EXHIBIT 10.21
FALCON AGREEMENT
Note: Certain information has been omitted pursuant to a request for
confidential treatment, and such confidential information has been filed
separately with the United States Securities and Exchange Commission.
XXXXXXXX RECEIVABLES CORPORATION
RECEIVABLES PURCHASE AGREEMENT
This Receivables Purchase Agreement dated as of November 14, 1996 is among
Xxxxxxxx Receivables Corporation, a Michigan corporation (the "Seller"), the
Investors, Falcon Asset Securitization Corporation ("Falcon") and The First
National Bank of Chicago, as Administrative Agent. Unless defined elsewhere
herein, capitalized terms used in this Agreement shall have the meanings
assigned to such terms in Exhibit I hereto.
PRELIMINARY STATEMENTS
The Seller desires to transfer and assign Receivable Interests to the
Purchasers from time to time.
Falcon may, in its absolute and sole discretion, purchase Receivable
Interests from the Seller from time to time.
The Investors shall, at the request of the Seller, purchase Receivable
Interests from time to time. In addition, the Investors have agreed to provide
a liquidity facility to Falcon.
The First National Bank of Chicago has been requested and is willing to act
as Administrative Agent on behalf of Falcon and the Investors in accordance with
the terms hereof.
ARTICLE I
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1. Purchase Facility. (a) Upon the terms and subject to the
conditions hereof, the Seller may, at its option, sell and assign Receivable
Interests to the Administrative Agent for the benefit of the Purchasers. Falcon
may, at its option, instruct the Administrative Agent to purchase on behalf of
Falcon, or if Falcon shall decline to purchase, the Administrative Agent shall
purchase on behalf of the Investors, Receivable Interests from time to time
during the period from the date hereof to but not including the Facility
Termination Date. The Seller hereby assigns, transfers and conveys to the
Administrative Agent for the benefit of the relevant Purchaser or Purchasers,
and the Administrative Agent hereby acquires all of the Seller's right, title
and interest in and to the Receivable Interests.
(b) The Seller may, upon at least five days' notice to the Administrative
Agent, terminate in whole or reduce in part ratably among the Investors the
unused portion of the
Purchase Limit; provided that each partial reduction of the Purchase Limit shall
be in an amount equal to $5,000,000 or an integral multiple thereof.
Section 1.2. Making Purchases. (a) The Seller shall provide the
Administrative Agent with a purchase notice, in substantially the form of
Exhibit IX hereto (each a "Purchase Notice"), at least three Business Days prior
to the date (the "Purchase Date") of each Incremental Purchase. A Purchase Date
may occur, in the case of a Dollar Purchase, on any Business Day prior to the
Facility Termination Date and, in the case of any DM Purchase, on the tenth
Business Day of any month prior to the Facility Termination Date. Each Purchase
Notice shall, except as set forth below, be irrevocable and shall specify the
requested (i) Purchase Price (which shall not be less than $2,000,000, or the
Dollar Equivalent thereof in the case of any DM Purchase), (ii) currency of such
Purchase Price, whether Dollars or Deutsche Marks, (iii) Purchase Date and (iv)
in the case of a Dollar Purchase, the duration of the initial Tranche Period and
the initial Discount Rate related thereto. Following receipt of a Purchase
Notice, the Administrative Agent will determine whether Falcon agrees to make
the purchase. If Falcon declines to make a proposed purchase, the Seller may
cancel the Purchase Notice or the Incremental Purchase of the Receivable
Interests will be made by the Investors.
(b) On the date of each Incremental Purchase, upon satisfaction of the
applicable conditions precedent set forth in Article IV, Falcon or each
Investor, as applicable, shall deposit to the Facility Account, in immediately
available funds and in the applicable currency, no later than 12:00 noon
(Chicago time), an amount equal to (i) in the case of Falcon, the aggregate
Purchase Price of each Receivable Interests Falcon is then purchasing or (ii) in
the case of an Investor, such Investor's Pro Rata Share of the aggregate
Purchase Price of each of the Receivable Interests the Investors are purchasing.
Section 1.3. Selection of Tranche Periods and Discount Rates. (a) Each
Receivable Interest shall at all times have an associated currency (whether
Dollars or Deutsche Marks), amount of Capital (in the applicable currency),
Discount Rate and Tranche Period applicable to it. Not less than $2,000,000 (or
the Dollar Equivalent thereof in the case of a Receivable Interest arising from
a DM Purchase) of Capital may be allocated to any single Receivable Interest.
