Report
or Settlement Statement, when such
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report was due or (ii) with respect to any other report, receipt by the
Collection Agent of written notice from the Administrative Agent that such
report is due; or
(u) any Event of Bankruptcy shall occur with respect to any Seller which
shall have sold Receivables with an Outstanding Balance at such time of less
than $10,000,000 pursuant to the Receivables Purchase Agreement.
SECTION 7.02. Remedies Upon the Occurrence of a Termination Event.
(a) Upon the occurrence of any Termination Event, the Administrative Agent
may, or at the direction of the Required Committed Purchasers shall, by notice
to the Transferor and the Collection Agent, declare the Termination Date to have
occurred; provided, however, that in the case of any event described in Sections
7.01(e), 7.01(f), 7.01(j) or 7.01(q) above, the Termination Date shall be deemed
to have occurred automatically upon the occurrence of such event. At all times
after the declaration or automatic occurrence of the Termination Date pursuant
to this Section 7.02(a), the Base Rate plus 3.00% shall be the Tranche Rate
applicable to the Net Investment for all existing and future Tranches. If an
event or condition shall have occurred which constitutes a Potential Termination
Event, the Administrative Agent may, by notice to the Transferor, declare such
event or condition a Potential Termination Event.
(b) In addition, if any Termination Event occurs hereunder, (i) the
Administrative Agent shall promptly notify the Transferor in writing whether it
has declared the Termination Date to have occurred and whether it will be
exercising the remedies specified in this Section 7.02, (ii) the Administrative
Agent, on behalf of the CP Conduit Purchasers and the Committed Purchasers,
shall have all of the rights and remedies provided to a secured creditor or a
purchaser of accounts under the Relevant UCC by applicable law in respect
thereto and (iii) if the Administrative Agent so elects (A) the Facility Limit
shall be reduced as of each calendar date thereafter to equal the Net Investment
as of such date and (B) the Percentage Factor shall be increased to 100%.
SECTION 7.03. Reconveyance Under Certain Circumstances. The Transferor
agrees to accept the reconveyance from the Administrative Agent, on behalf of
the CP Conduit Purchasers and/or the Committed Purchasers, of the Transferred
Interest if any Termination Event occurs hereunder and the Administrative Agent
notifies the Transferor of a material breach of any representation or warranty
made or deemed made pursuant to Sections 3.01(a), 3.01(b), 3.01(c), 3.01(d),
3.01(g) and 3.01(j) of this Agreement. The reconveyance price shall be paid by
the Transferor to the Administrative Agent, for the account of the CP Conduit
Purchasers and the Committed Purchasers, as applicable, in immediately available
funds on demand in an amount equal to the Aggregate Unpaids.
ARTICLE VIII
The Administrative Agent
SECTION 8.01. Appointment. Each of the CP Conduit Purchasers, the Committed
Purchasers and the Funding Agents hereby irrevocably designates and appoints the
Administrative Agent as the agent of such Person under this Agreement and
irrevocably
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authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and to exercise such powers
and perform such duties as are expressly delegated to the Administrative Agent
by the terms of this Agreement, together with such other powers as are
reasonably incidental thereto. To the extent the Administrative Agent takes any
such action, the Transferor, each Seller and the Collection Agent, in dealing
with the Administrative Agent, shall have the right to assume that the
Administrative Agent is authorized to so act, absent actual knowledge to the
contrary. Notwithstanding any provision to the contrary elsewhere in this
Agreement, (i) the Administrative Agent shall not have any duties or
responsibilities except those expressly set forth herein, or any fiduciary
relationship with any CP Conduit Purchaser, any Committed Purchaser or any
Funding Agent, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise exist
against the Administrative Agent; and (ii) in no event shall the Administrative
Agent be liable under or in connection with this Agreement for indirect,
special, or consequential losses or damages of any kind, including lost profits,
even if advised of the possibility thereof and regardless of the form of action
by which such losses or damages may be claimed. In performing its functions and
duties hereunder, the Administrative Agent shall act solely as the agent of the
CP Conduit Purchasers, the Committed Purchasers and the Funding Agents, and the
Administrative Agent does not assume, nor shall be deemed to have assumed, any
obligation or relationship of trust or agency with or for any such Person.
SECTION 8.02. Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement by or through agents or attorneys-in-fact
and shall be entitled to advice of counsel (who may be counsel for the
Transferor or the Collection Agent), independent public accountants and other
experts selected by it concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys in-fact selected by it with reasonable care.
SECTION 8.03. Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement (x) with
the consent or at the request of the CP Conduit Purchasers, the Committed
Purchasers or the Funding Agents or (y) in the absence of its own gross
negligence or willful misconduct or (ii) responsible in any manner to any of the
CP Conduit Purchasers, the Committed Purchasers or the Funding Agents for any
recitals, statements, representations or warranties made by the Transferor, the
Collection Agent, the Sellers or any officer thereof contained in this Agreement
or any other Transaction Document or in any certificate, report, statement or
other document referred to or provided for in, or received by the Administrative
Agent under or in connection with, this Agreement or any other Transaction
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement, any other Transaction Document, the
Receivables (or any Related Security, Collections and Proceeds with respect
thereto) or any Transferred Interest or for any failure of any of the
Transferor, the Collection Agent, the Sellers or the Obligors to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be under
any obligation to any CP Conduit Purchaser, any Committed Purchaser or any
Funding Agent to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Transaction Document or to inspect the properties, books or records of the
Transferor, the Collection Agent or any Seller.
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SECTION 8.04. Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
writing, resolution, notice, consent, certificate, affidavit, letter, fax,
e-mail, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Transferor or the Collection Agent), independent
accountants and other experts selected by the Administrative Agent and shall not
be liable for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Transaction Document unless it shall
first receive such advice or concurrence of the Funding Agents, on behalf of the
CP Conduit Purchasers, as it deems appropriate or it shall first be indemnified
to its satisfaction by the Funding Agents against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Administrative Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement and the other
Transaction Documents in accordance with a request of the Funding Agents, on
behalf of the CP Conduit Purchasers (unless, in the case of any action relating
to the giving of consent hereunder, the giving of such consent requires the
consent of all the CP Conduit Purchasers), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the CP Conduit
Purchasers, the Committed Purchasers and the Funding Agents.
SECTION 8.05. Notice of Collection Agent Default. The Administrative Agent
shall not be deemed to have knowledge or notice of the occurrence of any
Collection Agent Default or any Termination Event unless the Administrative
Agent has received notice from a CP Conduit Purchaser, an Committed Purchaser, a
Funding Agent, the Transferor or the Collection Agent referring to this
Agreement, describing such Collection Agent Default or Termination Event and
stating that such notice is a "notice of a Collection Agent Default" or "notice
of a Termination Event", as the case may be. In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
notice thereof to the Funding Agents, the Transferor and the Collection Agent.
The Administrative Agent shall take such action with respect to such event as
shall be reasonably directed by the Required Committed Purchasers, provided that
unless and until the Administrative Agent shall have received such directions,
the Administrative Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such event as it shall deem
advisable in the best interests of the CP Conduit Purchasers.
SECTION 8.06. Non-Reliance on the Administrative Agent and Other
Purchasers. Each of the CP Conduit Purchasers, the Committed Purchasers and the
Funding Agents expressly acknowledges that neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Transferor, shall be deemed to constitute any representation or warranty
by the Administrative Agent to any such Person. Each of the CP Conduit
Purchasers, the Committed Purchasers and the Funding Agents represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other CP Conduit Purchaser, Committed Purchaser or
Funding Agent and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
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Transferor and the Collection Agent and made its own decision to enter into this
Agreement. Each of the CP Conduit Purchasers, the Committed Purchasers and the
Funding Agents also represents that it will, independently and without reliance
upon the Administrative Agent or any other CP Conduit Purchaser, Committed
Purchaser or Funding Agent, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Transaction Documents, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Transferor, the Collection Agent
and the Sellers. Except for notices, reports and other documents expressly
required to be furnished to the Funding Agents by the Administrative Agent
hereunder, the Administrative Agent shall have no duty or responsibility to
provide any CP Conduit Purchaser, any Committed Purchaser or any Funding Agent
with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Transferor, the Collection Agent or the Sellers which may come into the
possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
SECTION 8.07. Indemnification. Each of the Committed Purchasers and the
Funding Agents agrees to indemnify the Administrative Agent in its capacity as
such (to the extent not reimbursed by the Transferor, the Collection Agent and
the Sellers and without limiting the obligation of the Transferor, the
Collection Agent and the Sellers to do so), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time be
imposed on, incurred by or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement, any of the other Transaction
Documents or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by the Administrative Agent under or in connection with any of the foregoing;
provided that no Committed Purchaser or Funding Agent shall be liable for the
payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
solely from the Administrative Agent's gross negligence or willful misconduct.
The agreements in this Section shall survive the payment of all amounts payable
hereunder.
SECTION 8.08. The Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Transferor, the Collection
Agent or any of their Affiliates as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to any Transferred Interest held by
the Administrative Agent, the Administrative Agent shall have the same rights
and powers under this Agreement and the other Transaction Documents as any CP
Conduit Purchaser or Committed Purchaser, and may exercise the same as though it
were not the Administrative Agent, and the terms "Committed Purchaser," and "CP
Conduit Purchaser" shall include the Administrative Agent in its individual
capacity.
SECTION 8.09. Resignation of Administrative Agent; Successor Administrative
Agent. The Administrative Agent may resign as Administrative Agent at any time
by giving 30 days' notice to the Funding Agents, the Transferor and the
Collection Agent; provided, that no such resignation shall become effective
until the acceptance of appointment of a successor Administrative Agent as
provided below. The Administrative Agent may be removed at any
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time by the Required Committed Purchasers; provided, that such removal shall
become effective upon the acceptance of appointment of a successor
Administrative Agent appointed by the Funding Agents and approved by the
Transferor and the Collection Agent (which approval shall not in each case be
unreasonably withheld). In the case of any proposed resignation of the
Administrative Agent, the Required Committed Purchasers shall promptly appoint a
successor Administrative Agent from among the Funding Agents, which successor
Administrative Agent shall be approved by the Transferor and the Collection
Agent (which approval shall not in each case be unreasonably withheld). If no
successor Administrative Agent is appointed prior to the proposed effective date
of the resignation of the Administrative Agent, the Administrative Agent may
appoint, after consulting with the Funding Agents, the Transferor and the
Collection Agent, a successor Administrative Agent from among the Funding
Agents. Effective upon the acceptance of appointment of a successor
Administrative Agent, such successor Administrative Agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor Administrative Agent, effective
upon such acceptance of appointment, and the former Administrative Agent's
rights, powers and duties as Administrative Agent shall be terminated, without
any other or further act or deed on the part of such former Administrative Agent
or any of the parties to this Agreement. After any Administrative Agent's
resignation, the provisions of this Article VII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.
ARTICLE IX
Additional Representations, Warranties and Covenants
of the Transferor and Collection Agent
SECTION 9.01. Additional Representations, Warranties and Covenants.
(a) The Transferor represents and warrants that:
(i) This Agreement creates a valid and continuing security interest
(as defined in the Relevant UCC) in the Receivables in favor of the
Administrative Agent, which security interest is prior to all other Liens,
and is enforceable as such as against creditors of and purchasers from the
Transferor.
(ii) The Receivables constitute "accounts" or "payment intangibles"
within the meaning of the Relevant UCC.
(iii) Prior to the transfer thereof to the Administrative Agent, the
Transferor owned and had good and marketable title to the Receivables free
and clear of any Lien, claim or encumbrance of any Person (other than
Permitted Encumbrances).
(iv) The Transferor has caused the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions
under applicable law in order to perfect the security interest in the
Receivables granted to the Administrative Agent hereunder.
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(v) Other than the security interest granted to the Administrative
Agent pursuant to this Agreement, the Transferor has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Receivables.
(vi) The Transferor has not authorized the filing of and is not aware
of any financing statements against the Transferor that include a
description of collateral covering the Receivables other than any financing
statement relating to the security interest granted to the Administrative
Agent hereunder or that has been terminated. The Transferor is not aware of
any judgment or tax lien filings against the Transferor.
(b) The Collection Agent agrees to maintain the perfection and priority of
the security interest granted pursuant to this Agreement.
(c) The representations and warranties set forth in this Section shall
survive the transfer and assignment of the Receivables to the Administrative
Agent and the termination of this Agreement.
(d) With respect to this Section, no failure to exercise and no delay in
exercising, on the part of any Person, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege.
ARTICLE X
Miscellaneous
SECTION 10.01. Term of Agreement. This Agreement shall terminate on the
date following the Termination Date upon which the Net Investment has been
reduced to zero, and all accrued Discount, Servicing Fees and all other
Aggregate Unpaids have been paid in full, in each case, in cash; provided,
however, that (i) the rights and remedies of the Administrative Agent, the CP
Conduit Purchasers and the Committed Purchasers with respect to any
representation and warranty made or deemed to be made by the Transferor or the
Seller pursuant to this Agreement, (ii) the indemnification and payment
provisions of the Asset Purchase Agreements, and (iii) the agreements set forth
in Sections 10.08 and 10.09 hereof, shall be continuing and shall survive any
termination of this Agreement.
SECTION 10.02. Waivers; Amendments.
(a) No failure or delay on the part of the Administrative Agent, any CP
Conduit Purchaser, any Funding Agent or any Committed Purchaser in exercising
any power, right or remedy under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any such power, right or
remedy preclude any other further exercise thereof or the exercise of any other
power, right or remedy. The rights and remedies herein provided shall be
cumulative and nonexclusive of any rights or remedies provided by law. Any
provision of this Agreement may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the parties hereto and the
Required Committed Purchasers and, if such
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amendment is material, the Rating Agencies, to the extent required by the terms
and conditions of the commercial paper program of any CP Conduit Purchaser, have
provided Rating Confirmations; provided, however, that no such amendment or
waiver shall, without the consent of each affected Committed Purchaser, (A)
extend the Termination Date or the date of any payment or deposit of Collections
by the Transferor or Collection Agent, (B) reduce the rate or extend the time of
payment of any interest or fees hereunder, (C) change the amount of an Committed
Purchaser's Pro Rata Share or Commitment, (D) consent to or permit the
assignment or transfer by the Transferor of any of its rights or obligations
under this Agreement, (E) amend or modify the definition of "Required Committed
Purchasers" or "Percentage Factor" or any other defined term used in such
definition, to the extent used in such definition, or (F) amend or modify this
Section 10.02.
(b) So long as JPMorgan Chase or an affiliate thereof is one of the agents
under the Senior Credit Facility, any amendments or waivers granted by the
lenders (the "Revolver Lenders") under the Senior Credit Facility which shall
have the effect of waiving or amending Section 7.01(n) shall be binding upon the
parties to this Agreement for purposes of determining whether a Termination
Event has occurred provided that if any fees are paid to the Revolver Lenders in
consideration for such amendment or waiver, a proportionate fee shall be
concurrently paid to the Funding Agents for each CP Conduit Purchaser or
Committed Purchaser, as the case may be.
