Exhibit 10.26
PURCHASE AND SALE AGREEMENT
PURCHASE AND SALE AGREEMENT dated as of December 21, 2000 (as
amended and supplemented, this "Agreement") among CITIBANK, N.A. (together with
its successors and assigns, the "Purchaser"), CITICORP NORTH AMERICA, INC., as
agent for the Purchaser (together with its successors and assigns, the "Program
Agent"), FEDERATED FUNDING 1997-1, INC., a Delaware corporation (together with
its permitted successors and assigns, the "Seller"), FEDERATED SECURITIES CORP.,
a Pennsylvania corporation (together with its permitted successors and assigns,
the "Distributor"), FEDERATED INVESTORS MANAGEMENT COMPANY, a Pennsylvania
corporation (together with its permitted successors and assigns, the
"Transferor") and FEDERATED INVESTORS, INC., a Pennsylvania corporation
(together with its permitted successors and assigns, the "Parent").
W I T N E S S E T H
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WHEREAS, the Distributor and the Transferor are parties to the
Distributor's Transfer Agreement (as defined in Appendix A hereto) pursuant to
which the Distributor shall from time to time sell and the Transferor shall
purchase Receivables (as defined in Appendix A hereto) in accordance with the
terms thereof;
WHEREAS, the Seller and the Transferor are parties to the
Transferor's Transfer Agreement (as defined in Appendix A hereto), pursuant to
which the Transferor shall from time to time sell and the Seller shall purchase
Receivables and the Ancillary Rights and Collections (as defined in Appendix A
hereto) pursuant to and in accordance with the terms thereof;
WHEREAS, the Seller and the Purchaser believe that it is in their
mutual interest for the Seller to from time to time sell the Receivables and the
Ancillary Rights and Collections with respect thereto to the Purchaser and for
the Purchaser to purchase such Receivables, Ancillary Rights and Collections
pursuant to and in accordance with the terms of this Agreement;
WHEREAS, the parties hereto intend that each purchase of Receivables
under this Agreement constitutes a True Sale (as defined in Appendix A hereto)
of such Receivables providing the Purchaser with the full benefits of ownership
of such Receivables; and
WHEREAS, the Parent shall realize a substantial economic benefit
from the Purchaser's purchase of Receivables pursuant to the Purchase Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:
Article I
DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. DEFINITIONS.
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Capitalized terms not otherwise defined herein shall have the
meanings assigned to such terms in the Definitions List attached hereto as
Appendix A. For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires (a) each use in this Agreement
of a singular version of a pronoun shall be deemed to include references to the
plural, and vice versa, (b) Article and Section headings are for convenience of
reference only and shall not affect the construction of this Agreement, and (c)
references to "this section" or words of similar import shall be deemed to refer
to the entire section and not to a particular subsection, and references to
"hereunder," "herein" or words of similar import shall be deemed to refer to
this entire Agreement and not to the particular section or subsection.
References in this Agreement to "including" means including without limiting the
generality of any description preceding such term.
For the avoidance of doubt (i) references in this Agreement to the
Distributor shall be deemed to include the Distributor in its capacities as
Distributor, Principal Shareholder Servicer and Servicer, and (ii) references to
"it" in Section 4.01 and Section 5.01 shall in respect of the Parent mean the
Parent and each other Federated Entity.
Article II
PURCHASE AND SALE OF RECEIVABLES; ADDITIONAL FUNDS
SECTION 2.01. PURCHASE OF RECEIVABLES.
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On each Purchase Date prior to the Termination Date, and subject to
and upon the terms and conditions set forth in this Agreement, the Seller shall
sell, transfer, convey and assign to the Purchaser, without recourse, except as
expressly provided in the Program Documents, on and as of such Purchase Date,
all of the Seller's right, title and interest in, to and under the Receivables
and the Collections and Ancillary Rights with respect thereto relating to Shares
issued by each Fund for the period from the immediately preceding Sale Cut-off
Date in respect of the Receivables of each Fund (which for the initial purchase
of Receivables of a Fund hereunder shall be deemed to mean the Other Purchasers'
End Date) to and including the Sale Cut-off Date specified in the Purchase
Notice with respect thereto, and the Purchaser shall purchase from the Seller
such Receivables and the Collections and Ancillary Rights with respect thereto
for an amount equal to the aggregate Purchase Prices payable in respect of such
Receivables. Such right, title and interest in, to and under such Receivables
and the Collections and Ancillary Rights with respect thereto shall
automatically vest in the Purchaser upon the Purchaser's payment of the Purchase
Price. Each of the Seller, the Distributor and the Transferor acknowledges that
the Purchaser shall be entitled to take all actions it considers reasonable to
collect from the respective Companies and Funds all payments in respect of the
Purchased Receivables as and when the same shall become due. Each of the Seller,
the Distributor and the Transferor hereby irrevocably authorizes and empowers
the Purchaser to demand, ▇▇▇ for, collect and receive payment of any funds due
with respect to the Purchased Receivables in its name, if required in the
judgment of the Purchaser.
SECTION 2.02. PURCHASE NOTICES.
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With respect to the Receivables to be purchased on any Purchase
Date, the Seller shall transmit to the Program Agent (with a copy to the
Collection Agent), not later than 10:00 a.m. (New York City time) on such
proposed Purchase Date, by facsimile transmission, a Purchase Notice. The Seller
agrees that it shall deliver from time to time prior to the Termination Date,
but no less frequently than once during each calendar month in which any
Commission Share is issued by a Fund, a Purchase Notice, sufficient to initiate
the sale of the Receivables for the period from the immediately preceding Sale
Cut-off Date to the Sale Cut-off Date specified in such Purchase Notice, which
Sale Cut-off Date shall not be more than three (3) Business Days prior to the
proposed Purchase Date.
SECTION 2.03. ADDITIONAL FUNDS, ETC.
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Unless an Event of Termination (or an event which, with the passage
of time or notice, or both, would constitute an Event of Termination) shall have
occurred and be continuing, the Seller may request that an Additional Fund
become a "Fund" under this Agreement on the Addition Effective Date with respect
thereto. On and as of such Addition Effective Date with respect thereto, (i)
each Additional Fund shall become a Fund hereunder, and in respect of any
Additional Fund which constitutes a Portfolio, the related Investment Company
shall become a "Company" hereunder, (ii) the Servicing Agreement shall be deemed
to be amended to add such Additional Fund and if applicable, the additional
Investment Company, (iii) Schedules I, II and IV to this Agreement shall be
deemed to be supplemented to add the applicable information relating to such
Additional Fund set forth in the Addendum relating to such Additional Fund, and
(iv) Exhibits C, D, E, F and G hereto shall be deemed to be supplemented by
Annexes A, B, C, D and E, respectively, to the Addendum to such Additional Fund,
and any reference in this Agreement to any change or modification since the date
of this Agreement to the distribution agreements, distribution plans, investment
advisory agreements, principal shareholder servicer's agreements, shareholder
servicer's agreements, prospectuses or contingent deferred sales charge
arrangements in respect of such Additional Fund shall be deemed to refer to any
change or modification thereof since such Addition Effective Date with respect
thereto.
The term "Addition Effective Date" shall mean, with respect to the
addition of any Additional Fund, the date on which all of the following
conditions shall have been satisfied:
(i) the Program Agent shall have received a fully executed and appropriately
completed Addendum together with such signed opinions of counsel to the
Seller, the Transferor, the Distributor, the Parent and such Additional
Fund (or in respect of any Additional Fund which constitutes a Portfolio,
the related Investment Company), each dated a date reasonably near the
Addition Effective Date, as the Program Agent or the Purchaser shall have
reasonably requested, all in form, scope and substance satisfactory to the
Program Agent;
(ii) the Program Agent shall have received such instruments, certificates and
documents regarding the addition of such Additional Fund from the
Distributor, the Transferor, the Seller, the Parent and such Additional
Fund as the Program Agent shall reasonably request; and
(iii) the Program Agent shall have received a fully executed Irrevocable Payment
Instruction (or in respect of any Additional Fund which constitutes a
Portfolio of an existing Company, a fully executed amendment to the
Irrevocable Payment Instruction relating to such Company) with respect to
such Additional Fund together with such instruments, certificates and
documents regarding such addition, as the Program Agent shall reasonably
request, all in form, scope and substance satisfactory to the Program
Agent.
Article III
CONDITIONS PRECEDENT
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS.
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The effectiveness of this Agreement shall be subject to the Program
Agent's receipt of each of the following:
(a) fully executed copies of the Servicing Agreement, the Collection Agency
Agreement, the Funding Agreement, the Distributor's Transfer Agreement, the
Transferor's Transfer Agreement, each Irrevocable Payment Instruction, each
Distribution Agreement, each Advisory Agreement, each Distribution Plan, each
Principal Shareholder Servicer's Agreement and each Shareholder Servicer's
Agreement which shall each be in full force and effect;
(b) the signed opinions of counsel to each of the Seller, the Transferor, the
Distributor, the Parent, the Advisors, each Company and each Fund, which shall
each be in form, scope and substance reasonably satisfactory to the Program
Agent;
(c) signed certificates of the Responsible Officers or Assistant Secretary of
the Seller, the Distributor, the Parent and the Transferor, in substantially the
form of Exhibits ▇-▇, ▇-▇, ▇-▇ and B-4 hereto, respectively;
(d) a copy of each Governmental Authorization and Private Authorization, if any,
which is required to be obtained by the Seller, the Transferor, the Distributor,
the Parent, any Advisor, any Company or any Fund in connection with this
Agreement, any other Program Document or the transactions contemplated hereby
and thereby, each of which shall be in form, scope and substance reasonably
satisfactory to the Program Agent;
(e) time stamped receipt copies of proper financing statements duly filed on or
before the initial Purchase Date under the UCC of all jurisdictions that the
Program Agent or the Purchaser may reasonably deem necessary in order to perfect
(i) the ownership interest of the Transferor in the Receivables and Ancillary
Rights sold pursuant to the Distributor's Transfer Agreement, (ii) the ownership
interest of the Seller in the Receivables and Ancillary Rights sold pursuant to
the Transferor's Transfer Agreement, and (iii) the ownership interest of the
Purchaser in the Purchased Receivables relating to each Fund as contemplated by
this Agreement, each of which shall be in form, scope and substance reasonably
satisfactory to the Program Agent;
(f) time stamped receipt copies of proper UCC termination statements necessary
to release all security interests and other rights, if any, of any Person in the
Purchased Receivables relating to each Fund;
(g) certified copies of requests for information (Form UCC-11) (or a similar
search report certified by a party acceptable to the Program Agent and the
Purchaser), dated reasonably near the initial Purchase Date, of the filings made
pursuant to Section 3.01(e) and Section 3.01(f), listing all effective financing
statements (including those referred to in Section 3.01(e) and Section 3.01(f))
which name the Seller, the Transferor or the Distributor (under its respective
present name or any previous name), as debtor and which are filed in the
jurisdictions in which filings were required to be made pursuant to Section
3.01(e), together with copies of such financing statements (none of which,
except for the financing statements referred to in Section 3.01(e), shall cover
any of the Purchased Receivables); and
(h) if required in order to avoid the termination of any Distribution Agreement,
Distribution Plan, Principal Shareholder Servicer's Agreement or Shareholder
Servicer's Agreement, evidence that the Board of Trustees of each Fund (or in
respect of each Fund which constitutes a Portfolio, the Board of Trustees of the
related Company in respect of each such Fund) has approved such Distribution
Plan, Distribution Agreement, Principal Shareholder Servicer's Agreement or
Shareholder Servicer's Agreement, relating to the Receivables of such Fund by a
vote of the majority of its Trustees who are not interested persons, within the
meaning of the Investment Company Act, in recognition of the transactions
contemplated by this Agreement and the other Program Documents.
SECTION 3.02. CONDITIONS PRECEDENT TO THE PURCHASER'S OBLIGATION TO PURCHASE
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RECEIVABLES.
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The obligation of the Purchaser to purchase Receivables relating to
a Fund on any Purchase Date shall be subject to the fulfillment at or prior to
the time of such Purchase Date of the following conditions:
(a) no Event of Termination (or event which, with the passage of time or notice
or both, would constitute such an Event of Termination) shall be continuing at
or prior to such Purchase Date or shall result therefrom;
(b) the Servicer shall have delivered all Investor Reports, Monthly Collection
Determination Date Statements and Activity Reports as and when required to be
delivered pursuant to the Program Documents, which shall be reasonably
satisfactory to the Purchaser and the Program Agent;
(c) the Receivables relating to such Fund shall constitute Eligible Receivables;
(d) immediately after giving effect to all such purchases on such Purchase Date,
the Unamortized Aggregate Purchase Price relating to the Purchased Receivables
of all Funds shall not exceed the Purchase Limit;
(e) as of any Calculation Date commencing with January 31, 2001, the Weighted
Average Percentage Decline in the Net Asset Value of Shares of all Funds
(adjusted for stock splits and excluding declines in the Net Asset Value
resulting from the payment of Normal Distributions) from the end of the
immediately preceding calendar month shall not be twenty percent (20%) or more;
PROVIDED, THAT, if on any date of determination the aggregate Net Asset Value of
Shares of the Funds relating to all Receivables shall have risen to a level of
at least eighty percent (80%) of the aggregate Net Asset Value of Shares of the
Funds as of the Calculation Date immediately preceding the Calculation Date that
the condition specified in this clause (e) was not satisfied and was not
subsequently complied with, this condition shall be deemed to be satisfied as of
such determination date;
(f) such Fund (or if such Fund constitutes a Portfolio, the Company in respect
of such Fund) and the Transfer Agent for such Fund shall have complied in full
with the Irrevocable Payment Instruction, neither such Fund nor such Transfer
Agent shall be prevented by any Authority or by any Applicable Law from paying
Collections in respect of amounts owed with respect to the Purchased Receivables
relating to such Fund or Related Collections in respect of such Fund strictly in
accordance with the applicable Irrevocable Payment Instruction and neither such
Fund (or if such Fund constitutes a Portfolio, the Company in respect of such
Fund) nor such Transfer Agent shall have so asserted in writing; and
(g) the Parent shall own the majority of the outstanding capital stock of the
Seller, the Transferor, the Distributor and each Advisor.
Article IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE SELLER, THE DISTRIBUTOR,
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THE TRANSFEROR AND THE PARENT.
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Each of the Seller, the Distributor, the Transferor and the Parent
represents and warrants on and as of the date hereof, and on and as of each
Purchase Date and, as to clause (k) hereof, on the date such information is
provided, which representations and warranties, in the case of the Parent, are
also made as to each Federated Entity, as follows:
(a) it is duly organized and is validly existing and in good standing under the
laws of the jurisdiction of its organization, with full power and authority to
own and operate its property, conduct the business in which it is now engaged
and to execute and deliver and perform its obligations under this Agreement and
the other Program Documents to which it is a party, and it is in compliance with
all Applicable Law and duly qualified to do business as a foreign corporation or
business trust, as the case may be, and is in good standing in each jurisdiction
in which the nature of its business or the performance of its obligations under
this Agreement and the other Program Documents to which it is a party requires
such qualification, where the failure to so comply or to be so qualified could
reasonably be expected to give rise to a Material Adverse Effect;
(b) the execution, delivery and performance by it of this Agreement, the other
Program Documents to which it is a party and the other instruments and
agreements contemplated hereby or thereby have been duly authorized by all
requisite corporate action by it and have been duly executed and delivered by it
and constitute its legal, valid and binding obligations, enforceable against it
in accordance with their respective terms, except as such enforceability may be
limited by applicable bankruptcy laws and similar laws affecting the rights and
remedies of creditors generally and by equitable principles;
(c) neither the execution and delivery of this Agreement, the other Program
Documents to which it is a party, or any instrument or agreement referred to
herein or therein, or contemplated hereby or thereby, nor the consummation of
any of the transactions herein or therein contemplated, nor compliance with the
terms, conditions and provisions hereof or thereof by it (i) will conflict with,
or result in a breach or violation of, or constitute a default under, the
certificate of its incorporation or by-laws or other organizational documents,
(ii) will conflict with, or result in a breach or violation of, or constitute a
default under, or permit the acceleration of any obligation or liability in, or
but for any requirement of the giving of notice or the passage of time (or both)
would constitute such a conflict with, breach of or violation of, or default
under, or permit any such acceleration in, any contractual obligation or any
agreement or document to which it is a party or by which it or any of its
properties is bound (or to which any such obligation, agreement or document
relates, including without limitation any Distribution Agreement, any Principal
Shareholder Servicer's Agreement, any Shareholder Servicer's Agreement, any
Distribution Plan and any Other Purchasers' Program Document) where such
conflict, breach or violation could reasonably be expected to give rise to a
Material Adverse Effect, (iii) will violate any Applicable Law, the violation of
which could reasonably be expected to give rise to a Material Adverse Effect,
(iv) could reasonably be expected to give rise to or permit the creation or
imposition of any Adverse Claim upon any Purchased Receivables or any
Collections or any Related Collections relating to any Fund, or (v) could
reasonably be expected to give rise to the termination of any Distribution
Agreement, any Principal Shareholder Servicer's Agreement, any Shareholder
Servicer's Agreement or any Distribution Plan;
(d) it has obtained all Governmental Authorizations and Private Authorizations,
and made all Governmental Filings, necessary for the execution, delivery and
performance by it of this Agreement, the other Program Documents to which it is
a party and the agreements and instruments contemplated hereby or thereby and no
consents which have not been obtained or waivers under any instruments to which
it is a party or by which it or any of its properties is bound are required by
it to be obtained or made in connection with the execution, delivery or
performance of this Agreement and the other Program Documents, except to the
extent the failure to so obtain or make the same could not reasonably be
expected to give rise to a Material Adverse Effect;
(e) the principal place of business and principal executive office of the Seller
and the Distributor, and the place where any and all records concerning the
Receivables are kept is at their address specified in Section 9.03 (except as
otherwise permitted by Section 5.01(o));
(f) each of its representations and warranties made or deemed made pursuant to
the Program Documents is true and accurate (except to the extent that such
representations and warranties related solely to an earlier date (in which case
such representations and warranties shall be true and accurate as of such
earlier date)), and each of the applicable conditions precedent set forth in
Article III has been satisfied or waived in writing by the Program Agent;
(g) it is not in default of any of its obligations under this Agreement, any
other Program Document to which it is a party or any Other Purchasers' Program
Document, which default could reasonably be expected to give rise to a Material
Adverse Effect;
(h) there are no proceedings or investigations pending, or, to the best of its
knowledge, threatened, against it before any Authority (i) asserting the
invalidity of this Agreement, any other Program Document to which it is a party
or any certificate, document or agreement executed by it in connection herewith
or therewith, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or any other Program Document, (iii)
seeking any determination or ruling which, if granted, could reasonably be
expected to adversely affect the performance by it of its obligations under, or
the validity or enforceability of, this Agreement, any other Program Document to
which it is a party or any agreement, certificate or document executed by it in
connection herewith or therewith, or (iv) which if adversely determined, could
otherwise reasonably be expected to give rise to a Material Adverse Effect;
(i) it is not an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act;
(j) it is not engaged principally or as one of its important activities in the
business of extending, or arranging for the extension of, credit for the purpose
of purchasing or carrying any margin stock within the meaning of Regulation U of
the Board of Governors of the Federal Reserve System and, in respect of the
Seller and the Distributor, no part of the purchase price paid to it under the
Distributor's Transfer Agreement, the Transferor's Transfer Agreement or the
Purchase Agreement, as the case may be, will be used to purchase or carry any
margin stock within the meaning of said regulation (except investments in funds
managed by an Affiliate of the Parent in accordance with ordinary business
operations) or to extend credit to others for such purpose in a manner which is
inconsistent with or a violation of the provisions of said regulations, and it
will not hold margin stock (including shares in such funds) such that the
aggregate current market value (as defined in said regulations) of all such
margin stock shall exceed 25% of the value (as determined by any reasonable
method) of its consolidated assets;
(k) all written information provided by or on behalf of it, DST Systems, Inc. or
any Sub-transfer Agent for purposes of or in connection with this Agreement, the
other Program Documents (including, without limitation, all Investor Reports,
Activity Reports, Monthly Collection Determination Date Statements and E-Mail
Investor Reports) to which it is a party or the transactions contemplated hereby
or thereby is, and all such information hereafter provided by any such Person to
the Purchaser, the Program Agent or any other Person in writing will be, when
taken as a whole, true, correct and complete in all material respects and not
misleading; it is understood that neither the Parent, the Seller, the Transferor
nor the Distributor shall be deemed to be in breach of this clause solely as a
result of any Monthly Collection Determination Date Statement failing to
properly reflect the methodology set forth in the Allocation Procedures provided
that the amounts and information set forth in the related Investor Report and
Activity Reports are true, correct and complete and such failure results solely
from the Excel Spreadsheet;
(l) neither it nor any ERISA Affiliate has engaged in a "prohibited
transaction", as such term is defined in Section 4975 of the Code or in a
transaction subject to the prohibitions of Section 406 of ERISA, which would
subject it or any ERISA Affiliate (after giving effect to any exemption) to the
tax or penalty on prohibited transactions imposed by Section 4975 of the Code,
Section 502 of ERISA or any other liability under ERISA which tax, penalty or
other liability could reasonably be expected to have a Material Adverse Effect
and neither the transactions contemplated hereby nor the exercise of the
Purchaser's or the Program Agent's rights and remedies under any of the Program
Documents constitutes a prohibited transaction under ERISA or the Code or
otherwise results or will result in the Purchaser or the Program Agent being a
fiduciary or party in interest under ERISA with respect to an ERISA plan or its
assets or the Purchased Receivables or being deemed in violation of Section 404
or Section 406 of ERISA;
(m) it has filed or caused to be filed all federal, state and local tax returns
which are required to be filed (except where such nonfiling could not reasonably
be expected to give rise to a Material Adverse Effect), and paid or caused to be
paid all taxes as shown on said returns or any other taxes or assessments
payable by it to the extent that such taxes have become due unless the same are
being contested in good faith by appropriate proceedings, and in respect of
which appropriate reserves have been established;
(n) the Purchased Receivables relating to each Fund constitute Eligible
Receivables;
(o) no Share of a Fund to which a Purchased Receivable relates contains any
Conversion Feature other than a Permitted Conversion Feature;
(p) no Share of a Fund taken into account in computing the Purchase Price paid
pursuant to this Agreement entitles the holder thereof to redeem the same in a
Free Redemption except in the specific situations set forth in the Prospectus of
such Fund as in effect on the date hereof or pursuant to the Systematic
Withdrawal Program;
(q) it is not contemplating the filing of a petition by it under any state or
federal bankruptcy or insolvency laws, and it has no Actual Knowledge of any
Person contemplating the filing of any such petition against it;
(r) all financial statements of it and its consolidated subsidiaries required to
be delivered to the Purchaser or the Program Agent hereunder fairly present its
assets, liabilities and financial condition and income as of the dates thereof
and have been prepared in accordance with GAAP; there exists no material equity
or long-term investments in, or outstanding advances to, or guaranties of, any
Person except such equity, investment, advances, or guaranties reflected in the
financial statements or in the footnotes thereto;
(s) all action necessary or advisable to protect, preserve and perfect the
Purchaser's first priority ownership interest in the Purchased Receivables free
and clear of all Adverse Claims has been duly and effectively taken and no
security agreement, financing statement, equivalent security or lien instrument
or continuation statement covering all or any part of such Purchased Receivables
is required to be on file or on record in any jurisdiction, except such as may
have been filed, recorded or made as contemplated by this Agreement and the
other Program Documents;
(t) nothing in any Other Purchasers' Program Documents or the UCC financing
statements filed in connection therewith conflicts with the terms of this
Agreement, the other Program Documents or the UCC financing statements filed in
connection herewith; and
(u) the factual assumptions set forth in the opinion of ▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
LLP dated on or about the date hereof on certain bankruptcy matters including
True Sale issues are true and correct as of such date.
SECTION 4.02. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE PARENT.