(b) In the case of each Receivable Interest that shall have arisen by
reason of a Dollar Purchase, the Seller shall request Discount Rates and Tranche
Periods for such Receivable Interest in the manner described in this subsection
(b). The Seller may select the CP Rate, with the concurrence of the
Administrative Agent, or the Base Rate for the Receivable Interests of Falcon
and the LIBO Rate or the Base Rate for the Receivable Interests of the
Investors. With respect to each expiring Tranche Period, the Seller shall give
the Administrative Agent irrevocable notice of the new Tranche Period and
Discount Rate for the Receivable Interest associated with such expiring Tranche
Period, by 9:00 a.m. (Chicago time), (i) at least three Business Days prior to
the expiration of any then existing Tranche Period with respect to which the
LIBO Rate is being requested as a new Discount Rate, (ii) at least two Business
Days prior to the expiration of any then existing Tranche Period with respect to
which the CP Rate
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is being requested as a new Discount Rate and (iii) at least one Business Day
prior to the expiration of any Tranche Period with respect to which the Base
Rate is being requested as a new Discount Rate. The Administrative Agent shall
advise the Seller in any instance if the Tranche Period selected by the Seller
at any time is not acceptable to Falcon or the Investors, as applicable. If the
Seller fails to request timely a Discount Rate and/or a Tranche Period for any
Receivable Interest pursuant to the terms of this Section 1.3(b), or the Seller
and the Administrative Agent fail to agree on an acceptable duration for any
Tranche Period, the Discount Rate shall be the CP Rate (if Falcon is the
applicable Purchaser) or the Base Rate, in the Administrative Agent's sole
discretion, and the applicable Tranche Period shall be a period of one day
commencing on the day requested in the Purchase Notice or the last day of the
then expiring Tranche Period for such Receivable Interest, as applicable. Until
the Seller gives notice to the Administrative Agent of another Discount Rate,
the initial Discount Rate for any Receivable Interest transferred to the
Investors pursuant to Section 2.1 shall be the Base Rate.
(c) In the case of each Receivable Interest that shall have arisen by
reason of a DM Purchase, the applicable Tranche Periods and Discount Rates shall
be determined in accordance with this subsection (c). Each Tranche Period for
each such Receivable Interest shall be coextensive with a Fixed Exchange Period
unless the Administrative Agent shall otherwise agree. The Discount Rate in
respect of each Tranche Period shall be a rate per annum determined by the
Administrative Agent on or prior to the first day of such Tranche Period on the
basis of (i) the cost of Dollar funds procured by the Purchaser(s) to fund and
maintain such Receivable Interest and (ii) the currency hedging and exchange
arrangements procured by such Purchaser(s) in order to maintain such Receivable
Interest in Deutsche Marks.
(d) If any Investor notifies the Administrative Agent that it has
determined that (i) funding its Pro Rata Share of the Receivable Interests of
the Investors at a LIBO Rate or maintaining an appropriate currency hedge or
exchange arrangement for the purpose of maintaining any Receivable Interest that
shall have arisen by reason of a DM Purchase would violate any applicable law,
rule, regulation, or directive, whether or not having the force of law, (ii)
deposits of a type and maturity appropriate to match fund its Receivable
Interests at such LIBO Rate are not available or (iii) such LIBO Rate does not
accurately reflect the cost of acquiring or maintaining a Receivable Interest at
such LIBO Rate, then the Administrative Agent shall suspend the availability of
such LIBO Rate and require the Seller to select a new Discount Rate for any
Receivable Interest accruing Discount at such LIBO Rate.
(e) If any Purchaser notifies the Administrative Agent that it shall not
be able to make or participate in the making of any DM Purchase then being
requested hereunder, or to maintain an appropriate currency hedge or exchange
arrangement for the purpose of maintaining any Receivable Interest that shall
have arisen from a DM Purchase or for the purpose of converting any Collections
denominated in Deutsche Marks into Dollars, in any such case whether because (i)
the introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for such Purchaser to do so or to convert
Dollar funds into Deutsche Marks in order to do so, (ii) any material disruption
shall have occurred in the credit, currency or foreign exchange markets
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in the United States or Germany (whether by reason of act of God, war,
governmental intervention, strike, power or communications system failure or
natural disaster) or (iii) any other event or condition beyond the reasonable
control of the Purchaser, then the Administrative Agent shall suspend the
availability of DM Purchases and in any such event the Purchasers shall
thereafter not have any obligation to make or fund any DM Purchase. Upon its
receipt of any such notice, the Administrative Agent shall declare the
Liquidation Day in respect of all Receivable Interests that shall have arisen by
reason of a DM Purchase.
Section 1.4. Percentage Evidenced by Receivable Interests. Each Receivable
Interest and its corresponding Currency Allocation Percentage shall be initially
computed on its date of purchase. Thereafter, until its Liquidation Day, each
Receivable Interest and Currency Allocation Percentage shall be automatically
recomputed (or deemed to be recomputed) on each day prior to its Liquidation
Day. The variable percentage represented by any Receivable Interest and its
corresponding Currency Allocation Percentage, in each case as computed (or
deemed recomputed) as of the close of business on the day immediately preceding
its Liquidation Day, shall remain constant at all times after such Liquidation
Day.
Section 1.5. Dividing or Combining Receivable Interests. The Seller or
the Administrative Agent may, upon notice to and consent by the other received
at least three Business Days prior to the end of a Tranche Period for any
Receivable Interest, take any of the following actions with respect to such
Receivable Interest: (i) divide the Receivable Interest into two or more
Receivable Interests having aggregate Capital equal to the Capital of such
divided Receivable Interest, (ii) combine the Receivable Interest with another
Receivable Interest with a Tranche Period ending on the same day, creating a new
Receivable Interest having Capital equal to the Capital of the two Receivable
Interests combined or (iii) combine the Receivable Interest with a Receivable
Interest to be purchased on such day by such Purchaser, creating a new
Receivable Interest having Capital equal to the Capital of the two Receivable
Interests combined, provided that, a Receivable Interest of Falcon may not be
combined with a Receivable Interest of the Investors and a Receivable Interest
that shall have arisen from a Dollar Purchase shall not be combined with a
Receivable Interest that shall have arisen from a DM Purchase.