SECTION 10.03. Notices. Except as provided below, all communications and
notices provided for hereunder shall be in writing (including telecopy or
electronic facsimile transmission or similar writing) and shall be given to the
other party at its address or telecopy number set forth below or at such other
address or telecopy number as such party may hereafter specify for the purposes
of notice to such party. Each such notice or other communication shall be
effective (i) if given by telecopy, when such telecopy is transmitted to the
telecopy number specified in this Section 10.03 and confirmation is received,
(ii) if given by mail three (3) Business Days following such posting, postage
prepaid, U.S. certified or registered, (iii) if given by overnight courier, one
(1) Business Day after deposit thereof with a national overnight courier
service, or (iv) if given by any other means, when received at the address
specified in this Section 10.03. However, anything in this Section 10.03 to the
contrary notwithstanding, the Transferor hereby authorizes the Administrative
Agent to effect Transfers, Tranche Period and Tranche Rate selections based on
telephonic notices made by any Person which the Administrative Agent in good
faith believes to be acting on behalf of the Transferor. The Transferor agrees
to deliver promptly to the Administrative Agent a written confirmation of each
telephonic notice signed by an authorized officer of Transferor. However, the
absence of such confirmation shall not affect the validity of such notice. If
the written confirmation differs in any material respect from the action taken
by the Administrative Agent, the records of the Administrative Agent shall
govern absent manifest error.
If to the CP Conduit Purchasers, to the address set forth on Schedule B
(with a copy to the Administrative Agent).
If to the Transferor:
CARCORP, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇-▇▇
▇▇▇▇▇ ▇▇▇
Las Vegas, Nevada 89109
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Treasurer
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Products Co.
▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with an additional copy to:
▇▇▇▇ ▇▇▇▇▇▇▇▇
Stroock & Stroock & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Sellers, to the address set forth opposite such Seller's name on
Exhibit D to the Receivables Purchase Agreement or in the applicable Additional
Seller Supplement.
If to the Administrative Agent:
JPMorgan Chase Bank
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Committed Purchasers, at their respective addresses set forth on
Schedule B.
SECTION 10.04. Governing Law; Submission to Jurisdiction; Integration.
(a) This Agreement shall be governed by and construed in accordance with
the laws of the State of New York. Each of the parties hereto hereby submits to
the nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York state court sitting in The
City of New York for purposes of all legal proceedings arising out of or
relating to this Agreement or the transactions contemplated hereby. Each of the
parties hereto hereby irrevocably waives, to the fullest extent it may
effectively do so, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum. Nothing in this Section 10.04 shall affect the right of any
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party hereto to bring any action or proceeding against any party hereto or its
respective properties in the courts of other jurisdictions.
(b) Each of the parties hereto hereby waives any right to have a jury
participate in resolving any dispute, whether sounding in contract, tort or
otherwise among any of them arising out of, connected with, relating to or
incidental to the relationship between them in connection with this Agreement or
the other Transaction Documents.
(c) This Agreement contains the final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire Agreement among the parties hereto with respect to
the subject matter hereof superseding all prior oral or written understandings.
SECTION 10.05. Severability; Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
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. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 10.06. Successors and Assigns.
(a) This Agreement shall be binding on the parties hereto and their
respective successors and assigns; provided, however, that neither the
Transferor nor the Seller may assign any of its rights or delegate any of its
duties hereunder or under any of the other Transaction Documents to which it is
a party without the prior written consent of the Administrative Agent. No
provision of this Agreement shall in any manner restrict the ability of any CP
Conduit Purchaser or any Committed Purchaser to assign, participate, grant
security interests in, or otherwise transfer any portion of the Transferred
Interest as provided in this Section 10.06. Each CP Conduit Purchaser may
assign, participate, grant security interests in or otherwise transfer all or
any portion of the Transferred Interest to any Program Support Provider with
respect to such CP Conduit Purchaser without prior notice to or consent from any
other party or any other condition or restriction of any kind.
(b) Conduit Assignees. Each CP Conduit Purchaser may (or, pursuant to
Section 2.26(b)(ii), shall), from time to time with prior or concurrent notice
to the Transferor, the Funding Agent for such CP Conduit Purchaser and the
Administrative Agent, assign all or any portion of the CP Conduit Purchaser's
Interest with respect to such CP Conduit Purchaser (and its related Committed
Purchasers) and its rights and obligations under this Agreement and any other
Transaction Documents to which it is a party to a Conduit Assignee with respect
to such CP Conduit Purchaser. Upon such assignment by a CP Conduit Purchaser to
a Conduit Assignee, (A) the related administrative or managing agent for such
Conduit Assignee will act as the Funding Agent for such Conduit Assignee
hereunder, (B) such Conduit Assignee and its liquidity support provider(s) and
credit support provider(s) and other related parties shall have the benefit of
all the rights and protections provided to such CP Conduit Purchaser and its
related Committed Purchasers herein and in the other Transaction Documents
(including, without
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limitation, any limitation on recourse against such Conduit Assignee), (C) such
Conduit Assignee shall assume all of such CP Conduit Purchaser's obligations
hereunder or under any other Transaction Document (whenever created, whether
before or after such assignment) with respect to the assigned portion of the CP
Conduit Purchaser's Interest and such CP Conduit Purchaser shall be released
from all such obligations, (D) all distributions to such CP Conduit Purchaser
hereunder with respect to the assigned portion of the CP Conduit Purchaser's
Interest shall be made to such Conduit Assignee, (E) the definition of the term
"CP Rate" shall be determined on the basis of the interest rate or discount
applicable to commercial paper issued by such Conduit Assignee (rather than such
CP Conduit Purchaser), (F) the defined terms and other terms and provisions of
this Agreement and the other Transaction Documents shall be interpreted in
accordance with the foregoing, and (G) if requested by the Administrative Agent
or administrative or managing agent with respect to the Conduit Assignee, the
parties will execute and deliver such further agreements and documents
(including amendments to this Agreement) and take such other actions as the
Administrative Agent or such administrative agent may reasonably request to
evidence and give effect to the foregoing.
(c) Participations. Any Committed Purchaser may, with the consent of the
Administrative Agent and in the ordinary course of its business and its
accordance with applicable law, at any time sell to one or more Persons (each, a
"Participant") a participating interest in its rights and obligations hereunder
and under the Transaction Documents; provided, however, that each Participant
shall purchase an identical percentage in such selling Committed Purchaser's
Commitment, and Pro Rata Share of the Committed Purchaser Funded Amount.
Notwithstanding any such sale by an Committed Purchaser of participating
interest to a Participant, such Committed Purchaser's rights and obligations
under this Agreement shall remain unchanged, such Committed Purchaser shall
remain solely responsible for the performance hereof, and each CP Conduit
Purchaser and the Administrative Agent shall continue to deal solely and
directly with such Committed Purchaser in connection with such Committed
Purchaser's rights and obligations under this Agreement and the other
Transaction Documents. Each Committed Purchaser agrees that any agreement
between such Committed Purchaser and any such Participant in respect of such
participating interest shall not restrict such Committed Purchaser's right to
agree to any amendment, supplement, waiver or modification to this Agreement.
(d) Assignments.
(i) Any Committed Purchaser may at any time and from time to time, upon the
prior written consent of the related CP Conduit Purchaser and the Administrative
Agent, and, if the purchaser is not an Affiliate of the selling Committed
Purchaser, the prior written consent of the Transferor (which consent shall not
be unreasonably withheld), assign to one or more accredited investors or other
Persons ("Assignee(s)") all or any part of its rights and obligations under this
Agreement and the other Transaction Documents pursuant to a supplement to this
Agreement, substantially in the form of Exhibit K hereto (each, a "Transfer
Supplement"); provided, however, that (A) each Assignee shall purchase an
identical percentage in such selling Committed Purchaser's Commitment and Pro
Rata Share of the Committed Purchaser Funded Amount, (B) any such assignment
cannot be for an amount less than the lesser of (1) $5,000,000 and (2) such
selling Committed Purchaser's Commitment or Pro Rata Share of the Committed
Purchaser Funded Amount (calculated at the time of such assignment) and (C) each
Purchaser must be (1) a financial institution incorporated in an OECD country
and rated at least A-1/P-1 (or
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the equivalent short-term ratio) by the Rating Agencies and (2) a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act of 1933,
as amended).
(ii) Each of the Committed Purchasers agrees that in the event that it
shall cease to have short-term debt ratings at least equal other ratings then
assigned to the Commercial Paper by the Rating Agencies, or, if such Committed
Purchaser does not have short-term debt which is rated by the Rating Agencies,
in the event that the parent corporation of such Committed Purchaser has rated
short-term debt, such parent corporation ceases to have short-term debt ratings
at least equal to the ratings then assigned to the Commercial Paper by the
Rating Agencies (each, an "Affected Committed Purchaser"), such Affected
Committed Purchaser shall be obliged, at the request of the related CP Conduit
Purchaser and the Administrative Agent, to assign all of its rights and
obligations hereunder to (x) one or more other Committed Purchasers selected by
such CP Conduit Purchaser and the Administrative Agent which are willing to
accept such assignment, or (y) another financial institution having short-term
debt ratings at least equal to the ratings then assigned to the Commercial Paper
by the Rating Agencies nominated by the Administrative Agent and consented to by
such CP Conduit Purchaser (which consent shall not be unreasonably withheld) and
the Administrative Agent, and willing to participate in this facility through
the Commitment Expiry Date in the place of such Affected Committed Purchaser;
provided that (i) the Affected Committed Purchaser receives payment in full,
pursuant to a Pro Rata Share of the Committed Purchaser Funded Amount and any
other amounts due and owing to such Affected Committed Purchaser under this
Agreement and the other Transaction Documents and (ii) such nominated financial
institution, if not an existing Committed Purchaser, satisfies all the
requirements of this Agreement.
(iii) Upon (A) execution of a Transfer Supplement, (B) delivery of an
executed copy thereof to the related CP Conduit Purchaser and the Administrative
Agent, (C) payment, if applicable, by the Assignee to such selling Committed
Purchaser of an amount equal to the purchase price agreed between such selling
Committed Purchaser and the Assignee and (D) receipt by such CP Conduit
Purchaser of a Rating Confirmation, such selling Committed Purchaser shall be
released from its obligations hereunder to the extent of such assignment and the
Assignee shall, for all purposes, be a Committed Purchaser party to this
Agreement and shall have all the rights and obligations of a Committed Purchaser
under this Agreement to the same extent as if it were an original party hereto,
and no further consent or action by the CP Conduit Purchasers, the Committed
Purchasers or the Administrative Agent shall be required. The amount of the
assigned portion of the selling Committed Purchaser's Pro Rata Share of the
Committed Purchaser Funded Amount allocable to the Assignee shall be equal to
the Transferred Percentage (as defined in the Transfer Supplement) of such
selling Committed Purchaser's Pro Rata Share of the Committed Purchaser Funded
Amount which is transferred thereunder regardless of the purchase price paid
therefor. Such Transfer Supplement shall be deemed to amend this Agreement to
the extent, and only to the extent, necessary to reflect the addition of the
Assignee as a Committed Purchaser and the resulting adjustment of the selling
Committed Purchaser's Commitment arising from the purchase by the Assignee of
all or a portion of the selling Committed Purchaser's rights, obligations and
interest hereunder.
SECTION 10.07. Confidentiality.
(a) Each of the Transferor, the Collection Agent and C&A shall maintain,
and shall cause each officer, employee and agent of itself and its Affiliates to
maintain, the
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confidentiality of the Transaction Documents and all other confidential
proprietary information with respect to the CP Conduit Purchasers, the Committed
Purchasers, the Funding Agents and the Administrative Agent and each of their
respective businesses obtained by them in connection with the structuring,
negotiation and execution of the transactions contemplated herein and in the
other Transaction Documents, except for information that has become publicly
available, and provided that any such information may be disclosed (i) to legal
counsel, accountants and other professional advisors to the Transferor, the
Collection Agent, C&A and their respective Affiliates, (ii) as required by law,
regulation or legal process (including in connection with any registration
statement or other filing made with the Securities and Exchange Commission) or
(iii) in connection with any legal or regulatory proceeding to which the
Transferor, the Collection Agent, C&A or any of their respective Affiliates is
subject.
(b) Subject to paragraph (c) below, each of the CP Conduit Purchasers, the
Committed Purchasers, the Funding Agents and the Administrative Agent shall
maintain, and shall cause each officer, employee and agent of itself and its
Affiliates to maintain, the confidentiality of the Transaction Documents and all
other confidential proprietary information with respect to the Transferor, the
Sellers, C&A and their Affiliates and each of their respective businesses
obtained by them in connection with the structuring, negotiation and execution
of the transactions contemplated herein and in the other Transaction Documents,
except for information that has become publicly available, and provided that any
such information may be disclosed (i) to legal counsel, accountants and other
professional advisors to the CP Conduit Purchasers, the Committed Purchasers,
the Funding Agent, the Administrative Agent and their respective Affiliates,
(ii) as required by law, regulation or legal process or (iii) in connection with
any legal or regulatory proceeding to which the CP Conduit Purchasers, the
Committed Purchasers, the Funding Agent, the Administrative Agent or any of
their respective Affiliates is subject.
(c) Each of the Transferor, the Collection Agent and C&A hereby consents to
the disclosure of any nonpublic information with respect to it received by any
CP Conduit Purchaser, any Committed Purchaser, any Funding Agent or the
Administrative Agent to (i) any of the CP Conduit Purchasers, Committed
Purchasers, Funding Agents or the Administrative Agent, (ii) any nationally
recognized rating agency providing a rating or proposing to provide a rating to
the CP Conduit Purchasers' Commercial Paper, (iii) any placement agent which
proposes to offer and sell the CP Conduit Purchasers' Commercial Paper, (iv) any
provider of the CP Conduit Purchasers' program-wide liquidity or credit support
facilities, (v) any potential Committed Purchaser or (vi) any Participant or
potential Participant.
(d) In connection with any disclosure pursuant to paragraph (c) above, each
of the Administrative Agent, the CP Conduit Purchasers, the Committed Purchasers
and the Funding Agents shall advise any Person to whom it discloses such
information to maintain the confidentiality of such information unless the prior
written consent of C&A is obtained.
SECTION 10.08. No Bankruptcy Petition Against the CP Conduit Purchasers.
Each of the Transferor, the Collection Agent and C&A hereby covenants and agrees
that, prior to the date which is one year and one day after the payment in full
of all outstanding Commercial Paper or other indebtedness of the CP Conduit
Purchasers, it will not institute against, or join any other Person in
instituting against, the CP Conduit Purchasers any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceeding
under the laws of the United States or any state of the United States.
