EXHIBIT 10.1
EXECUTION VERSION
SECOND AMENDMENT TO RECEIVABLES PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO RECEIVABLES PURCHASE AGREEMENT, dated as of May
26, 2004 (this "Amendment"), is entered into among XXXXXX FUNDING CORPORATION, a
Delaware corporation (the "Seller"), XXXXXX CO., a Pennsylvania corporation (the
"Servicer"), MARKET STREET FUNDING CORPORATION, a Delaware corporation (the
"Issuer") and PNC BANK, NATIONAL ASSOCIATION, a national banking association, as
Administrator (the "Administrator").
RECITALS
1. The Seller, the Servicer, the Issuer and the Administrator are parties
to the Receivables Purchase Agreement, dated as of May 29, 1998 (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
"Agreement"); and
2. The parties hereto desire to amend the Agreement as hereinafter set
forth.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Certain Defined Terms. Capitalized terms that are used herein without
definition and that are defined in Exhibit I to the Agreement shall have the
same meanings herein as therein defined.
2. Amendments to Agreement. The Agreement is hereby amended as follows:
2.1 Clause (a) of the definition of "Alternate Rate" in Exhibit I to
the Agreement is hereby amended by deleting "1.25%" therein and substituting
"2.00%" therefor.
2.2 The definition of "Concentration Percentage" in Exhibit I to the
Agreement is hereby amended and restated in its entirety to read as follows:
""Concentration Percentage" means: (a) for Lowes, 40% as long as
Lowes would be considered a Group A Obligor and for any other Group
A Obligor, 20%, (b) for any Group B Obligor, 16%, (c) for any Group
C Obligor, 8% and (d) for Menards and Ace Hardware, 7.5% as long as
such entities would be considered a Group D Obligor and for any
other Group D Obligor, 4%; provided, however, that the Issuer may,
with prior written consent from the Administrator and the Liquidity
Agent, approve higher Concentration Percentages for selected
Obligors."
2.3 The definition of "Concentration Reserve" in Exhibit I to the
Agreement is hereby amended and restated in its entirety to read as follows:
""Concentration Reserve" means, at any time: (a) the aggregate
Capital at such time multiplied by (b) (i) the Concentration Reserve
Percentage divided by (ii) 100% minus the Concentration Reserve
Percentage."
2.4 The definition of "Concentration Reserve Percentage" in Exhibit
I to the Agreement is hereby amended and restated in its entirety to read as
follows:
""Concentration Reserve Percentage" means, at any time, the largest
of: (a) the sum of five largest Group D Obligor Percentages, (b) the
sum of the three largest Group C Obligor Percentages and (c) the sum
of the two largest Group B Obligor Percentages."
2.5 The definition of "Dilution Reserve Percentage" in Exhibit I to
the Agreement is hereby amended and restated in its entirety to read as follows:
""Dilution Reserve Percentage" means on any date, the greater of:
(a) 7.5% or (b) the product of (i) the Dilution Horizon multiplied
by (ii) the sum of (x) 2.25 times the average of the Dilution Ratios
for the twelve most recent calendar months and (y) the Spike
Factor."
2.6 Clause (c) of the definition of "Eligible Receivable" is hereby
amended and restated in its entirety to read as follows:
"(c) that does not, except in the case of a Deferred Payment
Receivable, have a stated maturity which is more than 120 days after
the original invoice date of such Receivable; provided, however,
that in the case of a Deferred Payment Receivable, the Outstanding
Balance of such Deferred Payment Receivable when added to the
aggregate Outstanding Balance of all other Deferred Payment
Receivables, shall not exceed 2.0% of the aggregate Outstanding
Balance of all Pool Receivables,"
2.7 The definition of "Group A Obligor" in Exhibit I to the
Agreement is hereby amended and restated in its entirety to read as follows:
""Group A Obligor" means (i) any Obligor with a short-term rating of
at least: (a) "A-1" by Standard & Poor's, or if such Obligor does
not have a short-term rating from Standard & Poor's, a rating of
"A+" or better by Standard & Poor's on its long-term senior
unsecured and uncredit-enhanced debt securities, and (b) "P-1" by
Moody's, or if such Obligor does not have a short-term rating from
Xxxxx'x, "X0" or better by Moody's on its long-term senior unsecured
and uncredit-enhanced debt securities."