Section 1.6. Reinvestment Purchases. At any time that any Collection or
Collections are received by the Servicer after the initial purchase of a
Receivable Interest hereunder and on or prior to the Liquidation Day of such
Receivable Interest, the Seller hereby requests and, upon the terms and subject
to the conditions hereof, the Purchasers hereby agree to make, simultaneously
with such receipt, a reinvestment (each a "Reinvestment") with that portion of
each and every Collection received by the Servicer that is part of such
Receivable Interest, such reinvestment being in Receivables that shall have been
acquired by the Seller pursuant to the Xxxxxxxx Transfer Agreement since the
date of the last purchase or Reinvestment hereunder. Until the Administrative
Agent shall otherwise direct, Collections denominated in Dollars shall be
applied to a Reinvestment in respect of a Receivable Interest the Capital of
which is denominated in Dollars and Collections denominated in Deutsche Marks
shall be applied to a Reinvestment in respect of a Receivable Interest
denominated in Deutsche Marks. The making of a Reinvestment shall not, of
itself, cause any increase or decrease in, or otherwise affect, the
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Capital associated with any Receivable Interest. If, and to the extent, on any
day the Seller shall have insufficient Receivables for the purpose of
accommodating the Reinvestment of all Collections received on such day in the
applicable currency, the Servicer shall set aside and hold in trust for the
holder of each Receivable Interest such Collections until the earlier of (i) the
next date on which the Seller shall acquire Receivables in such currency and
shall be capable of accommodating a Reinvestment of such Collections and (ii)
the next following date that is the last day of any Tranche Period for a
Receivable Interest in such currency.
Section 1.7. Liquidation Settlement Procedures. (a) On the Liquidation
Day of a Receivable Interest and on each day thereafter, the Servicer shall set
aside and hold in trust for the holder of such Receivable Interest all
Collections received on such day that shall be denominated in the currency in
which the Capital of such Receivable Interest is denominated; provided that if
there shall be more than one Receivable Interest at such time the Capital of
which is denominated in such currency, then the Servicer shall set aside and
hold in trust for the holder or holders of the Receivable Interest that are then
liquidating their respective Currency Allocation Percentage of such Collections
received on such day. On the last day of each Tranche Period of a Receivable
Interest after the occurrence of its Liquidation Day, the Servicer shall remit
to the Administrative Agent's account the amounts set aside pursuant to the
preceding sentence, together with any remaining amounts set aside pursuant to
Section 1.8 prior to such day, in each case (unless the Administrative Agent
shall otherwise agree) in the currency in which such Collections shall have been
received or deemed received; provided that the aggregate amount remitted on any
day in respect of any Receivable Interest shall not exceed the sum of (i) the
accrued Discount for such Receivable Interest, (ii) the Capital of such
Receivable Interest, and (iii) the aggregate of all other amounts then owed
hereunder by Seller to the Purchasers.
(b) If there shall be insufficient funds on deposit for the Servicer
to distribute funds in payment in full of the aforementioned amounts, the
Servicer shall distribute funds first, to reimbursement of the Administrative
Agent's costs of collection and enforcement of this Agreement, second, in
payment of all accrued Discount for the Receivable Interests, third, in
reduction of the Capital of the Receivable Interests, and fourth, in payment of
all other amounts payable to the Purchasers. Notwithstanding any rule pertaining
to the application of Collections set forth in this Section 1.7, the
Administrative Agent may, at any time and in its discretion, allocate
Collections in one currency to a Receivable Interest denominated in another
currency. Collections allocated to the Receivable Interests of the Investors
shall be shared ratably by the Investors in accordance with their Pro Rata
Shares. Collections applied to the payment of fees, expenses, Discount and all
other amounts payable by the Seller to the Administrative Agent and the
Purchasers hereunder shall be allocated ratably among the Administrative Agent
and the Purchasers in accordance with such amounts owing to each of them.
Following the date on which the Aggregate Unpaids are reduced to zero, the
Servicer shall pay to Seller any remaining Collections set aside and held by the
Servicer pursuant to this Section 1.7.
Section 1.8. Deemed Collections. If on any day the Outstanding Balance of a
Receivable is either (x) reduced as a result of any defective or rejected goods
or services, any cash discount or any adjustment by the Seller, any Designated
Servicer or either Originator, or (y) reduced
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or cancelled as a result of a setoff in respect of any claim by any Person
(whether such claim arises out of the same or a related transaction or an
unrelated transaction), the Seller shall be deemed to have received on such day
a Collection of such Receivable in the amount of such reduction or cancellation
and in the currency of such Receivable. If on any day any of the representations
or warranties in Article III are no longer true with respect to a Receivable,
the Seller shall be deemed to have received on such day a Collection of such
Receivable in full in the applicable currency. If the Seller receives any
Collections or is deemed to receive Collections pursuant to this Section 1.8 or
otherwise, the Seller shall immediately pay such Collections or deemed
Collections to the Servicer and, at all times prior to such payment, such
Collections shall be held in trust by the Seller for the exclusive benefit of
the Purchasers and the Administrative Agent.
Section 1.9. Discount; Payments and Computations, Etc. (a) Discount shall
accrue for each Receivable Interest for each day occurring during the Tranche
Period for such Receivable Interest. On the last day of each Tranche Period the
Seller shall pay to the Administrative Agent an amount equal to the accrued and
unpaid Discount for such Tranche Period.