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SECTION 10.09. Limited Recourse. Notwithstanding anything to the contrary
contained herein, the obligations of the CP Conduit Purchasers under this
Agreement are solely the corporate obligations of the CP Conduit Purchasers and,
in the case of obligations of the CP Conduit Purchasers other than Commercial
Paper, shall be payable at such time as funds are actually received by, or are
available to, the CP Conduit Purchasers in excess of funds necessary to pay in
full all outstanding Commercial Paper and, to the extent funds are not available
to pay such obligations, the claims relating thereto shall not constitute a
claim against the CP Conduit Purchasers but shall continue to accrue. Each party
hereto agrees that the payment of any claim (as defined in Section 101 of Title
11 of the Bankruptcy Code) of any such party shall be subordinated to the
payment in full of all Commercial Paper.
No recourse under any obligation, covenant or agreement of the CP Conduit
Purchasers contained in this Agreement shall be had against any incorporator,
stockholder, officer, director, member, manager, employee or agent of the CP
Conduit Purchasers, the Administrative Agent, or any of their Affiliates (solely
by virtue of such capacity) by the enforcement of any assessment or by any legal
or equitable proceeding, by virtue of any statute or otherwise; it being
expressly agreed and understood that this Agreement is solely a corporate
obligation of the CP Conduit Purchasers, and that no personal liability whatever
shall attach to or be incurred by any incorporator, stockholder, officer,
director, member, manager, employee or agent of the CP Conduit Purchasers, the
Administrative Agent, or any of their Affiliates (solely by virtue of such
capacity) or any of them under or by reason of any of the obligations, covenants
or agreements of the CP Conduit Purchasers contained in this Agreement, or
implied therefrom, and that any and all personal liability for breaches by the
CP Conduit Purchasers of any of such obligations, covenants or agreements,
either at common law or at equity, or by statute, rule or regulation, of every
such incorporator, stockholder, officer, director, member, manager, employee or
agent is hereby expressly waived as a condition of and in consideration for the
execution of this Agreement; provided that the foregoing shall not relieve any
such Person from any liability it might otherwise have as a result of fraudulent
actions taken or fraudulent omissions made by them.
SECTION 10.10. Characterization of the Transactions Contemplated by the
Agreement.
(a) It is the intention of the parties that the transactions contemplated
hereby constitute (other than for tax purposes) the sale of the Transferred
Interest, conveying good title thereto free and clear of any Adverse Claims
(other than Permitted Encumbrances) to the CP Conduit Purchasers or the
Committed Purchasers, as the case may be, and that the Transferred Interest not
be part of the Transferor's estate in the event of an insolvency. If,
notwithstanding the foregoing, the transactions contemplated hereby should be
deemed a financing, the parties intend that the Transferor shall be deemed to
have granted to the Administrative Agent, on behalf of the CP Conduit Purchasers
and the Committed Purchasers, and the Transferor hereby grants to the
Administrative Agent, on behalf of the CP Conduit Purchasers and the Committed
Purchasers, a first priority perfected and continuing security interest in all
of the Transferor's right, title and interest in, to and under the Receivables,
the Related Security, Collections and Proceeds with respect thereto, the Lockbox
Accounts, and all of the Transferor's rights under the Receivables Purchase
Agreement with respect to the Receivables and with respect to any obligations
thereunder of the Seller with respect to the Receivables, and that this
Agreement shall constitute a security agreement under applicable law. The
Transferor hereby assigns to the
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Administrative Agent, on behalf of the CP Conduit Purchasers and the Committed
Purchasers, all of its rights and remedies under the Receivables Purchase
Agreement with respect to the Receivables and with respect to any obligations
thereunder of the Seller with respect to the Receivables. The Transferor agrees
that it shall not give any consent or waiver required or permitted to be given
under the Receivables Purchase Agreement without the prior consent of the
Administrative Agent, such consent not to be unreasonably withheld.
(b) It is the intention of the parties that the transactions contemplated
by the Receivables Transfer Agreement will create a debt obligation of the
Transferor for United States Federal, state and local income and franchise tax
purposes. Unless otherwise required by law, the parties agree to treat the
transactions accordingly for all such purposes.
SECTION 10.11. Waiver of Setoff. Each of the Administrative Agent, the
Transferor and the Collection Agent hereby waives any right of setoff it may
have or to which it may be entitled under this Agreement from time to time
against any CP Conduit Purchaser or its assets.
SECTION 10.12. JPMorgan Chase Conflict Waiver. JPMorgan Chase acts as
Administrative Agent and as Funding Agent for PARCO, as issuing and paying agent
for PARCO's Commercial Paper, as provider of other backup facilities for PARCO,
and may provide other services or facilities from time to time (the "JPMorgan
Chase Roles"). Without limiting the generality of Section 8.08, each of the
parties hereto hereby acknowledges and consents to any and all JPMorgan Chase
Roles, waives any objections it may have to any actual or potential conflict of
interest caused by JPMorgan Chase's acting as the Administrative Agent or as an
Committed Purchaser under the Asset Purchase Agreement with respect to PARCO and
acting as or maintaining any of the JPMorgan Chase Roles, and agrees that in
connection with any JPMorgan Chase Role, JPMorgan Chase may take, or refrain
from taking, any action which it in its discretion deems appropriate.
SECTION 10.13. Canadian Taxes. The Transferor represents and warrants to
the Administrative Agent and each Funding Agent for the benefit of the Committed
Purchasers and the CP Conduit Purchasers that it has not assumed in any manner
whatsoever any obligation of the Sellers under the Receivables Purchase
Agreement (i) to make collections and remittances in respect of any Canadian
goods and services tax, any Canadian provincial sales tax or any other similar
Canadian tax or (ii) to file any returns in respect of such taxes with Canadian
tax authorities and that it was not contemplated by either any Seller under the
Receivables Purchase Agreement or the Transferor that such obligation was to be
assumed by the Transferor. The parties hereto agree that none of the
Administrative Agent, the Committed Purchasers or the CP Conduit Purchasers are
assuming in any manner whatsoever any obligation of the Sellers under the
Receivables Purchase Agreement to collect such taxes, make such remittances and
file such returns, and that it is not contemplated by the parties hereto that
any such obligation is hereby assumed by the Committed Purchasers, the CP
Conduit Purchasers, the Administrative Agent or any Funding Agent. The
Transferor hereby indemnifies the Administrative Agent and each Funding Agent
for the benefit of the Committed Purchasers and the CP Conduit Purchasers and
holds them harmless from and against any assessments, withholding taxes, claims,
or other demands for payment of such taxes by Canadian tax authorities, as well
as interest and penalties; provided that any payments made by the Transferor
pursuant to this subsection shall be made solely from funds available to the
Transferor which are not otherwise required to be applied to
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the payment of any amounts pursuant to this Agreement (other than to the
Transferor), shall be non-recourse other than with respect to such funds, and
shall not constitute a claim against the Transferor to the extent that
insufficient funds exist to make such payment. It is understood that all of the
invoices in respect of the Receivables with Canadian Obligors of the Sellers
under the Receivables Purchase Agreement will bear the GST registration number
of such Seller.
SECTION 10.14. Limitation on the Termination of Sellers. Notwithstanding
anything to the contrary contained in the Receivables Purchase Agreement, the
Transferor shall not consent to any request made pursuant to Section 9.3
thereof, nor shall any Seller which is the subject of such request be terminated
under the Receivables Purchase Agreement, in each case unless (i) no Termination
Event or Potential Termination Event (other than with respect to the Seller to
be so terminated) has occurred and is continuing (both before and after giving
effect to such termination) and (ii) the Administrative Agent shall have
received prior notice of such termination.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Receivables Transfer Agreement as of the date first written above.
CARCORP, INC., as Transferor
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ PRODUCTS CO., individually
and as Collection Agent
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Treasurer
JPMORGAN CHASE BANK, as Administrative Agent
By:/s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
PARK AVENUE RECEIVABLES CORPORATION,
as CP Conduit Purchaser
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
JPMORGAN CHASE BANK, as Committed Purchaser
for Park Avenue Receivables Corporation
By:/s/ ▇▇▇▇▇▇▇ Zappatamni
---------------------------------
Name: ▇▇▇▇▇▇▇ Zappatamni
Title: Vice President
JPMORGAN CHASE BANK, as Funding Agent for
Park Avenue Receivables Corporation
By:/s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
SCHEDULE A
Definitions
"Accounting Change" means any change in accounting principles required by
the promulgation of any rule, regulation, pronouncement or opinion by the
Financial Accounting Standards Board of the American Institute of Certified
Public Accountants or, if applicable, the Securities and Exchange Commission or
any analogous Official Body.
"Additional Seller Supplement" shall have the meaning specified in Section
7.2(a) of the Receivables Purchase Agreement.
"Administrative Agent" shall mean JPMorgan Chase, as administrative agent
on behalf of the CP Conduit Purchasers, the Funding Agents and the Committed
Purchasers, and its permitted successors and assigns in such capacity.
"Advance" shall have the meaning specified in Section 3.2(a) of the
Receivables Purchase Agreement.
"Advance Limit" shall have the meaning specified in Section 3.2(a) of the
Receivables Purchase Agreement.
"Adverse Claim" shall mean a lien, security interest, charge or
encumbrance, or other right or claim in, of or on any Person's assets or
properties in favor of any other Person (including any UCC financing statement
or any similar instrument filed against such Person's assets or properties).
"Affected Committed Purchaser" shall have the meaning specified in Section
10.06(d)(ii) of the Receivables Transfer Agreement.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of the controlled
Person, whether through ownership of voting stock, by contract or otherwise;
provided, however, that a Person shall not be deemed an Affiliate of another
Person solely by reason of an individual serving as an officer or director of
any Person; and provided further, that any Person other than C&A and its
Subsidiaries which, directly or indirectly, is controlled by Heartland
Industrial Partners shall not be deemed an Affiliate of C&A or any of its
Subsidiaries.
"Aggregate Commitment" shall mean, at any time, the sum of the Commitments
then in effect.
"Aggregate Unpaids" shall mean, at any time, an amount equal to the sum of
(i) the aggregate accrued and unpaid Discount at such time, (ii) the Net
Investment at such time, (iii) all Fees, (iv) all Indemnified Amounts, amounts
payable pursuant to Section 2.21 of the Receivables Transfer Agreement and
Indemnified Taxes and (v) all other amounts owed
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(whether due or accrued) by the Transferor to the CP Conduit Purchasers and the
Committed Purchasers at such time.
"Applicable Margin" means, for any day:
(a) with respect to any BR Tranche, the spread specified in the definition
of "Applicable Rate" set forth in the Senior Credit Facility that is applicable
to Revolving Loans that are ABR Loans, and
(b) with respect to any Eurodollar Tranche, the spread specified in the
definition of "Applicable Rate" set forth in the Senior Credit Facility that is
applicable to Revolving Loans that are Eurocurrency Loans.
"Applicable Period" shall have the meaning specified in Section 6.02(c) of
the Receivables Transfer Agreement.
"Asset Purchase Agreement" shall mean, with respect to any CP Conduit
Purchaser, the asset purchase agreement, liquidity agreement or other agreement
among such CP Conduit Purchaser, the Funding Agent with respect to such CP
Conduit Purchaser and the Committed Purchaser with respect to such CP Conduit
Purchaser as the same may from time to time be amended, supplemented or
otherwise modified and in effect.
"Assignee" shall have the meaning specified in Section 10.06(d)(i) of the
Receivables Transfer Agreement.
"Authorized Foreign Exchange Dealer" shall mean any foreign exchange dealer
authorized by applicable law to deal and engage in foreign exchange transactions
relating to Canadian Dollars selected by the Collection Agent and reasonably
acceptable to the Administrative Agent.
"Bankruptcy Code" shall have the meaning assigned to that term in Section
3.01(v) of the Receivables Transfer Agreement.
"Base Rate" or "BR" shall mean, a rate per annum equal to the greater of
(i) the prime rate of interest announced by JPMorgan Chase from time to time,
changing when and as said prime rate changes (such rate not necessarily being
the lowest or best rate charged by JPMorgan Chase) or (ii) the sum of (a) 1.50%
and (b) the rate equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day for such transactions received
by JPMorgan Chase from three (3) Federal funds brokers of recognized standing
selected by it.
"Beneficiaries" shall mean the CP Conduit Purchasers, the Committed
Purchasers, the Funding Agents and the Administrative Agent, collectively.
"Benefit Plan" shall mean any employee benefit plan as defined in Section
3(3) of ERISA in respect of which the Transferor, a Seller or any ERISA
Affiliate of the Transferor or a
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Seller is, or at any time during the immediately preceding six (6) years was, an
"employer" as defined in Section 3(5) of ERISA.
"BR Tranche" shall mean a Tranche as to which Discount is calculated at the
Base Rate plus the Applicable Margin.
"BR Tranche Period" shall mean, with respect to a BR Tranche, either (i)
prior to the Termination Date, a period of up to thirty (30) days requested by
the Transferor and agreed to by a CP Conduit Purchaser, a Committed Purchaser or
the Funding Agent for such CP Conduit Purchaser or such Committed Purchaser, as
the case may be, commencing on a Business Day requested by the Transferor and
agreed to by the CP Conduit Purchaser, the Committed Purchaser or the Funding
Agent for such CP Conduit Purchaser or such Committed Purchaser, as the case may
be, or (ii) after the Termination Date, a period of one (1) Business Day. If
such BR Tranche Period would end on a day which is not a Business Day, such BR
Tranche Period shall end on the next succeeding Business Day.
"Business Day" shall mean any day excluding Saturday, Sunday and any day on
which commercial banks in The City of New York are authorized or required by law
to close, and, when used with respect to the determination of any Eurodollar
Rate or any notice with respect thereto, any such day which is also a day for
trading by and between banks in the London interbank market in United States
dollar deposits.
"C&A" shall mean ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Products Co., a Delaware corporation, and
its permitted successors and assigns.
"Canada/Canadian Dollar Collection Account" shall have the meaning
specified in Section 2.13(a) of the Receivables Transfer Agreement.
"Canada/U.S. Dollar Collection Account" shall have the meaning specified in
Section 2.13(a) of the Receivables Transfer Agreement.
"Canadian Dollar Receivables" shall mean Receivables payable in Canadian
Dollars sold to the Transferor pursuant to the Receivables Purchase Agreement.
"Canadian Dollars" shall mean dollars in lawful currency of Canada.
"Canadian Exchange Percentage" shall mean, at any date of determination,
the rate at which Canadian Dollars may be exchanged into United States dollars
(expressed as the percentage of Canadian Dollars per United States dollars), as
reported in The Wall Street Journal on the immediately preceding Business Day.
In the event that such rate does not appear in The Wall Street Journal on such
immediately preceding Business Day, the Canadian Exchange Percentage shall be
determined by reference to the relevant Bloomberg currency page (or, if such
rate does not appear on any Bloomberg currency page, on the relevant page of the
Reuters Monitor Money Rates Service) as of the close of business of the
immediately preceding Business Day. In the event that such rate does not appear
on any Bloomberg page or the relevant page of the Reuters Monitor Money Rates
Service, the Canadian Exchange Percentage shall be determined by reference to
such other publicly available service for displaying exchange rates with respect
to Canadian Dollars as may be selected by the Administrative Agent, and prior to
a
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Termination Event or Potential Termination Event, which is not reasonably
objected to by the Transferor.