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The Parent represents and warrants on and as of the date hereof and
on and as of each Purchase Date, as follows:
(a) attached hereto as Exhibits C, D, E, F and G, respectively, are true,
correct and complete copies of each Distribution Agreement, each Prospectus,
each Distribution Plan, each Principal Shareholder Servicer's Agreement and each
Shareholder Servicer's Agreement in effect on the date of this Agreement and a
true, correct and complete copy of each Advisory Agreement has been delivered to
the Program Agent on or before the date hereof, such Program Documents are each
in full force and effect and have not been amended or modified in any manner
after the date hereof without the written consent of the Program Agent, except
(i) in respect of the Prospectuses, for such amendments or modifications which
do not affect any Fundamental Investment Objectives set forth in Schedule IV
hereto or any CDSC arrangement and which could not reasonably be expected to
give rise to a Material Adverse Effect, and (ii) in respect of the Advisory
Agreements, for such amendments or modifications which could not reasonably be
expected to give rise to a Material Adverse Effect;
(b) each of the Companies, each of the Funds and each Advisor is in compliance
with the Fundamental Investment Objectives relating to each Fund;
(c) each of the Distributor, the Principal Shareholder Servicer, the Shareholder
Servicer, the Seller, the Transferor, each Advisor, the Servicer, each Company
and each Advisory Agreement, each Distribution Plan, each Distribution
Agreement, each Principal Shareholder Servicer's Agreement, each Shareholder
Servicer's Agreement, each Prospectus and the CDSC arrangements relating to each
Fund, is in compliance in all material respects with Applicable Law, including
Rule 12b-1 of the Investment Company Act and the Conduct Rules;
(d) the Asset Based Sales Charge, CDSC and Shareholder Servicing Fee
arrangements relating to the Shares of each Fund and the payments provided for
in, and actually being made pursuant to, the Distribution Plan and the
Prospectus for each such Fund are fairly and accurately described in the
Distribution Plan, the Distribution Agreement, the Principal Shareholder
Servicer's Agreement, the Shareholder Servicer's Agreement and Prospectus
relating to such Fund;
(e) the Parent is the indirect record and beneficial owner of all of the
outstanding shares of capital stock of the Seller, the Transferor, the
Shareholder Servicer and the Distributor;
(f) the Distributor is a registered broker-dealer under the Exchange Act, and
is a member of the NASD;
(g) each Advisor is a registered investment adviser under the Investment
Advisers Act;
(h) no Advisor is in breach of any of its representations, warranties or
material covenants or agreements set forth in the Advisory Agreements to which
it is a party;
(i) each Company is registered as an investment company under the Investment
Company Act; and
(j) neither the Seller, the Transferor, the Distributor, any Company nor any
Transfer Agent is prevented by any Applicable Law from paying the Collections or
the Related Collections strictly in accordance with the applicable Irrevocable
Payment Instruction.
SECTION 4.03. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE DISTRIBUTOR.
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The Distributor represents and warrants, on and as of the date
hereof and on and as of each Purchase Date, in its capacities as Distributor,
Principal Shareholder Servicer and Servicer, as follows:
(a) it has the requisite corporate power and authority and legal right to sell
Receivables relating to each Fund, and the Collections and the Ancillary Rights
with respect thereto, to the Transferor in accordance with the terms of the
Distributor's Transfer Agreement and it has duly authorized each such sale to
the Transferor by all necessary action;
(b) each transfer of Receivables and the Ancillary Rights with respect thereto
to the Transferor under the Distributor's Transfer Agreement constitutes a valid
and complete True Sale to the Transferor of all right, title and interest in and
to such Receivables and the Ancillary Rights with respect thereto free and clear
of any Adverse Claim; such transfer has not been made with an intent to hinder,
delay or defraud any present or future creditor; the purchase price paid for
such Receivables is fair consideration and of reasonably equivalent value to the
Receivables and the Ancillary Rights with respect thereto so transferred; and
immediately after the purchase pursuant to the Transfer Agreement the
Distributor will remain solvent and will have adequate capital for the conduct
of its business;
(c) immediately after each transfer of Receivables and the Ancillary Rights with
respect thereto by the Distributor to the Transferor under the Distributor's
Transfer Agreement and by the Transferor to the Seller under the Transferor's
Transfer Agreement, and immediately prior to each purchase of Receivables and
the Ancillary Rights with respect thereto by the Purchaser under this Agreement,
(i) no party claiming through the Distributor has any right, title or interest
in such Receivables or the Ancillary Rights or Collections in respect thereto,
including any payments or proceeds in respect thereto, and (ii) the Seller owns
such Receivables and the Ancillary Rights and Collections in respect thereto
free and clear of all Adverse Claims or other such restrictions on transfer
created by or arising out of the acts or omissions of the Distributor;
(d) neither the Distributor (as Distributor, Principal Shareholder Servicer or
Program Servicer Agent) nor any Company or Transfer Agent is prevented by any
Applicable Law from paying the Collections or Related Collections strictly in
accordance with the applicable Irrevocable Payment Instruction;
(e) the Distributor is a registered broker-dealer under the Exchange Act, and
is a member of the NASD;
(f) the Distributor has clearly and unambiguously marked its books, records and
electronic, computer files and master data processing records relating to the
Receivables to indicate the interests of the Transferor, the Seller and the
Purchaser in the Receivables;
(g) (i) the sum of the Distributor's assets exceeds and will, immediately
following the transactions contemplated hereby, exceed the Distributor's total
liabilities (including subordinated, unliquidated, disputed and contingent
liabilities); (ii) the Distributor's assets do not and, immediately following
the transactions contemplated hereby will not, constitute unreasonably small
capital to carry out its business as conducted or as proposed to be conducted;
and (iii) the Distributor does not intend to, and does not believe that it will,
incur debts and liabilities (including contingent liabilities and other
commitments) beyond its ability to pay such debts as they mature (taking into
account the timing and amounts to be payable on or in respect of obligations of
the Distributor); and
(h) the Distributor has not used and will not use any trade names or assumed
names other than "Federated Securities Corp."
SECTION 4.04. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR.
-----------------------------------------------------------
The Transferor represents and warrants, on and as of the date hereof
and on and as of each Purchase Date, as follows:
(a) it has the requisite corporate power and authority and legal right to sell
Receivables relating to each Fund, and the Collections and the Ancillary Rights
with respect thereto, to the Seller in accordance with the terms of the
Transferor's Transfer Agreement and the Transferor has duly authorized each such
sale to the Seller by all necessary action;
(b) each transfer of Receivables and the Ancillary Rights and Collections with
respect thereto to the Seller under the Transferor's Transfer Agreement and each
transfer of Receivables and the Ancillary Rights and Collections with respect
thereto to the Purchaser under this Agreement constitutes a valid and complete
True Sale of all right, title and interest in and to such Receivables and the
Ancillary Rights and Collections with respect thereto, free and clear of any
Adverse Claim; such transfers have not been made with an intent to hinder, delay
or defraud any present or future creditor; the purchase price paid therefore is
fair consideration and of reasonably equivalent value to the Receivables and the
Ancillary Rights and Collections with respect thereto so transferred; and
immediately after the purchase pursuant to this Agreement the Distributor, the
Transferor and the Seller will remain solvent and will have adequate capital for
the conduct of its business;
(c) immediately after each transfer of the Receivables and the Ancillary Rights
and Collections with respect thereto to the Seller under the Transferor's
Transfer Agreement and immediately prior to each purchase of the Receivables and
the Ancillary Rights and Collections with respect thereto by the Purchaser under
this Agreement, (i) no party claiming through the Transferor, the Seller or the
Distributor has any right, title or interest in such Receivables or the
Ancillary Rights or Collections in respect thereto, including any payments or
proceeds in respect thereto, (ii) the Seller owns such Receivables and the
Ancillary Rights and Collections in respect thereto free and clear of all
Adverse Claims or other such restrictions on transfer created by or arising out
of the acts or omissions of any Federated Entity, and (iii) such Receivables and
the Ancillary Rights and Collections in respect thereto have not been sold,
transferred or assigned by the Transferor to any other Person;
(d) the Transferor is not prevented by any Applicable Law from paying the
Collections and Related Collections strictly in accordance with the applicable
Irrevocable Payment Instruction;
(e) the Transferor has clearly and unambiguously marked all of its books,
records and electronic computer files and master data processing records
relating to the Receivables to indicate the interests of the Purchaser in the
Purchased Receivables;
(f) (i) the sum of the Transferor's assets exceeds and will, immediately
following the transactions contemplated hereby, exceed the Transferor's total
liabilities (including subordinated, unliquidated, disputed and contingent
liabilities); (ii) the Transferor's assets do not and, immediately following the
transactions contemplated hereby will not, constitute unreasonably small capital
to carry out is business as conducted or as proposed to be conducted; and (iii)
the Transferor does not intend to, and does not believe that it will, incur
debts and liabilities (including contingent liabilities and other commitments)
beyond its ability to pay such debts as they mature (taking into account the
timing and amounts to be payable on or in respect of obligations of the
Transferor); and
(g) the Transferor has not used and will not use any trade names or assumed
names other than "Federated Investors Management Company" and "Federated
Disbursing Corp."
SECTION 4.05. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE SELLER.
-------------------------------------------------------
The Seller represents and warrants, on and as of the date hereof and
on and as of each Purchase Date, as follows:
(a) the Seller was founded solely for the purpose of performing its obligations
under the Other Purchasers' Program Documents and the Program Documents and
activities incidental thereto, and it has the requisite corporate power and
authority and legal right to sell Receivables relating to each Fund sold on such
Purchase Date, and the Collections and the Ancillary Rights with respect
thereto, to the Purchaser in accordance with the terms of this Agreement and the
Seller has duly authorized each such sale to the Purchaser by all necessary
action;
(b) the transfer of Receivables and the Ancillary Rights and Collections with
respect thereto to the Seller under the Transferor's Transfer Agreement and the
transfer of Receivables and the Ancillary Rights and Collections with respect
thereto to the Purchaser under this Agreement on each Purchase Date each
constitutes a valid and complete True Sale of all right, title and interest in
and to such Receivables and the Ancillary Rights and Collections with respect
thereto, free and clear of any Adverse Claim; such transfers have not been made
with an intent to hinder, delay or defraud any present or future creditor; the
purchase price paid thereunder is fair consideration and of reasonably
equivalent value to the Receivables so transferred; and immediately after the
purchase pursuant to this Agreement the Distributor, the Transferor and the
Seller will remain solvent and will have adequate capital for the conduct of its
business;
(c) immediately after the transfer of the Receivables to the Seller under the
Transferor's Transfer Agreement and immediately prior to each purchase of the
Receivables and the Ancillary Rights and Collections with respect thereto by the
Purchaser under this Agreement on such Purchase Date, (i) no party claiming
through the Seller has any right, title or interest in such Receivables, the
Ancillary Rights with respect thereto or the Collections in respect thereto,
including any payments or proceeds in respect thereto, (ii) the Seller owns such
Receivables, the Ancillary Rights with respect thereto and the Collections in
respect thereto free and clear of all Adverse Claims or other such restrictions
on transfer created by or arising out of the acts or omissions of any Federated
Entity, and (iii) such Receivables, the Ancillary Rights with respect thereto
and the right to Collections in respect thereto have not been sold, transferred
or assigned by the Seller to any other Person;
(d) this Agreement and the actions of the Seller required to be taken pursuant
to the terms hereof and thereof are and at all times shall be effective to
transfer to the Purchaser all of the Seller's right, title and interest in, to
and under the Purchased Receivables free and clear of any Adverse Claim;
(e) the Seller is not prevented by any Applicable Law from paying the
Collections or Related Collections strictly in accordance with the applicable
Irrevocable Payment Instruction;
(f) the Seller is in full compliance with the Bankruptcy Remote Covenants;
(g) the Seller has clearly and unambiguously marked all of its books, records
and electronic, computer files and master data processing records relating to
the Receivables to indicate the interests of the Purchaser in the Purchased
Receivables;
(h) (i) the sum of the Seller's assets exceeds and will, immediately following
the transactions contemplated hereby, exceed the Seller's total liabilities
(including subordinated, unliquidated, disputed and contingent liabilities),
(ii) the Seller's assets do not and, immediately following the transactions
contemplated hereby will not, constitute unreasonably small capital to carry out
its business as conducted or as proposed to be conducted, and (iii) the Seller
does not intend to, and does not believe that it will, incur debts and
liabilities (including contingent liabilities and other commitments) beyond its
ability to pay such debts as they mature (taking into account the timing and
amounts to be payable on or in respect of obligations of the Seller); and
(i) the Seller has not used and will not use any trade names or assumed names
other than Federated Funding 1997-1, Inc.
SECTION 4.06. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND THE PROGRAM
--------------------------------------------------------------
AGENT.
-----
Each of the Purchaser and the Program Agent represents and warrants
to the other parties to this Agreement as follows:
(a) It is duly organized and existing under the laws of the jurisdiction of its
organization with full power and authority to execute and deliver this Agreement
and to perform all of the duties and obligations to be performed by it under
this Agreement; and
(b) This Agreement has been duly authorized, executed and delivered by it, and
constitutes its valid, legal and binding obligation enforceable against it in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency or other similar laws of general application relating to
or affecting the enforcement of creditors' rights in general or by general
principles of equity.
Article V
COVENANTS
SECTION 5.01. COVENANTS OF THE SELLER, THE DISTRIBUTOR, THE TRANSFEROR AND
-------------------------------------------------------------
THE PARENT.
----------
Each of the Seller, the Distributor, the Transferor and the Parent
covenants and agrees that it shall, and, in the case of the Parent, that it
shall itself and that it shall also cause each Federated Entity to from the date
hereof until the Program Termination Date:
(a) (i) preserve and maintain its legal existence and all of its material
rights, privileges and franchises, and duly observe and conform to all
requirements of Applicable Law applicable to it, the conduct of its business or
to its properties or assets, (ii) preserve and keep in full force and effect its
corporate existence, rights, privileges and franchises, and maintain records of
its resolutions or similar actions regarding the transactions contemplated by
the Program Documents and (iii) obtain, make, maintain and keep in full force
and effect all Governmental Authorizations and Private Authorizations which are
necessary or appropriate to properly carry out the transactions contemplated to
be performed by it under this Agreement and the other Program Documents, except
in such case where the failure to so observe, conform to, preserve, obtain,
make, maintain or keep in full force and effect could not reasonably be expected
to give rise to a Material Adverse Effect;
(b) duly fulfill all obligations on its part to be performed under or in
connection with this Agreement and the other Program Documents and the
agreements and instruments entered into in connection herewith or therewith;
(c) keep proper books of record and account in accordance with GAAP and its
normal business practice in which full and appropriate entries shall be made of
all dealings or transactions in relation to its business and activities and (in
the case of the Seller, the Transferor and the Distributor) ▇▇▇▇ its data
processing or other records, if any, so as to clearly indicate that the
Purchased Receivables have been sold to the Purchaser;
(d) promptly deliver to the Program Agent copies of any amendments or
modifications to its certificate of incorporation, by-laws or other
organizational documents, certified by a Responsible Officer;
(e) (i) promptly give written notice to the Program Agent of the occurrence of
any Event of Termination (or event which, with the passage of time or notice, or
both, would constitute an Event of Termination), the failure of any conditions
precedent set forth in Section 3.02 to be fully satisfied on or immediately
prior to the applicable Purchase Date, or any breach of any term or condition of
any Program Document, which in each case relates to or is caused by it or any of
its Affiliates or the performance of any such Persons under any Program
Document, (ii) give written notice to the Program Agent, promptly after it
becomes aware thereof, of any other Event of Termination (or event which with
the passage of time, notice or both would constitute such an Event of
Termination), or the failure of any other conditions precedent set forth in
Section 3.02 or any other breach of any terms or conditions of any Program
Documents, and (iii) promptly give written notice to the Program Agent of any
litigation or proceedings with respect to it or any of its Affiliates or
affecting it, any of its Affiliates or any of their respective assets or
properties, which if adversely determined, could reasonably be expected to give
rise to a Material Adverse Effect;
(f) cause to be computed, paid and discharged all taxes, assessments and other
charges or levies of any Authority imposed upon it, or upon any of its income or
assets, unless and to the extent that the same shall be contested in good faith
by appropriate proceedings and with respect to which adequate reserves have been
established on its books in accordance with GAAP;
(g) to the extent obtained or received by it, furnish or cause to be furnished
to the Program Agent a copy of all Private Authorizations and all Governmental
Authorizations obtained or required to be obtained by it in connection with the
transactions contemplated by this Agreement or any other Program Documents to
which it is a party;
(h) annually, or more frequently as the Program Agent may request upon the
occurrence and during the continuance of an Event of Termination (or an event
which upon the passage of time or notice, or both, would constitute an Event of
Termination), (i) cause an independent nationally recognized accounting firm
selected by it and reasonably satisfactory to the Program Agent to enter its
premises (and each other Person to whom it delegates any of its duties under the
Program Documents) and examine and audit the books, records and accounts
relating to the Purchased Receivables and its or such other Person's performance
under the Program Documents (which audit may be coordinated as part of each such
Person's regular annual audit and may be coordinated with any similar audit
required to be conducted under the Other Purchaser's Program Documents), (ii)
permit such accounting firm to discuss its or such other Person's affairs,
finances, accounts and performance under the Program Documents with the
officers, partners, employees and accountants of it or such other Person, (iii)
cause such accounting firm to provide the Program Agent with a certified report
in respect of the foregoing, which shall be in form and scope reasonably
satisfactory to the Program Agent, and (iv) authorize such accounting firm to
discuss such affairs, finances, records and accounts with representatives of the
Program Agent, the Purchaser and any Permitted Designee;
(i) permit, and cause each Person to which it delegates any of its duties under
the Program Documents to permit the Purchaser, the Program Agent or any
Permitted Designee to, upon reasonable advance notice and during normal business
hours, visit and inspect its and such Person's books, records and accounts
relating to the Purchased Receivables and its performance under the Program
Documents and to discuss the foregoing with the officers, partners, employees
and accountants of it and such Person, all as often as the Program Agent or any
such Permitted Designee may reasonably request; PROVIDED, HOWEVER, that so long
as no Event of Termination (or event which with the passage of time, notice or
both, would constitute an Event of Termination) shall have occurred, such
inspections shall be at the expense of the requesting party;
(j) promptly, at its expense, execute and deliver to the Program Agent such
further instruments and documents, and take such further action as the Program
Agent may from time to time reasonably request in order to further carry out the
intent and purpose of this Agreement and the other Program Documents and to
establish and protect the rights, interests and remedies created, or intended to
be created, hereby and thereby, and the protection and perfection of the
Purchaser's first priority ownership interest in the Purchased Receivables free
and clear of all Adverse Claims, including, without limitation, the execution,
delivery, recordation and filing of financing statements and continuation
statements under the UCC of any applicable jurisdiction;
(k) promptly deliver to the Program Agent copies of all notices, requests,
agreements, amendments, supplements, waivers and other documents received or
delivered by it under or with respect to any of the Program Documents;
(l) in the event that, notwithstanding the Irrevocable Payment Instructions, it
shall receive any Collections or Related Collections from any Fund, any Company
or any Transfer Agent or other Person (including without limitation FOF
Collections) promptly upon its receipt of any such Collections or Related
Collections remit the same to the Demand Deposit Account for further credit to
the Collection Account, and, until such funds are so deposited into the Demand
Deposit Account, ensure that such amounts are not commingled with any other
funds;
(m) promptly notify the Program Agent of any material adverse change with
respect to the business, properties (in respect of properties, other than in the
ordinary course of its and each Company's and each Fund's business, as conducted
on the date hereof), financial condition or results of operations of it, or, to
its knowledge, any Company or Fund since September 30, 2000;
(n) not permit to exist any Adverse Claims on, or otherwise attempt to transfer
any interest in, any Purchased Receivables or any interest therein or except for
the interest of the Other Purchasers under the Other Purchasers' Program
Documents, any interest in any other Receivables, the Ancillary Rights with
respect thereto or any Related Collections or any interest therein; PROVIDED,
HOWEVER, that in the event that the Purchaser shall not purchase certain
Receivables relating to Shares of any Fund, the Seller may transfer all or a
portion of its interest in such Receivables and the Ancillary Rights with
respect thereto to another Person provided each of the following conditions are
met: (1) that such Person and the Program Agent, the Collection Agent and the
Purchaser shall have entered into a mutually satisfactory intercreditor
agreement and amendment to the Collection Agency Agreement as contemplated by
Section 8.06 thereof, and (2) the Program Agent, the Collection Agent and the
Purchaser shall have received such certificates and opinions as they may
reasonably request in connection therewith all in form, scope and substance
reasonably satisfactory to them;
(o) not (in the case of the Seller, the Transferor and the Distributor) move its
principal executive office or the place where it keeps its records concerning
the Receivables from the offices specified in Section 4.01(e), unless (a) it
shall have given to the Program Agent not less than twenty (20) days prior
written notice of its intention to do so, clearly describing the new location
and (b) it shall have taken such action, satisfactory to the Program Agent, to
maintain the first priority perfected or ownership interest of the Purchaser in
the Purchased Receivables at all times fully perfected and in full force and
effect;
(p) not amend, waive, terminate or otherwise modify the terms of any Irrevocable
Payment Instruction or take any action inconsistent with any Irrevocable Payment
Instruction;
(q) not act affirmatively to change its operations in any material manner if at
the time of such action, based upon all of the facts and circumstances, such
change could reasonably be expected to give rise to a Material Adverse Effect;
(r) not reflect the Purchased Receivables as being owned by the Seller or any
Affiliate of the Seller (except to the extent such treatment is required by a
change in GAAP after the date hereof and all appropriate financial statements
are footnoted to reflect the sale thereof to the Purchaser); PROVIDED that
Shareholder Servicing Fees may be reflected as an asset of the Distributor, the
Transferor or the Seller if such treatment is required by GAAP and if all
appropriate financial statements are footnoted to reflect the sale thereof to
the Purchaser;
(s) not take any action to cancel, terminate, amend, supplement, modify or waive
any of the provisions of any Distribution Agreement, any Principal Shareholder
Servicer's Agreement, any Shareholder Servicer's Agreement, any Distribution
Plan, the Conversion Features or the CDSC arrangements applicable to the holders
of any Shares of any Fund (including by way of allowing Free Redemptions in
respect of Shares of any Fund under circumstances not required by the Prospectus
of such Fund in effect on the date of this Agreement or by the Systematic
Withdrawal Program or by allowing Free Redemptions which are not Permitted Free
Exchanges), or request, consent or agree to any such cancellation, termination,
amendment, supplement, modification or waiver, except with the prior written
consent of the Program Agent, except that it may from time to time waive a CDSC
that becomes payable provided it pays in accordance with the Program Servicing
Procedures an amount to the Purchaser equal to the CDSC to which such Purchaser
would have been entitled;
(t) cause or ensure that (i) all written information provided to the Seller, the
Purchaser or the Program Agent for purposes of or in connection with this
Agreement or any other Program Document or the transactions contemplated hereby
or thereby (including without limitation, all Investor Reports, Activity Reports
and Monthly Collection Determination Date Statements by or on behalf of any
Federated Entity, DST Systems, Inc. or any Sub-transfer Agent is, and all such
information hereafter provided by any such Person to the Seller, the Purchaser
or the Program Agent will be, when taken as a whole, true, correct, complete in
all material respects and not misleading on the date such information is stated
or certified; it is understood that neither the Seller, the Transferor nor the
Distributor shall be deemed to be in breach of this clause solely as a result of
any Monthly Collection Determination Date Statement failing to properly reflect
the methodology set forth in the Allocation Procedures provided that the amounts
and information set forth in the related Investor Report and Activity Reports
are true, correct and complete and such failure results solely from the Excel
Spreadsheet, and (ii) each Activity Report continues to include at least the
same scope of information as the Activity Reports the form of which have been
reviewed by the Program Agent prior to the effective date of this Agreement (or
in respect of any Activity Report provided by a Sub-transfer Agent appointed
after the date hereof, the same form and scope as the report of such
Sub-transfer Agent approved by the Program Agent in accordance with Section
5.01(u));
(u) not permit any Person to become a Sub-transfer Agent for any Fund unless the
forms of the reports to be provided by such Person have been approved in writing
by the Program Agent.
(v) cause and ensure that all actions, which the opinion of ▇▇▇▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇, LLP dated on or about the date hereof in respect of certain bankruptcy
matters including "true sale" and "substantive consolidation" assumes will be
taken or omitted by it, will be taken or omitted as so assumed.
SECTION 5.02. ADDITIONAL COVENANTS OF THE PARENT.