(b) Notwithstanding any limitation on recourse contained in this Agreement,
the Seller shall pay to the Administrative Agent, for the account of the
relevant Purchasers, such fees as set forth in the Fee Letter (which fees shall
be sufficient to pay the Investor Fees), all amounts payable as Discount, all
amounts payable pursuant to Article VIII, if any, all Servicer costs, if any,
payable pursuant to Section 6.2 and on demand therefor, any Early Collection
Fee. If any Person fails to pay any amount when due hereunder, such Person
agrees to pay, on demand, the Default Fee.
(c) All amounts to be paid or deposited by any Person hereunder shall be
paid or deposited in accordance with the terms hereof no later than 12:00 noon
(Chicago time) on the day when due in immediately available funds; if such
amounts are payable to a Purchaser they shall be paid to the Administrative
Agent, for the account of such Purchaser, at (i) in the case of any Dollar-
denominated amount, Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 and (ii)
in the case of any Deutsche Xxxx-denominated amount, Niederlassung, Frankfurt,
Germany, BLZ 503 304 00, in each case until otherwise notified by the
Administrative Agent. Upon notice to the Seller, the Administrative Agent may
debit the Facility Account for all amounts due and payable hereunder. Except as
otherwise provided herein, all computations of Discount and per annum fees
hereunder and under the Fee Letter shall be made on the basis of a year of 360
days for the actual number of days elapsed (including the first but excluding
the last day). All per annum fees shall be payable monthly in arrears. If any
amount hereunder shall be payable on a day which is not a Business Day, such
amount shall be payable on the next succeeding Business Day.
(d) Where appropriate, the Administrative Agent may designate whether any
of the foregoing fees or other amounts shall be payable in Dollars or Deutsche
Marks. In the event, for any reason, (i) payment on any obligation shall be
remitted to the Administrative Agent or any Purchaser in a currency other than
the currency designated by the Administrative Agent or
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(ii) Collections in one currency are allocated to a Receivable Interest
denominated in another currency pursuant to Section 1.7(b), then the
Administrative Agent shall convert such payment or such Collections into such
other currency using such hedging arrangements and markets as shall then be
available to the Administrative Agent and as shall have been selected by the
Administrative Agent in its sole discretion and the payment of such obligation
or the application of such Collections to such Receivable Interest shall be
deemed to have occurred only to the extent of the amount of such other currency
received by the Administrative Agent or the applicable Purchaser after giving
effect to such conversion.
Section 1.10. Capital Limit. The Seller shall ensure that the Aggregate
Capital at no time exceeds the Capital Limit. If on the Liquidation Day of a
Receivable Interest or on any day on which the Coverage Exchange Rate is to be
determined in accordance with the definition thereof, the Aggregate Capital
exceeds the Capital Limit, the Seller shall immediately pay to the
Administrative Agent an amount in Dollars or Deutsche Marks (as the
Administrative Agent may direct) to be applied to reduce the Capital of the
Receivable Interests, such that after giving effect to such payment the
Aggregate Capital does not exceed the Capital Limit. Such amount shall be
applied to the reduction of the Capital of the Receivable Interests in the
applicable currency. Any amounts received by the Investors pursuant to the
preceding sentence shall be applied ratably in accordance with their Pro Rata
Shares.
Section 1.11. Seller's Extinguishment. The Seller shall have the right,
on three (3) Business Days' written notice to the Administrative Agent, at any
time following the Facility Termination Date and the reduction of the Aggregate
Capital to a level that is less than ten percent (10%) of the Purchase Limit in
effect on the date hereof, to repurchase from the Purchasers all, and not part,
of the then outstanding Receivable Interests. The purchase price in respect
thereof shall be an amount equal to the Aggregate Unpaids (which amount shall
include, without limitation, any Early Collection Fee that shall arise in
connection with such repurchase) through the date of such repurchase, payable in
immediately available funds. Such repurchase shall be without representation,
warranty or recourse of any kind by, on the part of or against any Purchaser or
the Administrative Agent.
Section 1.12. Extensions of the Liquidity Termination Date. The Seller
may, by written notice (an "Extension Request") given to the Administrative
Agent not later than sixty days prior to the Liquidity Termination Date then in
effect, request that such Liquidity Termination Date be extended. Each such
Extension Request shall contemplate an extension of the Liquidity Termination
Date then in effect to a date that is a Business Day not more than 364 days
after such Liquidity Termination Date. The Administrative Agent shall promptly
advise each Purchaser of its receipt of any Extension Request. Each Purchaser
may, in its sole discretion, consent to a requested extension by giving written
notice thereof to the Administrative Agent by not later than the date that is 30
days prior to the Liquidity Termination Date then in effect. Failure on the
part of any Purchaser to respond to an Extension Request by such date shall be
deemed to be a denial of such request by such Purchaser. If all of the
Purchasers shall consent in writing to a requested extension, such request shall
be granted and the requested
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extension shall become effective on the Liquidity Termination Date then
otherwise in effect. No extension granted under this Section 1.12 shall exceed a
period of 364 days.
ARTICLE II
LIQUIDITY FACILITY
Section 2.1. Transfer to Investors. Each Investor hereby agrees, subject
to Section 2.4, that immediately upon written notice from Falcon delivered on or
prior to the Liquidity Termination Date, it shall acquire by assignment from
Falcon, without recourse or warranty, its Pro Rata Share of one or more of the
Receivable Interests of Falcon as specified by Falcon. Each Investor shall
promptly pay to the Administrative Agent at an account designated by the
Administrative Agent, for the benefit of Falcon, its Acquisition Amount in
Dollars. Unless an Investor has notified the Administrative Agent that it does
not intend to pay its Acquisition Amount, the Administrative Agent may assume
that such payment has been made and may, but shall not be obligated to, make the
amount of such payment available to Falcon in reliance upon such assumption.