"Capitalized Lease" of a Person shall mean any lease of property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP consistently applied.
"Carrying Cost Reserve Ratio" shall mean, on any day, an amount, expressed
as a percentage, equal to (a) the product of (i) 2 times DSO as of such day and
(ii) the Base Rate in effect as of the last day of the prior Settlement Period
plus 2.75%, divided by (b) 365.
"Change in Control" shall have the meaning specified in the Senior Credit
Facility.
"Charged-Off Receivables" shall mean, with respect to any Settlement
Period, all Receivables (or portions thereof) which, in accordance with the
Credit and Collection Policy, have or should have been written off during such
Settlement Period as uncollectible, including, without limitation, the
Receivables of any Obligor which becomes the subject of any voluntary or
involuntary bankruptcy proceeding.
"Closing Date" shall mean December 20, 2001.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder.
"Collection Accounts" shall have the meaning specified in Section 2.13(a)
of the Receivables Transfer Agreement.
"Collection Agent" shall mean, at any time, the Person then authorized
pursuant to Section 6.01 of the Receivables Transfer Agreement to service,
administer and collect Receivables. The initial Collection Agent shall be C&A.
"Collection Agent Default" shall have the meaning specified in Section 6.07
of the Receivables Transfer Agreement.
"Collections" shall mean, with respect to any Receivable, all cash
collections and other cash proceeds of such Receivable, including, without
limitation, any Finance Charges, any cash proceeds of Related Security with
respect to such Receivable, and any amounts in respect of a Receivable deemed to
have been received pursuant to Section 2.10(a) or (b) of the Receivables
Transfer Agreement.
"Commercial Paper" shall mean the short-term promissory notes of the CP
Conduit Purchasers issued by the CP Conduit Purchasers in the commercial paper
market.
"Commitment" shall mean, with respect to any Committed Purchaser, the
amount specified as such on Schedule B to the Receivables Transfer Agreement for
such Committed Purchaser, as the same may be reduced from time to time as
provided in Section 2.07 of the Receivables Transfer Agreement.
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"Commitment Expiry Date" shall initially mean with respect to each
Committed Purchaser, December 19, 2002, as extended from time to time with
respect to such Committed Purchaser pursuant to Section 2.26 of the Receivables
Transfer Agreement, and subject to termination pursuant to Section 10.01 of the
Receivables Transfer Agreement.
"Committed Purchaser Funded Amount" shall mean, with respect to any
Committed Purchaser for any day the excess, if any, of the portion of the Net
Investment funded by such Committed Purchaser and the related CP Conduit
Purchaser on such day over the CP Conduit Funded Amount of such CP Conduit
Purchaser for such day.
"Committed Purchasers" shall mean the banks and other financial
institutions identified as such on Schedule B to the Receivables Transfer
Agreement, as the same may be amended, supplemented or otherwise modified and in
effect from time to time.
"Concentration Factor" shall mean, on any day with respect to any Obligor,
except for a Special Obligor (except as specified in the definition of Special
Obligor Concentration Factor), a percentage equal to the following:
(i) with respect to Receivables of any Obligor with short-term ratings
or, if the Obligor does not have a short term rating from the applicable
Rating Agency, long-term ratings, of at least A-1 or A by S&P,
respectively, and at least P-1 or A2 by Moody's, respectively, 15%;
(ii) with respect to Receivables of any Obligor with short-term
ratings or, if the Obligor does not have a short term rating from the
applicable Rating Agency, long-term ratings, of at least A-2 or BBB+ by
S&P, respectively, and at least P-2 or Baa1 by Moody's, respectively, 12%;
(iii) with respect to Receivables of any Obligor which does not have a
short term rating from the applicable Rating Agency, but has a long-term
rating of at least BBB- by S&P and at least Baa3 by Moody's, 6%;
(iv) with respect to Receivables of any Obligor with short-term
ratings or, if the Obligor does not have a short term rating from the
applicable Rating Agency, long-term ratings, below A-2 or BBB- by S&P,
respectively, and below P-2 or Baa3 by Moody's, respectively, 3%; and
(v) with respect to Receivables of any Obligor with no short-term or
long-term ratings by S&P and Moody's, 3%.
The Concentration Factor for Obligors with split ratings shall be determined
based upon the lower of the two ratings.
"Conduit Assignee" shall mean, with respect to any CP Conduit Purchaser,
any commercial paper conduit that issues commercial paper rated at least A-1 by
S&P and P-1 by Moody's, administered by the Funding Agent with respect to such
CP Conduit Purchaser and designated by such Funding Agent to accept an
assignment from such CP Conduit Purchaser of such CP Conduit Purchaser's rights
and obligations pursuant to Section 10.06(b) of the Receivables Transfer
Agreement.
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"Consent Date" shall have the meaning specified in Section 2.26(a) of the
Receivables Transfer Agreement.
"Contract" shall mean a written agreement or invoice, pursuant to or under
which an Obligor shall be obligated to pay for merchandise purchased or services
rendered by the related Seller (or, in the case of the Dyers Receivables, Dyers)
and including all items and provisions incorporated or implied by applicable
law, including, without limitation, the Relevant UCC.
"Contributed Receivables" shall have the meaning specified in Section
3.2(b) of the Receivables Purchase Agreement.
"CP Conduit Funded Amount" means, with respect to any CP Conduit Purchaser
for any day, the aggregate portion of the Net Investment funded by such CP
Conduit Purchaser through the issuance of Commercial Paper outstanding on such
day.
"CP Conduit Funding Limit" means, with respect to any CP Conduit Purchaser,
the amount set forth opposite such CP Conduit Purchaser's name on Schedule B to
the Receivables Transfer Agreement, as the same may be reduced from time to time
as provided in Section 2.07 of the Receivables Transfer Agreement.
"CP Conduit Purchasers" shall mean the Persons identified as such on
Schedule B to the Receivables Transfer Agreement, as the same may be amended,
supplemented or otherwise modified and in effect from time to time.
"CP Conduit Purchaser's Interest" shall mean, on any day, with respect to
any CP Conduit Purchaser, the beneficial interest of such CP Conduit Purchaser
in the Receivables and Related Security and Collections and Proceeds thereof,
which beneficial interest shall equal the product of (i) the Percentage Factor
on such day, (ii) the Outstanding Balance of all Receivables and (iii) the
percentage equivalent of a fraction, the numerator of which is the CP Conduit
Funded Amount of such CP Conduit Purchaser and the denominator of which is the
Net Investment.
"CP Conduit Purchaser's Termination Event" shall mean, in the case of
PARCO, a PARCO Termination Event or, in the case of any Conduit Assignee or
other Person who becomes a CP Conduit Purchaser after the Closing Date, the "CP
Conduit Purchaser's Termination Event" specified in the agreement by which such
Person becomes a party to the Receivables Transfer Agreement.
"CP Rate" shall mean, (a) with respect to any CP Tranche funded or
maintained by any Match Funding CP Conduit Purchaser during any CP Tranche
Period, the rate equivalent to the weighted average of (i) the discount rate (or
if more than one discount rate, the weighted average of the discount rates) at
which Commercial Paper having a term equal to such CP Tranche Period can be sold
by any placement agent or commercial paper dealer selected by such Match Funding
CP Conduit Purchaser, converted to an annual yield-equivalent rate on the basis
of a 360-day year, which rates shall include placement agent and dealer fees and
commissions and (ii) the annual interest rate (or if more than one rate, the
weighted average of the annual interest rates) payable by such Match Funding CP
Conduit Purchaser on interest-bearing
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Commercial Paper having a term equal to such CP Tranche Period, on the basis of
a 360-day year, which rates shall include placement agent and dealer fees and
commissions, and (b) with respect to any CP Conduit Funded Amount funded or
maintained by any Pooled Funding CP Conduit Purchaser during any CP Tranche
Period, the rate equivalent to the weighted average of (i) the weighted average
of the discount rates on all of such Pooled Funding CP Conduit Purchaser's
Commercial Paper issued at a discount and outstanding during such Tranche
Period, converted to an annual yield-equivalent rate on the basis of a 360-day
year, which rates shall include placement agent and dealer fees and commissions,
and (ii) the weighted average of the annual interest rates payable by such
Pooled Funding CP Conduit Purchaser on all interest-bearing Commercial Paper
outstanding during such Tranche Period, on the basis of a 360-day year, which
rates shall include placement agent and dealer fees and commissions; provided,
that to the extent that such CP Tranche is funded by a specific issuance of such
Pooled Funding CP Conduit Purchaser's Commercial Paper, the "CP Rate" may, in
such Pooled Funding CP Conduit Purchaser's sole discretion, equal the rate or
weighted average of the rates applicable to such issuance.
"CP Tranche" shall mean a Tranche as to which Discount is calculated at the
CP Rate.
"CP Tranche Period" shall mean, (a) for any Match Funding CP Conduit
Purchaser, with respect to a CP Tranche, a period of days not to exceed 90 days
commencing on a Business Day requested by the Transferor and agreed to by such
Match Funding CP Conduit Purchaser pursuant to Section 2.03 of the Receivables
Transfer Agreement; provided that if a CP Tranche Period would end on a day
which is not a Business Day, such CP Tranche Period shall end on the next
succeeding Business Day, and (b) for any Pooled Funding CP Conduit Purchaser,
with respect to a CP Tranche, each calendar month, provided that on or after the
Termination Date, each Pooled Funding CP Conduit Purchaser (or the Funding Agent
with respect to such Pooled Funding CP Conduit Purchaser) shall select all
Tranche Periods.
"Credit and Collection Policy" shall mean the Sellers' credit and
collection policy or policies relating to Contracts and Receivables existing on
the Closing Date and referred to in Exhibit A attached to the Receivables
Transfer Agreement, as amended, supplemented or otherwise modified and in effect
from time to time in compliance with Section 5.02(c) of the Receivables Transfer
Agreement.
"Credit Default Swap" shall mean (i) the credit default swap dated as of
December 20, 2001 between the Transferor and an Eligible Counterparty with
respect to the payment obligations of DaimlerChrysler AG under Receivables sold
to the Transferor, (ii) the credit default swap dated as of December 20, 2001
between the Transferor and an Eligible Counterparty with respect to the payment
obligations of General Motors Corporation under Receivables sold to the
Transferor, (iii) the credit default swap dated as of December 20, 2001 between
the Transferor and an Eligible Counterparty with respect to the payment
obligations of Ford Motor Company under Receivables sold to the Transferor, and
(iv) any other credit default swap entered into by the Transferor with respect
to payment obligations of any Obligor in respect of the related Receivables, in
each case which shall be satisfactory in form, substance, amount and in all
other respects to the Administrative Agent and each Committed Purchaser, as the
same may from time to time be modified, supplemented, amended, extended or
replaced as consented to by the Administrative Agent, each Funding Agent and
each Committed Purchaser.
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"Daily Report" shall mean a Deposit Report delivered on each Business Day
pursuant to Section 2.12 of the Receivables Transfer Agreement.
"Deemed Collections" shall mean any Collections on any Receivable deemed to
have been received pursuant to Section 2.10(a) or (b) of the Receivables
Transfer Agreement.
"Default Ratio" shall mean, as of the last day of each Settlement Period,
the percentage equivalent of a fraction, the numerator of which shall be the sum
of (a) the aggregate unpaid balance of Receivables that were 91 to 120 days past
due and (b) the aggregate amount of Receivables that were charged off as
uncollectible or which, in accordance with the Credit and Collection Policy,
should be written off as uncollectible, in each case prior to the day that is
121 days after its original due date during such Settlement Period, and the
denominator of which shall be the aggregate amount of all Receivables originated
(or, in the case of the Dyers Receivables, acquired) by the Sellers during the
fifth prior Settlement Period (including the Settlement Period ended on such
day).
"Defaulted Receivable" shall mean a Receivable: (i) as to which any
payment, or part thereof, remains unpaid for more than 91 days from the original
due date for such Receivable; (ii) as to which an Event of Bankruptcy has
occurred and is continuing with respect to the Obligor thereof; (iii) which has
been identified by the Transferor, the Seller or the Collection Agent as
uncollectible; or (iv) which, in accordance with the Credit and Collection
Policy, should be written off as uncollectible.
"Delinquency Ratio" shall mean, on any day, a fraction the numerator of
which is the aggregate principal amount of all Delinquent Receivables as of the
end of the preceding Settlement Period and the denominator of which is the
aggregate principal amount of all outstanding Receivables as of the end of the
preceding Settlement Period.
"Delinquent Receivable" shall mean a Receivable as to which any payment, or
part thereof, remains unpaid for more than 61 days past its original due date.
"Deposit Account" shall have the meaning specified in Section 2.05 of the
Receivables Transfer Agreement.
"Deposit Report" shall mean a written report substantially in the form
attached hereto as Exhibit D-1.
"Diluted Receivable" shall mean, any Receivable which is the subject of a
reduction or cancellation as a result of any defective, rejected or returned
merchandise or services and all credits, rebates, discounts, disputes, warranty
claims, repossessed or returned goods, charge backs, allowances, other dilutive
factors and any other billing or other adjustment (whether effected through the
granting of credits against the applicable Receivables or by the issuance of a
check or other payment in respect of (and as payment for) such reduction or
cancellation) but excluding adjustments, reductions, or cancellations in respect
of the Obligor's bankruptcy or insolvency.
"Dilution Adjustments" shall mean, collectively, the adjustments,
cancellations and reductions described in the definition of "Diluted
Receivable."
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"Dilution Horizon" shall mean the number of days from the invoicing of a
Receivable until a Dilution Adjustment with respect to such Receivable is issued
by a Seller or a Seller receives notice that a Dilution Adjustment will have to
be issued in respect of such Receivable.
"Dilution Horizon Factor" shall mean (i) for the period from the Closing
Date until the July 2002 Settlement Date, 2.52 and (ii) for any six-month period
thereafter (beginning and ending on a Settlement Date) a fraction, the numerator
of which is the dollar weighted average Dilution Horizon of the Sellers (based
upon the Dilution Adjustment of the selected Receivables) in the prior six-month
period, or in the case of the July 2002 to January 2003 period the last four
Settlement Periods prior to such period (which shall be calculated by the
Collection Agent, in accordance with its past procedures for such calculations),
and the denominator of which is 30; provided however, that if the Dilution
Horizon Factor for any period is less than the Dilution Horizon Factor for the
immediately preceding period, then the actual Dilution Horizon Factor for such
current period shall be recalculated to equal a fraction, the numerator of which
is equal to the average of the numerators used to calculate the Dilution Horizon
Factor for such immediately preceding period and such current period and the
denominator of which is 30.
"Dilution Period" shall mean as of any Settlement Date and continuing until
(but not including) the next Settlement Date, the quotient of (i) the product of
(A) the principal amount of Receivables originated (or, in the case of the Dyers
Receivables, acquired) by the Sellers during the Settlement Period immediately
preceding such earlier Settlement Date and (B) the Dilution Horizon Factor
divided by (ii) the Net Receivables Balance as of the last day of the Settlement
Period preceding such earlier Settlement Date.