----------------------------------
The Parent covenants and agrees that it shall from the date hereof
until the Program Termination Date:
(a) cause the Seller to use the Purchase Price paid to it on any Purchase Date
solely for the purpose of purchasing Receivables under the Transferor's Transfer
Agreement or for reimbursing itself for the purchase price of the Receivables
purchased under the Transferor's Transfer Agreement and cause the Transferor to
use the purchase price paid to it for Receivables under the Transferor's
Transfer Agreement on any date solely for the purpose of purchasing Receivables
or for reimbursing itself for the purchase price of Receivables purchased under
the Distributor's Transfer Agreement; (b) cause each Advisor to perform its
obligations under the Advisory Agreements to which it is a party and to manage
each applicable Fund in accordance with the Fundamental Investment Objectives in
respect of such Fund as in effect from time to time;
(c) consistent with the fiduciary obligations of the Federated Entities to the
Funds use its best efforts, which are commercially reasonable in relation to the
consequence to the Purchaser if they are not successful, to maintain the
Fundamental Investment Objectives in respect of any Fund as reflected in
Schedule IV hereto and, in the event that as a consequence of fiduciary
obligations of the Federated Entities to the Funds it cannot resist a proposed
change in the Fundamental Investment Objectives in respect of the Fund, and in
the event that despite such commercially reasonable best efforts such change
will be made, it shall, prior to taking any action inconsistent with the
maintenance of such Fundamental Investment Objectives, or failing to take the
action it could otherwise take, or to the effectiveness of such change, as the
case may be: (i) notify the Program Agent in writing of the nature of such
change, and (ii) provide certification by a Responsible Officer that such change
is necessary in order to comply with such fiduciary obligations;
(d) consistent with the fiduciary obligations of the Federated Entities to the
Funds use its best efforts, which are commercially reasonable in relation to the
consequences to the Purchaser if they are not successful, to obtain the approval
of the Board of Trustees of each Fund to: (i) annually re-approve the
Distribution Plan, the Distribution Agreement, the Principal Shareholder
Servicer's Agreement, and the Shareholder Servicer's Agreement relating to each
such Fund, if necessary in order to continue payments in respect of the
Purchased Receivables relating to such Fund, and (ii) in the event any of the
foregoing shall be terminated with respect to any such Fund, to approve a new
distribution plan, distribution agreement, principal shareholder servicer's
agreement, and/or shareholder servicer's agreement in respect of such Fund so as
to permit the continued payments in respect of the Purchased Receivables
relating to such Fund as though no such termination had occurred, and in the
event that as a consequence of fiduciary obligations of the Federated Entities
to the Funds, it cannot endeavor to obtain the approval of the Board of Trustees
of a Fund to take the actions described in clauses (i) and (ii) above, or in the
event that despite its efforts such action will not be taken, it shall, prior to
taking any action inconsistent with the actions described in clauses (i) and
(ii) above, or failing to take any action it could otherwise take, or to any
termination referred to in clause (ii) above: (x) notify the Purchaser and the
Program Agent in writing of the nature of such failure or inability or
termination, and (y) provide certification by a Responsible Officer that such
failure or inability is required in order to comply with such fiduciary
obligations;
(e) provide prompt written notice to the Program Agent of any action by the
Board of Directors of any Advisor or the Shareholder Servicer or the Board of
Trustees of any Fund to make any modification, amendment or supplement to, or
any waiver of any provisions of, or any termination of, any Distribution Plan,
any Distribution Agreement, any Principal Shareholder Servicer's Agreement, any
Shareholder Servicer's Agreement, any Advisory Agreement, any Conversion
Feature, any CDSC arrangement, any Fundamental Investment Objectives of any
Company in respect of any Fund, or any modification, amendment, supplement or
waiver in the amounts payable or actually being paid thereunder, each as in
effect on the date of that agreement; PROVIDED, HOWEVER, that the Parent shall
not be required to provide the Program Agent with written notices of any
modification, amendment or supplement to or waivers of any provisions of the
Prospectuses under this Section 5.02(e), unless such modifications, amendments,
supplements or waivers (i) affect or relate to the CDSC obligations or the
Fundamental Investment Objectives, or (ii) otherwise could reasonably be
expected to have a Material Adverse Effect;
(f) cause each of the Seller, the Transferor and the Distributor to comply in
all respects with their covenants and agreements under the Program Documents
(including the Bankruptcy Remote Covenants) and use its best efforts to cause
each Company to comply with Applicable Law and to duly fulfill and perform its
obligations under the Program Documents, where such failure to comply or perform
could give rise to a Material Adverse Effect;
(g) furnish to the Program Agent:
(i) annually within 120 days after the end of each fiscal year audited
consolidated financial statements of the Parent and its consolidated
subsidiaries prepared in accordance with GAAP for such fiscal year;
(ii) quarterly within 45 days after the end of the first three fiscal quarters
of any fiscal year unaudited consolidated financial statements of the
Parent and its consolidated subsidiaries prepared in accordance with GAAP
for such fiscal quarter;
(iii) such other information as the Program Agent may reasonably request and
which is reasonably available;
(h) consistent with the fiduciary obligations of the Federated Entities to the
Funds not initiate or propose the adoption by any Fund or any Company, of any
Liquidation Plan, and use its best efforts, which are commercially reasonable in
relation to the consequences to the Purchaser if they are not successful, to
cause the Board of Trustees and shareholders of each Company and each Fund to
avoid adopting any Liquidation Plan, and in any event the Parent shall promptly
notify the Program Agent of any proposed Liquidation Plan by the Company or any
Fund;
(i) the Parent will not permit to occur any change in Control of the Parent, the
Distributor, the Seller, the Principal Shareholder Servicer, the Shareholder
Servicer or any Advisor unless either:
(1) in connection with such change in Control:
(i) either (A) such Distributor, Principal Shareholder Servicer, Shareholder
Servicer, Advisor or the Parent shall remain distributor, principal
shareholder servicer, shareholder servicer or advisor, as the case may be,
for the Funds and the Parent shall remain the ultimate parent of each of
the foregoing or (B) if another Person shall be retained to replace any of
the foregoing to act as distributor, principal shareholder servicer,
shareholder servicer or investment advisor, as the case may be, for the
Funds, or as parent, such Person shall (x) meet the requirements of (iii)
below with reference to the expertise, experience and capacity applicable
to the function it undertakes to perform and (y) have agreed, in respect of
periods from and after its retention, to be bound by the undertakings of
the Distributor, the Principal Shareholder Servicer, the Shareholder
Servicer, the Advisor or the Parent, as the case may be, under the Program
Documents and shall have confirmed as of a current date the representations
and warranties of the Distributor, the Principal Shareholder Servicer, the
Shareholder Servicer, the Advisor or the Parent, as the case may be, except
such representations and warranties as expressly relate solely to an
earlier date (in which case such representations and warranties shall be
true and correct as of such earlier date);
(ii) in the case where another Person is retained to replace the
Distributor, Principal Shareholder Servicer, Shareholder Servicer or
the Advisor to act as distributor, principal shareholder servicer,
shareholder servicer or investment advisor, as the case may be, for
the Funds, ownership of at least 51% of the voting securities of
each of the Persons serving as the distributor, the principal
shareholder servicer, the shareholder servicer or investment advisor
to the Funds is retained by, or transferred to, a single Person (the
"Immediate Parent");
(iii) in the case where another Person is retained to replace the
Distributor, Principal Shareholder Servicer, Shareholder Servicer,
Advisor or the Parent to act as distributor, principal shareholder
servicer, shareholder servicer, investment advisor or parent, as the
case may be, for the Funds, in the reasonable opinion of the Parent,
the Immediate Parent, together with its affiliated subsidiaries
(including the Immediate Parent and the Persons then serving as
distributor, principal shareholder servicer, shareholder servicer
and investment advisor to the Funds) in the aggregate, have
financial resources and mutual fund management, distribution and
investment advisory expertise, experience and capacity immediately
after the change in Control sufficient to satisfy the obligations of
their counterparts under the Program Documents; and
(iv) in the case where another Person is retained to replace the
Distributor, Principal Shareholder Servicer, Shareholder Servicer or
the Advisor to act as distributor, principal shareholder servicer,
shareholder servicer or investment advisor, as the case may be, for
the Funds, a majority of the Board of Trustees of the Funds,
including a majority who are not "Interested Persons" (as defined by
Section 2(a)(19) of the Investment Company Act) shall have either
(i) reapproved the Distribution Plans, Distribution Agreements, the
Principal Shareholder Servicer's Agreements, the Shareholder
Servicer's Agreements and any Advisory Agreements, or (ii) approved
substitute agreements substantially identical thereto so that no
Material Adverse Effect could reasonably be expected to result from
such substitute agreements; or
(2) the Program Agent shall have consented to such change in Control, such
consent not to be unreasonably withheld;
PROVIDED, HOWEVER, that nothing in this Section 5.02(i) shall be
deemed to restrict the ability of the Parent directly or indirectly to engage in
any offering of its capital stock so long as no Person or group of Persons
acting in concert (other than Persons who are currently in control of the Parent
and any employee benefit plan or related trust of the Parent or any of its
subsidiaries) shall obtain Control of the Parent as a result thereof;
(j) ensure that each Transfer Agent's tracking capabilities and/or the Seller's
tracking capabilities for each Fund and each Sub-transfer Agent's tracking
capabilities are sufficient to: (i) track the Receivables and provide the
information specified in the Investor Reports and the Monthly Collection
Determination Date Statement, and (ii) identify and remit Collections and
Related Collections in accordance with the applicable Irrevocable Payment
Instruction, and the Parent shall use its best efforts to replace any Transfer
Agent or Sub-transfer Agent which does not maintain such capabilities or in
respect of which an event similar to those described in Section 6.01(e) occurs
(whether or not such Transfer Agent or Sub-transfer Agent to which Section
6.01(e) applies is a Federated Entity) within sixty (60) days after becoming
aware of such event; and
(k) cause the Seller to at all times constitute a Bankruptcy Remote Entity.
SECTION 5.03. ADDITIONAL COVENANTS OF THE DISTRIBUTOR.
---------------------------------------
The Distributor covenants and agrees that it shall from the date
hereof until the Program Termination Date:
(a) not reflect the Purchased Receivables or Collections in respect thereof as
being owned by the Distributor or any Affiliate of the Distributor (except to
the extent such treatment is required by a change in GAAP after the date hereof
and all appropriate financial statements are footnoted to reflect the sale
thereof pursuant to the Distributor's Transfer Agreement, the Transferor's
Transfer Agreement and this Agreement); PROVIDED, that Shareholder Servicing
Fees may be reflected as an asset of the Distributor, the Transferor or the
Seller if such treatment is required by GAAP and if all appropriate financial
statements are footnoted to reflect the sale thereof to the Purchaser;
(b) promptly upon preparation, deliver to the Program Agent, copies of the
semi-annual unaudited reports and annual audited reports of each Company;
(c) consistent with the fiduciary obligations of the Federated Entities to the
Funds use its best efforts, which are commercially reasonable in relation to the
consequences to the Purchaser if they are not successful, to obtain approval of
the Board of Trustees of each Company in respect of each Fund to: (i) annually
reapprove the Distribution Plan, the Distribution Agreement, the Principal
Shareholder Servicer's Agreement and the Shareholder Servicer's Agreement
relating to each such Fund, if necessary, in order to continue payments in
respect of the Purchased Receivables relating to such Fund, and (ii) in the
event any of the foregoing shall be terminated with respect to any such Fund, to
approve a new distribution plan, distribution agreement, principal shareholder
servicer's agreement, and/or shareholder servicer's agreement in respect of such
Fund so as to permit the continued payments in respect of the Purchased
Receivables relating to such Fund as though no such termination had occurred,
and in the event that as a consequence of fiduciary obligations of the Federated
Entities to the Funds it cannot endeavor to obtain the approval of the Board of
Trustees of a Fund to take the actions described in clauses (i) and (ii) above,
or in the event that despite its efforts such action will not be taken, it
shall, prior to taking any action inconsistent with the actions described in
clauses (i) and (ii) above, or failing to take any action it could otherwise
take, or to any termination referred to in clause (ii) above: (x) notify the
Program Agent in writing of the nature of such failure or inability or
termination, and (y) provide certification by a Responsible Officer that such
failure or inability is required in order to comply with such fiduciary
obligations;
(d) provide prompt written notice to the Program Agent of any action by its
Board of Directors or the Board of Directors of any Advisor or the Shareholder
Servicer or the Board of Trustees of any Fund or any Company in respect of any
Fund to make any modification, amendment or supplement to, or any waiver of any
provisions of, or any termination of, any Distribution Plan, any Distribution
Agreement, any Principal Shareholder Servicer's Agreement, any Shareholder
Servicer's Agreement, any Advisory Agreement, any Conversion Feature, any CDSC
arrangement, or any Fundamental Investment Objectives of any Fund or any Company
in respect of any Fund, or any modification, amendment, supplement or waiver in
the amounts payable or actually being paid thereunder, each as in effect on the
date of that agreement; PROVIDED, HOWEVER, that the Distributor shall not be
required to provide the Program Agent with written notices of any modification,
amendment or supplement to or waivers of any provisions of the Prospectuses
under this Section 5.03(d), unless such modifications, amendments, supplements
or waivers (i) affect or relate to the CDSC obligations or the Fundamental
Investment Objectives, or (ii) otherwise could reasonably be expected to have a
Material Adverse Effect;
(e) promptly (i) notify the Program Agent in writing of all filings by any
Company or any Fund with the SEC and all material mailings to shareholders of
any Company or any Fund, and (ii) to the extent the same are not readily
obtainable by the Program Agent through the Securities and Exchange Commission's
Electronic Data Gathering, Analysis and Retrieval system or other public on-line
sources, deliver to the Program Agent copies of such filings and mailings; and
(f) promptly notify the Program Agent of any material adverse change with
respect to the business, properties (in respect of properties, other than in the
ordinary course of its and each Fund's business, as conducted on the date
hereof) or its financial condition or results of operations, or to its
knowledge, any Company or Fund, since September 30, 2000, including any material
change in the sales commission structure relating to any Fund or arrangements,
distribution fees, CDSCs or exchange privileges for shareholders; and
(g) keep each Irrevocable Payment Instruction in full force and effect.
SECTION 5.04. ADDITIONAL COVENANTS OF THE SELLER.
----------------------------------
The Seller covenants and agrees that it shall from the date hereof
until the Program Termination Date:
(a) use the purchase price paid to it on each Purchase Date solely for the
purpose of purchasing Receivables or for reimbursing itself for the purchase
price of the Receivables purchased under the Transferor's Transfer Agreement
pursuant to and in accordance with the terms of the Transferor's Transfer
Agreement;
(b) after the Other Purchaser's End Date, not purchase any Receivables under
the PLT Transferor's Transfer Agreement; and
(c) comply in all respects with the Bankruptcy Remote Covenants at all times.
SECTION 5.05. ADDITIONAL COVENANTS OF THE TRANSFEROR.
--------------------------------------
The Transferor covenants and agrees that it shall from the date
hereof until the Program Termination Date:
(a) use the purchase price paid to it on each Purchase Date under the
Transferor's Transfer Agreement solely for the purpose of purchasing Receivables
under the Distributor's Transfer Agreement or for reimbursing itself for the
purchase price of the Receivables purchased under the Distributor's Transfer
Agreement pursuant to and in accordance with the terms of the Distributor's
Transfer Agreement; and
(b) not after the Other Purchaser's End Date, purchase any Receivables under the
PLT Distributor's Transfer Agreement or sell any Receivables under the PLT
Transferor's Transfer Agreement.
Article VI
EVENTS OF TERMINATION
SECTION 6.01. EVENTS OF TERMINATION.
---------------------
If any of the following events (each an "Event of Termination")
shall occur:
(a) the Parent, the Distributor (as Distributor, Principal Shareholder Servicer
or as Servicer), the Seller, the Transferor, the Shareholder Servicer, any
Advisor, any Transfer Agent, any Sub-transfer Agent, any Company or any Fund
shall fail to make or cause to be made in the manner and when due any payment or
deposit to be made or to be caused to be made by it under this Agreement or any
of the other Program Documents and such failure shall continue for three (3)
Business Days; or
(b) the Parent, the Distributor (as Distributor, Principal Shareholder Servicer
or as Servicer), the Seller, the Transferor, the Shareholder Servicer, any
Advisor, any Transfer Agent or any Selling Agent, any Company or any Fund shall
fail to perform or observe any covenant or agreement on its part to be performed
or observed under any Program Document (other than those described in clause (a)
of this Section 6.01) and such failure shall continue for ten (10) Business Days
after such Person has knowledge of such failure; or
(c) (i) any representation or warranty made or deemed made by the Parent, the
Distributor (as Distributor, Principal Shareholder Servicer or as Servicer), the
Seller, the Transferor, the Shareholder Servicer (or any of their respective
officers) under or in connection with any Program Document shall have been
incorrect when made or deemed made; PROVIDED, HOWEVER, that if any such
incorrect representation or warranty is capable of being cured within ten (10)
Business Days and the Person in breach of such representation or warranty is
diligently using its best efforts to cure such representation or warranty, such
incorrect representation or warranty shall not constitute an Event of
Termination if, within such ten (10) Business Day period, such incorrect
representation or warranty has been cured and the Parent has certified to the
Program Agent that such cure has been effected, or (ii) any Investor Report, any
Activity Report or any other statement, certificate or report delivered by or on
behalf of the Parent, the Distributor, the Seller, the Transferor or the
Shareholder Servicer in connection with this Agreement, or any other Program
Document, shall have been false, incorrect or misleading, when taken as a whole,
in any material respect when delivered; or
(d) the Purchaser shall fail to acquire in a True Sale, or shall cease to have,
a 100% undivided ownership interest in any Purchased Receivable, free and clear
of any Adverse Claim; or
(e) (i) the Seller, the Transferor, the Distributor, the Parent, the Shareholder
Servicer, any Advisor, any Transfer Agent, any Sub-transfer Agent, any Company
or any Fund or any Significant Affiliate thereof shall generally not pay its
Debts as such Debts become due, or shall admit in writing its inability to pay
its Debts generally, or shall make a general assignment for the benefit of
creditors or, in the case of the Distributor, the Distributor shall otherwise
become "insolvent" within the meaning of SIPA; or (ii) any proceeding shall be
instituted by or against the Seller, the Transferor, the Distributor, the
Parent, the Shareholder Servicer, any Advisor, any Transfer Agent, any
Sub-transfer Agent, any Company, any Fund or any Significant Affiliate thereof
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up reorganization, arrangement, adjustment, protection, relief, or
composition of it or its Debts under any Applicable 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, custodian or other
similar official for it or for any substantial part of its property and, in the
case of any such proceeding instituted against it (but not instituted by it),
either such proceeding shall remain undismissed or unstayed for a period of
sixty (60) days; or (iii) any of the actions sought in any proceeding described
in (ii) above (including an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for, it or for any
substantial part of its property) shall occur; or (iv) the Seller, the
Transferor, the Distributor, the Parent, the Shareholder Servicer, any Advisor,
any Transfer Agent, any Sub-transfer Agent, any Company, any Fund or any
Significant Affiliate thereof shall take any action to authorize any of the
actions set forth above in this Section 6.01(e); or
(f) there shall have occurred any material adverse change in (i) the financial
condition or results of operations of the Parent and its consolidated
subsidiaries taken as a whole since September 30, 2000, or (ii) the Seller, the
Transferor, the Shareholder Servicer, the Parent, the Distributor, any Advisor
or any Transfer Agent which is an Affiliate of the Parent shall fail to make
payments when due in respect of Debt aggregating in excess of $10,000,000,
provided that the determination of default on such Debt is not being diligently
contested in good faith through appropriate proceedings; or
(g) any Distribution Plan, Distribution Agreement, Principal Shareholder
Servicer's Agreement, Shareholder Servicer's Agreement, Prospectus, the Conduct
Rules or the Investment Company Act, or the CDSC arrangements applicable to
holders of Shares of any Fund or the terms of any Conversion Feature in respect
of any Share of any Fund, each as in effect on the date of this Agreement, or
the Fundamental Investment Objectives in respect of any Fund, shall be amended,
waived, supplemented or modified, in any manner or by any means (including a
change in Applicable Law), which would reasonably be expected to have a Material
Adverse Effect, unless waived by the Program Agent; or
(h) the Securities Investor Protection Corporation, established under SIPA,
shall have applied for a protective decree against the Distributor; or
(i) the Distributor shall have failed to meet the minimum capital requirements
prescribed from time to time by Rule 15c3-1 under the Exchange Act and such
failure continues uncured for ten (10) days after the Distributor obtains
knowledge thereof; or
(j) the SEC shall have modified or terminated Rule 12b-1 of the Investment
Company Act or the NASD shall have modified or terminated the Conduct Rules in a
manner which could reasonably be expected to give rise to a Material Adverse
Effect; or
(k) the Distributor shall cease to be registered as a broker/dealer under the
Exchange Act and with the NASD or the NASD suspends the Distributor's membership
or registration; or
(l) any Company or any Transfer Agent shall, without the written consent of the
Program Agent, fail to withhold from redemption proceeds paid to any holder of a
Share any CDSC required to be withheld and remit such funds strictly in
accordance with any Irrevocable Payment Instruction, or shall be prevented by
any Authority or by any Applicable Law from doing so or any Company or any
Transfer Agent shall so assert in writing; or
(m) any Fund or any Company shall be required by any Authority or any Applicable
Law to cease or suspend the sale of Shares of any Fund under circumstances that
could reasonably be expected to result in a Material Adverse Effect; or
(n) any Company in respect of itself or any Fund shall propose or effect a
merger, consolidation or other combination with another Person or any
Liquidation Plan other than a Permitted Merger; or
(o) the applicable Advisor shall cease to act as the investment advisor of any
Fund under the applicable Advisory Agreement;
then in respect of any occurrence of any such event, the Program Agent may in
respect of each such occurrence, by notice to the Seller declare the Termination
Date to have occurred (in which case the Termination Date shall be deemed to
have occurred); PROVIDED, that, upon the occurrence of any event (without any
requirement for the giving of notice) described in subsection (e) or (h) of this
Section 6.01, the Termination Date shall be deemed to have automatically
occurred.
Article VII
PARENT'S UNDERTAKINGS
SECTION 7.01. UNDERTAKINGS; PAYMENT OF DAMAGES.
--------------------------------
The Parent hereby irrevocably and unconditionally agrees and
guarantees for the benefit of the Purchaser, the Program Agent and each
Indemnified Party to cause the Seller, the Transferor, the Shareholder Servicer,
the Distributor (as Distributor, Principal Shareholder Servicer and Servicer)
and each other Federated Entity to perform and punctually and completely carry
out each and every agreement, covenant and undertaking of the Seller, the
Transferor, the Shareholder Servicer, the Distributor (as Distributor, Principal
Shareholder Servicer and Servicer) and each other Federated Entity under this
Agreement and each other Program Document in accordance with the terms hereof
and thereof, notwithstanding that the Seller, the Transferor, the Shareholder
Servicer, the Distributor (as Distributor, Principal Shareholder Servicer or
Servicer), or any other Federated Entity fails to fully perform any such
agreements, covenants and undertakings for any reason, including liquidation,
insolvency, dissolution, receivership, bankruptcy, assignment for the benefit of
creditors, reorganization, composition, adjustment, legal limitations, court
order, disability, incapacity, invalidity, unenforceability, defense, offset or
counterclaim.
SECTION 7.02. AGREEMENT NOT AFFECTED.
----------------------
The Purchaser and the Program Agent may proceed to exercise any
right or remedy which it might have pursuant to this Article VII or Applicable
Law without regard to any actions or omissions of the Purchaser, the Program
Agent or any other Person. The validity of this Article VII shall not be
affected by any action or inaction which may be taken under or in respect of any
Program Document. The Purchaser and the Program Agent at its option may proceed
in the first instance against the Parent to obtain a remedy under any Program
Document in the amount and in the manner set forth in such Program Document,
without being obliged to resort first to any claim or action against the Seller,
the Transferor, the Shareholder Servicer, the Distributor (as Distributor,
Principal Shareholder Servicer or Servicer) or any other Federated Entity.
SECTION 7.03. WAIVER OF NOTICE; NO OFFSET; NO SUBROGATION.
-------------------------------------------
The Parent hereby waives any and all notices or demands to which it
may otherwise be entitled in connection with the pursuit of any remedy under any
Program Documents and to the extent permitted under Applicable Law; PROVIDED,
that this sentence shall not constitute a waiver on behalf of the Seller, the
Transferor, the Shareholder Servicer, the Distributor or any other Federated
Entity of any notice or demand to which the Seller, the Transferor, the
Shareholder Servicer, the Distributor or any other Federated Entity is entitled
under the Program Documents. The obligations of the Parent under this Article
VII shall not be subject to any defense, counterclaim or right of offset which
the Parent, the Seller, the Transferor, the Shareholder Servicer, the
Distributor (as Distributor, Principal Shareholder Servicer or Servicer), or any
other Person has or may have against the Purchaser, the Program Agent, any
Indemnified Party or any other Person, whether in respect of this Agreement, any
other Program Document, any Purchased Receivable or any Ancillary Rights with
respect thereto or otherwise, but nothing herein shall limit the right of the
Parent to pursue any claim in a separate action.
Article VIII
THE PROGRAM AGENT
SECTION 8.01. AUTHORIZATION AND ACTION.
------------------------
The Purchaser hereby irrevocably appoints and authorizes the Program
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement, the Servicing Agreement and the other Program Documents to
which the Program Agent is a party as are delegated to the Program Agent by the
terms hereof and thereof, together with such powers as are reasonably incidental
thereto. As to any matters not expressly provided for by this Agreement or the
other Program Documents, the Program Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Purchaser; PROVIDED, HOWEVER, that the Program
Agent shall not be required to take any action which exposes the Program Agent
to personal liability or which is contrary to this Agreement, the other Program
Documents or Applicable Law.