Falcon hereby sells and assigns to the Administrative Agent for the ratable
benefit of the Investors, and the Administrative Agent hereby purchases and
assumes from Falcon, effective upon the receipt by Falcon of the Falcon Transfer
Price, the Receivable Interests of Falcon which are the subject of any transfer
pursuant to this Article II.
Section 2.2. Transfer Price Reduction Discount. If the Adjusted
Liquidity Price is included in the calculation of the Falcon Transfer Price for
any Receivable Interest, each Investor agrees that the Administrative Agent
shall pay to Falcon the Reduction Percentage of any Discount received by the
Administrative Agent with respect to such Receivable Interest.
Section 2.3. Payments to Falcon. In consideration for the reduction of
the Falcon Transfer Prices by the Falcon Transfer Price Reductions, effective
only at such time as the aggregate amount of the Capital of the Receivable
Interests of the Investors equals the Falcon Residual, each Investor hereby
agrees that the Administrative Agent shall not distribute to the Investors and
shall immediately remit to Falcon any Discount, Collections or other payments
received by it to be applied pursuant to the terms hereof or otherwise to reduce
the Capital of the Receivable Interests of the Investors.
Section 2.4. Limitation on Commitment to Purchase from Falcon.
Notwithstanding anything to the contrary in this Agreement, no Investor shall
have any obligation to purchase any Receivable Interest from Falcon, pursuant to
Section 2.1 or otherwise, if:
(i) Falcon shall have voluntarily commenced any proceeding or filed
any petition under any bankruptcy, insolvency or similar law seeking the
dissolution, liquidation or reorganization of Falcon or taken any corporate
action for the purpose of effectuating any of the foregoing; or
(ii) involuntary proceedings or an involuntary petition shall have
been commenced or filed against Falcon by any Person under any bankruptcy,
insolvency or similar law
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seeking the dissolution, liquidation or reorganization of Falcon and such
proceeding or petition shall have not been dismissed.
Section 2.5. Defaulting Investors. If one or more Investors defaults in
its obligation to pay its Acquisition Amount pursuant to Section 2.1 (each such
Investor shall be called a "Defaulting Investor" and the aggregate amount of
such defaulted obligations being herein called the "Falcon Transfer Price
Deficit"), then upon notice from the Administrative Agent, each Investor other
than the Defaulting Investors (a "Non-Defaulting Investor") shall promptly pay
to the Administrative Agent, in immediately available Dollar funds, an amount
equal to the lesser of (x) such Non-Defaulting Investor's proportionate share
(based upon the relative Commitments of the Non-Defaulting Investors) of the
Falcon Transfer Price Deficit and (y) the unused portion of such Non-Defaulting
Investor's Commitment. A Defaulting Investor shall forthwith upon demand pay to
the Administrative Agent for the account of the Non-Defaulting Investors all
amounts paid by each Non-Defaulting Investor on behalf of such Defaulting
Investor, together with interest thereon, for each day from the date a payment
was made by a Non-Defaulting Investor until the date such Non-Defaulting
Investor has been paid such amounts in full, at a rate per annum equal to the
Federal Funds Effective Rate plus 2%. In addition, without prejudice to any
other rights that Falcon may have under applicable law, each Defaulting Investor
shall pay to Falcon forthwith upon demand, the difference between such
Defaulting Investor's unpaid Acquisition Amount and the amount paid with respect
thereto by the non-Defaulting Investors, together with interest thereon, for
each day from the date of the Administrative Agent's request for such Defaulting
Investor's Acquisition Amount pursuant to Section 2.1 until the date the
requisite amount is paid to Falcon in full, at a rate per annum equal to the
Federal Funds Effective Rate plus 2%.
Section 2.6. Hedging Arrangements. The Administrative Agent and Falcon
shall take such actions as are reasonably necessary to cause Falcon's rights and
interest in each hedging or exchange arrangement entered into in connection with
a Receivable Interest to be transferred to the Investors upon the transfer by
Falcon of such Receivable Interest to the Investors. Following the purchase by
the Investors of any Receivable Interest hereunder, whether under Section 1.2 or
2.1, the Administrative Agent shall facilitate the procurement by the Investors
of hedging and exchange arrangements in connection with the funding and
maintenance of Receivable Interests by the Investors.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Seller Representations and Warranties. The Seller hereby
represents and warrants to the Purchasers that:
(a) Corporate Existence and Power. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of its state of
incorporation, and has all corporate
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power and all governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its business is
conducted.
(b) No Conflict. The execution, delivery and performance by the Seller of
this Agreement and each other Transaction Document to which it is a party, and
the Seller's use of the proceeds of purchases made hereunder, are within its
corporate powers, have been duly authorized by all necessary corporate action,
do not contravene or violate (i) its certificate or articles of incorporation or
by-laws, (ii) any law, rule or regulation applicable to it, (iii) any
restrictions under any agreement, contract or instrument to which it is a party
or by which it or any of its property is bound, or (iv) any order, writ,
judgment, award, injunction or decree binding on or affecting it or its
property, and do not result in the creation or imposition of any Adverse Claim
on assets of the Seller (except created hereunder); and no transaction
contemplated hereby requires compliance with any bulk sales act or similar law.