"Dilution Ratio" shall mean, as of the last day of each Settlement Period,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Diluted Receivables (other than Excluded Diluted Receivables) arising
during such Settlement Period and the denominator of which is the aggregate
principal amount of all Receivables originated (or, in the case of the Dyers
Receivables, acquired) by the Sellers during the Settlement Period immediately
preceding the Settlement Period ended on such day.
"Dilution Reserve Ratio" shall mean, as of any Settlement Date, and
continuing until (but not including) the next Settlement Date, an amount
(expressed as a percentage) that is calculated as follows:
DRR = [(C x D) + [(E-D) x (E/D)]] x F
Where:
DRR = Dilution Reserve Ratio;
C = 2.0;
D = the twelve-month rolling average of the Dilution Ratio that occurred
during the period of twelve consecutive Settlement Periods ending
immediately prior to such earlier Settlement Date;
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E = the highest Dilution Ratio that occurred during the period of twelve
consecutive Settlement Periods ending prior to such earlier Settlement
Date; and
F = the Dilution Period.
"Discount" means, with respect to any Tranche Period:
(TR x TNI x AD)
-------------------
YD
Where:
TR = the Tranche Rate applicable to such Tranche Period;
TNI = the portion of the Net Investment allocated to such Tranche Period;
AD = the actual number of days during such Tranche Period; and
YD = either (i) if the Tranche Rate is the CP Rate or the Eurodollar Rate, 360
or (ii) if the Tranche Rate is the Base Rate, 365 or 366, as applicable.
provided, however, that no provision of the Receivables Transfer Agreement shall
require the payment or permit the collection of Discount in excess of the
maximum amount permitted by applicable law; and provided, further, that Discount
shall not be considered paid by any distribution if, at any time, such
distribution is rescinded or must be returned for any reason.
"Discount Percentage" shall mean, on any date, the percentage obtained from
the following formula:
100% - (A + B + C + D)
all determined by the Transferor as of the related Transfer Date,
Where
A = The ratio, as of such Transfer Date, obtained by dividing (a) Charged-Off
Receivables (net of recoveries in respect of Charged-Off Receivables)
during the six-fiscal month period immediately preceding the Settlement
Date most recently preceding such Transfer Payment Date by (b) the
aggregate amount of Collections during the six-fiscal month period
immediately preceding the Settlement Date most recent to such Transfer Date
(the "Adjusted Loss Reserve Percentage").
B = The amount, as of such Transfer Date, obtained by dividing (a) the
product of (i) 1.5, (ii) the average of the DSO for the three Settlement
Dates most recent to such Transfer Date and (iii) the Base Rate as of the
Settlement Date most recent to such Transfer Date by (b) 365 (the "Adjusted
Carrying Cost Reserve Percentage").
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C = The product of (i) the Servicing Fee Percentage and (ii) 1.5 times the
average DSO for the three Settlement Dates immediately preceding such
Transfer Date divided by (iii) 365.
D = The amount of 1/10 of 1%, which reflects the cost of the Transferor's
overhead, including costs of processing the purchase of Receivables and
other normal operation costs and a reasonable profit margin (the
"Processing Expense Reserve Percentage").
None of the elements of the above-referenced formula, in respect of any
purchase of Receivables, will be adjusted following the related Transfer Date.
With respect to each calculation set forth above with respect to a
Settlement Date, such calculation as calculated on such Settlement Date and
included in the applicable Settlement Statement shall remain in effect from and
including the related Settlement Date to but excluding the following Settlement
Date.
For the initial Settlement Period, the Discount Percentage will be 98%.
"Dismissal Period" shall mean, with respect to any Event of Bankruptcy, the
continuance, undismissed, unstayed and in effect, of a related proceeding for a
period of sixty (60) consecutive days.
"DSO" shall mean, on any Settlement Date, the number of calendar days equal
to the product of (a) 91 and (b) the amount obtained by dividing (i) the Net
Receivables Balance as of the last day of the immediately preceding Settlement
Period by (ii) the aggregate balance of Receivables which arose during the three
(3) consecutive Settlement Periods immediately preceding such Settlement Date,
which calculation shall remain in effect until the next succeeding Settlement
Date for all purposes of the Receivables Transfer Agreement.
"Dyers" shall mean Western Avenue Dyers, L.P., a Delaware limited
partnership.
"Dyers Receivable" shall mean a Receivable acquired by C&A from Dyers,
prior to the Closing Date.
"Early Collection Fee" shall mean, for any Tranche Period during which the
portion of the Net Investment that was allocated to such Tranche Period is
reduced for any reason whatsoever, the excess, if any, of (i) the additional
Discount that would have accrued during such Tranche Period if such reductions
had not occurred, minus (ii) the income, if any, received by the recipient of
such reductions from investing the proceeds of such reductions.
"Eligible Counterparty" shall mean a Counterparty with commercial paper or
short-term deposit ratings of at least A-1 or P-1.
"Eligible Obligor" shall mean any Obligor (i) as to which not more than 25%
of the aggregate Receivables relating thereto are more than 60 days past their
original due date, (ii) as to which, if the aggregate Receivables of such
Obligor exceed 15% of the then aggregate Eligible Receivables, such aggregate
Receivables are covered by a Credit Default Swap, (iii) that is not an Official
Body or an Affiliate of any of the parties to the Receivables Transfer
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Agreement, and (iv) that is not the subject of an Event of Bankruptcy (without
giving effect to any Dismissal Period).
"Eligible Receivable" shall mean, at any time, any Receivable:
(1) which has been originated by a Seller and (b) sold to the Transferor
pursuant to and in accordance with the Receivables Purchase Agreement, and
to which the Transferor has good title thereto, free and clear of any
Adverse Claims (other than Permitted Encumbrances);
(2) which (together with the Collections and Related Security related thereto)
has been the subject of either (A) a valid sale and assignment from the
Transferor to the Administrative Agent, on behalf of the CP Conduit
Purchasers and the Committed Purchasers, of all of the Transferor's right,
title and interest therein or (B) the grant of a first priority perfected
security interest therein (and in the Collections and Related Security
related thereto), in each case free and clear of all liens and effective
until the termination of the Receivables Transfer Agreement.
(3) the Obligor of which is an Eligible Obligor;
(4) the Obligor of which is a United States resident; provided, however, that
Receivables the Obligors of which are resident in Canada shall be deemed to
be Eligible Receivables (x) if such Receivables would otherwise be Eligible
Receivables and (y) only to the extent the aggregate principal amount of
such Receivables does not exceed 20.0% of the Outstanding Balance of all
Eligible Receivables;
(5) which is not a Delinquent Receivable or a Defaulted Receivable;
(6) which (A) arises pursuant to a Contract with respect to which the Seller
has performed all obligations required to be performed by it thereunder,
including, without limitation, shipment of the merchandise and/or the
performance of the services purchased thereunder; and (B) according to the
Contract related thereto, has been billed and is required to be paid in
full within 60 days of the original billing date therefor in accordance
with the terms of the applicable Contract;
(7) which is an "eligible asset" as defined in Rule 3a-7 under the Investment
Company Act of 1940, as amended;
(8) which is (A) an "account" within the meaning of Section 9-102(a)(2) of the
Relevant UCC or (B) a "general intangible" within the meaning of Section
9-102(a)(42) of the Relevant UCC;
(9) which is denominated and required to be settled only in United States
dollars or Canadian Dollars in the United States or Canada, provided that
if (A) the Required Currency Hedge is not in place or (B) a Counterparty
ceases to be an Eligible Counterparty, then such Receivables shall not be
Eligible Receivables (except that if such Counterparty is no longer an
Eligible Counterparty as a result of such Counterparty's commercial paper
or short-term deposit ratings not being
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at least A-1 or P-1, but such ratings are not lower than A-2 or P-2,
respectively, and such Counterparty is to be replaced with an Eligible
Counterparty in accordance with Section 5.01(r), then such Receivables
shall be Eligible Receivables during the 30-day period referred to in
Section 5.01(r)); and provided, further that if the Required Currency Hedge
is for a notional amount less than the Required Hedge Notional Amount, then
the principal amount of Canadian Dollar Receivables included as Eligible
Receivables will be limited to the actual notional amount of the Required
Currency Hedge calculated using the Valuation Price;
(10) which arises under a Contract that, together with the Receivable related
thereto, is in full force and effect and constitutes the legal, valid and
binding obligation of the related Obligor, enforceable against such Obligor
in accordance with its terms and is not subject to any litigation, dispute,
offset (including, without limitation, with respect to any amounts owed by
C&A or any Seller to ▇▇▇▇▇▇▇ Controls, Inc.), counterclaim or other defense
other than unexpired volume or pricing discounts or rebates to which the
obligor thereon may be entitled, provided that only such portion of such
receivable subject to any such dispute, offset, counterclaim or defense
shall be deemed ineligible under this criterion;
(11) which, together with the Contract related thereto, does not contravene in
any material respect any laws, rules or regulations applicable thereto
(including, without limitation, laws, rules and regulations relating to
truth in lending, fair credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices and privacy) and with respect
to which no part of the Contract related thereto is in violation of any
such law, rule or regulation in any material respect;
(12) which (A) satisfies all applicable requirements of the Credit and
Collection Policy, (B) is assignable without the consent of, or notice to,
the Obligor thereunder and (C) complies with such other reasonable criteria
and requirements as the Administrative Agent may, in accordance with any
changes to Rating Agency criteria, from time to time specify to the
Transferor following five (5) days' notice;
(13) which was originated in the ordinary course of the Seller's business;
(14) the Obligor of which has been directed to make all payments to a specified
account of the Transferor with respect to which there shall be a Lockbox
Agreement in effect;
(15) the assignment of which under the Receivables Purchase Agreement by the
Seller to the Transferor and the assignment of which under the Receivables
Transfer Agreement by the Transferor to the CP Conduit Purchasers and the
Committed Purchasers does not violate, conflict with or contravene any
applicable laws, rules, regulations, orders or writs or any contractual or
other restriction, limitation or encumbrance and does not require the
consent of any Person that has not been obtained;
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(16) which has not been compromised, adjusted or modified for credit reasons
(including by the extension of time for payment or the granting of any
discounts, allowances or credits), provided that only such portion of such
receivable that has been so compromised, adjusted or modified shall be
deemed ineligible pursuant to this criterion; and
(17) which, if purchased with proceeds of Commercial Paper, would constitute a
"current transaction" within the meaning of Section 3(a)(3) of the
Securities Act of 1933, as amended.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended, supplemented or otherwise modified and in effect from time to time, and
the rules and regulations promulgated thereunder.
"ERISA Affiliate" shall mean, with respect to any Person, (i) any
corporation which is a member of the same controlled group of corporations
(within the meaning of Section 414(b) of the Code (as in effect from time to
time, the "Code")) as such Person; (ii) a trade or business (whether or not
incorporated) under common control (within the meaning of Section 414(c) of the
Code) with such Person; or (iii) a member of the same affiliated service group
(within the meaning of Section 414(m) of the Code) as such Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above.
"ERISA Event" shall mean any of the following: (i) the filing pursuant to
Section 412(d) of the Code or Section 303(d) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (ii) the
receipt by such Person or any ERISA Affiliate from the Pension Benefit Guaranty
Corporation or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan;
(iii) the incurrence by such Person or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; (iv) any "reportable event" as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (unless either
(x) the 30-day notice period is waived or (y) the event is described in Pension
Benefit Guaranty Corporation Regs. Sections 4043.29, 4043.30, 4043.31 or
4043.32, and (A) no increase in unfunded vested benefits of a Plan or
termination of a Plan occurs or could reasonably be expected to occur as a
result and (B) the transaction involved is not described in Section 4069 or
4212(c) of ERISA), (v) the incurrence by such Person or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan or (vi) the receipt by such Person or any ERISA
Affiliate of any notice, or the receipt by any Multiemployer Plan from such
Person or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Tranche
Period, a rate per annum equal to the sum (rounded upwards, if necessary, to the
next higher 1/100 of 1%) of (A) the rate obtained by dividing (i) the applicable
LIBOR Rate by (ii) a percentage equal to 100% minus the reserve percentage used
for determining the maximum reserve requirement as specified in Regulation D of
the Board of Governors of the Federal Reserve System of the United States (or
any successors) or in any regulations of any other Official Body having
jurisdiction with respect thereto (including, without limitation, any marginal,
emergency,
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supplemental, special or other reserves) that is applicable during such
Eurodollar Tranche Period in respect of eurocurrency or eurodollar funding,
lending or liabilities (or, if more than one percentage shall be so applicable,
the daily average of such percentage for those days in such Eurodollar Tranche
Period during which any such percentage shall be applicable) plus (B) the then
daily net annual assessment rate (rounded upwards, if necessary, to the nearest
1/100 of 1%) as estimated by the Administrative Agent for determining the
current annual assessment payable to the Federal Deposit Insurance Corporation
in respect of eurocurrency or eurodollar funding, lending or liabilities.
"Eurodollar Tranche" shall mean a Tranche as to which Discount is
calculated at the Eurodollar Rate plus the Applicable Margin.
"Eurodollar Tranche Period" shall mean, with respect to a Eurodollar
Tranche, prior to the Termination Date, a period of up to three (3) months
requested by the Transferor and agreed to by a CP Conduit Purchaser, a Committed
Purchaser or the Funding Agent for such CP Conduit Purchaser or such Committed
Purchaser commencing on a Business Day requested by the Transferor and agreed to
by the CP Conduit Purchaser, the Committed Purchaser or the Funding Agent for
such CP Conduit Purchaser or such Committed Purchaser; provided, however, that
if such Eurodollar Tranche Period would expire on a day which is not a Business
Day, such Eurodollar Tranche Period shall expire on the next succeeding Business
Day; provided, further, that if such Eurodollar Tranche Period would expire on
(a) a day which is not a Business Day but is a day of the month after which no
further Business Day occurs in such month, such Eurodollar Tranche Period shall
expire on the next preceding Business Day or (b) a Business Day for which there
is no numerically corresponding day in the applicable subsequent calendar month,
such Eurodollar Tranche Period shall expire on the last Business Day of such
month.
"Event of Bankruptcy" shall mean, with respect to any Person, (i) that such
Person (a) shall generally not pay its debts as such debts become due or (b)
shall admit in writing its inability to pay its debts generally or (c) shall
make a general assignment for the benefit of creditors; (ii) any proceeding
shall be instituted by or against such Person seeking to adjudicate it as
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any substantial part of
its property, and, with respect to any Person other than the Transferor, in the
case of a proceeding instituted by a party other than such Person, the Dismissal
Period shall have elapsed, or (iii) if such Person is a corporation, such Person
or any Subsidiary shall take any corporate action to authorize any of the
actions set forth in the preceding clauses (i) or (ii).