SECTION 8.02. PROGRAM AGENT'S RELIANCE, ETC.
--------------------------------
Neither the Program Agent nor any of its directors, officers, agents
or employees shall be liable for any action taken or omitted to be taken by it
or them under or in connection with this Agreement or any of the other Program
Documents, except for its or their own gross negligence or willful misconduct.
Without limiting the generality of the foregoing, the Program Agent: (i) may
consult with legal counsel (including counsel for any Federated Entity),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (ii) makes
no warranty or representation to the Purchaser and shall not be responsible to
the Purchaser for any statements, warranties or representations (whether written
or oral) made in or in connection with this Agreement or the other Program
Documents; (iii) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement or the other Program Documents on the part of any Federated Entity or
any Company or Fund or to inspect the property (including the books and records)
of any Federated Entity or any Company or Fund; (iv) shall not be responsible to
the Purchaser for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, the other Program Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(v) shall incur no liability under or in respect of this Agreement or any other
Program Document by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telecopier, telegram, cable or telex)
believed by it to be genuine and signed or sent by the proper party or parties.
SECTION 8.03. INDEMNIFICATION.
---------------
The Purchaser agrees to indemnify the Program Agent (to the extent
not reimbursed by or on behalf of any Federated Entity) from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against the Program Agent in any way
relating to or arising out of this Agreement or any other Program Document or
any action taken or omitted by the Program Agent under this Agreement or any
other Program Document; PROVIDED, THAT, the Purchaser shall not be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of the Program Agent. Without limitation
of the foregoing, the Purchaser agrees to reimburse the Program Agent promptly
upon demand for any out-of-pocket expenses (including counsel fees) incurred by
the Program Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) or legal advice in respect of
rights or responsibilities under this Agreement or the other Program Documents,
to the extent that the Program Agent is not reimbursed for such expenses by or
on behalf of any Federated Entity.
Article IX
MISCELLANEOUS
SECTION 9.01. NO WAIVER; RIGHTS AND REMEDIES; MODIFICATIONS IN WRITING.
--------------------------------------------------------
No failure or delay on the part of the Program Agent or the
Purchaser exercising any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder or under any other Program
Document. The remedies provided for herein are cumulative and are not exclusive
of any remedies that may be available to the Program Agent and the Purchaser, at
law or in equity. Without limiting the generality of the foregoing, each of the
Seller, the Transferor, the Distributor and the Parent acknowledges and agrees
that it will be impossible to measure in money the damage to the Program Agent,
the Purchaser or any other Indemnified Party in the event of a breach of any of
the covenants set forth in Article V hereof, and that, in the event of any such
breach, the Program Agent, the Purchaser and the other Indemnified Parties may
not have an adequate remedy at Law, and each of the Seller, the Distributor and
the Parent agrees that it shall not argue, and hereby waives any defense, that
there is an adequate remedy available at Law. No amendment, modification,
supplement, termination or waiver of this Agreement shall be effective unless
the same shall be in writing and signed by the parties to this Agreement. Any
waiver of any provision of this Agreement and any consent to any departure by
any party to this Agreement from the terms of any provision of this Agreement,
shall be effective only in the specific instance and for the specific purpose
for which given. No notice to or demand on any party to this Agreement in any
case shall entitle a Federated Entity to any other or further notice or demand
in similar or other circumstances.
SECTION 9.02. PAYMENT.
-------
Unless otherwise provided herein, whenever any payment to be made
hereunder shall be due on a non-Business Day, such payment shall be made on the
next succeeding Business Day. All amounts owing and payable to the Purchaser,
the Program Agent or any other Indemnified Party under this Agreement shall be
paid in immediately available funds without counterclaim, setoff, deduction,
defense, abatement, suspension or deferment. All amounts payable to the
Purchaser, the Program Agent or any other Indemnified Party pursuant to Article
VII, Section 9.04 and Section 9.05 shall be paid to the Purchaser's Remittance
Account. Each of the Seller, the Distributor and the Parent hereby agrees to pay
interest on any amounts payable by it under this Agreement, which shall not be
paid in full when due, for the period commencing on the due date thereof until,
but not including, the date the same is paid in full at the Post-Default Rate.
For purposes of calculating interest at the Post-Default Rate, any amount
received by or on behalf of the Purchaser, the Program Agent or any other
Indemnified Party after 3:00 p.m. (New York City time) shall be deemed to have
been received on the next succeeding Business Day. SECTION 9.03. NOTICES, ETC.
(a) Except where telephonic instructions are expressly authorized herein to be
given, all notices, demands, instructions and other communications required or
permitted to be given to or made upon any party hereto shall be in writing and
shall be personally delivered or sent by registered, certified or express mail,
postage prepaid, or by prepaid telegram (with messenger delivery specified in
the case of a telegram), or by telecopier, or by prepaid courier service. Unless
otherwise specified in a notice sent or delivered in accordance with the
foregoing provisions of this Section 9.03, notices, demands, instructions and
other communications in writing shall be given to or made upon the respective
parties hereto at their respective addresses (or to their respective telecopier
numbers) indicated below:
If to the Purchaser: Citibank, N.A.
▇/▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, B Share Servicing
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Program
Agent: Citicorp North America, Inc.
U.S. Securitization
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, B Share Servicing
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Seller, the
Transferor, the
Distributor or the Parent: Federated Investors, Inc.
Federated Investors Tower
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, LLP
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Building
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) All notices, demands, consents, requests and other communications to be sent
or delivered hereunder shall be deemed to be given or become effective for all
purposes of this Agreement as follows: (a) when delivered in person, when given;
(b) when sent by mail, when received by the Person to whom it is given, unless
it is mailed by registered, certified or express mail, in which case it shall be
deemed given or effective on the earlier of the date of receipt or refusal; and
(c) when sent by telegram, telecopy or other form of rapid transmission, when
receipt of such transmission is acknowledged.
SECTION 9.04. COSTS AND EXPENSES; INDEMNIFICATION.
-----------------------------------
(a) Regardless of whether or not any of the transactions contemplated hereby are
actually consummated, the Parent agrees to pay promptly on demand to the other
parties hereto (other than any other Federated Entity) (i) all reasonable costs
and expenses in connection with the preparation, review, negotiation,
reproduction, execution, delivery, administration and any modification,
amendment and waiver of this Agreement and the other Program Documents, (ii) all
costs and expenses incurred in connection with the enforcement of, or
preservation of, any rights under this Agreement and the other Program
Documents, (iii) all actuarial fees, UCC filing fees and periodic auditing
expenses in connection with the transactions contemplated by this Agreement and
the other Program Documents, and (iv) all reasonable fees and disbursements of
counsel in connection with the foregoing; PROVIDED, HOWEVER, that if the
transactions contemplated hereby are not actually consummated, the Parent's
obligations under this Section 9.04(a) shall be subject to the terms of that
certain letter from the Purchaser to the Distributor dated October 6, 2000 (the
"Mandate Letter"); PROVIDED, FURTHER, that the fees of counsel to the Purchaser
and the Program Agent incurred prior to the initial Purchase Date hereunder
shall be subject to the limitation set forth in the Mandate Letter.
(b) INDEMNIFICATION. The Parent agrees to indemnify and hold harmless the
Purchaser, the Program Agent, the Collection Agent, the Master Servicer, the
Master Trusts, the Transferees and each of their respective successors and
assigns, Affiliates and the respective officers, directors, employees, trustees,
agents, advisors, and any Person controlling any of the foregoing (each, an
"Indemnified Party") from and against any and all damages, losses, liabilities,
expenses, obligations, penalties, actions, suits, judgments and disbursements of
any kind or nature whatsoever (including the reasonable fees and disbursements
of counsel) (collectively, the "Liabilities") that are incurred by or asserted
or awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (and regardless of whether or not any such
transactions are consummated) any of the transactions contemplated by the
Program Documents, including without limitation, any one or more of the
following:
(i) any failure or alleged (by Persons other than the Indemnified Party)
failure by any Federated Entity to perform any of its obligations,
covenants, or agreements contained in any Program Document to which it is
a party promptly and fully;
(ii) any representation or warranty made or deemed made by any Federated Entity
contained in any Program Document or in any certificate, written statement
or report delivered by or on behalf of any such Person in connection
therewith is, or is alleged (by Persons other than the Indemnified Party)
to have been, false or misleading in any respect when made;
(iii) any failure by any Federated Entity to comply promptly and fully with any
Applicable Law or any contractual obligation binding upon it;
(iv) any proceeding by or against any Federated Entity seeking to adjudicate
such Person, bankrupt or insolvent, or seeking liquidation, winding up,
administration, reorganization, arrangement, adjustment, protection,
relief, or composition of such Person or the debts of such Person under
any law relating to bankruptcy, insolvency, liquidation, administrative,
reorganization or relief of debtors or seeking the entry of an order for
relief or the appointment of a receiver, trustee, custodian,
administrator, liquidator, or other similar official for such Person or
for a substantial part of such Person's property;
(v) preparation for a defense of, any investigation, litigation or proceeding
arising out of, any of the transactions, events or circumstances described
above;
(vi) failure of any Sub-transfer Agent to remit CDSCs in respect of the Omnibus
Shares to the Transfer Agent or the failure of any Company or any Transfer
Agent to comply with any Irrevocable Payment Instruction, except, in
respect of any Company and the Transfer Agents, to the extent that such
failure results from such Company or such Transfer Agent being prevented
by court order from making such payment as a result of a bankruptcy,
insolvency or similar proceeding against such Company;
(vii) any commingling of Collections on deposit in the Collection Account or the
Demand Deposit Account with funds of any other Person (including without
limitation, with funds of any Other Purchaser), including without
limitation in conjunction with any bankruptcy or insolvency proceeding by
or against any Other Purchaser or the Other Agent which affects the
Purchaser's timely receipt of any Collections; or
(viii)the adoption of any Company or any Fund of a Liquidation Plan other than
in connection with any insolvency or similar proceeding against such
Company or Fund;
PROVIDED, HOWEVER, that the Parent shall not be required to indemnify any
Indemnified Party in respect of any Liability to the extent such Liability (A)
is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted directly and primarily from such Indemnified
Party's gross negligence or willful misconduct, (B) arises out of the Purchased
Receivables proving to be uncollectible (including uncollectibility resulting
from declines in the NAV of a Fund or as a result of a Complete Termination (as
defined in the Distribution Agreement and Principal Shareholder Servicer's
Agreement relating to any Fund)), except to the extent that such
uncollectibility is attributable to what would not have occurred but for any one
or more of the events described in clauses (i) through (viii) above, or (C)
arises out of a subsequent sale or assignment of any Purchased Receivables by
any Purchaser and is not attributable to, or would not have accrued but for, one
or more of the events or circumstances described in clauses (i) through (viii)
above.
(c) Unless the Parent shall have assumed responsibility for contesting a
Liability as provided in the next sentence, the Program Agent and the Purchaser
may, but shall have no obligation to, contest, settle or compromise such
Liability. The Parent may pursue, at its sole cost and expense, such lawful
rights as are available at law to contest any Liability asserted against the
Purchaser or the Program Agent provided: (i) the Parent has assumed
responsibility for such contest and conceded in writing its responsibility to
indemnify the Program Agent and the applicable Indemnified Parties, in
accordance with this Section, for the full amount of such Liability; (ii) such
contest is conducted in a manner which does not result in a Lien on any
Receivables and, if the manner of contest does not defer the obligation to pay
the Liability, the Parent shall pay such Liability when due, subject to the
right to recover such Liability if the contest is successful, (iii) the Parent
shall have provided to the Program Agent such undertakings as the Program Agent
shall request, in form and substance satisfactory to the Program Agent whereby
the Parent agrees to hold the Program Agent and the applicable Indemnified
Parties harmless from any and all liabilities, costs and expenses which may
arise as a consequence of such contest; (iv) the Parent shall have furnished the
Program Agent with an opinion, in form and scope reasonably satisfactory to the
Program Agent that there is a meritorious basis for such contest; (v) the
contest of such Liability may be conducted in a manner which does not affect the
liability of the applicable Indemnified Parties, for any liability not
indemnified by the Parent; (vi) the contest of such Liability can be separated
from any contest of any other liability in respect of which the Parent has not
indemnified the applicable Indemnified Parties, without prejudicing the
Indemnified Party's ability to deal with or otherwise contest such other
liability; and (vii) the Program Agent and the applicable Indemnified Parties
have not waived their right to indemnification by the Parent in respect of such
Liability. The Parent shall keep the Program Agent fully advised on a current
basis concerning any such contest, and, without limiting the foregoing: (x) the
Parent shall give the Program Agent reasonable notice of and a reasonable
opportunity to be present in person or by counsel at any proceeding in
connection therewith; (y) the Parent shall give the Program Agent notice of any
proposed filings or papers to be served or filed by the Parent in connection
with any such proceedings and a reasonable opportunity to comment upon them; and
(z) the Parent shall promptly supply the Program Agent with copies of any
filings or papers served upon the Parent in connection with such proceedings; it
being understood that the applicable Indemnified Parties shall bear their own
costs incurred in connection with any participation by such Indemnified Parties
or their respective counsel in the contest as contemplated by this sentence.
(d) Without prejudice to the survival of any other agreement of the Parent
hereunder, the agreement and obligations of the Parent contained in this Section
9.04 and of the Parent in Article VII shall survive the termination of this
Agreement.
SECTION 9.05. TAXES.
-----
(a) Any and all payments by any Federated Entity, any Transfer Agent, any
Sub-transfer Agent, any Company or any Fund under this Agreement, any
Irrevocable Payment Instruction or any other Program Document shall be made free
and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, EXCLUDING, taxes imposed on the recipient's income, and
franchise taxes imposed on the recipient, by (i) the United States federal
government, (ii) the jurisdiction under the laws of which the recipient is
organized or any political subdivision thereof, (iii) the jurisdiction in which
is located the principal executive office of the recipient or any political
subdivision thereof or (iv) any other jurisdiction which asserts the authority
to impose such tax on the basis of contacts the recipient maintains with such
jurisdiction other than the contacts arising out of the transactions
contemplated hereby (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as "Taxes").
If any Federated Entity, any Transfer Agent, any Sub-transfer Agent, any Company
or any Fund shall be required by Applicable Law to deduct any Taxes from or in
respect of any sum payable hereunder or under any other Program Document, (i)
the sum payable hereunder or thereunder shall be increased as may be necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 9.05) the recipient receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) such Federated Entity, Transfer Agent, Sub-transfer Agent, Company or Fund
shall make such deductions, and (iii) such Federated Entity, Transfer Agent,
Sub-transfer Agent, Company or Fund shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with Applicable
Law.
(b) In addition, the Parent agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any transfer of Receivables in connection with the
Program Documents or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement or any other Program Document
(hereinafter referred to as "Other Taxes").
(c) The Parent will indemnify the Program Agent and the Purchaser for the full
amount of Taxes or Other Taxes (including any Taxes or Other Taxes imposed by
any jurisdiction on amounts payable under this Section 9.05) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted, so long as there is a reasonable basis for the assertion of such Taxes
or Other Taxes. This indemnification shall be made within thirty (30) days from
the date the Program Agent or the Purchaser makes written demand therefor to the
Parent. The Purchaser and the Program Agent shall endeavor to avoid or reduce
any Taxes or Other Taxes subject to the foregoing indemnity; PROVIDED that they
shall not be required to take any action which, in their sole judgment, may
subject them to any adverse effect.
(d) Within thirty (30) days after the date of any payment of Taxes, the Parent
will furnish to the Purchaser and the Program Agent the original or a certified
copy of a receipt evidencing payment thereof.
(e) In the event the Parent shall pay a Tax or Other Tax pursuant to this
Section 9.05 and all or a portion of such Tax or Other Tax previously paid by
the Parent is later refunded by the applicable taxing Authority the recipient of
such refund shall pay to the Parent, the portion of such refund which relates to
the amount previously paid by the Parent.
(f) Unless the Parent shall have assumed responsibility for contesting a Tax or
Other Tax described in paragraph (c) of this Section 9.05 as provided in the
next sentence, the Program Agent and the Purchaser may, but shall have no
obligation to, contest, settle or compromise such Tax or Other Tax. The Parent
may pursue, at its sole cost and expense, such lawful rights as are available at
law to contest any Tax or Other Tax asserted against the Purchaser or the
Program Agent provided: (i) the Parent has assumed responsibility for such
contest and conceded in writing its responsibility to indemnify the Purchaser or
the Program Agent, as the case may be, in accordance with this Section, for the
full amount of such Tax or Other Tax; (ii) such contest is conducted in a manner
which does not result in a Lien on the Receivables and, if the manner of contest
does not defer the obligation to pay the Tax or Other Tax, the Parent shall pay
such Tax or Other Tax when due, subject to the right to recover such Tax or
Other Tax if the contest is successful, (iii) to the extent not covered by
Section 9.04(b), the Parent shall have provided to the Purchaser or the Program
Agent, as the case may be, such undertaking as such Purchaser or the Program
Agent, as the case may be, shall request, in form and substance satisfactory to
the Purchaser, or the Program Agent, as the case may be, whereby the Parent
agrees to hold the Purchaser or the Program Agent, as the case may be, harmless
from any and all liabilities, costs and expenses which may arise as a
consequence of such contest; (iv) the Parent shall have furnished the Purchaser
or the Program Agent, as the case may be, with an opinion in form and scope
reasonably satisfactory to the Purchaser or the Program Agent, as the case may
be, of counsel reasonably satisfactory to the Purchaser or the Program Agent, as
the case may be, that there is a meritorious basis for such contest; (v) the
contest of such Tax or Other Tax may be conducted in a manner which does not
affect the liability of the Purchaser or the Program Agent, as the case may be,
for any tax not indemnified by the Parent; (vi) the contest of such Tax or Other
Tax can be separated from any contest of any other tax in respect of which the
Parent has not indemnified the Purchaser or the Program Agent, as the case may
be, without prejudicing the Purchaser's or the Program Agent's, as the case may
be, ability to deal with or otherwise contest such other liability; and (vii)
the Purchaser or the Program Agent, as the case may be, has not waived its right
to indemnification by the Parent in respect of such Tax or Other Tax. The Parent
shall keep the Purchaser or the Program Agent, as the case may be, fully advised
on a current basis concerning any such contest, and, without limiting the
foregoing: (a) the Parent shall give the Purchaser or the Program Agent, as the
case may be, reasonable notice of and a reasonable opportunity to be present in
person or by counsel at any proceeding in connection therewith; (b) the Parent
shall give the Purchaser or the Program Agent, as the case may be, notice of any
proposed filings or papers to be served or filed by the Parent in connection
with any such proceedings and a reasonable opportunity to comment upon them; and
(c) the Parent shall promptly supply the Purchaser or the Program Agent, as the
case may be, with copies of any filings or papers served upon the Parent in
connection with such proceedings; it being understood that the Purchaser or the
Program Agent, as the case may be, shall bear its own costs incurred in
connection with any participation by the Purchaser or the Program Agent, as the
case may be, or its counsel in the contest as contemplated by this sentence.
(g) Without prejudice to the survival of any other agreement of the Parent
hereunder, the agreements and obligations of the Parent contained in this
Section 9.05 shall survive the termination of this Agreement.
Without prejudice to the survival of any other agreement of the
Seller hereunder, the agreement and obligations of the Seller contained in this
Section 9.05 shall survive the termination of this Agreement.
SECTION 9.06. EXECUTION IN COUNTERPARTS.
-------------------------
This Agreement may be executed in any number of counterparts and by
different parties hereto on separate counterparts, each of which counterparts,
when so executed and delivered, shall be deemed to be an original and all of
which counterparts, taken together, shall constitute but one and the same
Agreement.
SECTION 9.07. BINDING EFFECT; ASSIGNMENT.
--------------------------
This Agreement shall be binding upon, and inure to the benefit of,
the parties hereto and their respective successors and assigns. No Federated
Entity shall assign its rights or obligations hereunder or in connection
herewith or any interest herein or in any other Program Document (including
without limitation the Distribution Agreements and Principal Shareholder
Servicer's Agreement) (voluntarily, or by operation of law or otherwise) without
the Program Agent's and the Purchaser's prior written consent (which consent
shall not be unreasonably withheld), PROVIDED, HOWEVER, that its obligations
hereunder may be assigned in connection with any transfer permitted by Section
5.02(i). This Agreement and the Program Agent's and the Purchaser's rights
herein (including without limitation in respect of the Purchased Receivables and
the Ancillary Rights with respect thereto) shall be assignable, in whole or in
part, by the Purchaser and the Program Agent and their respective successors and
assigns. The Purchaser shall not assign its obligations under Sections 2.01 and
2.02 of this Agreement without the prior written consent of the Seller (which
consent shall not be unreasonably withheld or delayed). Each of the Seller, the
Transferor, the Distributor and the Parent hereby consents to the Purchaser and
the Program Agent entering into the Take-out Transactions; PROVIDED, HOWEVER,
that in connection with any proposed Take-out Transaction, prior to distributing
to potential offerees any offering materials which contain information
concerning the Seller or any of its Affiliates, the Purchaser shall give the
Seller a reasonable opportunity to review and comment upon such information for
the purpose of preventing the inclusion of Proprietary Information in such
offering materials. The Seller agrees to relay the good faith comments, if any,
of the Seller or any of its Affiliates as soon as practical after receipt of
such information (but in any event within five (5) Business Days of such
receipt). Unless the Program Agent reasonably determines that disclosure is
required in order to comply with Law applicable to such Take-out Transaction,
the Purchaser shall not make any disclosure of Proprietary Information, the
release of which would have a material adverse consequence to the Seller or any
of its Affiliates.
SECTION 9.08. GOVERNING LAW.
-------------
THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS
OF THE STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF SAID STATE.
SECTION 9.09. SEVERABILITY OF PROVISIONS.
--------------------------
Any provision of this Agreement which is 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 or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 9.10. CONFIDENTIALITY.
---------------
(a) Each of the Seller, the Distributor and the Parent agrees that it shall and
shall cause each of its respective Affiliates (i) to keep this Agreement, the
Servicing Agreement, the Collection Agency Agreement, the Funding Agreement, the
Purchase Rate Letter, the Investor Reports, the Monthly Collection Determination
Date Statements, the proposal relating to the structure of the facility
contemplated by this Agreement (the "Facility"), any analyses, computer models,
information or document prepared by the Program Agent, the Purchaser or any of
their respective Affiliates in connection with the Facility, the Program
Agent's, the Purchaser's and their respective Affiliate's written reports to the
Seller, the Distributor, the Parent, any Company, any Fund or any of their
respective Affiliates and any related written information (collectively, the
"Product Information") confidential and to disclose Product Information (i) only
to its officers, employees, agents, accountants, legal counsel and other
representatives and the Board of Trustees of the Funds (collectively, the
"Federated Representatives") in connection with the negotiation, completion,
approval and administration of the Facility; (ii) to use the Product Information
only in connection with the Facility and not for any other purpose; and (iii) to
cause the Federated Representatives to comply with the provisions of this
Section 9.10(a); PROVIDED, HOWEVER, that Product Information may be disclosed by
the Seller, the Distributor or the Parent to the extent required by the
Applicable Law or by any Authority, it being understood that any such disclosure
or filing shall not relieve the Seller, the Distributor or the Parent of any of
its obligations under this Section 9.10(a). Each of the Seller, the Distributor
and the Parent agree that if any Product Information is required by Applicable
Law to be included by it in any filing with the SEC or any other Authority it
shall, in consultation with the Program Agent, use its reasonable best efforts
to "black-out" all information which is not necessary under Applicable Law to be
included in such filing which the Program Agent deems is of a sensitive nature
and in no event shall the Purchase Price be disclosed in any such filing.
(b) Unless otherwise required by Applicable Law or by any Authority,
the Purchaser and the Program Agent agree to maintain the confidentiality of the
Proprietary Information; PROVIDED, THAT, such Proprietary Information may be
disclosed to: (i) assignees, participants and potential assignees and
participants of the Purchaser, the Program Agent and the Master Trusts; (ii)
third parties to the extent such disclosure is consented to in writing by all
parties to this Agreement (which consent shall not be unreasonably withheld) and
such disclosure is made pursuant to a written confidentiality agreement in form
and substance substantially identical to this Section 9.10(b); (iii) the
officers, partners, directors, employees, legal counsel and auditors of the
Purchaser, the Program Agent and the Master Trusts; (iv) any rating agency and
as the Program Agent or the Purchaser otherwise may deem necessary or
appropriate in connection with any Take-out Transaction. As used herein the term
"Proprietary Information" means information provided to the Purchaser and the
Program Agent pursuant to this Agreement or the Servicing Agreement regarding
the Seller, the Distributor, the Parent or their respective Affiliate's
strategic plans, operations, financial condition, history, business or
marketing, but only to the extent such information has not become generally
known or available to the public.