This Agreement and each other Transaction Document has been duly authorized,
executed and delivered by the Seller.
(c) Governmental Authorization. Other than the filing of the financing
statements required hereunder, no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by the Seller of the
Transaction Documents.
(d) Binding Effect. The Transaction Documents to which the Seller is a
party constitute the legal, valid and binding obligations of the Seller
enforceable against the Seller in accordance with their respective terms, except
as such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or limiting creditors' rights
generally.
(e) Accuracy of Information. All information heretofore furnished by the
Seller or any of its Affiliates to the Administrative Agent or the Purchasers
for purposes of or in connection with this Agreement, any of the other
Transaction Documents, or any transaction contemplated hereby or thereby is, and
all such information hereafter furnished by the Seller to the Purchasers will
be, true and accurate in every material respect, on the date such information is
stated or certified and does not and will not contain any material misstatement
of fact or omit to state a material fact or any fact necessary to make the
statements contained therein not misleading.
(f) Use of Proceeds. No proceeds of any purchase hereunder will be used
(i) for a purpose which violates, or would be inconsistent with, Regulation G,
T, U or X promulgated by the Board of Governors of the Federal Reserve System
from time to time or (ii) to acquire any security in any transaction which is
subject to Section 13 or 14 of the Securities Exchange Act of 1934, as amended.
(g) Title to Receivables Purchased from Originators. Each Receivable
transferred (i) by Hohe to Xxxxxxxx has been purchased by Xxxxxxxx from Hohe in
accordance with the terms of the Hohe Transfer Agreement, and Xxxxxxxx has
thereby irrevocably obtained all legal and
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equitable title to, and has the legal right to sell, such Receivable and the
Related Security to the Seller, and (ii) by Xxxxxxxx to the Seller has been
purchased by the Seller from Xxxxxxxx in accordance with the terms of the
Xxxxxxxx Transfer Agreement, and the Seller has thereby irrevocably obtained all
legal and equitable title to, and has the legal right to sell, such Receivable,
the Related Security and the Hohe Discount. Each such Receivable has been
transferred to Xxxxxxxx and to the Seller, as applicable, free and clear of any
Adverse Claim. Without limiting the foregoing, there has been duly filed all
financing statements or other similar instruments or documents, and there has
been duly taken all other actions, necessary under the UCC (and any comparable
law in the United States, Germany, Canada, Belgium, Spain, Sweden or any other
country in which an Obligor of an Eligible Receivable may be located) of all
applicable jurisdictions to perfect Xxxxxxxx'x and the Seller's, as applicable,
ownership interest in such Receivable, the Related Security and the Hohe
Discount.
(h) Good Title; Perfection. Immediately prior to each purchase hereunder,
the Seller shall be the legal and beneficial owner of the Receivables, Related
Security with respect thereto and the Hohe Discount, free and clear of any
Adverse Claim, except as created by the Transaction Documents. This Agreement is
effective to, and shall, upon each purchase hereunder, transfer to the relevant
Purchaser or Purchasers (and such Purchaser or Purchasers shall acquire from the
Seller) a valid and perfected first priority undivided percentage ownership
interest in each Receivable existing or hereafter arising and in the Related
Security, the Hohe Discount and Collections with respect thereto, free and clear
of any Adverse Claim, except as created by the Transactions Documents.
(i) Places of Business. The principal places of business and chief
executive office of the Seller and the offices where the Seller keeps all its
Records are located at the address(es) listed on Exhibit II or such other
locations notified to the Administrative Agent in accordance with Section 5.2(a)
in jurisdictions where all action required by Section 5.2(a) has been taken and
completed. The Seller's Federal Employer Identification Number is correctly set
forth on Exhibit II.
(j) Collection Banks; etc. Except as otherwise notified to the
Administrative Agent in accordance with Section 5.2(b), (i) the Seller has
instructed, or has caused the Originators to instruct, all Obligors to pay all
Collections directly to a lock-box listed on Exhibit III or, in the case of
wire-transfers on Deutsche Xxxx-denominated Receivables, to the concentration
account therefor specified on Exhibit III, (ii) proceeds from any such lock-
boxes are deposited directly by a Collection Bank into a concentration account
or a depository account listed on Exhibit III, (iii) the names and addresses of
all Collection Banks, together with the account numbers of the Collection
Accounts of the Seller at each Collection Bank, are listed on Exhibit III, and
(iv) each lock-box and Collection Account to which Collections are remitted is
subject to a Collection Account Agreement that is in full force and effect. In
the case of lock-boxes and Collection Accounts identified on Exhibit III which
were established by an Originator or by any Person other than the Seller,
exclusive dominion and control thereof has been transferred to the Seller. The
Seller has not granted any Person, other than the Administrative Agent as
contemplated by this Agreement, dominion and control of any lock-box or
Collection Account, or the right to
Page 11
take dominion and control of any lock-box or Collection Account at a future time
or upon the occurrence of a future event.
(k) Material Adverse Effect. Since June 29, 1996, no event has occurred
which would have a Material Adverse Effect.
(l) Names. In the past five years, the Seller has not used any corporate
names, trade names or assumed names other than those listed on Exhibit II.