"Excluded Diluted Receivables" shall mean:
(i) Receivables originated by any New Seller which became Diluted
Receivables (x) prior to the Closing Date or (y) after the Closing Date up
to $500,000 in the aggregate, in each case as a result of DaimlerChrysler's
5.5% price rollback announced in the fourth quarter of 2000;
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(ii) any Tooling Receivables originated by any New Seller which became
a Diluted Receivable (x) prior to the Closing Date, as a result of such
Receivable being billed prior to completion of a production part approval
process (or equivalent process) with respect to such Receivable, or (y)
after the Closing Date, as a result of Dilution Adjustments to Receivables
originated prior to the Closing Date;
(iii) any Receivable originated by any New Sellers which became a
Diluted Receivable prior to the Closing Date as a result of Dilution
Adjustments made on the date such Receivable was originated; and
(iv) any Receivable originated by any New Sellers owed by any Obligor
which became a Diluted Receivable prior to the Closing Date as a result of
Dilution Adjustments arising from the netting of amounts owed by any New
Sellers to such Obligor against such Receivable.
"Extending Committed Purchaser" shall have the meaning specified in Section
2.26(a) of the Receivables Transfer Agreement.
"Facility Limit" shall mean, at any time, the sum of the CP Conduit Funding
Limits then in effect; provided, that the Facility Limit may not at any time
exceed 98.04% of the Aggregate Commitment at any time in effect; provided,
further, that from and after the Termination Date, the Facility Limit shall at
all times equal the Net Investment.
"Federal Funds Rate" shall mean, for any day, an interest rate per annum
equal to (a) the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or (b) if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 11:00 A.M. (New
York time) on such day on such transactions received by the Administrative Agent
from three (3) federal funds brokers of recognized standing selected by the
Administrative Agent in its sole discretion.
"Fee Letter" shall mean the letter agreement, dated the Closing Date,
between the Transferor and the Administrative Agent, for the benefit of the CP
Conduit Purchasers, the Funding Agents and the Committed Purchasers with respect
to the fees to be paid by the Transferor under the Transaction Documents, as
amended, supplemented or otherwise modified and in effect from time to time.
"Fees" shall mean the fees payable pursuant to the Fee Letter.
"Finance Charges" shall mean, with respect to a Contract, any finance,
interest, late or similar charges owing by an Obligor pursuant to such Contract.
"Funding Agents" shall mean the Persons identified as such on Schedule B to
the Receivables Transfer Agreement, as the same may be amended, supplemented or
otherwise modified and in effect from time to time.
"GAAP" shall mean United States generally accepted accounting principles as
in effect from time to time.
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"Guarantor" shall mean C&A in its capacity as Guarantor under the Limited
Guaranty.
"Guaranty" shall mean, with respect to any Person, any agreement by which
such Person assumes, guarantees, endorses, contingently agrees to purchase or
provide funds for the payment of, or otherwise becomes liable upon, the
obligation of any other Person, or agrees to maintain the net worth or working
capital or other financial condition of any other Person or otherwise assures
any other creditor of such other Person against loss, including, without
limitation, any comfort letter, operating agreement or take-or-pay contract and
shall include, without limitation, the contingent liability of such Person in
connection with any application for a letter of credit; provided, however, that
the term "Guaranty" shall not mean or include the endorsements by such Person of
Instruments for deposit or collection in the ordinary course of business.
"Incremental Transfer" shall mean a Transfer which is made pursuant to
Section 2.02(a) of the Receivables Transfer Agreement.
"Indebtedness" shall mean, with respect to any Person, such Person's (i)
obligations for borrowed money, (ii) obligations representing the deferred
purchase price of property other than accounts payable arising in the ordinary
course of such Person's business on terms customary in the trade, (iii)
obligations, whether or not assumed, secured by liens or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) Capitalized Lease obligations and (vi) Guaranty obligations.
"Indemnified Amounts" shall have the meaning specified in Section 2.20 of
the Receivables Transfer Agreement.
"Indemnified Party" shall have the meaning specified in Section 2.20 of the
Receivables Transfer Agreement.
"Indemnified Taxes" shall mean any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any Official
Body, excluding (A) all franchise taxes, all taxes, levies, imposts, duties,
charges, fees, deductions and withholdings imposed on or measured by net income,
capital or net worth or all taxes, levies, imposts, duties, charges, fees,
deductions and withholdings on doing business, in each case, imposed:
(i) by the United States or any political subdivision or taxing
authority thereof or therein;
(ii) by any jurisdiction under the laws of which any Program Support
provider or any Indemnified Party or lending office is organized or in
which its lending office is located, managed or controlled or in which its
principal office is located or any political subdivision or taxing
authority thereof or therein; or
(iii) by reason of any connection between the jurisdiction imposing
such tax and the Administrative Agent, any Program Support Provider, any
Indemnified Party or such lending office other than a connection arising
solely from the Receivables Transfer
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Agreement or any other Transaction Document or any transaction hereunder or
thereunder,
(B) all penalties, interests, additions to taxes and expenses resulting from
gross negligence or wilful misconduct on the part of any Program Support
Provider or any Indemnified Party, as the case may be, and (C) all taxes,
levies, imposts, duties, charges, fees, deductions and withholdings imposed by
reason of the failure of any Indemnified Party to comply with its obligations,
if any, under Section 2.22(b) of the Receivables Transfer Agreement (including,
without limitation, its inability to comply with Section 2.22(b)(i) of the
Receivables Transfer Agreement).
"Independent Director" shall have the meaning specified in Section
5.01(n)(x) of the Receivables Transfer Agreement.
"Insolvency Event" means, as to any Person:
(a) (i) a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of such Person in an involuntary case under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, which decree or order is not stayed, or any other
similar relief shall be granted under any applicable federal or state law, (ii)
an involuntary case is commenced against such Person under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect which
remains undismissed, undischarged or unbonded for a period of 90 days or (iii)
such Person shall have a decree or an order for relief entered with respect to
it or commence a voluntary case under the Bankruptcy Code or any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect; or
(b) such Person shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to all or
substantially all of its property, or a decree or order of a court or agency or
supervisory authority having jurisdiction in the premises for the appointment of
a conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against such
Person; or such Person shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make a general assignment for
the benefit of its creditors or voluntarily suspend payment of its obligations.
"Interest Coverage Ratio" shall be calculated as set forth in the Senior
Credit Facility; provided that, for purposes set forth in Section 2.12 of the
Receivables Transfer Agreement, such ratio shall be compared to the ratio set
forth below opposite the applicable time period:
Period Ending: Ratio:
December 31, 2001-September 30, 2002 2.25 to 1.00
December 31, 2002 2.35 to 1.00
March 31, 2003 2.45 to 1.00
June 30, 2003 2.55 to 1.00
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September 30, 2003 2.65 to 1.00
December 31, 2003-September 30, 2004 2.85 to 1.00
December 31, 2004-March 31, 2005 3.00 to 1.00
June 30, 2005 and thereafter 3.25 to 1.00
"JCI Collection Account" shall have the meaning specified in Section
6.05(g) of the Receivables Transfer Agreement.
"JCI Collections" shall have the meaning specified in Section 6.05(g) of
the Receivables Transfer Agreement.
"JPMorgan Chase" shall mean JPMorgan Chase Bank, in its individual
capacity, and its successors.
"JPMorgan Chase Roles" shall have the meaning specified in Section 10.12 of
the Receivables Transfer Agreement.
"Law" shall mean any law (including common law), constitution, statute,
treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of
any Official Body.
"Leverage Ratio" shall be calculated as set forth in the Senior Credit
Facility; provided, that, for purposes set forth in Section 2.12 of the
Receivables Transfer Agreement, such ratio shall be compared to the ratio set
forth below opposite the applicable time period:
Period Ending: Ratio:
December 31, 2001-September 30, 2002 4.50 to 1.00
December 31, 2002 4.25 to 1.00
March 31, 2003 4.00 to 1.00
June 30, 2003 3.75 to 1.00
September 30, 2003 3.50 to 1.00
December 31, 2003-September 30, 2004 3.25 to 1.00
December 31, 2004 and thereafter 3.00 to 1.00
"LIBOR Rate" shall mean with respect to each Eurodollar Tranche Period for
a Eurodollar Tranche, the rate per annum equal to the rate at which the
Administrative Agent is offered U.S. Dollar deposits at or about 10:00 A.M.
local market time, two Business Days prior to the beginning of such Eurodollar
Tranche Period in the interbank eurodollar market where the eurodollar and
foreign currency and exchange operations in respect of its Eurodollar Tranches
are then being conducted for delivery on the first day of such Eurodollar
Tranche Period for the number of days comprised therein and in an amount
comparable to the amount of its Eurodollar Tranche be outstanding during such
Eurodollar Tranche Period (and rounded upward to the next whole multiple of 1/16
of 1%).
"Limited Guaranty" shall mean the Limited Guaranty of the Guarantor, in
substantially the form of Exhibit M to the Receivables Transfer Agreement, dated
as of December 20, 2001, as amended, supplemented or otherwise modified and in
effect from time to time.
SB-19
"Liquidating Purchaser Group" shall mean any Committed Purchaser whose
Commitment has reached its Commitment Expiry Date, together with the related CP
Conduit Purchaser.
"Liquidation Share" shall mean, for any Liquidating Purchaser Group, during
the term of the applicable Partial Liquidation and any day during such Partial
Liquidation, 100%.
"Lockbox Account" shall mean an account owned by the Transferor and
maintained by the Collection Agent at a Lockbox Bank for the purpose of
receiving Collections from Receivables.
"Lockbox Agreement" shall mean an agreement among the Transferor, the
Administrative Agent, the Collection Agent and a Lockbox Bank in substantially
the form of Exhibit C to the Receivables Transfer Agreement.
"Lockbox Bank" shall mean each of the banks set forth in Exhibit B to the
Receivables Transfer Agreement, and such banks as may be added thereto or
deleted therefrom pursuant to Section 2.09 of the Receivables Transfer
Agreement.
"Loss and Dilution Reserve Ratio" shall mean, on any day, the greater of:
(a) the Minimum Loss Reserve; and
(b) the sum of the Loss Reserve Ratio plus the Dilution Reserve Ratio.
"Loss Horizon" shall mean, on any day, the amount obtained by dividing (i)
the sum of all Receivables which arose during the three Settlement Periods
immediately preceding such day plus 0.25 times the sum of all Receivables which
arose during the fourth Settlement Period immediately preceding such day by (ii)
the Net Receivables Balance as of the end of the preceding Settlement Period.
"Loss Reserve Ratio" shall mean, as of any Settlement Date, and continuing
until (but not including) the next Settlement Date, an amount (expressed as a
percentage) that is calculated as follows:
LRR = A * B * C * D
Where:
LRR = Loss Reserve Ratio;
A = 2.0;
B = the highest three month average Default Ratio that occurred during the
twelve most recent Settlement Periods; and
C = the Loss Horizon;
D = the Payment Terms Factor.
SB-20
"Match Funding CP Conduit Purchaser" means each CP Conduit Purchaser that
is identified on Schedule D to the Receivables Transfer Agreement as a Match
Funding CP Conduit Purchaser and each CP Conduit Purchaser that, after the
Closing Date, notifies the Transferor and the Administrative Agent in accordance
with Section 2.03(a) of the Receivables Transfer Agreement in writing that it is
funding its CP Conduit Funded Amount with Commercial Paper issued by it, or for
its benefit, in specified CP Tranches selected in accordance with Section
2.03(a) of the Receivables Transfer Agreement and that, in each case, has not
subsequently notified the Transferor and the Administrative Agent in writing
that the Transferor will no longer be permitted to select CP Tranches in
accordance with Section 2.03(a) of the Receivables Transfer Agreement in respect
of the CP Conduit Funded Amount with respect to such CP Conduit Purchaser.
"Material Adverse Effect" shall mean any event or condition which would
have a material adverse effect on (i) the collectibility of the Receivables,
(ii) the condition (financial or otherwise), businesses or properties of the
Transferor or any Seller, (iii) the ability of the Transferor or any Seller to
perform its respective obligations under the Transaction Documents to which it
is a party or (iv) the interests of the Administrative Agent, the CP Conduit
Purchasers, the Funding Agents or the Committed Purchasers under the Transaction
Documents; provided, however, that for purposes of clause (ii) an event or
condition resulting in a material adverse change in the condition (financial or
otherwise) of any Seller will not be deemed to have a Material Adverse Effect
unless such event or condition, in the Administrative Agent's reasonable
discretion, is reasonably likely to have a material adverse effect on the
condition (financial or otherwise) of C&A on a consolidated basis or on the
Transferor.
"Maximum Percentage Factor" means 100%.
"Minimum Loss Reserve" shall mean, as of any Settlement Date and continuing
until (but not including) the next Settlement Date, an amount (expressed as a
percentage) that is calculated as follows:
MLR = (a*b)+c
Where:
MLR = Minimum Loss Reserve;
a = the average of the Dilution Ratios during the period of twelve
consecutive Settlement Periods ending prior to such earlier Settlement
Date;
b = the Dilution Period; and
c = 15%
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc., and its successors
and assigns.
SB-21
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA which is or was at any time during the current year
or the immediately preceding five years contributed to by the Transferor, any
Seller or any ERISA Affiliate of the Transferor or any Seller on behalf of its
employees.
"Net Investment" shall mean the sum of the cash amounts paid to the
Transferor by the CP Conduit Purchasers and/or the Committed Purchasers for all
Incremental Transfers minus the aggregate amount of Collections received and
applied by the Administrative Agent to reduce such Net Investment pursuant to
Section 2.06 or 2.10 of the Receivables Transfer Agreement; provided that the
Net Investment shall be restored and reinstated in the amount of any Collections
so received and applied if, at any time, the distribution of such Collections is
rescinded or must otherwise be returned for any reason.
"Net Receivables Balance" shall mean, at any time, the aggregate
Outstanding Balance of the Eligible Receivables at such time, as reduced by (i)
the aggregate amount by which the Outstanding Balance of all Eligible
Receivables of each Obligor exceeds the product of the Concentration Factor or
Special Obligor Concentration Factor, as applicable, for such Obligor multiplied
by the Outstanding Balance of all Eligible Receivables and (ii) the Outstanding
Balance of all Tooling Receivables originated by the New Sellers prior to the
Closing Date.
"New Sellers" shall mean Textron Automotive Interiors Inc., Textron
Automotive Exteriors Inc., M&C Advanced Processes, Inc. and Textron Canada
Limited.
"Non-Extending Committed Purchaser" shall have the meaning specified in
Section 2.26(a) of the Receivables Transfer Agreement.
"Notional Amount" shall mean (i) with respect to DaimlerChrysler AG, an
amount up to $100,000,000, (ii) with respect to General Motors Corporation, an
amount up to $60,000,000, and (iii) with respect to Ford Motor Company, an
amount up to $15,000,000.
"Obligor" shall mean a Person obligated to make payments for indebtedness
and other obligations, including, without limitation, for the provision of goods
and services pursuant to a Contract.