SECTION 9.11. INTENT OF AGREEMENT.
-------------------
It is the intention of this Agreement that each purchase of
Receivables hereunder shall convey to the Purchaser an undivided 100% ownership
interest in such Receivables and the Ancillary Rights and Collections in respect
thereto on the Purchase Date therefor and that such transactions shall
constitute a True Sale and not a secured loan. If, notwithstanding such
intention, any conveyance of Receivables from the Seller to the Purchaser shall
ever be recharacterized as a secured loan and not a sale, it is the intention of
this Agreement that this Agreement shall constitute a security agreement under
Applicable Law, and that the Seller shall be deemed to have granted to the
Purchaser a duly perfected first priority security interest in all of the
Seller's right, title and interest in, to and under the Purchased Receivables
(together with the Proceeds in respect thereof) free and clear of any Adverse
Claim in order to secure payment and performance of the obligations of the
Federated Entities under the Program Documents.
SECTION 9.12. LIABILITIES TO ANY FUND OR ANY COMPANY.
--------------------------------------
No obligation or liability to any Fund, any Company, to any
shareholder of any Fund or to any Person contracting with any Fund or any
Company is intended to be assumed by the Program Agent, the Purchaser or any
Indemnified Party under or as a result of this Agreement or the other Program
Documents and the transactions contemplated hereby and thereby and, to the
maximum extent permitted under provisions of Law, the Program Agent and the
Purchaser expressly disclaim any such assumption.
SECTION 9.13. ENTIRE AGREEMENT.
----------------
The Program Documents taken as a whole incorporate the entire
agreement between the parties thereto concerning the subject matter thereof. The
Program Documents supersede any prior agreements among the parties relating to
the subject matter thereof.
SECTION 9.14. ASSIGNEE RIGHTS; TAKE-OUT TRANSACTIONS; ETC.
----------------------------------------------
(a) Each of the Seller, the Transferor, the Distributor and the Parent
acknowledges and agrees that any Person which purchases or otherwise acquires
any interest in any Purchased Receivables (or the right to receive any
Collections with respect thereto in a Take-out Transaction) (each such Person, a
"Transferee"), (and in the case of indemnitees, their respective Affiliates and
their officers, directors, employees and agents) shall each, to the extent of
such Transferee's interest, be a beneficiary of the representations, warranties,
indemnities, covenants, agreements and undertakings of the Seller, the
Transferor, the Distributor and the Parent under this Agreement and the other
Program Documents; PROVIDED, HOWEVER, that such rights of the Transferees in a
Take-out Transaction may be enforced on behalf of such Transferees only by the
Master Servicer for the related Master Trust. Each of the Seller, the
Transferor, the Distributor and the Parent shall execute and deliver such
instruments and documents and shall take all such actions as the Program Agent,
the Purchaser or any Master Trust shall reasonably deem necessary in order to
confer upon any such Transferee the rights and privileges in and to the
Purchased Receivables and the Ancillary Rights and Collections with respect
thereto to which such Transferee has an interest and under the Program Documents
to the extent of such transfer and assignment. Notwithstanding anything in this
Section 9.14 to the contrary, no Transferee shall be deemed to have assumed any
of the obligations or liabilities of the Seller, the Transferor, the Distributor
or the Parent under this Agreement or any other Program Document.
(b) Subject to the other requirements set forth in Section 9.07, the Program
Agent agrees that any written offering memorandum or circular used in connection
with any Take-out Transaction involving Purchased Receivables which contains
information concerning the Seller, the Transferor, the Distributor or the Parent
shall (i) incorporate language substantially in the form of Schedule V hereto,
and (ii) provide that the securities which are the subject of such Take-out
Transaction will be offered only to institutional accredited investors (as
defined in Rule 501(a) under the Securities Act), to a qualified institutional
buyer within the meaning of Rule 144A under the Securities Act and/or to any
Person in a transaction exempt from registration under the Securities Act.
SECTION 9.15. SURVIVAL.
--------
Each of the representations, warranties, covenants, indemnities and
other agreements of the parties contained or reaffirmed in this Agreement: (i)
shall survive the execution and delivery of this Agreement and the purchase of
and payment for the Purchased Receivables relating to each Fund and (ii) shall
remain and continue in full force and effect without regard to any waiver,
modification, extension, renewal, consolidation, amendment or restatement of any
term or provision.
SECTION 9.16. CONTINUING OBLIGATIONS.
----------------------
Notwithstanding any other provision of this Agreement or the other
Program Documents, to the extent that any obligation of the Federated Entities
under, pursuant to and in connection with the Purchased Receivables remains
unperformed or executory, the Federated Entities shall be obligated to perform
such obligation to the same extent as if the purchase and sale contemplated
hereby had not taken place, and the Purchaser and the Program Agent shall not be
required or obligated in any manner to perform or fulfill any of the obligations
of the Federated Entities under, pursuant to or in connection with any Purchased
Receivables.
SECTION 9.17. UNDERTAKINGS OF THE PARTIES.
---------------------------
Each of the Program Agent and the Purchaser agree that if the
Distributor is replaced as principal distributor for any Fund, any Advisor is
replaced as investment advisor for any Fund or the investment advisor for any
proposed Additional Fund is not an Advisor hereunder, they shall at the request
of the Seller consider in good faith entering into mutually satisfactory
amendments to the Program Documents so as to permit Receivables to continue to
be purchased hereunder.
It being understood that the Purchaser and the Program Agent shall
not be obligated to consent to any such amendment and that the decision to
consent to any such amendment will be subject to their due diligence review of
any such successor or additional party.
SECTION 9.18. LIMITED LIABILITY.
-----------------
None of the Federated Entities (other than the Parent), nor any
shareholder, officers or agents of any thereof, shall be liable hereunder or
under the other Program Documents for the obligations of the Seller, and,
subject to Article VII hereof with respect to the Parent, the other parties
hereto and thereto shall look solely to the assets of the Seller for the payment
of any claim hereunder or thereunder for the performance of the obligations of
the Seller, except to the extent expressly set forth herein or in any other
Program Document.
SECTION 9.19. NO PROCEEDINGS.
--------------
Each party hereto agrees that it will not institute against the
Seller, or join any other Person in instituting against Seller, any insolvency
proceeding of the type described in Section 6.01(e) so long as there shall not
have elapsed one (1) year and one (1) day since any Share relating to a
Purchased Receivable shall be outstanding. The foregoing shall not limit the
right of any party hereto to file any claim in or otherwise take any action in
any insolvency proceeding that was instituted against Seller by any other
Person.
SECTION 1.01.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
CITIBANK, N.A.,
as Purchaser
By:_/S/ ▇▇▇▇▇▇ MARTINEZ____________________
-------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
CITICORP NORTH AMERICA, INC.,
as Program Agent
By:_/S/ ▇▇▇▇▇▇ MARTINEZ_____________________
-------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
FEDERATED INVESTORS MANAGEMENT COMPANY,
as Transferor
By:_/S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ III___________________
---------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ III
Title: Senior Vice President
FEDERATED SECURITIES CORP.,
as Distributor, Principal Shareholder Servicer and
Servicer
By:_/S/ ▇▇▇▇▇▇▇ ▇. HANLEY___________________
---------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
FEDERATED FUNDING 1997-1, INC.,
as Seller
By:_/S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ III____________________
---------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ III
Title: Vice President
FEDERATED INVESTORS, INC.,
as Parent
By:_/S/ ▇. ▇▇▇▇▇▇▇▇▇▇▇ DONAHUE________________
--------------------------
Name: J. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President
22
APPENDIX A
TO
PURCHASE AND SALE
AGREEMENT
DEFINITIONS LIST
The following terms have the respective meanings set forth below for
all purposes of the Purchase Agreement, the Servicing Agreement, the Collection
Agency Agreement, the Funding Agreement and the exhibits and schedules thereto
and the definitions of such terms are equally applicable both to the singular
and plural forms of such terms.
"ACTIVITY REPORT" shall have the meaning assigned to such term in
Section 3.01(a) of the Servicing Agreement.
"ACTUAL KNOWLEDGE" means, (i) as it applies to any natural Person,
actual knowledge of such Person, (ii) as it applies to any Person which is a
corporate entity or business trust, the actual knowledge of a Responsible
Officer of such Person, and (iii) as it applies to any Person which is a trust
entity, the actual knowledge of such trustee determined with reference to both
clauses (i) and (ii) of this definition.
"ADDENDUM" means the addendum substantially in the form of Exhibit H
to the Purchase Agreement, executed by the Seller, the Distributor, the Parent,
the Purchaser and the Program Agent.
"ADDITION EFFECTIVE DATE" shall have the meaning assigned to such
term in Section 2.03 to the Purchase Agreement.
"ADDITIONAL FUND" means any additional Portfolio of an existing
Company or of an Investment Company which does not currently constitute a
"Company":
(i) which shall have in full force and effect a distribution plan, investment
advisory agreement, distribution agreement, principal shareholder
servicer's agreement and shareholder servicer's agreement, the terms of
which are either substantially identical to the Distribution Plans,
Advisory Agreements, Distribution Agreements, Principal Shareholder
Servicer's Agreements and Shareholder Servicer's Agreements in effect on
the date of the Purchase Agreement or are in form, scope and substance
reasonably satisfactory to the Program Agent;
(ii) with respect to which the Distributor shall act as the principal
distributor and principal shareholder servicer, the Shareholder Servicer
shall act as shareholder servicer and an Advisor shall act as investment
adviser;
(iii) the fundamental investment objectives of which shall be in compliance with
all Applicable Law and shall be substantially comparable to the
Fundamental Investment Objectives in respect of Shares of any Fund listed
on Schedule IV hereto, including without limitation in respect of the
risks associated with such fundamental investment objectives, and to the
extent not substantially comparable, which shall be reasonably
satisfactory to the Program Agent;
(iv) with respect to which the Distributor shall be entitled to receive Asset
Based Sales Charges, Shareholder Servicing Fees and CDSCs on terms which
are either identical to the arrangements for the Funds in effect on the
date of the Purchase Agreement or are reasonably satisfactory to the
Program Agent;
(v) as to which there exists no understanding between any Federated Entity on
the one hand and such Additional Fund or the board of trustees or
directors thereof on the other hand, which if implemented would cause such
Additional Fund to fail to meet any of the above requirements or would
cause the Receivables relating to such Fund to fail to qualify as Eligible
Receivables; and
(vi) the Receivables relating thereto will be conveyed to the Transferor by the
Distributor under and in accordance with the Distributor's Transfer
Agreement and by the Transferor to the Seller under and in accordance with
the Transfer Agreement.
"ADVERSE CLAIM" means any Lien of any Person, other than any Lien of
or any Lien created by the Purchaser, the Program Agent, any Master Trust or any
of their respective successors or assigns.
"ADVISOR" means each of Passport Research, Ltd., Federated Global
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Investment Management Corp. and Federated Investment Management Company in their
capacities as investment advisors and managers of the companies included in the
Program, and any other Federated Entity which is a permitted successor or
assignee of any of them in such capacities.
"ADVISORY AGREEMENT" means with respect to any Fund, the investment
advisory agreement between the applicable Advisor and such Fund (or if such Fund
constitutes a Portfolio, the related Company in respect of such Fund) and any
replacement agreement as may be adopted in the future, pursuant to which such
Advisor may receive advisory or management fees relating to such Fund.
"AFFILIATE" of a referenced Person means (a) another Person
controlling, controlled by or under common control with such referenced Person,
(b) any other Person beneficially owning or controlling ten percent (10%) or
more of the outstanding voting securities or rights of or the interest in the
capital, distributions or profits of the referenced Person, or (c) any officer
(exclusive of a "ministerial officer" with no authority to bind a Person) or
director of, or partner in, the referenced Person; PROVIDED, HOWEVER, that with
respect to the Seller, the Distributor, the Transferor or the Parent, the term
"Affiliate" shall not include any Fund, any Company. The terms "control,"
"controlling," "controlled" and the like shall mean the direct or indirect
possession of the power to direct or cause the direction of the management or
policies of a Person or the disposition of its assets or properties, whether
through ownership, by contract, arrangement or understanding, or otherwise.
"ALLOCATION PROCEDURES" means the procedures set forth as Schedule X
to the Collection Agency Agreement.
"AMORTIZED MAXIMUM AGGREGATE SALES CHARGE ALLOWABLE" means with
respect to the Receivables relating to any Shares of any Fund as of any date of
determination, (i) an amount equal to the Maximum Aggregate Sales Charge
Allowable payable in respect of such Receivables, minus (ii) the aggregate
amounts previously paid by such Fund (or if such Fund constitutes a Portfolio,
by the related Company in respect of such Fund) and the holders of such Shares
relating thereto.
"ANCILLARY RIGHTS" means all of the Seller's, the Transferor's and
the Distributor's rights, remedies, title and interests in, to and under (i) the
Distributor's Transfer Agreement, the Transferor's Transfer Agreement and the
other Program Documents (to the extent of representations, warranties, covenants
and other rights and remedies thereunder with respect to the Purchased
Receivables), including the right to receive payments pursuant thereto, (ii) all
UCC financing statements covering any of the foregoing, (iii) all proceeds
thereof, and (iv) all other rights the Seller, the Transferor or the
Distributor, as the case may be, may have in respect of the foregoing under
Applicable Law, in each case as they relate to the Purchased Receivables.
"APPLICABLE LAW" means any Law of any Authority, whether domestic or
foreign, including, without limitation, all federal and state banking or
securities laws, to which the Person in question is subject or by which it or
any of its property is bound.
"ASSET BASED SALES CHARGES" means the fees payable by a Fund (or if
such Fund constitutes a Portfolio by the related Company in respect of such
Fund) pursuant to the related Distribution Plan and Distribution Agreement in
consideration of the distribution of its Shares, excluding the Shareholder
Servicing Fee.
"AUTHORITY" means any governmental or quasi-governmental authority
(including the NASD, the stock exchanges and the SEC), whether executive,
legislative, judicial, administrative or other, or any combination thereof,
including, without limitation, any federal, state, local government or
governmental or quasi-governmental agency, arbitrator, board, body, branch,
bureau, commission, corporation, court, department, instrumentality or other
political unit or subdivision or other entity of any of the foregoing, whether
domestic or foreign.
"BANKRUPTCY CODE" means the United States Bankruptcy Code of 1978,
as amended from time to time or any similar legislation of the United States
enacted in substitution or replacement thereof.
"BANKRUPTCY REMOTE COVENANTS" means the covenants set forth in
Schedule VI hereto.
"BANKRUPTCY REMOTE ENTITY" means a special purpose entity formed
under the laws of one of the states of the United States or the District of
Columbia which is organized and operated in a manner designed to insulate it
from the risk of becoming the subject of reorganization or liquidation under the
Bankruptcy Code and that satisfies substantially all of the published criteria
of S&P relating to special purpose, bankruptcy remote entities.
"BASE RATE" means a fluctuating interest rate per annum as shall be
in effect from time to time which rate per annum shall at all times be equal to
the higher of: (a) the Prime Rate; and (b) 1/2 of one percent per annum above
the Federal Funds Rate.
"BOARD OF TRUSTEES" shall mean (i) in respect of any Fund relating
to a Company that constitutes a trust, the board of trustees of such Fund, and
(ii) in respect of any Fund relating to a Company that constitutes a corporation
or limited liability company, the board of directors of such Fund.
"BUSINESS DAY" means any day on which banks are not authorized or
required to close in New York City or Pittsburgh, Pennsylvania.
"CALCULATION DATE" means the last day of each calendar month.
"CDSC" means with respect to any Fund, the contingent deferred sales
charges, or other similar charges howsoever denominated, payable, either
directly or by withholding from the proceeds of the redemption of the Shares of
such Fund, by the shareholders of such Fund, on any redemption of Shares
relating to such Fund in accordance with the Distribution Agreement and the
Prospectus relating to such Fund.
"CITIBANK" means Citibank, N.A.
"CODE" means the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated and the rulings issued thereunder.
"COLLECTION ACCOUNT" shall have the meaning assigned to the term
"Program Collection Account" in Section 4.01 of the Collection Agency Agreement.
"COLLECTION AGENCY AGREEMENT" means the Amended and Restated
Federated Investors Program Funding and Collection Agency Agreement, dated as of
December 21, 2000 among the Purchaser, the Program Agent, the Seller, the
Transferor, the Distributor, the Collection Agent, the Other Agent and the Other
Purchasers, as the same may from time to time be amended, supplemented, waived
or modified.
"COLLECTION AGENT" means Bankers Trust Company, as collection agent
under the Collection Agency Agreement and as funding agent under the Funding
Agreement, together with its permitted successors and assigns.
"COLLECTIONS" means (i) all amounts paid or payable by each Fund (or
in respect of each Fund which constitutes a Portfolio, by each Company in
respect of each related Fund) in respect of the Purchased Receivables relating
to such Fund and by each shareholder of such Fund in respect of the Purchased
Receivables relating to such Fund (including all CDSCs in respect of Purchased
Receivables payable by such shareholders and withheld from redemption proceeds
payable to such shareholders by such Fund); (ii) all FOF Collections in respect
of Purchased Receivables, and (iii) all Proceeds of the foregoing.
"COMMISSION SHARE" means, in respect of any Fund, each Share of such
Fund which is issued under circumstances which would normally give rise to an
obligation of the holder of such Share to pay a CDSC upon redemption of such
Share, including any Share of such Fund issued in connection with a Permitted
Free Exchange, and any such Share shall not cease to be a Commission Share prior
to the redemption (including a redemption in connection with a Permitted Free
Exchange) or conversion even though the obligation to pay the CDSC shall have
expired or conditions for waivers thereof shall exist.
"COMPANY" means each of the Investment Companies specified on
Schedule I to the Purchase Agreement under the heading "Companies," which
maintain one or more Portfolios which constitute Funds, as the same may be
supplemented pursuant to Section 2.03 to the Purchase Agreement.
"CONDUCT RULES" means the Conduct Rules of the NASD, as amended, and
the rules, regulations and interpretations (including examples and explanations)
of the NASD in respect thereto, as the same may from time to time be amended or
modified.
"CONTROL" shall have the meaning assigned to such term in Section
2(a)(9) of the Investment Company Act.
"CONVERSION FEATURE" means with respect to any Share of any Fund, a
mandatory or elective provision (including, without limitation, a provision
which permits or requires such Share to be converted into a share of a different
class) which may result in a reduction or termination of any amount owing from
such Fund (or the related Company in respect of such Fund) or the shareholder in
respect of the Receivables relating to such Share (or the Share obtained by
virtue of the conversion of such Share) at some point in the future.
"CORPORATE TRUST OFFICE" shall mean the principal office of Bankers
Trust Company at which, at any particular time, its corporate trust business
shall be administered, which office at the date of the execution of the Program
Documents is located at Four ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Corporate Trust and Agency Group-Structured Finance or at any other time at such
other address as Bankers Trust Company may designate from time to time.
"DATE OF ORIGINAL ISSUANCE" means in respect of any Commission
Share, the date with reference to which the amount of the CDSC payable on
redemption thereof, if any, is computed.
"DEBT" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, (iv) all obligations of such Person as lessee under leases or other
agreements which have been or should be included in determining total
liabilities in accordance with GAAP, and (v) all Secured or Guaranteed Debt.
"DEMAND DEPOSIT ACCOUNT" shall have the meaning assigned to the term
Program Demand Deposit Account in Section 4.01 of the Collection Agency
Agreement.
"DEPOSITED FUNDS" means all funds at any time and from time to time
on deposit in or otherwise to the credit of the Collection Account.
"DISTRIBUTION AGREEMENT" means with respect to any Shares of any
Fund, the agreement between the Distributor and such Fund (or with respect to
any Fund which constitutes a Portfolio, the related Company in respect of such
Fund) in respect of such Shares of such Fund and any replacement agreement as
may be adopted in the future, pursuant to which the Distributor has been
appointed the principal underwriter in respect of such Fund.
"DISTRIBUTION PLAN" means with respect to any Shares of any Fund,
the distribution plan of the related Fund (or with respect to any Fund which
constitutes a Portfolio, the related Company in respect of such Fund) in respect
thereto, pursuant to which such Shares of such Fund are distributed, and any
replacement plan as may be adopted in the future.
"DISTRIBUTOR" means Federated Securities Corp., together with its
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permitted successors and assigns.
"DISTRIBUTOR'S TRANSFER AGREEMENT" means the Distributor's Transfer
Agreement dated as of December 21, 2000 between the Distributor and the
Transferor, as the same may be amended, supplemented, waived or modified as
permitted by this Agreement.
"DOLLARS" and "$" mean lawful money of the United States of America.
"ELIGIBLE RECEIVABLE" means a Receivable: (a) which represents an
obligation of a United States Person which is not an Authority; PROVIDED, THAT,
the fact that holder of not more than ten percent (10%) of the outstanding
Shares (other than Omnibus Shares) of all Funds does not meet such condition
will not in itself cause such Receivables to not constitute an Eligible
Receivable; (b) which constitutes an "account" or "general intangible," as such
terms are defined in the UCC of all jurisdictions the laws of which are
applicable for determining whether the interests created by the Program
Documents are perfected; (c) which is denominated and payable in Dollars; (d)
which constitutes a legal, valid and binding contractual obligation of the
obligor thereof which is fully vested, not executory and is not subject to a
dispute, offset, counterclaim, defense or Adverse Claim whatsoever, (e) in
respect of the related Shares, each of the conditions set forth in the Principal
Shareholder Servicer's Agreement and Shareholder Servicer's Agreement which are
necessary so that the Principal Shareholder Servicer's entitlement to the
Shareholder Servicing Fee in respect of the related Shares is deemed to be fully
earned as of the issuance thereof and to render the applicable Fund's obligation
to pay the Shareholder Servicing Fee in respect thereof absolute and
unconditional and so that it shall not be subject to dispute, offset,
counterclaim or any defense whatsoever (except in connection with a Complete
Termination, as defined in the Principal Shareholder Servicer's Agreement) have
been met; (f) which does not contravene any Applicable Law; (g) with respect to
which the related Share does not have a Conversion Feature other than a
Permitted Conversion Feature or a Redemption Feature other than a Permitted
Redemption Feature; (h) which, in respect of Asset Based Sales Charges, requires
the payment thereof at the Maximum Sales Charge Allowable; (i) which, in respect
of CDSCs, requires the payment thereof at the rate set forth on Schedule II to
the Purchase Agreement; (j) which, in respect of Shareholder Servicing Fees,
requires the payment thereof at the Maximum Service Fee Allowable; and (k) which
is freely transferable.
"E-MAIL INVESTOR REPORT" shall have the meaning specified in Section
3.01(b) of the Servicing Agreement.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect on the date
of this Agreement and, as of the relevant date, any subsequent provisions of
ERISA, amendatory thereof, supplemental thereto or substituted therefor.
"ERISA AFFILIATE" means any corporation or trade or business that is
a member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which a Person is a member and (ii) solely for purposes of potential
liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code
and the lien created under Section 302(f) of ERISA and Section 412(n) of the
Code, described in section 414(m) or (o) of the Code of which such Person is a
member.
"EVENT OF TERMINATION" shall have the meaning specified in Section
6.01 to the Purchase Agreement.
"EXCEL SPREADSHEET" shall have the meaning assigned to such term in
the Collection Agency Agreement.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, and the
rules and regulations of the SEC thereunder, all as from time to time in effect,
or any successor law, rules or regulations, and any reference to any statutory
or regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
"EXCHANGE SHARE" means, in respect of any Fund, Shares of such Fund
that were issued in a Permitted Free Exchange of Shares of any other Fund.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest
rate per annum equal for each day during such period 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 which is a Business Day, the average of the quotations for such day on such
transactions received by Citibank from three Federal funds brokers of recognized
standing selected by it.
"FEDERATED ENTITY" means each of the Parent, the Seller, the
Transferor, the Distributor (as Distributor, Principal Shareholder Servicer and
Servicer), the Shareholder Servicer, each Advisor and each Transfer Agent and
each Sub-transfer Agent which is an Affiliate of any thereof.
"FOF COLLECTIONS" means in respect of any Fund, all servicing fees
received by the Principal Shareholder Servicer which reduce the Shareholder
Servicing Fee payable by such Fund in accordance with Section 2 of Exhibit 1 to
the Principal Shareholder Servicer's Agreement.
"FOF FUNDS" means a Fund acting as a fund-of-funds.