(m) Actions, Suits. There are no actions, suits or proceedings pending,
or to the knowledge of the Seller threatened, against or affecting the Seller or
either Originator, or any of the respective properties of the Seller or either
Originator, in or before any court, arbitrator or other body, which are
reasonably likely to (i) adversely affect the collectibility of a material
portion of the Receivables, (ii) materially adversely affect the financial
condition of the Seller or such Originator or (iii) materially adversely affect
the ability of the Seller or such Originator to perform its obligations under
the Transaction Documents. Neither the Seller nor either Originator is in
default with respect to any order of any court, arbitrator or governmental body.
(n) Coverage. The Aggregate Capital does not exceed the Capital Limit.
(o) Credit and Collection Policies. With respect to each Receivable, each
of the applicable Originator, the Seller and the Designated Servicer has
complied in all material respects with the Credit and Collection Policy. Except
as otherwise permitted under this Agreement, the Credit and Collection Policy
has not been amended or modified in any material respect since the date of this
Agreement.
(p) Payments to Originator. With respect to (i) each Receivable
transferred to Xxxxxxxx under the Hohe Transfer Agreement, and (ii) each
Receivable transferred to the Seller under the Xxxxxxxx Transfer Agreement,
Xxxxxxxx or the Seller, as applicable, has given reasonably equivalent value to
the applicable Originator in consideration for such transfer of such Receivable
and the Related Security with respect thereto and the Hohe Discount under the
applicable Transfer Agreement and such transfer was not made for or on account
of an antecedent debt. No transfer by either Originator of any Receivable is or
may be voidable under any Section of the Bankruptcy Reform Act of 1978 (11
U.S.C. (S)(S) 101 et seq.), as amended or under any law, rule or regulation in
effect in Germany or any other country in which any Obligor on any Receivable
may be located, or any political subdivision thereof or jurisdiction therein,
whether relating to bankruptcy, insolvency, reorganization, creditors' rights or
otherwise.
(q) Ownership of the Seller. Xxxxxxxx owns, directly or indirectly, one
hundred percent (100%) of the issued and outstanding capital stock of the
Seller. Such capital stock is validly issued, fully paid and nonassessable and
there are no options, warrants or other rights to acquire securities of the
Seller.
Page 12
(r) Subsidiaries. The Seller has no Subsidiaries.
(s) Not an Investment Company. The Seller is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended from time
to time, or any successor statute.
Section 3.2. Investor Representations and Warranties. Each Investor
hereby represents and warrants to the Administrative Agent and Falcon that:
(a) Existence and Power. Such Investor is a corporation or a banking
association duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation or organization, and has all corporate
power to perform its obligations hereunder.
(b) No Conflict. The execution, delivery and performance by such Investor
of this Agreement are within its corporate powers, have been duly authorized by
all necessary corporate action, do not contravene or violate (i) its certificate
or articles of incorporation or association or by-laws, (ii) any law, rule or
regulation applicable to it, (iii) any restrictions under any agreement,
contract or instrument to which it is a party or any of its property is bound,
or (iv) any order, writ, judgment, award, injunction or decree binding on or
affecting it or its property, and do not result in the creation or imposition of
any Adverse Claim on its assets. This Agreement has been duly authorized,
executed and delivered by such Investor.
(c) Governmental Authorization. No authorization or approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and performance by
such Investor of this Agreement.
(d) Binding Effect. This Agreement constitutes the legal, valid and
binding obligation of such Investor enforceable against such Investor in
accordance with its terms, except as such enforcement may be limited by
applicable bankruptcy, insolvency, reorganization or other similar laws relating
to or limiting creditors' rights generally.
ARTICLE IV
CONDITIONS OF PURCHASES
Section 4.1. Conditions Precedent to Initial Purchase. The initial
purchase of a Receivable Interest under this Agreement is subject to the
conditions precedent that the Administrative Agent shall have received on or
before the date of such purchase those documents listed on Schedule A hereto.
Page 13
Section 4.2. Conditions Precedent to All Purchases and Reinvestments.
Each purchase of a Receivable Interest (other than pursuant to Section 2.1) and
each Reinvestment shall be subject to the further conditions precedent that (a)
in the case of each such purchase, the Servicer shall have delivered to the
Administrative Agent on or prior to the date of such purchase, in form and
substance satisfactory to the Administrative Agent, all Settlement Reports as
and when due under Section 6.5; (b) on the date of each such purchase or
Reinvestment, the following statements shall be true both before and after
giving effect to such Reinvestment (and acceptance of the proceeds of such
purchase or Reinvestment shall be deemed a representation and warranty by the
Seller that such statements are then true):
(i) the representations and warranties set forth in Article III are
correct on and as of the date of such purchase or Reinvestment
as though made on and as of such date;
(ii) no event has occurred, or would result from such purchase or
Reinvestment, that will constitute a Servicer Default, and no
event has occurred and is continuing, or would result from such
purchase or Reinvestment, that would constitute a Potential
Servicer Default;
(iii) the Liquidity Termination Date shall not have occurred, the
Aggregate Capital shall not exceed the Purchase Limit, and the
Aggregate Capital shall not exceed the Capital Limit; and
(iv) in the case of any DM Purchase or any Reinvestment for a
Receivable Interest that shall have arisen from a DM Purchase,
the applicable Purchaser(s) shall have obtained hedging and
currency arrangements in connection therewith reasonably
satisfactory to such Purchaser(s).
and (c) the Administrative Agent shall have received such other approvals,
opinions or documents as it may reasonably request.