"Official Body" shall mean any government or political subdivision or any
agency, authority, bureau, central bank, commission, department or
instrumentality of any such government or political subdivision, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
"Other Transferor" shall mean any Person, other than the Transferor, that
has entered into a receivables purchase agreement, receivables transfer
agreement, loan agreement or funding agreement with the CP Conduit Purchasers.
"Outstanding Balance" shall mean, with respect to any Receivable at any
time, the then outstanding principal amount thereof, excluding any accrued and
outstanding Finance Charges related thereto.
SB-22
"PARCO" shall mean the Park Avenue Receivables Corporation, a Delaware
corporation, and its successors and assigns.
"PARCO Termination Event" shall mean that the providers of PARCO's program
liquidity and/or letter of credit facilities shall have given notice that an
event of default has occurred and is continuing under their respective
agreements with PARCO.
"Parent" shall mean ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Corporation, a Delaware corporation,
as the holder of 100% of the issued and outstanding capital stock of C&A.
"Partial Liquidation" shall have the meaning specified in Section 2.06(c)
of the Receivables Transfer Agreement.
"Participant" shall have the meaning specified in Section 10.06(c) of the
Receivables Transfer Agreement.
"Payment Terms Factor" shall mean (i) for the period from the Closing Date
until the second Settlement Date thereafter, 1.09 and (ii) for each one-month
period to occur thereafter, a fraction, the numerator of which is the sum of (A)
the weighted average payment terms (based upon the principal amount of the
Receivables and expressed as a number of days) for the Receivables generated or
acquired by the Sellers during such period and (B) 60, and the denominator of
which is 90; provided, however, that if the Payment Terms Factor for any period
is less than the Payment Terms Factor for the immediately preceding periods,
then the actual Payment Terms Factor for such current period shall be
recalculated to equal a fraction, the numerator of which is equal to the average
of the numerators used to calculate the Payment Terms Factor for such current
period and the three immediately preceding periods (without giving effect to
this proviso) and the denominator of which is 90; provided, further, the Payment
Terms Factor shall never be less than 1.0.
"Percentage Factor" shall mean the fraction (expressed as a percentage)
computed on any date of determination as follows:
(LDRR + CCRR) (SFRR x +OBR)
[NI x [1 + -------------------------- ] ] + --------------------
1 - LDRR 1 - LDRR
--------------------------------------------------------------------------------
NRB
Where:
NI = the Net Investment on the date of such computation;
LDRR = the Loss and Dilution Reserve Ratio on the date of such computation;
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CCRR = the Carrying Cost Reserve Ratio on the date of such computation;
SFRR = the Servicing Fee Reserve Ratio on the date of such computation;
OBR = the Outstanding Balance of all Receivables on the date of such
computation; and
NRB = the Net Receivables Balance on the date of such computation.
"Permitted Encumbrances" means (i) liens for taxes, assessments or other
governmental charges or levies not yet due and payable or if a Person shall
currently be contesting the validity thereof in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of such Person, (ii) carriers' warehousemen's, mechanics',
materialmen's, repairmen's and other like liens imposed by law, arising in the
ordinary course of business and securing obligations that are not overdue by
more than 30 days or are being contested by a Person in good faith by
appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of such Person, (iii) liens resulting from
any judgment or award (other than any judgment or award against the Transferor),
which do not, in the aggregate, exceed $1,000,000 at any time, the time for the
appeal or petition for rehearing of which shall not have expired, or appeals or
proceedings for review of which are being prosecuted in good faith, and with
respect to which adequate reserves are being maintained in accordance with GAAP,
and (iv) liens, charges or encumbrances in favor of the Administrative Agent,
any Funding Agent, the Transferor, any Committed Purchaser or any CP Conduit
Purchaser created pursuant to the Transaction Documents.
"Permitted Investments" shall mean any of the following:
(a) negotiable instruments or securities represented by instruments in
bearer or registered or in book-entry form which evidence (i)
obligations fully guaranteed by the United States of America; (ii)
obligations of any agency of the United States of America (iii) time
deposits in, or bankers acceptances issued by, any depositary
institution or trust company incorporated under the laws of the United
States of America or any state thereof and subject to supervision and
examination by Federal or state banking or depositary institution
authorities; provided, however, that at the time of investment or
contractual commitment to invest therein, the certificates of deposit
or short-term deposits, if any, or long-term unsecured debt
obligations (other than such obligation whose rating is based on
collateral or on the credit of a Person other than such institution or
trust company) of such depositary institution or trust company shall
have a credit rating from ▇▇▇▇▇'▇ and S&P of at least "P-1" and "A-1,"
respectively, in the case of the certificates of deposit or short-term
deposits, or a rating not lower than one of the two highest investment
categories granted by ▇▇▇▇▇'▇ and by S & P; (iv) certificates of
deposit having, at the time of investment or contractual commitment to
invest therein, a rating from ▇▇▇▇▇'▇ and S&P of at least "P-1" and
"A-1," respectively; or (v) investments in money market funds rated in
the highest investment category or otherwise approved in writing by
the Rating Agencies;
SB-24
(b) demand deposits and cash escrows in any depositary institution or
trust company referred to in (a)(iii) above;
(c) commercial paper (having original or remaining maturities of no
more than 30 days) having, at the time of investment or contractual
commitment to invest therein, a credit rating from ▇▇▇▇▇'▇ and S&P of at
least "P-1" and "A-1", respectively;
(d) Eurodollar time deposits having a credit rating from ▇▇▇▇▇'▇ and
S&P of at least "P-1" and "A-1", respectively; and
(e) repurchase agreements involving any of the Permitted Investments
described in clauses (a)(i), (a)(iv) and (d) of this definition so long as
the other party to the repurchase agreement has at the time of investment
therein, a rating from ▇▇▇▇▇'▇ and S&P of at least "P-1" and "A-1",
respectively.
"Person" shall mean any corporation, limited liability company, natural
person, firm, joint venture, partnership, trust, unincorporated organization,
enterprise, government or any department or agency of any government.
"Pooled Funding CP Conduit Purchaser" means each CP Conduit Purchaser that
is not a Match Funding CP Conduit Purchaser.
"Potential Termination Event" shall mean an event which but for the lapse
of time or the giving of notice, or both, would constitute a Termination Event.
"Proceeds" shall mean "proceeds" as defined in Section 9-102(a)(64) the
Relevant UCC.
"Program Fee" shall have the meaning specified in the Fee Letter.
"Program Support Provider" means, with respect to any CP Conduit Purchaser,
the Committed Purchaser with respect to such CP Conduit Purchaser and any other
additional Person now or hereafter extending credit, or having a commitment to
extend credit to or for the account of, or to make purchases from, such CP
Conduit Purchaser or issuing a letter of credit, surety bond or other instrument
to support any obligations arising under or in connection with such CP Conduit
Purchaser's securitization program.
"Pro Rata Share" shall mean, on any date of determination, (a) with respect
to any CP Conduit Purchaser, the ratio (expressed as a percentage) of such CP
Conduit Purchaser's CP Conduit Funding Limit to the Facility Limit at such time
and (b) with respect to any Committed Purchaser, the ratio (expressed as a
percentage) of such Committed Purchaser's Commitment to the Aggregate Commitment
at such time.
"Purchase" shall mean any assignment by a CP Conduit Purchaser to the
Committed Purchaser with respect to such CP Conduit Purchaser of the CP Conduit
Purchaser's Interest pursuant to the relevant Asset Purchase Agreement.
"Purchase Price" shall have the meaning specified in Section 3.1 of the
Receivables Purchase Agreement.
SB-25
"Purchased Receivables" shall have the meaning specified in Section 3.2(b)
of the Receivables Purchase Agreement.
"Purchased Receivables Percentage" means, with respect to any Seller as to
which C&A has submitted a Seller Termination Request, the percentage equivalent
of a fraction, the numerator of which is an amount equal to the aggregate
Outstanding Balance of Receivables sold by such Seller as of the applicable
Seller Termination Request Date, and the denominator of which is an amount equal
to the aggregate Outstanding Balance of all Receivables as of such date.
"Purchase Termination Date" shall have the meaning specified in Section 9.1
of the Receivables Purchase Agreement.
"Rating Agencies" means on any date of determination the rating agencies
then rating the Commercial Paper at the request of any CP Conduit Purchaser.
"Rating Agency Confidential Information Memorandum" means the Rating Agency
/ Co-Purchaser Confidential Information Memorandum, $250 Million Trade
Receivables Securitization, dated December 2001.
"Rating Confirmation" means, with respect to any CP Conduit Purchaser and
any subject amendment, modification, waiver or other action to be taken pursuant
to the terms of the Transaction Documents, a confirmation by each of the Rating
Agencies that such proposed amendment, modification, waiver or action shall not
result in a downgrade or withdrawal of such Rating Agency's then current rating
of the Commercial Paper.
"Receivables" shall mean all indebtedness and other obligations owed to a
Seller by an Obligor (including Tooling Receivables except as provided below),
whether constituting an account or general intangible, arising in connection
with the sale or lease of merchandise or the rendering of services by (x) except
in the case of any such indebtedness acquired by C&A from Dyers, a Seller, and
(y) in the case of any such indebtedness acquired by C&A from Dyers, by Dyers;
and in each case includes the right to payment of any Finance Charges and other
obligations of such Obligor with respect thereto; provided, that any Tooling
Receivables originated or acquired by ▇▇▇▇▇▇ Group, L.L.C. shall not be
considered "Receivables" for the purposes of the Transaction Documents.
Notwithstanding the foregoing, once a Receivable has been deemed collected
pursuant to Section 2.10 of the Receivables Transfer Agreement, it shall no
longer constitute a Receivable under the Receivables Transfer Agreement.
"Receivables Purchase Agreement" shall mean the Receivables Purchase
Agreement dated as of December 27, 1999, among C&A, C&A's wholly-owned direct
and indirect Subsidiaries listed on Exhibit D thereto as sellers, and the
Transferor, as Purchaser, as amended and restated by the Amended and Restated
Receivables Purchase Agreement dated as of December 20, 2001, among the Sellers,
as sellers, and the Transferor, as purchaser, and the other Sellers from time to
time named therein, as such agreement may be amended, supplemented or otherwise
modified and in effect from time to time.
"Receivables Transfer Agreement" shall mean the Receivables Transfer
Agreement, dated as of December 20, 2001, by and between the Transferor, C&A,
individually
SB-26
and as Collection Agent, the CP Conduit Purchasers, the Committed Purchasers,
the Funding Agents and the Administrative Agent, as such agreement may be
amended, supplemented or otherwise modified and in effect from time to time.
"Recipient" shall have the meaning specified in Section 2.15 of the
Receivables Transfer Agreement.
"Records" shall mean all Contracts and other documents, books, records and
other writings and information (including, without limitation, computer
programs, tapes, discs, punch cards, data processing software and related
property and rights) maintained with respect to Receivables and the related
Obligors.
"Related Security" shall mean, with respect to any Receivable, all of a
Seller's or the Transferor's right, title and interest in, to and under:
(a) all other accounts, contract rights, chattel paper, instruments,
general intangibles, investment property and other obligations of any
Obligor with respect to any Receivable or related Contract, now or
hereafter existing, whether or not arising out of or in connection with the
sale or lease of goods or the rendering of services;
(b) all other security interests or liens and property subject thereto
from time to time, if any, purporting to secure payment of such Receivable,
whether pursuant to the Contract related to such Receivable or otherwise,
together with all financing statements (or other similar instruments)
signed by an Obligor describing any collateral securing such Receivable;
(c) all guarantees, indemnities, warranties, insurance (and proceeds
and premium refunds thereof) or other agreements or arrangements of any
kind from time to time supporting or securing payment of such Receivable
whether pursuant to the Contract related to such Receivable or otherwise;
(d) all Records related to such Receivable;
(e) in the case of the Transferor, all rights and remedies of the
Transferor under the Transaction Documents, together with all financing
statements (or other similar instruments) naming any Seller as debtor or
seller and the Transferor as secured party or buyer filed in connection
therewith;
(f) in the case of the Transferor, the Required Currency Hedge and
each Credit Default Swap; and
(g) with respect to each Seller and the Transferor, all Proceeds of
the foregoing clauses (a), (b), (c) and (d) and, in the case of the
Transferor, all Proceeds of the foregoing clauses (e) and (f).
"Relevant UCC" shall mean, with respect to any state, the Uniform
Commercial Code as from time to time in effect in such state.
SB-27
"Required Committed Purchasers" shall mean Committed Purchasers having Pro
Rata Shares in the aggregate equal to more than 66 2/3% or, if the Commitments
have been terminated, having more than 66 2/3% of the Net Investment; provided
that the Commitment of any defaulting Committed Purchaser that has not paid all
amounts due and owing by it in respect of Purchases it was obliged to make shall
not be included in the Commitments for purposes of this definition.
"Required Currency Hedge" shall mean one or more foreign currency
instruments including currency options, currency ▇▇▇▇▇▇ and similar items,
acceptable to the Administrative Agent, exercisable at any time, with an
Eligible Counterparty providing for the delivery by such Eligible Counterparty
of United States dollars in exchange for the receipt of Canadian Dollars, in
each case having a remaining term at any time of not less than five (5) months.
"Required Currency Hedge Assignment" shall have the meaning specified in
Section 5.01(p)(ii) of the Receivables Transfer Agreement.
"Required Hedge Notional Amount" shall mean (i) as of the Closing Date,
135,000,000 Canadian Dollars, and (ii) for each Settlement Period following the
delivery of the first Settlement Statement thereafter, an amount denominated in
United States dollars, which represents the portion of Net Receivables Balance
payable in Canadian Dollar Receivables, as calculated in the most recent
Settlement Statement.
"Responsible Officer" shall mean, with respect to any Person, the Chairman,
the President, the Controller, any Vice President, the Secretary, the Treasurer,
or any other officer of such Person customarily performing functions similar to
those performed by any of the above designated officers and also, with respect
to a particular matter any other officer to whom such matter is referred because
of such officer's knowledge of and familiarity with the particular subject.
"Revolver Lender" shall have the meaning specified in Section 10.02(b) of
the Receivables Transfer Agreement.
"Seller Addition Date" shall have the meaning specified in Section 7.2 of
the Receivables Purchase Agreement.
"Seller Effective Date" shall have the meaning specified in Section 2.1(a)
of the Receivables Purchase Agreement.
"Seller Note" shall have the meaning specified in Section 8.1 of the
Receivables Purchase Agreement.
"Seller Property" shall have the meaning specified in Section 2.1(d) of the
Receivables Purchase Agreement.
"Seller Termination Request" shall have the meaning specified in Section
9.3(a) of the Receivables Purchase Agreement.
"Seller Termination Request Date" shall have the meaning specified in
Section 9.3(a) of the Receivables Purchase Agreement.
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"Sellers" shall have the meaning specified in the recitals to the
Receivables Purchase Agreement.