"FREE REDEMPTIONS" means a redemption of Shares of any Fund (other
than Reinvested Shares of such Fund) by a shareholder of such Fund under any
arrangement which relieves or defers, in whole or in part, such shareholder's
obligation to pay the maximum CDSC which would have been payable in the absence
of such arrangement by any other shareholder of such Fund redeeming a Share of
such Fund that had been held by such other shareholder for the same period the
Shares of such Fund had been held by the shareholder in question, including (i)
arrangements pursuant to which certain Persons are entitled to acquire Shares of
such Fund under circumstances in which no CDSC will be payable by them, and (ii)
arrangements pursuant to which CDSCs are deferred in connection with the
redemption of Shares of such Fund because the redeeming shareholder is
reinvesting all or a portion of the proceeds of such redemption in shares of
another fund; PROVIDED, HOWEVER, that the term "Free Redemptions" shall not
include any Permitted Free Exchanges.
"FREE SHARE" means, in respect of any Fund, each Share of such Fund
other than a Commission Share, including, without limitation, any Reinvested
Share.
"FUND" means each Investment Company or Portfolio specified on
Schedule I to the Purchase Agreement under the heading "Fund," as the same may
be supplemented pursuant to Section 2.03 of the Purchase Agreement.
"FUNDAMENTAL INVESTMENT OBJECTIVES" means, with respect to any Fund,
the fundamental investment objectives of such Fund specified on Schedule IV to
the Purchase Agreement, as the same may be amended, supplemented or replaced
with the prior written consent of the Program Agent.
"FUNDING AGREEMENT" means the Funding Agreement dated as of December
21, 2000 among the Seller, the Transferor, the Purchaser, the Program Agent and
the Collection Agent, as the same may from time to time be amended,
supplemented, waived or modified.
"GAAP" means generally accepted accounting principles in the United
States, in effect from time to time, consistently applied.
"GOVERNMENTAL AUTHORIZATIONS" means all franchises, permits,
licenses, approvals, consents and other authorizations of any kind of
Authorities.
"GOVERNMENTAL FILINGS" means all filings, including franchise and
similar tax filings, and the payment of all fees, assessments, interests and
penalties associated with such filings with all Authorities.
"GUARANTEE" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the payment thereof
or to protect such obligee against loss in respect thereof (in whole or in
part); PROVIDED, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"INDEMNIFIED PARTY" shall have the meaning assigned to such term in
Section 9.04(b) of the Purchase Agreement.
"INITIAL PURCHASER" means Wilmington Trust Company, as owner trustee
of PLT Finance Trust 1997-1.
"INVESTMENT ADVISERS ACT" means the Investment Advisers Act of 1940,
as amended, and the rules and regulations of the SEC thereunder, all as from
time to time in effect, or any successor law, rules or regulations, and any
reference to any statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
"INVESTMENT COMPANY" means any entity registered as a separate
investment company under the Investment Company Act.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940,
as amended, and the rules and regulations of the SEC thereunder, all as from
time to time in effect, or any successor law, rules or regulations, and any
reference to any statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
"INVESTOR REPORT" means a report in substantially the form of
Exhibit B to the Collection Agency Agreement.
"IRREVOCABLE PAYMENT INSTRUCTION" means in respect of any Fund, the
irrevocable payment instruction in effect in respect of such Fund and its
Transfer Agent, in the form of Exhibit A to the Collection Agency Agreement, as
the same may be amended or supplemented as contemplated thereby and hereby.
"LAW" means any (a) judicial, executive, legislative, administrative
or other decree, directive, enactment, finding, guideline, law, injunction,
interpretation, judgment, order, ordinance, policy statement, proclamation,
promulgation, regulation, requirement, rule, rule of public policy, settlement
agreement, statute, or writ, of any Authority, whether domestic or foreign, and
whether or not having the force of law, or any particular section, part or
provision thereof, (b) common law or other legal or quasi-legal precedent, or
(c) arbitrator's, mediator's or referee's decision, finding, award or
recommendation.
"LIEN" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien or security interest (statutory or
other), or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the UCC or comparable law of any jurisdiction),
or other charge or encumbrance, including the retained security title of a
conditional vendor or lessor.
"LIQUIDATION PLAN" means with respect to any Company or any Fund, a
plan of liquidation, a plan to dispose of a substantial portion of its assets
out of the ordinary course of business (except in connection with a Permitted
Merger) or any other plan of action with similar effect.
"MASTER SERVICER" means Citicorp North America, Inc., in its capacity
---------------
as master servicer for the Master Trusts, together with its successors and
assigns.
"MASTER TRUST" means any trust or other special purpose entity to
which any interest in any of the Purchased Receivables relating to any Fund or
the right to receive any Collections with respect thereto has been transferred
in connection with a Take-out Transaction.
"MATERIAL ADVERSE EFFECT" means (i) any occurrence of, or any
increase in, any Adverse Claim on the Purchased Receivables or the Collections,
(ii) any adverse effect upon the status of any transfer of any Receivables under
the Program Documents as a True Sale, (iii) any material adverse effect upon the
Seller's, the Transferor's, the Distributor's, the Parent's, the Shareholder
Servicer's, any Advisor's, any Company's, any Fund's, any Selling Agent's or any
Transfer Agent's ability to pay or fully perform any of its respective
obligations under any Program Document in a timely manner, (iv) any material
adverse effect upon the assets, operations, business or financial condition of
any Company, any Fund or the Parent and its consolidated subsidiaries, taken as
a whole, (v) any adverse effect on the status of the Receivables as Eligible
Receivables, (vi) any adverse effect on the amount of or timing of any payment
of any Collections or Related Collections, (vii) any adverse effect on the
timely receipt by the Collection Agent of any Collections or Related Collections
in accordance with the terms of any Irrevocable Payment Instruction or any other
Program Document, (viii) any adverse effect on the Purchaser's right, title or
interest in the Purchased Receivables, the Collections or Ancillary Rights in
respect thereof, the Demand Deposit Account or the Collection Account, (ix) any
occurrence of, or any increase in, any claims, damages, losses, liabilities,
expenses, obligations, penalties, or disbursements of any kind or nature of the
Purchaser or the Program Agent arising out of the transactions contemplated by
the Program Documents, or (x) any material adverse effect on any of the other
rights or remedies of the Purchaser or the Program Agent under the Program
Documents.
"MAXIMUM AGGREGATE SALES CHARGE ALLOWABLE" means, at any time with
respect to any Fund, the maximum aggregate Asset Based Sales Charges which may
be paid by such Fund (or if such Fund constitutes a Portfolio, by the related
Company in respect of such Fund) in respect of Shares of such Fund pursuant to
the Distribution Agreement, the Distribution Plan and the Prospectus relating to
such Fund, together with interest thereon at the Maximum Interest Allowable,
relating to such Shares and pursuant to the "maximum sales charge rule" set
forth in the Conduct Rules, assuming such Fund pays a separate Service Fee in
connection with such Shares, unreduced by payments previously made in respect
thereof by such Fund (or if such Fund constitutes a Portfolio, by the related
Company in respect of such Fund).
"MAXIMUM INTEREST ALLOWABLE" means the maximum interest which may be
taken into account under Rule 2830(d) of the Conduct Rules in computing the
Maximum Aggregate Sales Charge Allowable.
"MAXIMUM SALES CHARGE ALLOWABLE" means with respect to any Fund, the
maximum Asset Based Sales Charge which may be paid by the related Fund (or if
such Fund constitutes a Portfolio, by the related Company in respect of such
Fund) at any time under the Conduct Rules, including the annual limit and the
limit on the Maximum Aggregate Sales Charge Allowable.
"MAXIMUM SERVICE FEE ALLOWABLE" means with respect to any Fund, the
maximum Service Fee which may be paid by such Fund (or if such Fund constitutes
a Portfolio, by the related Company in respect of such Fund) in respect of
Shares of such Fund under the Conduct Rules.
"MONTHLY COLLECTION DETERMINATION DATE" means the twenty ninth
(29th) calendar day of each calendar month, or if such day is not a Business
Day, the next succeeding Business Day; PROVIDED, HOWEVER, that if there is no
such day in such calendar month, the Monthly Collection Determination Date shall
occur on the first Business Day of the immediately following calendar month.
"MONTHLY COLLECTION DETERMINATION DATE STATEMENT" shall have the
meaning assigned to such term in Section 4.03(d) of the Collection Agency
Agreement.
"MONTHLY SETTLEMENT DATE" means the Business Day next succeeding
each Monthly Collection Determination Date.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc., together with its
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successors and assigns.
"MULTIEMPLOYER PLAN" means a multiemployer plan defined as such in
Section 3(37) or 4001(a)(3) of ERISA to which contributions have been, or were
required to have been, made by a Person or any ERISA Affiliate, or under which
such Person or any ERISA Affiliate may incur any Liability.
"NASD" means both the National Association of Securities Dealers,
----
Inc. and NASD Regulation, Inc., or any successor entity.
"NET ASSET VALUE" means, (i) with respect to any Fund, as of the
date any determination thereof is made, the net asset value of such Fund
computed in the manner such value is required to be computed by such Fund (or if
such Fund constitutes a Portfolio, by the related Company in respect of such
Fund) in its reports to its shareholders, and (ii) with respect to any Share of
such Fund as of any date, the quotient obtained by dividing: (A) the net asset
value of such Fund (as computed in accordance with clause (i) above) allocated
to Shares of such Fund (in accordance with the Distribution Plan and Prospectus)
as of such date, by (B) the number of Shares of such Fund outstanding on such
date.
"NON-OMNIBUS SHARES" means, in respect of any Fund, all Shares of
such Fund other than Omnibus Shares.
"NORMAL DISTRIBUTIONS" means, in respect of any Fund, distributions
out of (a) "investment company taxable income", (b) "exempt-interest dividends"
and (c) "capital gain dividends," of such Fund, in each case, (i) as such terms
are used in Section 852 of the Code and (ii) to the extent required to be
distributed by such Fund (or if such Fund constitutes a Portfolio, by the
related Company in respect of such Fund) in accordance with Section 852 or
Section 4982 of the Code in order to avoid taxation at the entity level, and
(iii) to the extent the gains giving rise to the distributions requirement
described in clause (ii) arose in the ordinary course of such Fund's investment
activities (including shifts in the proportion of assets held in cash or cash
equivalents) and in accordance with such Fund's Fundamental Investment
Objectives as the same may be amended, supplemented or replaced in accordance
with the Program Documents (it being understood that this clause (iii) includes
gains resulting from sales to raise funds to satisfy shareholder redemption
requests made in the ordinary course of business).
"OMNIBUS ACCOUNT" means, in respect of any Fund, any account
maintained by the Transfer Agent reflecting the record ownership of Shares of
such Fund by a Person who maintains sub-transfer records reflecting the actual
beneficial ownership of such Shares in other Persons.
"OMNIBUS SHARES" means, in respect of any Fund, the Shares of such
Fund held in the name of a broker-dealer street account on the records
maintained by the Transfer Agent and for which account such broker-dealer
provides sub-transfer agency services for such Fund.
"OTHER AGENT" means ▇▇▇▇▇▇, ▇▇▇▇▇▇ Securities Inc.
-----------
"OTHER PURCHASERS" means the Initial Purchaser and the Revolving
----------------
Purchaser.
"OTHER PURCHASERS' END DATE" means September 30, 2000.
--------------------------
"OTHER PURCHASERS' PROGRAM DOCUMENTS" means the Master Agreement as
defined in the Collection Agency Agreement and the agreements and documents
entered into in connection therewith.
"PARENT" means Federated Investors, Inc., a Pennsylvania corporation,
------
together with its permitted successors and assigns.
"PERMITTED CONVERSION FEATURE" means with respect to any Share of
any Fund, a Conversion Feature in respect of such Fund which, by its terms, may
not become effective prior to the calendar month following the calendar month in
which falls the eighth (8th) year anniversary of the issuance of such Share or,
if such Share constitutes an Exchange Share, of the Share from which such
Exchange Share derives; PROVIDED, that the amount of Free Shares of any holder
relating to any Fund shall convert in proportion to the number of Commission
Shares of that holder in such Fund being converted on such date.
"PERMITTED DESIGNEE" means any Person designated by the Program
Agent which may be (a) the Program Agent, or any Affiliate of Citibank or the
Program Agent, or (b) any other Person designated by the Program Agent which has
agreed to be bound by confidentiality undertakings in substance comparable to
Section 9.10 to the Purchase Agreement.
"PERMITTED FREE EXCHANGE" means any exchange of Shares of one Fund
(the "Redeeming Fund") for Exchange Shares of another Fund (the "Issuing Fund"),
where, pursuant to the applicable constituent documents of the Issuing Fund: (i)
Exchange Shares of the Issuing Fund are deemed for all purposes (including the
computation of the amount of, and timing of payment of the related CDSC) to have
been acquired at the time when the exchanged Shares of the Redeeming Fund were
acquired (or deemed to have been acquired) by the holder thereof; (ii) the
exchanging shareholder becomes obligated to pay to the Issuing Fund the same
CDSC in respect of the Exchange Shares of the Issuing Fund and on the same terms
as such holder was obligated to pay to the Redeeming Fund in respect of the
Shares of the Redeeming Fund so exchanged; (iii) the date upon which such
Exchange Shares of the Issuing Fund received in the Exchange are converted
pursuant to the Permitted Conversion Feature is the same as the date the
exchanged Shares of the Redeeming Fund were to be converted pursuant to the
Permitted Conversion Feature of the exchanged Shares; (iv) the Maximum Aggregate
Sales Charge Allowable in respect of the Issuing Fund pursuant to the
Distribution Agreement, the Distribution Plan and the Prospectus of the Issuing
Fund is increased on the effective date of the exchange by a percentage of the
Net Asset Value on such exchange date of the Shares of the Redeeming Fund being
so exchanged determined in accordance with Schedule III to the Purchase
Agreement with reference to the number of calendar months which have passed
since the Date of Original Issuance of the Shares of the Redeeming Fund redeemed
in connection with such exchange; PROVIDED, that the amount of such increase
shall not exceed the Amortized Maximum Aggregate Sales Charge Allowable of the
Redeeming Fund immediately prior to the exchange; (v) the Amortized Maximum
Aggregate Sales Charge Allowable in respect of the Redeeming Fund is reduced by
the same amount as the Maximum Aggregate Sales Charge Allowable in respect of
such Issuing Fund is increased; and (vi) both the redemption of the Shares of
the Redeeming Fund so exchanged and the issuance of the Shares of the Issuing
Fund are effected at the Net Asset Value of such Shares at the date of the
exchange without any reduction for fees or expenses attributable to such
exchange.
"PERMITTED MERGER" means a merger or consolidation of two or more
Funds: (i) pursuant to which all of the assets of the participating Funds are
transferred to the surviving Fund, (ii) pursuant to which the surviving Fund
assumes all obligations of the participating Funds, including the obligations in
respect of the Purchased Receivables, (iii) which is carried out in a manner so
that the Distribution Plan of each of the participating Funds is continued as
part of the Distribution Plan of the surviving Fund without affecting the rights
of the Distributor in respect of the Purchased Receivables relating to the
participating Funds, and (iv) which could not otherwise give rise to a
reasonable possibility of a Material Adverse Effect.
"PERMITTED REDEMPTION FEATURE" means with respect to any class of
Shares of any Fund, a Redemption Feature which, by its terms, requires that
Shares owned of record for any Shareholder's account be redeemed in the
following order: FIRST, Free Shares of such class owned of record for such
Shareholder account to the extent thereof in the same order as the Date of
Original Issuance thereof occurred (it being understood that under no
circumstance shall the redemption of a Free Share include the appreciation on
Commission Shares above the original Net Asset Value of such Commission Shares
at the Date of Original Issuance thereof); and SECOND, each Commission Share of
such class owned of record for such Shareholder account in the same order as the
Date of Original Issuance thereof occurred (it being understood that the
redemption of each individual Commission Share will include all the appreciation
on such Commission Share above the original Net Asset Value of such Commission
Share at the Date of Original Issuance thereof).
"PERSON" means an individual or a corporation (including a business
trust), partnership, limited liability company, trust, incorporated or
unincorporated association, cooperative, joint stock company, government (or an
agency or political subdivision thereof) or other entity of any kind.
"PLAN" means an employee benefit plan or other benefit plan as
defined in Section 3(3) of ERISA established or maintained by a Person or any
ERISA Affiliate during the five-year period ended immediately prior to the
Purchase Date or to which such Person or any ERISA Affiliate makes, is obligated
to make or has, within the five-year period ended immediately prior to the
Purchase Date, been required to make contributions or under which such Person or
any ERISA Affiliate may incur any liability or which covers any employee or
former employee of such Person or any ERISA Affiliate other than a Multiemployer
Plan.
"PLT DISTRIBUTOR'S TRANSFER AGREEMENT" means the Federated Investors
Program Transferor's Transfer Agreement, dated as of October 24, 1997, between
the Seller and the Distributor, as amended, supplemented, waived or modified.
"PLT TRANSFEROR'S TRANSFER AGREEMENT" means the Federated Investors
Seller's Transfer Agreement dated as of October 24, 1997 between the Seller and
Federated Funding 1997-1, Inc., as amended and supplemented.
"PORTFOLIO" means a separate investment portfolio or series of an
Investment Company which is itself not an Investment Company.
"POST-DEFAULT RATE" means in respect of any amount not paid when
due, a rate per annum during the period commencing on the due date thereof until
such amount is paid in full equal to the Base Rate as in effect from time to
time plus two percent (2%).
"PRIME RATE" means the rate of interest from time to time announced
by Citibank at its Principal Office as its prime commercial lending rate. The
Prime Rate is a reference rate and does not necessarily represent the lowest or
best rate actually charged to any customer.
"PRINCIPAL OFFICE" means the principal office of Citibank presently
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇.
"PRINCIPAL SHAREHOLDER SERVICER" shall mean, in respect of any Fund,
the Distributor, in its capacity as principal shareholder servicer in respect of
such Fund.
"PRINCIPAL SHAREHOLDER SERVICER'S AGREEMENT" means, in respect of
any Fund, the agreement between the Principal Shareholder Servicer and such Fund
(or if such Fund constitutes a Portfolio, the related Company in respect of such
Fund) pursuant to which the Principal Shareholder Servicer agrees to act in such
capacity in respect of Shares of such Fund, and any replacement agreement
pursuant to which the Principal Shareholder Servicer has been appointed
principal shareholder servicer in respect of Shares of such Fund.
"PRIVATE AUTHORIZATIONS" means all franchises, permits, licenses,
approvals, consents and other authorizations of all Persons (other than
Authorities) including, without limitation, those with respect to trademarks,
service marks, trade names, copyrights, computer software programs, and
technical and other know-how.
"PROCEEDS" shall have, with reference to any property or asset, the
meaning assigned to such term under the UCC and, in any event, shall include,
but not be limited to, whatever is received upon the sale, exchange, collection
or other disposition of such property or asset and any and all amounts from time
to time paid or payable under or in connection with such property or asset.
"PROGRAM AGENT" means Citicorp North America, Inc., as agent for the
-------------
Purchaser, together with its successors and assigns.
"PROGRAM DOCUMENTS" means the Purchase Agreement, the Servicing
Agreement, the Collection Agency Agreement, the Funding Agreement, the
Distributor's Transfer Agreement, the Transferor's Transfer Agreement, the
Purchase Rate Letter, each Selling Agent's Agreement, each Distribution
Agreement, each Prospectus, each Advisory Agreement, each Distribution Plan,
each Irrevocable Payment Instruction, each Shareholder Servicer's Agreement,
each Principal Shareholder Servicer's Agreement and each Transfer Agent's
Agreement, and all exhibits, schedules and annexes thereto.
"PROGRAM TERMINATION DATE" means the date upon which the Purchaser
shall no longer be entitled to any future Collections in respect of any
Purchased Receivables and all amounts owing to the Purchaser and the Program
Agent under the Program Documents have been paid in full; PROVIDED, HOWEVEr,
that if any amount paid to the Purchaser or the Program Agent under any Program
Document is later required to be disgorged in connection with any proceeding
under the Bankruptcy Code, the Program Termination Date shall be deemed not to
have occurred.
"PROPRIETARY INFORMATION" shall have the meaning assigned to such
term in Section 9.10(b) of the Purchase Agreement.
"PROSPECTUS" means with respect to any Fund the prospectus filed
with the SEC as a part of such Fund's registration statement on Form N-1A, as
amended (or any successor SEC form), and shall include, without limitation, the
related statement of additional information included in such registration
statement.
"PURCHASE AGREEMENT" means the Purchase and Sale Agreement dated as
of December 21, 2000 among the Purchaser, the Program Agent, the Seller, the
Transferor, the Distributor and the Parent, as the same may from time to time be
amended, supplemented, waived or modified.
"PURCHASE DATE" means with respect to the Receivables relating to
any Fund, each purchase date set forth in the Purchase Notice. In the event that
a Purchase Date shall fall upon a day which is not a Business Day, the Purchase
Date shall be the Business Day next following the date on which the Purchase
Date would otherwise have occurred.
"PURCHASE LIMIT" means $150,000,000, or such other amount as shall
be agreed to in writing by the Purchaser, the Program Agent and the Seller;
provided, FURTHER, that on and after the Termination Date, the Purchase Limit
shall be deemed to be zero for all purposes of this Agreement.
"PURCHASE NOTICE" means the notice substantially in the form of
Exhibit A to the Purchase Agreement.
"PURCHASE PRICE" means with respect to the Receivables relating to
any Fund to be purchased on any Purchase Date, an amount equal to the product of
(A) the Purchase Price Percentage relating to such Fund, and (B) the total issue
price of the Shares of such Fund sold on or prior to the Sale Cut-off Date for
the Receivables relating to such Fund set forth in the relevant Purchase Notice
and after (i) in respect of the initial Purchase Date for such Receivables, the
Other Purchasers' End Date, and (ii) in respect of any Purchase Date after the
initial Purchase Date of such Receivables, the immediately preceding Sale
Cut-off Date for the Receivables relating to such Fund; PROVIDED, HOWEVER, that
in the event that the Seller has received any amount in respect of the Sales
Charges relating to any Receivables proposed to be purchased hereunder, the
Purchase Price for such Receivables shall be adjusted as agreed to by the
Program Agent and the Seller in order to reflect the reduced amount payable to
the Purchaser in respect of such Receivables and notwithstanding anything in
this Agreement to the contrary the Purchaser shall have no obligation to
purchase any such Receivables under this Agreement until such reduced Purchase
Price has been so agreed upon.
"PURCHASE PRICE PERCENTAGE" means, with respect to the Receivables
relating to any Fund, the percentage set forth in the Purchase Rate Letter.
"PURCHASE RATE LETTER" means that certain Purchase Rate Letter dated
as of December 21, 2000 among the Seller, the Purchaser, and the Program Agent,
as the same may from time to time be amended, supplemented or modified.
"PURCHASED RECEIVABLES" means, with respect to any Fund, as of any
date, the Receivables required to be allocated to the Purchaser in respect of
the Shares of such Fund in accordance with the Allocation Procedures, together
with the Collections and Ancillary Rights with respect thereto, which is
intended to include all Asset Based Sales Charges, CDSCs and Shareholder
Servicing Fees payable by or in respect of such Fund arising out of the Shares
attributed to the Purchaser and all shareholder servicing fees payable by any
fund arising out of Class A shares of such fund acquired by FOF Funds with the
proceeds of Shares attributed to the Purchaser.
"PURCHASER" means Citibank, together with its successors and
assigns.
"PURCHASER'S ASSUMED YIELD" means as of the date of any
determination, an amount (computed on a daily average basis on the basis of
actual days elapsed in a year of 365 days) equal to the Purchaser's Assumed
Yield Rate on an amount equal to the aggregate Purchase Prices paid by the
Purchaser under the Purchase Agreement in respect of all Purchased Receivables,
less the portion of the aggregate amounts of Asset Based Sales Charges and CDSCs
relating to Shares of the Fund which have been allocated to the Purchaser in
accordance with the Allocation Procedures and distributed to the Purchaser under
the Collection Agency Agreement on such date.
"PURCHASER'S ASSUMED YIELD RATE" means a rate equal to the Prime
Rate plus one percent (1%) per annum.
"PURCHASER'S FUNDING ACCOUNT" shall have the meaning assigned to
such term in Section 3.01 of the Funding Agreement.
"PURCHASER'S REMITTANCE ACCOUNT" means the account of the Purchaser
------------------------------
maintained at Citibank, N.A. entitled the "Citibank Concentration Account", ABA
No.: ▇▇▇▇▇▇▇▇▇, Account No.: ▇▇▇▇▇▇▇▇ or such other account as the Program Agent
shall designate in writing to the Collection Agent.