2.8 The definition of "Loss Reserve Percentage" in Exhibit I to the
Agreement is hereby amended and restated in its entirety to read as follows:
""Loss Reserve Percentage" means, on any date, the greater of: (a)
12.5% or (b) (i) the product of (A) 2.25 times the highest average
of the Default Ratios for any three consecutive calendar months
during the twelve most recent calendar months multiplied by (B) the
aggregate credit sales made during the four most recent calendar
months divided by (ii) the aggregate Outstanding Balance of Eligible
Receivables as of such date."
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2.9 Clause (g) of Exhibit V to the Agreement is hereby amended and
restated in its entirety to read as follows:
"(g)(i) the (A) Default Ratio shall exceed 4.0% or (B) the
Delinquency Ratio shall exceed 10.0% or (ii) the average for three
consecutive calendar months of: (A) the Default Ratio shall exceed
3.0%, (B) the Delinquency Ratio shall exceed 8.0% or (C) the
Dilution Ratio shall exceed 5.5%."
3. Representations and Warranties; No Default. The Seller hereby
represents and warrants to each of the parties hereto as follows:
(a) Representations and Warranties. The representations and
warranties contained in Exhibit III of the Agreement are true and
correct as of the date hereof.
(b) No Default. Both before and immediately after giving
effect to this Amendment and the transactions contemplated hereby,
no Termination Event or Unmatured Termination Event exists or shall
exist.
4. Effect of Amendment. All provisions of the Agreement, as expressly
amended and modified by this Amendment, shall remain in full force and effect.
After this Amendment becomes effective, all references in the Agreement (or in
any other Transaction Document) to "this Agreement", "hereof", "herein" or words
of similar effect referring to the Agreement shall be deemed to be references to
the Agreement as amended by this Amendment. This Amendment shall not be deemed,
either expressly or impliedly, to waive, amend or supplement any provision of
the Agreement other than as set forth herein.
5. Conditions Precedent to Effectiveness. This Amendment shall become
effective as of the date hereof upon receipt by the Administrator of:
(a) counterparts of this Amendment (whether by facsimile or
otherwise) executed by each of the parties hereto; and
(b) (i) counterparts of that certain fee letter agreement,
dated of even date herewith, among the Seller, the Servicer, the
Issuer and the Administrator, and (ii) the "structuring fee"
referred to therein.
6. Receipt of Certain Officer Certificates. Notwithstanding anything in
this Amendment, the Agreement or any other Transaction Document to the contrary,
the parties hereto expressly agree that, on or prior to the close of business on
June 30, 2004, the Administrator shall have received an officer certificate from
an authorized officer of each of the Seller and the Servicer, stating that on or
prior to such date, ownership of each Lock-Box Account has been transferred to
and is in the name of the Seller, in form and substance satisfactory to the
Administrator and its counsel and that the failure of the timely occurrence of
the condition set forth in this Section 6 shall, without any notice,
declaration, demand, or other act by any Person, be deemed to result in the
automatic occurrence of the Facility Termination Date, unless the time period
set forth above has been extended in writing by the Administrator
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(on behalf of the Issuer) or such failure has been otherwise waived or excused
in writing by the Administrator (on behalf of the Issuer).
7. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties on separate counterparts, each of which
when so executed shall be deemed to be an original and all of which when taken
together shall constitute but one and the same instrument.
8. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the internal laws of the State of New York (without regard to
any otherwise applicable principles of conflicts of law).
9. Section Headings. The various headings of this Amendment are included
for convenience only and shall not affect the meaning or interpretation of this
Amendment, the Agreement or any provision hereof or thereof.
[signature pages follow]
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
XXXXXX FUNDING CORPORATION,
as Seller
By: /s/ Xxxxx X. Friend
Name: Xxxxx X. Friend
Title: CFO
XXXXXX CO.,
as Servicer
By: /s/ Xxxxx X. Friend
Name: Xxxxx X. Friend
Title: CFO
X-0
XXXXXX XXXXXX FUNDING CORPORATION,
as Issuer
By: /s/ Xxxxxx Xxxxxxxxxx
Name: Xxxxxx Xxxxxxxxxx
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION,
as Administrator
By: /s/ Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxxxxx
Title: Vice President
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