"Senior Credit Facility" shall mean the Credit Agreement dated as of
December 20, 2001 among ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Products Co., as borrower, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇ Canada Inc., as a Canadian borrower, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Plastics, Ltd., as
a Canadian Borrower, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Corporation, the lenders named therein,
Deutsche Banc Alex. ▇▇▇▇▇ Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Capital Corporation, as
Co-Documentation Agents, Credit Suisse First Boston, as Syndication Agent,
JPMorgan Chase Bank, as Administrative Agent, and The Chase Manhattan Bank of
Canada, as Canadian Administrative Agent, including any amendments or
modifications thereto, as in effect from time to time.
"Servicing Fee" shall mean the fees payable by the Transferor to the
Collection Agent in an amount equal to the Servicing Fee Percentage multiplied
by the amount of the aggregate Outstanding Balance of the Receivables. Such fee
shall accrue from the date of the initial purchase of an interest by a CP
Conduit Purchaser in the Receivables to the later of the Termination Date or the
date on which the Percentage Factor is reduced to zero. On or prior to the
Termination Date, and provided that no Potential Termination Event shall have
occurred and be continuing, such fee shall be payable only from Collections
pursuant to, and subject to the priority of payments set forth in, Section 2.05
of the Receivables Transfer Agreement. After the Termination Date or during the
continuation of a Potential Termination Event, such fee shall be payable only
from Collections pursuant to, and subject to the priority of payments set forth
in, Section 2.06 of the Receivables Transfer Agreement.
"Servicing Fee Percentage" shall mean 1.0% per annum.
"Servicing Fee Reserve Ratio" shall mean, at any time, an amount equal to:
the Servicing Fee x the DSO x 2
Percentage
-----------------------------------------------------------
360
"Settlement Date" shall mean the tenth day immediately succeeding each
Settlement Period or, if such day is not a Business Day, the next succeeding
Business Day.
"Settlement Period" shall mean the period of days from and including the
first day of a fiscal month of C&A (which fiscal months for the years 2001 and
2002 are set forth on Schedule F to the Receivables Transfer Agreement) to and
including the last day of such fiscal month.
"Settlement Statement" shall mean a report, in substantially the form
attached to the Receivables Transfer Agreement as Exhibit D-3 or in such other
form as is mutually agreed to by the Transferor and the Administrative Agent,
delivered by the Collection Agent to the Administrative Agent on each Settlement
Date pursuant to Section 2.12 of the Receivables Transfer Agreement.
"Solvent" shall mean, with respect to any Person on a particular date, that
on such date (a) the fair value of the property of such Person is greater than
the total amount of liabilities,
SB-29
including contingent liabilities, of such Person; (b) the present fair salable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its Indebtedness as
they become absolute and matured; (c) such Person does not intend to, and does
not believe that it will, incur Indebtedness or liabilities beyond such Person's
ability to pay as such Indebtedness and liabilities mature; and (d) such Person
is not engaged in a business or transaction, and is not about to engage in a
business or transaction, for which such Person's property would constitute an
unreasonably small amount of capital. The amount of contingent liabilities (such
as litigation, guaranties, and unfunded pension liabilities) at any time shall
be computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that can reasonably be expected to
become an actual or matured liability.
"Special Obligors" shall mean each of the Obligors designated by the
Funding Agents (in their sole discretion upon C&A's request) and approved by the
Rating Agencies which will each be permitted to exceed the Concentration Factor,
as specified and subject to the requirements set forth in Schedule C to the
Receivables Transfer Agreement, as such Schedule may be amended or modified by
the Funding Agents and approved by the Rating Agencies from time to time to add
or delete Obligors.
"Special Obligor Concentration Factor" shall mean, with respect to each
Special Obligor, the percentage applicable to such Special Obligor specified on
Schedule C to the Receivables Transfer Agreement, as such Schedule may be
amended or modified by the Funding Agents and approved by the Rating Agencies
from time to time to change such percentages; provided, that at such times as
the requirements in Schedule C are not met by any Special Obligor, the
Concentration Factor for such Special Obligor shall be calculated as specified
in the definition of Concentration Factor.
"Specified Bankruptcy Opinion Provisions" shall mean the factual
assumptions (including those contained in the factual certificate referred to
therein) and the actions to be taken by the Sellers or the Transferor, in each
case as specified in the legal opinion of Stroock & Stroock & ▇▇▇▇▇ LLP relating
to certain bankruptcy matters delivered on the Closing Date.
"Standard & Poor's" or "S&P" shall mean Standard & Poor's Ratings Services,
a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors and assigns.
"Subsidiary" of a Person shall mean any Person more than 50% of the
outstanding voting interests of which shall at any time be owned or controlled,
directly or indirectly, by such Person or by one or more Subsidiaries of such
Person or any similar business organization which is so owned or controlled.
"Termination Date" shall mean with respect to each CP Conduit Purchaser and
Committed Purchaser the earliest of (i) the Business Day designated by the
Transferor to the CP Conduit Purchasers and Committed Purchasers as the
Termination Date at any time following thirty (30) days written notice to the CP
Conduit Purchasers and Committed Purchasers, (ii) the day upon which a
Termination Date is declared or automatically occurs relating to a Termination
Event pursuant to Section 7.02(a) of the Receivables Transfer Agreement, (iii)
two (2) Business Days prior to the latest Commitment Expiry Date, (iv) a
Purchase Termination Date shall occur with respect to all the Sellers under the
Receivables Purchase Agreement, (v) the date on which
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all amounts due and owing to the CP Conduit Purchasers and the Committed
Purchasers under the Receivables Transfer Agreement and the other Transaction
Documents have been paid in full, or (vi) the date on which the Aggregate
Commitment has been reduced to zero pursuant to the Receivables Transfer
Agreement.
"Termination Event" shall mean an event described in Section 7.01 of the
Receivables Transfer Agreement.
"Title IV Plan" shall mean a pension plan (other than a Multiemployer Plan)
that is covered by Title IV of ERISA and that a Seller, the Transferor, the
Guarantor or an ERISA Affiliate maintains, contributes to or has an obligation
to contribute to on behalf of participants who are or were employed by any of
them.
"Tooling Receivable" shall mean an obligation of any Person to pay for (i)
tooling or equipment purchased or built by a Seller for the purpose of
manufacturing products for such Person or (ii) services rendered in connection
with building tooling for the purposes of manufacturing products for such Person
(including, in each case, the right to payment of any interest, sales taxes,
Finance Charges, returned check or late charges and other obligations of such
Person with respect thereto), which in the case of Tooling Receivables of ▇▇▇▇▇▇
Group, L.L.C. are identified by numerical code on the related invoice as
relating to "tooling related services".
"Tranche" shall mean a portion of the Net Investment allocated to a Tranche
Period pursuant to Section 2.03 of the Receivables Transfer Agreement.
"Tranche Period" shall mean a CP Tranche Period, a BR Tranche Period or a
Eurodollar Tranche Period, as applicable.
"Tranche Rate" shall mean the CP Rate, the Base Rate or the Eurodollar
Rate, as applicable, plus, in the case of the Base Rate or the Eurodollar Rate,
the Applicable Margin.
"Transaction Costs" shall have the meaning specified in Section 2.23(a) of
the Receivables Transfer Agreement.
"Transaction Documents" shall mean, collectively, the Receivables Transfer
Agreement, the Receivables Purchase Agreement, the Fee Letter, the Lockbox
Agreements, the Seller Note and all of the other instruments, documents,
certificates and other agreements executed and delivered by the Sellers or the
Transferor in connection with any of the foregoing, in each case, as the same
may be amended, restated, supplemented or otherwise modified from time to time.
"Transfer" shall mean a conveyance, transfer and assignment by the
Transferor to the CP Conduit Purchasers or the Committed Purchasers of an
undivided percentage ownership interest in Receivables, Related Security,
Collections and Proceeds pursuant to, and in accordance with, the Receivables
Transfer Agreement (including, without limitation, as a result of any
reinvestment of Collections in Transferred Interests pursuant to Section 2.02(b)
and Section 2.05 of the Receivables Transfer Agreement).
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"Transfer Certificate" shall have the meaning specified in Section 2.02(a)
of the Receivables Transfer Agreement.
"Transfer Date" shall mean, with respect to each Transfer, the Business Day
on which such Transfer is made.
"Transfer Price" shall mean, with respect to any Incremental Transfer, the
amount paid to the Transferor by the CP Conduit Purchasers or the Committed
Purchasers, as applicable, as described in the applicable Transfer Certificate.
The Transfer Price for any Incremental Transfer shall be equal to the aggregate
Net Investment (including such Incremental Transfer) minus the aggregate portion
of the Net Investment paid in connection with all prior Transfers.
"Transfer Supplement" shall have the meaning specified in Section
10.06(d)(i) of the Receivables Transfer Agreement.
"Transferor" shall mean Carcorp, Inc., a Delaware corporation, and its
successors and permitted assigns.
"Transferred Interest" shall mean, on any date of determination, an
undivided percentage ownership interest of the CP Conduit Purchasers or the
Committed Purchasers, as applicable, in (i) each and every then outstanding
Receivable, (ii) all Related Security with respect to each such Receivable,
(iii) all Collections with respect thereto and (iv) other Proceeds of the
foregoing, which undivided ownership interest shall be equal to the Percentage
Factor at such time, and only at such time (without regard to prior
calculations). The Transferred Interest in each Receivable, together with
Related Security, Collections and Proceeds with respect thereto, shall at all
times be equal to the Transferred Interest in each other Receivable, together
with Related Security, Collections and Proceeds with respect thereto. To the
extent that the Transferred Interest shall decrease as a result of a
recalculation of the Percentage Factor, the CP Conduit Purchasers or the
Committed Purchasers, as applicable, shall be considered to have reconveyed to
the Transferor an undivided percentage ownership interest in each Receivable,
together with Related Security, Collections and Proceeds with respect thereto,
in an amount equal to such decrease such that, in each case, the Transferred
Interest in each Receivable shall be equal to the Transferred Interest in each
other Receivable.
"Transferred Receivables" shall have the meaning specified in Section
3.2(b) of the Receivables Purchase Agreement.
"U.S." or "United States" means the United States of America and its
territories.
"U.S. Dollar Collection Account" shall have the meaning specified in
Section 2.13(a) of the Receivables Transfer Agreement.
"Unfunded Pension Liability" shall mean, at any time, the aggregate amount,
if any, of the sum of (a) the amount by which the present value of all accrued
benefits under each Title IV Plan exceeds the fair market value of all assets of
such Title IV Plan allocable to such benefits, all determined as of the most
recent valuation date for each such Title IV Plan using the actuarial
assumptions for funding purposes in effect under such Title IV Plan (and not the
assumptions used by the Pension Benefit Guaranty Corporation in calculating such
amounts), and (b) for a period of five years following a transaction that might
reasonably be expected to be
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covered by Section 4069 of ERISA, the liabilities (whether or not accrued) that
could be avoided by a Seller or any ERISA Affiliate as a result of such
transaction.
"United States Person" shall have the meaning specified in Section 2.22(b)
of the Receivables Transfer Agreement.
"Valuation Price" shall mean as of any date of determination, the strike
price of any outstanding Required Currency Hedge that would require the highest
amount of Canadian Dollars to purchase one U.S. Dollar.
"Weekly Report" shall mean a Deposit Report delivered on each Weekly
Settlement Date pursuant to Section 2.12 of the Receivables Transfer Agreement.
"Weekly Settlement Date" shall mean the third Business Day of each calendar
week.
"Weekly Settlement Period" shall mean the period of days from and including
the Sunday of any calendar week to and including the Saturday of the same
calendar week.
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SCHEDULE B
Schedule of CP Conduit Purchasers,
Committed Purchasers and Funding Agents
CP CONDUIT PURCHASERS:
Park Avenue Receivables Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
CP Conduit Funding Limit: $ 250,000,000
COMMITTED PURCHASERS:
JPMorgan Chase Bank, as Committed Purchaser for Park Avenue
Receivables Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Commitment: $ 255,000,000
SC-1
FUNDING AGENTS:
Funding Agent for Park Avenue Receivables Corporation:
JPMorgan Chase Bank
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
SC-2
SCHEDULE C
Schedule of Special Obligors
Special Obligor Percentage Limit Conditions
DaimlerChrysler AG
The lesser of (X) the sum of (i) the applicable percentages set forth in the
definition of Concentration Factor if such Obligor was not a Special Obligor and
(ii) the quotient (expressed as a percentage) of (A) the Notional Amount of the
applicable Credit Default Swap divided by (B) the Outstanding Balance of
Eligible Receivables and (Y) 40%.
DaimlerChrysler AG shall be a Special Obligor until Dec. 20, 2002 (as such date
may be extended following the purchase of a new Credit Default Swap acceptable
to the Administrative Agent) so long as (i) a Credit Default Swap is in full
force and effect with an Eligible Counterparty with an expiration date no
earlier than March 20, 2003 and (ii) such Obligor shall be rated at least BBB-
and Baa3 by S&P and ▇▇▇▇▇'▇, respectively.
General Motors Corporation
The lesser of (X) the sum of (i) the applicable percentages set forth in the
definition of Concentration Factor if such Obligor was not a Special Obligor and
(ii) the quotient (expressed as a percentage) of (A) the Notional Amount of the
applicable Credit Default Swap divided by (B) the Outstanding Balance of
Eligible Receivables and (Y) 35%.
General Motors Corporation shall be a Special Obligor until Dec. 20, 2002 (as
such date may be extended following the purchase of a new Credit Default Swap
acceptable to the Administrative Agent) so long as (i) a Credit Default Swap is
in full force and effect with an Eligible Counterparty with an expiration date
no earlier than March 20, 2003 and (ii) such Obligor shall be rated at least
BBB- and Baa3 by S&P and ▇▇▇▇▇'▇, respectively.
Ford Motor Company
The lesser of (X) the sum of (i) the applicable percentages set forth in the
definition of Concentration Factor if such Obligor was not a Special Obligor and
(ii) the quotient (expressed as a percentage) of (A) the Notional Amount of the
applicable Credit Default Swap divided by (B) the Outstanding Balance of
Eligible Receivables and (Y) 20%.
Ford Motor Company shall be a Special Obligor until Dec. 20, 2002 (as such date
may be extended following the purchase of a new Credit Default Swap acceptable
to the Administrative Agent) so long as (i) a Credit Default Swap is in full
force and effect with an Eligible Counterparty with an expiration date no
earlier than March 20, 2003 and (ii) such Obligor shall be rated at least BBB-
and Baa3 by S&P and ▇▇▇▇▇'▇.
SD-1
Mitsubishi Motors 5%
▇▇▇▇ Corporation 4%
SD-2
SCHEDULE D
Schedule of Match Funding CP Conduit Purchasers
None.
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SCHEDULE E
List of Equipment and Software
SE-1
SCHEDULE F
(CHART OMITTED)
List of C&A Fiscal Periods for the Years 2001 and 2002
CALENDAR FOR FISCAL YEAR ENDING DECEMBER 29, 2001
CALENDAR FOR FISCAL YEAR ENDING DECEMBER 31, 2002
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