"RECEIVABLES" means with respect to each Fund, all of the rights
under the related Distribution Agreement, the related Distribution Plan, the
related Principal Shareholder Servicer's Agreement and the related Prospectus to
receive amounts paid or payable in respect of Asset Based Sales Charges
(including interest at the Maximum Interest Allowable), CDSCs and Shareholder
Servicing Fees, in each case in respect of the Shares of such Fund and in
respect of Shares of any other Fund acquired in any Permitted Free Exchange of
Shares of the Fund in question, including, without limitation, any similar
amount paid or payable under any replacement distribution agreement,
distribution plan, principal shareholder servicer's agreement or prospectus, and
any continuation payments in respect thereof paid or payable by such Fund (or if
such Fund constitutes a Portfolio, by the related Company in respect of such
Fund) in the event of a termination of the related Distribution Plan, the
related Distribution Agreement, Principal Shareholder Servicer's Agreement or
Prospectus, and all shareholder servicing fees payable by any fund arising out
of Class A shares of such fund acquired by FOF Funds with the proceeds of
Shares.
"REDEMPTION FEATURE" means with respect to any Share of any Fund,
the rules applied to determine the order in which Free Shares and Commission
Shares owned of record for any Shareholder account are redeemed.
"REINVESTED SHARE" means, in respect of any Fund, a Share which is
issued by such Fund as a result of the reinvestment of dividends or other
distributions, whether ordinary income, capital gain or exempt-interest
dividends or other distributions, of such Fund.
"RELATED COLLECTIONS" means (i) all amounts paid or payable by each
Fund (or in respect of each Fund which constitutes a Portfolio, by each Company
in respect of each related Fund) in respect of receivables relating to such Fund
and by each shareholder of each such Fund in respect of Receivables relating to
each such Fund (including all CDSCs payable by such shareholders and withheld
from redemption proceeds payable to such shareholders by each Fund), (ii) all
FOF Collections, and (iii) all Proceeds of the foregoing, excluding, in the case
of (i), (ii) and (iii) above, all Collections.
"RESPONSIBLE OFFICER" means, (i) with respect to any Person which is
a corporate entity or business trust other than Bankers Trust Company, any
officer or Person with like authority or employee of such Person with
responsibility and authority for the matters relating to such Person's
participation in the transactions contemplated by the Program Documents,
including the person to whom notices to such Person are to be directed as
identified pursuant to the notice provisions of any Program Documents, and (ii)
with respect to Bankers Trust Company, any officer assigned to the Corporate
Trust Office, including any managing director, vice president, assistant vice
president, assistant treasurer, assistant secretary or any other officer of
Bankers Trust Company customarily performing functions similar to those
performed by any of the above designated officers and having direct
responsibility for the administration of the Program Documents, and also, with
respect to a particular matter, any other officer to which such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"REVOLVING PURCHASER" means ▇▇▇▇▇▇ ▇▇▇▇▇▇ Finance, L.P.
-------------------
"RULE 12B-1" means Rule 12b-1 adopted under the Investment Company
Act, as the same may from time to time be amended, supplemented or modified.
"S&P" means Standard & Poor's Corporation, together with its
successors and assigns.
"SALES CHARGE" shall have the meaning set forth in Section 2830 of
the Conduct Rules.
"SALE CUT-OFF DATE" means with respect to any Fund, the last date
upon which Shares of such Fund were issued in a transaction taken into account
in computing the Purchase Price paid by the Purchaser on any Purchase Date in
respect of the Receivables of such Fund.
"SEC" means the Securities and Exchange Commission or any other
governmental authority of the United States of America at the time administering
the Securities Act, the Investment Company Act or the Exchange Act.
"SECURED OR GUARANTEED DEBT" of any Person means at any date, (i)
all Debt of others secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person, and (ii) all Debt of others in respect of
which such Person has issued a Guarantee.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and
the rules and regulations of the SEC thereunder, all as from time to time in
effect, or any successor law, rules or regulations, and any reference to any
statutory or regulatory provisions shall be deemed to be a reference to any
successor statutory or regulatory provision.
"SELLER" means Federated Funding 1997-1, Inc., together with its
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permitted successors and assigns.
"SELLER'S REMITTANCE ACCOUNT" means the account of the Seller
maintained at PNC Bank, at 2 PNC Plaza, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ABA No.: ▇▇▇▇▇▇▇▇▇, Account No.: 1010937889, "For the
benefit of Federated Investors Management Company" or such other account as the
Seller shall designate in writing to the Purchaser, the Program Agent and the
Collection Agent.
"SELLING AGENT" means each Person which acts as the direct or
indirect distributor, underwriter, broker, dealer or agent for the Shares of a
Fund, pursuant to a Selling Agent's Agreement, together with its successors and
assigns.
"SELLING AGENT'S AGREEMENTS" means each agreement pursuant to which
a Selling Agent undertakes to act as Selling Agent in respect of the Shares of
any Fund.
"SERVICE FEE" shall have the meaning set forth in Section 2830 of
the Conduct Rules.
"SERVICER" means Federated Securities Corp., in its capacity as
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servicer under the Servicing Agreement, together with its permitted successors
and assigns.
"SERVICING AGREEMENT" means the Amended and Restated Federated
Investors Program Servicer Agent Agreement dated as of December 21, 2000 among
the Purchaser, the Program Agent, the Other Purchasers, the Other Agent and the
Servicer, as the same may from time to time be amended, supplemented, waived or
modified.
"SERVICING FEE" shall have the meaning assigned to such term in
Section 3.03 of the Servicing Agreement.
"SERVICING PROCEDURES" means the Servicing Procedures in the form of
Exhibit A to the Servicing Agreement, as the same may from time to time be
amended or supplemented with the prior written consent of the Program Agent.
"SHAREHOLDER" means, in respect of any Fund, a holder of Shares of
such Fund.
"SHAREHOLDER SERVICER" means Federated Shareholder Services Company,
in its capacity as shareholder servicer for the Funds, together with its
permitted successors and assigns.
"SHAREHOLDER SERVICER'S AGREEMENT" means, in respect of any Fund,
the agreement among such Fund (or if such Fund constitutes a Portfolio, the
related Company in respect of such Fund), the Distributor and the Shareholder
Servicer pursuant to which the Shareholder Servicer undertakes to act as
shareholder servicer in respect of the Shares of such Fund.
"SHAREHOLDER SERVICING FEE" means the fees payable by a Fund (or if
such Fund constitutes a Portfolio, by the related Company in respect of such
Fund) with respect to the Shares of a Fund pursuant to the Principal Shareholder
Servicer's Agreement in consideration of services to holders of Shares of such
Fund.
"SHAREHOLDER SERVICING FEE PORTION" means in respect of the Seller,
the Purchaser or the Other Purchasers, as of any date, the aggregate portion of
the Deposited Funds constituting Shareholder Servicing Fees allocable to it on
such date pursuant to the Allocation Procedures.
"SHARES" shall mean, in respect of any Fund, the shares specified on
Schedule I to the Purchase Agreement under the heading "Shares", as the same may
be supplemented pursuant to Section 2.03 of the Purchase Agreement.
"SIGNIFICANT AFFILIATES" means (i) any corporation or holding
company or similar entity which after the date hereof owns or controls the
majority of the outstanding voting securities of the Seller or the Transferor,
or (ii) any Affiliate of the Seller or the Transferor which is a subsidiary of
the Parent if the Parent's beneficial interest in the total assets of such
subsidiary is equal to or greater than ten percent (10%) of the total assets of
the Parent, and in any event shall include the Distributor, the Transferor, the
Parent, the Shareholder Servicer, the Seller and the Advisors.
"SIPA" means the Securities Investor Protection Act of 1970, as
amended from time to time and the regulations promulgated and the rulings issued
thereunder.
"SUB-TRANSFER AGENT" means, in respect of any Fund, the record owner
of any Omnibus Account.
"SYSTEMATIC WITHDRAWAL PROGRAM" means the program permitted by the
Funds whereby shareholders are allowed to withdraw up to 12% of their account
balance per year free of the applicable CDSC; PROVIDED, THAT, unless the prior
written consent of the Program Agent has been obtained (which consent shall not
be unreasonably withheld) (i) to be eligible for such program the account of
such shareholder must be at least one year old; (ii) the account of such
shareholder must have a balance of at least $10,000 in order to establish a
Systematic Withdrawal Program; (iii) withdrawals free of the CDSC will be
limited to 12% annually; (iv) all dividends and capital gains must be
reinvested; and (v) withdrawals can be scheduled monthly, quarterly or
semi-annually.
"TAKE-OUT ADJUSTMENT AMOUNT" means in connection with a Take-out
Transaction, the amount by which the Purchaser's capacity to purchase
Receivables has been increased as a result of such Take-out Transaction, as set
forth in the related Take-out Notice.
"TAKE-OUT NOTICE" means a notice from the Program Agent to the
Seller, substantially in the form attached as Exhibit I to the Purchase
Agreement, stating that the Purchaser has completed a Take-out Transaction and
specifying the related Take-out Adjustment Amount.
"TAKE-OUT TRANSACTION" means any transaction pursuant to which the
Purchaser (including, without limitation, any Master Trust which obtains such
interest directly or indirectly from the Purchaser) sells or otherwise
transfers, participates or causes to be sold, transferred or participated
interests in the Purchased Receivables relating to any Fund (including, without
limitation, the right to receive any portion of any Collections) to any Person,
including a Master Trust which sells debt instruments and/or certificates or
other instruments representing ownership interests in such Master Trust or
interest in any Purchased Receivables relating to any Fund (including, without
limitation, any right to receive any portion of any Collections).
"TERMINATION DATE" means the date which is the earlier to occur of
(a) December 31, 2003 or such later date as shall be agreed to in writing by the
parties hereto, and (b) the date the Purchase Agreement shall terminate pursuant
to Section 6.01 thereof.
"TERMINATION OF FUNDING NOTICE" means a notice substantially in the
form of Exhibit A to the Funding Agreement.
"TRANSFER AGENT" means, in respect of the Shares of any Fund at any
time, the Person who acts at such time as the transfer agent for such Fund in
respect of such Shares or any successor transfer agent for such Fund.
"TRANSFER AGENT'S AGREEMENT" means each agreement pursuant to which
a Transfer Agent or Sub-transfer Agent undertakes to act as transfer agent or
Sub-transfer Agent in respect of a Fund.
"TRANSFEREE" shall have the meaning assigned to such term in Section
9.14 of the Purchase Agreement.
"TRANSFEROR" means Federated Investors Management Company, together
with its permitted successors and assigns.
"TRANSFEROR'S TRANSFER AGREEMENT" means the Transferor's Transfer
Agreement dated as of December 21, 2000 between the Transferor and the Seller,
as the same may be amended, supplemented, waived or modified as permitted by
this Agreement.
"TRUE SALE" means, with respect to any asset or property, the sale
of an ownership interest in such asset or property (not the granting of a
security interest therein), within the meaning of all Applicable Law, including,
without limitation, the UCC and the Bankruptcy Code and, without limiting the
generality of the foregoing, which is enforceable against all creditors of the
Person making such transfer and all Affiliates of such Person in accordance with
the terms of such transfer, notwithstanding the bankruptcy, insolvency or
reorganization of, or similar proceeding with respect to, or the appointment of
a receiver or conservator of the Person making such transfer or any Affiliate of
such Person, and in connection with any proceeding under the Bankruptcy Code, in
respect of which the Person making such transfer or any Affiliate of such Person
is the "debtor," as such term is used in the Bankruptcy Code, the Purchased
Receivables and the proceeds thereof will not be deemed the property of the
debtor.
"UCC" means the Uniform Commercial Code, as from time to time in
effect in the applicable jurisdictions.
"UNAMORTIZED AGGREGATE PURCHASE PRICE" means, in respect of the
Purchased Receivables as of any date of determination, an amount equal to the
aggregate Purchase Prices paid by the Purchaser under the Purchase Agreement in
respect of all Purchased Receivables, less the sum of (i) the portions of the
aggregate amounts of Asset Based Sales Charges, CDSCs and Shareholder Servicing
Fees remitted to the Collection Account (or after the delivery of an Attachment
Notice, the Purchaser's Remittance Account) relating to Purchased Receivables
which have not been conveyed by the Purchaser in connection with a Take-out
Transaction for which a Take-out Notice has been executed and which have been
allocated and distributed to Citibank through such date of determination
pursuant to the allocation procedures set forth in the documentation entered
into in connection with a Take-out Transaction which exceeds the accrued and
unpaid Purchaser's Assumed Yield, and (ii) the sum of each Take-out Adjustment
Amount in respect of each Take-out Transaction specified in one or more Take-out
Notices which have been acknowledged by the Seller and returned to the Program
Agent on or prior to such date of determination.
"WEIGHTED AVERAGE PERCENTAGE DECLINE IN THE NET ASSET VALUE OF
SHARES OF ALL FUNDS" in reference to a period from one Calculation Date (the
"Reference Date") to a later Calculation Date shall be determined by (i)
determining the negative or positive percentage change in the Net Asset Value
per Share which relate to Purchased Receivables of each Fund from the Reference
Date to such later Calculation Date, (ii) computing the arithmetic sum of the
products obtained by multiplying the percentage change obtained in clause (i)
for Shares relating to Purchased Receivables of each Fund by the Net Asset Value
of such Shares of such Fund on such later Calculation Date, and (iii) if the sum
obtained in clause (ii) is negative dividing the sum obtained in clause (ii) by
the Net Asset Value of all Shares which relate to Purchased Receivables of all
Funds on such later Calculation Date and expressing the result as a negative
percentage, and if the sum obtained in clause (iii) is positive the "Weighted
Average Percentage Decline in the Net Asset Value of Shares of All Funds" shall
be zero.
4
Schedule I
LIST OF COMPANIES, FUNDS AND SHARES
LIST OF INVESTMENT COMPANIES, FUNDS AND SHARES
1. FEDERATED AMERICAN LEADERS FUND, INC.
Class B Shares
2. FEDERATED EQUITY FUNDS
Federated Aggressive Growth Fund - Class B Shares
Federated Capital Appreciation Fund - Class B Shares
Federated Communications Technology Fund - Class B Shares
Federated Growth Strategies Fund - Class B Shares
Federated Large Cap Growth Fund - Class B Shares
Federated Large Cap Tech Fund - Class B Shares
Federated Market Opportunity Fund - Class B Shares
Federated New Economy Fund - Class B Shares
Federated Small Cap Strategies Fund - Class B Shares
3. FEDERATED EQUITY INCOME FUND, INC.
Class B Shares
4. FEDERATED FIXED INCOME SECURITIES, INC.
Federated Strategic Income Fund - Class B Shares
5. FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES, INC.
Class B Shares
6. FEDERATED GOVERNMENT INCOME SECURITIES, INC.
Class B Shares
7. FEDERATED HIGH INCOME BOND FUND, INC.
Class B Shares
8. FEDERATED INTERNATIONAL SERIES, INC.
Federated International Equity Fund - Class B Shares
Federated International Bond Fund - Class B Shares
9. FEDERATED INVESTMENT SERIES FUNDS, INC.
Federated Bond Fund - Class B Shares
10. FEDERATED MUNICIPAL OPPORTUNITIES FUND, INC.
Class B Shares
11.FEDERATED MUNICIPAL SECURITIES FUND, INC.
Class B Shares
12. FEDERATED MUNICIPAL SECURITIES INCOME TRUST
Federated California Municipal Income Fund - Class B Shares
Federated Pennsylvania Municipal Income Fund - Class B Shares
13. FEDERATED STOCK AND BOND FUND, INC.
Class B Shares
14. FEDERATED UTILITY FUND, INC.
Class B Shares
15. FEDERATED WORLD INVESTMENT SERIES, INC.
Federated World Utility Fund - Class B Shares
Federated Asia Pacific Growth Fund - Class B Shares
Federated Emerging Markets Fund - Class B Shares
Federated European Growth Fund - Class B Shares
Federated Global Equity Income Fund - Class B Shares
Federated Global Financial Services Fund - Class B Shares
Federated International Growth Fund - Class B Shares
Federated International High Income Fund - Class B Shares
Federated International Small Company Fund - Class B Shares
16. MONEY MARKET OBLIGATIONS TRUST
Liberty U.S. Government Money Market Trust - Class B Shares
Schedule II
CONTINGENT DEFERRED SALES CHARGE SCHEDULE
Years from
FUND SHARE PURCHASE CDSC RATE
0-1 5.50%
1-2 4.75
2-3 4.0
3-4 3.0
4-5 2.0
5-6 1.0
6+ 0.0
13620.148 #200982
Schedule III
SCHEDULE OF TRANSFERABLE NASD CAP
If the number of calendar months which have passed since the Date of
Original Issuance of the Share of the Redeeming Fund redeemed in connection with
a Permitted Free Exchange falls in a given range of calendar months indicated in
Column I below, the amount by which the Maximum Aggregate Sales Charge Allowable
in respect of the Issuing Fund must be increased as a result of such Free
Exchange is the percentage set forth in Column II below directly opposite such
range of calendar months in Column I of the date of redemption Net Asset Value
of the Share of the Redeeming Fund so redeemed.
I II
CALENDAR MONTHS PERCENTAGE
0 to 12 5.90%
13 to 24 5.25%
25 to 36 4.60%
37 to 48 4.00%
49 to 60 3.40%
61 to 72 2.90%
73 to 84 2.50%
85 to 96 2.00%
97 or more 0%
13620.148 #200982
Schedule IV
LIST OF INVESTMENT OBJECTIVES FOR CLASS B SHARES
Federated American Leaders Fund, Inc. - Class B Shares
Investment Objective: The investment objective of the Corporation is to seek
growth of capital and of income by concentrating the area of investment decision
in the securities of high-quality companies. The Corporation's investment
approach is based upon the conviction that over the longer term the economy will
continue to expand and develop and that this economic growth will be reflected
importantly in the growth of major corporations.
Federated Equity Funds
Federated Aggressive Growth Fund - Class B Shares
Investment Objective: The investment objective is to provide appreciation of
capital.
Federated Capital Appreciation Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation.
Federated Communications Technology Fund - Class B Shares
Investment Objective: The investment objective is to achieve capital
appreciation.
Federated Growth Strategies Fund - Class B Shares
Investment Objective: The investment objective is to provide appreciation of
capital.
Federated ▇▇▇▇▇▇▇▇ Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation.
Federated Large Cap Growth Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation.
Federated Large Cap Tech Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation.
Federated Market Opportunity Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation and high current income.
Federated New Economy Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation.
Federated Small Cap Strategies Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation.
FEDERATED EQUITY INCOME FUND, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to provide
above-average income and capital appreciation.
FEDERATED FIXED INCOME SECURITIES, INC.
Federated Strategic Income Fund - Class B Shares
Investment Objective: The investment objective is to seek a high level of
current income.
FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to provide
current income.
FEDERATED GOVERNMENT INCOME SECURITIES, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to provide
current income.
FEDERATED HIGH INCOME BOND FUND, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to seek
high current income.
FEDERATED INTERNATIONAL SERIES, INC.
Federated International Equity Fund - Class B Shares
Investment Objective: The investment objective is to obtain a total return on
its assets.
Federated International Bond Fund - Class B Shares
Investment Objective: The investment objective is to seek a high level of
current income in U.S. dollars consistent with prudent investment risk. The
secondary objective is to provide capital appreciation.
FEDERATED INVESTMENT SERIES FUNDS, INC.
Federated Bond Fund - Class B Shares
Investment Objective: The investment objective is to provide as high a level of
current income as is consistent with the preservation of capital.
FEDERATED MUNICIPAL OPPORTUNITIES FUND, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to provide
a high level of current income which is generally exempt from the federated
regular income tax.
FEDERATED MUNICIPAL SECURITIES FUND, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to provide
for its shareholders a high level of current income which is exempt from federal
regular income tax.
FEDERATED MUNICIPAL SECURITIES INCOME TRUST
Federated California Municipal Income Fund - Class B Shares
Investment Objective: The investment objective is to provide current income
exempt from federal regular income tax (federal regular income tax does not
include the federal alternative minimum tax) and the personal income taxes
imposed by the state of California and California municipalities.
Federated Pennsylvania Municipal Income Fund - Class B Shares
Investment Objective: The investment objective is to provide current income
exempt from federal regular income tax and the personal income taxes imposed by
the state of Pennsylvania and Pennsylvania municipalities.
FEDERATED STOCK AND BOND FUND, INC. - Class B Shares
Investment Objective: The investment objective of the Corporation is to provide
relative safety of capital with the possibility of long-term growth of capital
and income. Consideration is also given to current income.
FEDERATED UTILITY FUND, INC. - Class B Shares
Investment Objective: The investment objectives of the Corporation are current
income and long-term capital growth of income. The secondary objective is to
provide capital appreciation.
FEDERATED WORLD INVESTMENT SERIES, INC.
Federated World Utility Fund - Class B Shares
Investment Objective: The investment objective is to provide total return.
Federated Asia Pacific Growth Fund - Class B Shares
Investment Objective: The investment objective is to provide long-term growth of
capital.
Federated Emerging Markets Fund - Class B Shares
Investment Objective: The investment objective is to provide long-term growth of
capital.
Federated European Growth Fund - Class B Shares
Investment Objective: The investment objective is to provide long-term growth of
capital.
Federated Global Equity Income Fund - Class B Shares
Investment Objective: The investment objective is to provide capital
appreciation and above-average income.
Federated Global Financial Services Fund - Class B Shares
Investment Objective: The investment objective is to provide long-term growth of
capital.
Federated International Growth Fund - Class B Shares
Investment Objective: The investment objective is to provide long-term growth of
capital.
Federated International High Income Fund - Class B Shares
Investment Objective: The investment objective is to seek a high level of
current income. The secondary objective is to provide capital appreciation.
Federated International Small Company Fund - Class B Shares
Investment Objective: The investment objective is to provide long-term growth of
capital.
MONEY MARKET OBLIGATIONS TRUST
Liberty U.S. Government Money Market Trust - Class B Shares
Investment Objective: The investment objective is stability of principal and
current income consistent with stability of principal.
13620.148 #200982
Schedule V
FORM OF LEGEND
NEITHER ANY [DISTRIBUTOR], ANY [ADVISOR], ANY [FUND] NOR ANY OF THEIR
RESPECTIVE AFFILIATES WILL RECEIVE ANY PORTION OF THE PROCEEDS FROM THE
SALE OF THE [SECURITIES]. NEITHER ANY [DISTRIBUTOR], ANY [ADVISOR], ANY
[FUND] NOR ANY OF THEIR RESPECTIVE AFFILIATES IS RESPONSIBLE FOR THE
ACCURACY OR COMPLETENESS OF THE INFORMATION CONTAINED IN THIS
[MEMORANDUM].
13620.148 #200982
Schedule VI
BANKRUPTCY REMOTE COVENANTS
The Seller shall, and the Parent shall cause the Seller to:
1. maintain books and records separate from any other Person;
2. maintain its accounts separate from any other Person;
3. not commingle assets with those of any affiliate;
4. conduct its own business in its own name;
5. prepare and maintain separate financial statements;
6. pay its own liabilities out of its own funds;
7. observe all corporate formalities;
8. maintain an arm's-length relationship with its affiliates;
9. not guarantee or become obligated for the debts of any other entity or hold
out its credit as being available to satisfy the obligations of others;
10. not acquire obligations or securities of its shareholders;
11. allocate fairly and reasonably any overhead for shared office space, if any;
12. use separate stationery, invoices and checks;
13. except as contemplated in this Agreement and the Master Agreement (as
defined in the Collection Agency Agreement) not pledge its assets for the
benefit of any other Person or make any loans or advances to any Person;
14. hold itself out as a separate entity;
15. correct any known misunderstanding regarding its separate identity;
16. maintain adequate capital in light of its contemplated business operations,
including an initial capital contribution by FII Holdings Inc. of $25,000;
17. ensure that its certificate of incorporation shall: (a) limit its corporate
purposes to the performance of its obligations under the Program Documents and
the Other Purchasers' Program Documents and activities incidental thereto; (b)
prohibit it from incurring Debt, other than in connection with the activities
described in (a); (c) require that it have at least one duly appointed
Independent Director; (d) require the unanimous consent of its directors to: (i)
institute bankruptcy or insolvency proceedings; (ii) dissolve, liquidate,
consolidate, merge, or sell all, or substantially all, of its assets, (iii)
engage in any activity other than that specified in (a) above, or (iv) amend its
certificate of incorporation; and (e) require that the directors consider the
interests of the Purchaser and creditors in connection with all corporate
actions;
18. not permit the Distributor or the Transferor to have any equity or other
ownership interest, direct or indirect, in it;
19. not conduct its daily business such that it requires management by any
other Federated Entity or other Person; and
20. not enter into any contract or agreement with any Person unless such Person
has agreed in writing not to institute any proceeding against the Seller of the
type referred to in Section 6.01(e) of the Purchase Agreement so long as there
shall not have elapsed one (1) year and one (1) day since any Share relating to
a Purchased Receivable shall be outstanding.
13620.148 #200982
2
EXHIBIT A
PURCHASE NOTICE
Citicorp North America, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Bankers Trust Company
Four ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Purchase and Sale Agreement dated as of
December 21, 2000 (the "Purchase Agreement") among
Federated Funding 1997-1, Inc., Federated Investors
Management Company, Federated Securities Corp.,
Federated Investors, Inc., Citibank, N.A. and
Citicorp North America, Inc., as program
AGENT
--------------------------------------------------------------
Pursuant to Section 2.02 of the above-referenced Purchase Agreement,
you are hereby notified that on _______________, 20__ (the "Purchase Date"), the
undersigned proposes, subject to the terms and conditions set forth in the
Purchase Agreement, to sell to Citibank, N.A. certain Receivables relating to
each of the Funds, in the amount of $_________. The Sale Cut-off Dates and the
Purchase Prices for such Receivables are set forth on Schedule I attached
hereto. The Purchase Prices for such Receivables have been computed as set forth
in Schedule II hereto. Capitalized terms used herein unless otherwise defined
herein shall have the meanings assigned to such terms in Appendix A to the
Purchase Agreement.
The undersigned certifies that the conditions precedent set forth in
Section 3.02 of the Purchase Agreement have been satisfied. The undersigned
represents that Schedule I hereto is true, correct and complete and accurately
describes the Receivables to be purchased by the Purchaser on the Purchase Date,
that each Receivable represents an entitlement to Asset Based Sales Charges and
Shareholder Servicing Fees at an annual rate of one percent (1%) per annum of
Net Asset Value.
FEDERATED FUNDING 1997-1, INC.
By:____________________________
Authorized Signatory
13620.148 #200982
2
SCHEDULE I TO EXHIBIT A
Purchase Period for each Fund __________________
Sale Cutoff Date for each Fund __________________
Total Issue Price
of Shares Related
Name to Receivables Purchase
of Fund to be Purchased Amount ($)
$------- $------- $-------
$------- $------- $-------
$-------- $-------
13620.148 #200982
7
SCHEDULE II TO EXHIBIT A
[CALCULATION OF PURCHASE PRICE FOR
THE RECEIVABLES RELATING TO EACH FUND]
EXHIBIT B-1
FEDERATED FUNDING
1997-1, INC.
Certificate
(Pursuant to Section 3.01(c) of the
Purchase and Sale Agreement)
I, the undersigned [Secretary] [Assistant Secretary] of Federated
Funding 1997-1, Inc., a Delaware corporation (the "Seller"), DO HEREBY CERTIFY
THAT:
1. This Certificate is furnished pursuant to Section 3.01(c) of that certain
Purchase and Sale Agreement dated as of December 21, 2000 (said Purchase and
Sale Agreement, as in effect on the date of this Certificate, being herein
called the "Purchase Agreement") among Federated Investors Management Company,
Federated Securities Corp., Federated Investor, Inc., the Seller, Citibank, N.A.
and Citicorp North America, Inc. Unless otherwise defined herein, capitalized
terms used in this Certificate shall have the meanings assigned to those terms
in Appendix A to the Purchase Agreement.
2. Attached hereto as Annex A is a copy of the Articles of Incorporation of
the Seller as in effect on the date hereof, certified by the Secretary of State
of Delaware.
3. Attached hereto as Annex B is a true and correct copy of the By-laws of the
Seller as in effect on the date hereof.
4. Attached hereto as Annex C is a true and correct copy of resolutions duly
adopted by unanimous consent of the Board of Directors of the Seller on _______,
20__ which resolutions have not been revoked, modified, amended or rescinded and
are still in full force and effect, and the Purchase Agreement, the Transferor's
Transfer Agreement, the Collection Agency Agreement, the Servicing Agreement and
the other Program Documents are in substantially the forms of those documents
submitted to, and approved by, the Board of Directors of the Seller.
5. The below-named persons have been duly elected and have duly qualified as,
and at all times since their appointment (to and including the date hereof) have
been, officers of the Seller, holding the respective offices below set opposite
their names, and the signatures below set opposite their names are their genuine
signatures:
NAME OFFICE SIGNATURE
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
WITNESS my hand as of this ____ day of _______________, 20__.
By:_______________________________
[Secretary][Assistant Secretary]
FEDERATED FUNDING 1997-1, INC.
I, the undersigned [President] [Vice President] of the Seller, DO
HEREBY CERTIFY that:
1. __________________ is the duly elected and qualified [Secretary]
[Assistant Secretary] of the Seller and the signature above is [his] [her]
genuine signature.
2. The Purchase Agreement and each other Program Document is subsisting and in
full force and effect on the date hereof.
3. The representations and warranties on the part of the Seller contained in the
Purchase Agreement and the other Program Documents to which the Seller is a
party are true and correct in all material respects at and as of the date hereof
as though made on and as of the date hereof.
4. The conditions precedent set forth in Article III of the Purchase Agreement
are fully satisfied and no Event of Termination (or event which with the passage
of time or notice, or both would constitute an Event of Termination) has
occurred and is continuing or would occur with the Purchase of Receivables
pursuant to the Purchase Agreement.
WITNESS my hand as of this ____ day of December __, 2000
By:____________________________
[President] [Vice President]
FEDERATED FUNDING 1997-1, INC.
13620.091 #201425
EXHIBIT B-2
FEDERATED SECURITIES CORP.
Certificate
(Pursuant to Section 3.01(c) of the
Purchase and Sale Agreement)
I, the undersigned [Secretary] [Assistant Secretary] of Federated
Securities Corp., a Pennsylvania Corporation (the "Distributor"), DO HEREBY
CERTIFY THAT:
1. This Certificate is furnished pursuant to Section 3.01(c) of that
certain Purchase and Sale Agreement dated as of December 21, 2000 (said Purchase
and Sale Agreement, as in effect on the date of this Certificate, being herein
called the "Purchase Agreement") among the Distributor, Federated Funding
1997-1, Inc., Federated Investors, Inc., Federated Investors Management Company,
Citibank, N.A. and Citicorp North America, Inc. Unless otherwise defined herein,
capitalized terms used in this Certificate shall have the meanings assigned to
those terms in Appendix A to the Purchase Agreement.
2. Attached hereto as Annex A is a copy of the Articles of Incorporation of the
Distributor as in effect on the date hereof, certified by the Secretary of State
of Pennsylvania.
3. Attached hereto as Annex B is a true and correct copy of the By-laws of
the Distributor as in effect on the date hereof.
4. Attached hereto as Annex C is a true and correct copy of resolutions duly
adopted by unanimous consent of the Board of Directors of the Distributor on
_______, 20__ which resolutions have not been revoked, modified, amended or
rescinded and are still in full force and effect, and the Purchase Agreement,
the Distributor's Transfer Agreement, the Collection Agency Agreement, the
Servicing Agreement and the other Program Documents are in substantially the
forms of those documents submitted to, and approved by, the Board of Directors
of the Distributor.
5. The below-named persons have been duly elected and have duly qualified as,
and at all times since their appointment (to and including the date hereof) have
been, officers of the Distributor, holding the respective offices below set
opposite their names, and the signatures below set opposite their names are
their genuine signatures:
NAME OFFICE SIGNATURE
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
WITNESS my hand as of this ____ day of _______________, 20__.
By:_______________________________
[Secretary][Assistant Secretary]
FEDERATED SECURITIES CORP.
I, the undersigned [President] [Vice President] of the Distributor,
DO HEREBY CERTIFY that:
1. __________________ is the duly elected and qualified [Secretary] [Assistant
Secretary] of the Distributor and the signature above is [his] [her] genuine
signature.
2. Each of the Purchase Agreement, the Servicing Agreement and each other
Program Document is subsisting and in full force and effect on the date hereof.
3. The representations and warranties on the part of the Distributor contained
in the Purchase Agreement and the other Program Documents to which the
Distributor is a party are true and correct in all material respects at and as
of the date hereof as though made on and as of the date hereof..
4. The conditions precedent set forth in Article III of the Purchase Agreement
are fully satisfied and no Event of Termination (or event which with the passage
of time or notice, or both would constitute an Event of Termination) has
occurred and is continuing or would occur with the Purchase of Receivables
pursuant to the Purchase Agreement.
WITNESS my hand as of this ____ day of December __, 2000
By:____________________________
[President] [Vice President]
FEDERATED SECURITIES CORP.
EXHIBIT B-3
FEDERATED INVESTORS,
INC.
Certificate
(Pursuant to Section 3.01(c) of the
Purchase and Sale Agreement)
I, the undersigned [Secretary] [Assistant Secretary] of Federated
Investors, Inc., a Pennsylvania corporation (the "Parent"), DO HEREBY CERTIFY
THAT:
1. This Certificate is furnished pursuant to Section 3.01(c) of that certain
Purchase and Sale Agreement dated as of December 21, 2000 (said Purchase and
Sale Agreement, as in effect on the date of this Certificate, being herein
called the "Purchase Agreement") among Federated Funding 1997-1, Inc., Federated
Securities Corp., the Parent, Federated Investors Management Company, Citibank,
N.A. and Citicorp North America, Inc. Unless otherwise defined herein,
capitalized terms used in this Certificate shall have the meanings assigned to
those terms in Appendix A to the Purchase Agreement.
2. Attached hereto as Annex A is a copy of the Articles of Incorporation of the
Parent as in effect on the date hereof, certified by the Secretary of State of
Pennsylvania.
3. Attached hereto as Annex B is a true and correct copy of the By-laws of the
Parent as in effect on the date hereof.
4. Attached hereto as Annex C is a true and correct copy of resolutions duly
adopted by unanimous consent of the Board of Directors of the Parent on _______,
20__ which resolutions have not been revoked, modified, amended or rescinded and
are still in full force and effect, and the Purchase Agreement and the other
Program Documents are in substantially the forms of those documents submitted
to, and approved by, the Board of Directors of the Parent.
5. The below-named persons have been duly elected and have duly qualified as,
and at all times since their appointment (to and including the date hereof) have
been, officers of the Parent, holding the respective offices below set opposite
their names, and the signatures below set opposite their names are their genuine
signatures:
NAME OFFICE SIGNATURE
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
WITNESS my hand as of this ____ day of _______________, 20__.
By:_______________________________
[Secretary][Assistant Secretary]
FEDERATED INVESTORS, INC.
I, the undersigned [President] [Vice President] of the Parent, DO
HEREBY CERTIFY that:
1. __________________ is the duly elected and qualified [Secretary] [Assistant
Secretary] of the Parent and the signature above is [his] [her] genuine
signature.
2. The Purchase Agreement and each other Program Document is subsisting and in
full force and effect on the date hereof.
3. The representations and warranties on the part of the Parent contained in the
Purchase Agreement and the other Program Documents to which the Parent is a
party are true and correct in all material respects at and as of the date hereof
as though made on and as of the date hereof.
4. The conditions precedent set forth in Article III of the Purchase Agreement
are fully satisfied and no Event of Termination (or event which with the passage
of time or notice, or both would constitute an Event of Termination) has
occurred and is continuing or would occur with the Purchase of Receivables
pursuant to the Purchase Agreement.
WITNESS my hand as of this ____ day of December __, 2000
By:____________________________
[President] [Vice President]
FEDERATED INVESTORS, INC.
13620.148 #200982
EXHIBIT B-4
FEDERATED INVESTORS
MANAGEMENT COMPANY
Certificate
(Pursuant to Section 3.01(c) of the
Purchase and Sale Agreement)
I, the undersigned [Secretary] [Assistant Secretary] of Federated
Investors Management Company, a Pennsylvania Corporation (the "Transferor"), DO
HEREBY CERTIFY THAT:
1. This Certificate is furnished pursuant to Section 3.01(c) of that certain
Purchase and Sale Agreement dated as of December 21, 2000 (said Purchase and
Sale Agreement, as in effect on the date of this Certificate, being herein
called the "Purchase Agreement") among Federated Funding 1997-1, Inc., Federated
Securities Corp., Federated Investors, Inc., the Seller, Citibank, N.A. and
Citicorp North America, Inc. Unless otherwise defined herein, capitalized terms
used in this Certificate shall have the meanings assigned to those terms in
Appendix A to the Purchase Agreement.
2. Attached hereto as Annex A is a copy of the [Articles of Incorporation] of
the Transferor as in effect on the date hereof, certified by the Secretary of
State of Pennsylvania.
3. Attached hereto as Annex B is a true and correct copy of the By-laws of the
Transferor as in effect on the date hereof.
4. Attached hereto as Annex C is a true and correct copy of resolutions duly
adopted by unanimous consent of the Board of Directors of the Transferor on
_______, 20__ which resolutions have not been revoked, modified, amended or
rescinded and are still in full force and effect, and the Purchase Agreement and
the other Program Documents are in substantially the forms of those documents
submitted to, and approved by, the Board of Directors of the Transferor.
5. The below-named persons have been duly elected and have duly qualified as,
and at all times since their appointment (to and including the date hereof) have
been, officers of the Transferor, holding the respective offices below set
opposite their names, and the signatures below set opposite their names are
their genuine signatures:
NAME OFFICE SIGNATURE
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
------------------- ------------------- -------------------
WITNESS my hand as of this ____ day of _______________, 20__.
By:_______________________________
[Secretary][Assistant Secretary]
FEDERATED INVESTORS MANAGEMENT COMPANY
I, the undersigned [President] [Vice President] of the Transferor,
DO HEREBY CERTIFY that:
1. __________________ is the duly elected and qualified [Secretary] [Assistant
Secretary] of the Transferor and the signature above is [his] [her] genuine
signature.
2. The Purchase Agreement and each other Program Document is subsisting and in
full force and effect on the date hereof.
3. The representations and warranties on the part of the Transferor contained in
the Purchase Agreement and the other Program Documents to which the Transferor
is a party are true and correct in all material respects at and as of the date
hereof as though made on and as of the date hereof.
4. The conditions precedent set forth in Article III of the Purchase Agreement
are fully satisfied and no Event of Termination (or event which with the passage
of time or notice, or both would constitute an Event of Termination) has
occurred and is continuing or would occur with the Purchase of Receivables
pursuant to the Purchase Agreement.
WITNESS my hand as of this ____ day of December __, 2000
By:____________________________
[President] [Vice President]
FEDERATED INVESTORS MANAGEMENT COMPANY
EXHIBIT C
FORM OF DISTRIBUTION AGREEMENT
EXHIBIT D
FORM OF PROSPECTUS
EXHIBIT E
FORM OF DISTRIBUTION PLAN
EXHIBIT F
FORM OF PRINCIPAL SHAREHOLDER SERVICER'S AGREEMENT
EXHIBIT G
FORM OF SHAREHOLDER SERVICER'S AGREEMENT
EXHIBIT H
ADDENDUM
Dated as of ________, ____
Reference is hereby made to that certain Purchase and Sale Agreement
dated as of December 21, 2000 (as from time to time amended, supplemented,
waived or modified, the "Purchase Agreement") among Federated Funding 1997-1,
Inc. (together with its permitted successors and assigns, the "Seller"),
Federated Investors Management Company (together with its permitted successors
and assigns, the "Transferor"), Federated Securities Corp. (the "Distributor"),
Federated Investors, Inc. (together with its permitted successors and assigns,
the "Parent"), Citibank, N.A. (together with its permitted successors and
assigns, the "Purchaser") and Citicorp North America, Inc., as program agent
(together with its permitted successors and assigns, the "Program Agent").
Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings assigned to such terms in the Purchase Agreement.
Pursuant to the terms of Section 2.03 of the Purchase Agreement, the
Seller hereby requests that effective as of the Addition Effective Date [INSERT
NAME OF FUND] a series of [INSERT NAME OF COMPANY], an Additional Eligible Fund,
become a "Fund" under and for all purposes of the Purchase Agreement [and that
[INSERT NAME OF COMPANY], an investment company registered with the SEC under
the Investment Company Act (the "Additional Company") become a "Company" under
and for all purposes of the Purchase Agreement.
On and as of the Addition Effective Date, (i) such Additional Fund
shall become a Fund under and for all purposes of the Program Documents, [and
the Additional Company shall constitute a Company under the Program Documents,]*
(ii) the Servicing Agreement and the other Program Documents shall be deemed to
be supplemented to reflect such addition, (iii) Annexes A, B, C, D and E to this
Addendum shall be deemed to be made a part of Exhibits C, D, E, F and G to the
Purchase Agreement, and (iv) any reference in the Purchase Agreement to any
change or modification since the date of the Purchase Agreement to the
Distribution Agreement, the Distribution Plan, the Advisory Agreement, the
Principal Shareholder Servicer's Agreement, the Shareholder Servicer's Agreement
or the Prospectus in respect of such Additional Fund shall be deemed to refer to
any change or modification thereof since the Addition Effective Date.
In addition, on and as of the Addition Effective Date, Schedule I to
the Purchase Agreement is hereby deemed supplemented to add the following
information under each heading:
--------------
* Insert if the investment company relating to the Additional Fund is not an
existing "Company" under the Purchase Agreement.
FUNDS SHARES
[INSERT NAME OF Class __
FUND]
COMPANIES
[INSERT NAME OF ADDITIONAL COMPANY]*
In addition, on and as of the Addition Effective Date, Schedule IV
to the Purchase Agreement is hereby deemed supplemented to add the following
information under each heading:
FUND FUNDAMENTAL INVESTMENT
----
OBJECTIVES AND POLICIES
Each of the Seller, the Distributor and the Parent represents and
warrants to the Program Agent and the Purchaser that, on and immediately after
the Addition Effective Date, (i) its representations and warranties contained in
Article IV of the Purchase Agreement are true and correct in all respects, (ii)
no Event of Termination (or event which with the passage of time or notice, or
both, would constitute an Event of Termination has occurred, and (iii) the
conditions precedent set forth in Article III to the Purchase Agreement are
satisfied.
The Addition Effective Date shall occur when (a) a counterpart hereof, signed by
each of the parties hereto, has been received by the Program Agent, and (b) the
other requirements described in Section 2.03 of the Purchase Agreement have been
fully satisfied.
FEDERATED FUNDING 1997-1, INC.
By:___________________________
Name:
Title:
FEDERATED INVESTORS MANAGEMENT COMPANY
By:___________________________
Name:
Title:
FEDERATED SECURITIES CORP.
By:__________________________
Name:
Title:
FEDERATED INVESTORS, INC.
By:__________________________
Name:
Title:
Acknowledged and Agreed to
as of the date first written above
CITIBANK, N.A.
By:__________________________
Name:
CITICORP NORTH AMERICA, INC.,
as Program Agent
By:__________________________
Name:
Title:
13620.148 #200982
ANNEX A to Exhibit H
DISTRIBUTION AGREEMENT OF ADDITIONAL FUND
ANNEX B to Exhibit H
PROSPECTUS OF ADDITIONAL FUND
ANNEX C to Exhibit H
DISTRIBUTION PLAN OF ADDITIONAL FUND
ANNEX D to Exhibit H
PRINCIPAL SHAREHOLDER SERVICER'S
AGREEMENT OF ADDITIONAL FUND
ANNEX E to Exhibit H
SHAREHOLDER SERVICER'S
AGREEMENT OF ADDITIONAL FUND
EXHIBIT I
FORM OF TAKE-OUT NOTICE
[Date]
Federated Funding 1997-1, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Pursuant to that certain Purchase and Sale Agreement dated as of
December 21, 2000 (as amended and supplemented, the "Purchase Agreement") among
Federated Funding 1997-1, Inc., Federated Investors Management Company,
Federated Securities Corp., Federated Investors, Inc., Citibank N.A. and the
undersigned Citicorp North America, Inc., we hereby deliver this Take-out Notice
advising you that the Purchaser completed a Take-out Transaction [stipulate
transaction]. The "Take-out Adjustment Amount" in connection with such Take-out
Transaction is $_________. Capitalized terms used herein and which are not
otherwise defined herein shall have the meanings assigned to such terms in the
Purchase Agreement.
Very truly yours,
CITICORP NORTH AMERICA, INC.,
as Program Agent
By:________________________
Authorized Signatory
Acknowledged and agreed as of the date first written above:
FEDERATED FUNDING 1997-1, INC.
By:_______________________
Authorized Signatory
13620.148 #200982
------------------------------------------------------------------------------
PURCHASE AND SALE AGREEMENT
Dated as of December 21, 2000
among
FEDERATED INVESTORS MANAGEMENT COMPANY,
as Transferor
FEDERATED SECURITIES CORP.,
as Distributor, Principal Shareholder Servicer and Servicer
FEDERATED FUNDING 1997-1, INC.,
as Seller
FEDERATED INVESTORS, INC.
as Parent
CITIBANK, N.A.,
as Purchaser
and
CITICORP NORTH AMERICA, INC.,
as Program Agent
------------------------------------------------------------------------------
[Type VII-C]
13620.148 #200982
iv
i
TABLE OF CONTENTS
PAGE
PURCHASE AND SALE AGREEMENT
Article I
DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. Definitions...................................................2
Article II
PURCHASE AND SALE OF RECEIVABLES; ADDITIONAL FUNDS
SECTION 2.01. Purchase of Receivables.......................................2
SECTION 2.02. Purchase Notices..............................................3
SECTION 2.03. Additional Funds, Etc.........................................3
Article III
CONDITIONS PRECEDENT
SECTION 3.01. Conditions Precedent to Effectiveness.........................4
SECTION 3.02. Conditions Precedent to the Purchaser's Obligation to Purchase
Receivables...................................................5
Article IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Seller, the Distributor,
the Transferor and the Parent.................................6
SECTION 4.02. Additional Representations and Warranties of the Parent......10
SECTION 4.03. Additional Representations and Warranties of the Distributor.11
SECTION 4.04. Additional Representations and Warranties of the Transferor..12
SECTION 4.05. Additional Representations and Warranties of the Seller......14
SECTION 4.06. Representations and Warranties of the Purchaser and the Program
Agent........................................................15
Article V
COVENANTS
SECTION 5.01. Covenants of the Seller, the Distributor, the Transferor
and the Parent...............................................15
SECTION 5.02. Additional Covenants of the Parent...........................19
SECTION 5.03. Additional Covenants of the Distributor......................23
SECTION 5.04. Additional Covenants of the Seller...........................24
SECTION 5.05. Additional Covenants of the Transferor.......................25
Article VI
EVENTS OF TERMINATION
SECTION 6.01. Events of Termination........................................25
Article VII
PARENT'S UNDERTAKINGS
SECTION 7.01. Undertakings; Payment of Damages.............................28
SECTION 7.02. Agreement Not Affected.......................................28
SECTION 7.03. Waiver of Notice; No Offset; No Subrogation..................28
Article VIII
THE PROGRAM AGENT
SECTION 8.01. Authorization and Action.....................................29
SECTION 8.02. Program Agent's Reliance, Etc................................29
SECTION 8.03. Indemnification..............................................30
Article IX
MISCELLANEOUS
SECTION 9.01. No Waiver; Rights and Remedies; Modifications in Writing.....30
SECTION 9.02. Payment......................................................31
SECTION 9.03. Notices, Etc.................................................31
SECTION 9.04. Costs and Expenses; Indemnification..........................32
SECTION 9.05. Taxes........................................................35
SECTION 9.06. Execution in Counterparts....................................37
SECTION 9.07. Binding Effect; Assignment...................................37
SECTION 9.08. Governing Law................................................38
SECTION 9.09. Severability of Provisions...................................38
SECTION 9.10. Confidentiality..............................................38
SECTION 9.11. Intent of Agreement..........................................39
SECTION 9.12. Liabilities to any Fund or any Company.......................39
SECTION 9.13. Entire Agreement.............................................40
SECTION 9.14. Assignee Rights; Take-out Transactions; Etc..................40
SECTION 9.15. Survival.....................................................40
SECTION 9.16. Continuing Obligations.......................................42
SECTION 9.17. Undertaking of the Parties...................................42
SECTION 9.18. Limited Liability............................................42
SECTION 9.19. No Proceedings...............................................42
APPENDIX A Definitions List
SCHEDULES
SCHEDULE I List of Companies, Funds and Shares
SCHEDULE II CDSCs
SCHEDULE III Transferable NASD Cap
SCHEUDLE IV Fundamental Investment Objectives
SCHEDULE V Form of Legend
SCHEDULE VI Bankruptcy Remote Covenants
EXHIBITS
EXHIBIT A Form of Purchase Notice
EXHIBIT B-1 Form of Seller's Certificate
EXHIBIT B-2 Form of Distributor's Certificate
EXHIBIT B-3 Form of Parent's Certificate
EXHIBIT B-4 Form of Transferor's Certificate
EXHIBIT C Form of Distribution Agreement
EXHIBIT D Form of Prospectus
EXHIBIT E Form of Distribution Plan
EXHIBIT F Form of Principal Shareholder Servicer's Agreement
EXHIBIT G Form of Shareholder Servicer's Agreement
EXHIBIT H Form of Addendum
EXHIBIT I Form of Take-out Notice
13620.148 #200982