ARTICLE V
COVENANTS
Section 5.1. Affirmative Covenants of Seller. Until the date on which
the Aggregate Unpaids have been indefeasibly paid in full, the Seller hereby
covenants, individually and in its capacity as Servicer, that:
(a) Financial Reporting. The Seller will maintain a system of accounting
established and administered in accordance with generally accepted accounting
principles, and furnish to the Administrative Agent:
(i) Annual Reporting. Within 90 days after the close of each of its
fiscal years, financial statements for such fiscal year certified in a
manner acceptable to the Administrative Agent by the chief financial
officer of the Seller.
Page 14
(ii) Quarterly Reporting. If so requested by the Administrative
Agent, within 45 days after the close of the first three quarterly periods
of each of its fiscal years, balance sheets as at the close of each such
period and statements of income and retained earnings and a statement of
cash flows for the period from the beginning of such fiscal year to the end
of such quarter, all certified by its chief financial officer.
(iii) Compliance Certificate. Together with the financial statements
required hereunder, a compliance certificate in substantially the form of
Exhibit IV signed by the Seller's corporate comptroller or chief financial
officer and dated the date of such annual financial statement or such
quarterly financial statement, as the case may be.
(iv) Shareholders Statements and Reports. Promptly upon the
furnishing thereof to the shareholders of the Seller, copies of all
financial statements, reports and proxy statements so furnished.
(v) Change in Credit and Collection Policy. At least 30 days prior
to the effectiveness of any material change in or amendment to the Credit
and Collection Policy, a copy of the Credit and Collection Policy then in
effect and a notice indicating such change or amendment.
(vi) Notices under Transaction Documents. Forthwith upon its receipt
of any notice, request for consent, financial statements, certification,
report or other communication under or in connection with any Transaction
Document from any Person other than the Administrative Agent or any
Purchaser, copies of the same.
(vii) Other Information. Such other information (including non-
financial information) as the Administrative Agent or any Purchaser may
from time to time reasonably request.
(b) Notices. The Seller will notify the Administrative Agent in writing of
any of the following immediately upon learning of the occurrence thereof,
describing the same and, if applicable, the steps being taken with respect
thereto:
(i) Servicer Defaults or Potential Servicer Defaults. The occurrence
of each Servicer Default or each Potential Servicer Default, by a statement
of the corporate comptroller or senior financial officer of the Seller.
(ii) Judgment. The entry of any judgment or decree against the
Seller.
(iii) Litigation. The institution of any litigation, arbitration
proceeding or governmental proceeding against the Seller or to which the
Seller becomes party.
(iv) Xxxxxxxx Credit Rating. The introduction of, or any change in,
any publicly announced or privately issued indicative credit rating by
Standard & Poor's Ratings
Page 15
Services, a division of the XxXxxx-Xxxx Companies, Inc., Xxxxx'x Investors
Service, Inc., the National Association of Insurance Commissioners or any
other nationally recognized rating agency or similar organization with
respect to any indebtedness or obligations of Xxxxxxxx at any time that
Xxxxxxxx is performing any servicing responsibilities in respect of the
Receivables.
(c) Compliance with Laws. The Seller will comply in all material respects
with all applicable laws, rules, regulations, orders writs, judgments,
injunctions, decrees or awards to which it may be subject.
(d) Audits. The Seller will furnish to the Administrative Agent from time
to time such information with respect to it and the Receivables as the
Administrative Agent may reasonably request. The Seller shall, from time to time
during regular business hours as requested by the Administrative Agent upon
reasonable notice, permit the Administrative Agent, or its agents or
representatives (and shall cause each Originator to permit the Administrative
Agent or its agents or representatives), (i) to examine and make copies of and
abstracts from all Records in the possession or under the control of the Seller
or such Originator relating to Receivables and the Related Security, including,
without limitation, the related Contracts, and (ii) to visit the offices and
properties of the Seller or such Originator for the purpose of examining such
materials described in clause (i) above, and to discuss matters relating to the
Seller's or such Originator's financial condition or the Receivables and the
Related Security or the Seller's performance hereunder, or such Originator's
performance under any of the other Transaction Documents, or the Seller's or
such Originator's performance under the Contracts with any of the officers or
employees of the Seller or such Originator having knowledge of such matters.
(e) Keeping and Marking of Records and Books; Notation in Financial
Statements.
(i) The Seller will, and will cause each Originator to, maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing Receivables in the
event of the destruction of the originals thereof), and keep and maintain
all documents, books, records and other information reasonably necessary or
advisable for the collection of all Receivables (including, without
limitation, records adequate to permit the immediate identification of each
new Receivable and all Collections of and adjustments to each existing
Receivable). The Seller will, and will cause each Originator to, give the
Administrative Agent notice of any material change in the administrative
and operating procedures referred to in the previous sentence.
(ii) The Seller will, and will cause each Originator to, (a) on or
prior to the date hereof, xxxx its master data processing records and other
books and records relating to the Receivable Interests with a legend,
acceptable to the Administrative Agent, describing the Receivable Interests
or, in the case of Hohe, the ownership interest of Xxxxxxxx and the Seller
in the "Purchased Receivables" under and as defined in the Hohe Transfer
Page 16
Agreement and (b) upon the request of the Administrative Agent at any time
following the replacement of the Seller as the Servicer hereunder, deliver
to the Administrative Agent all Contracts (including, without limitation,
all multiple originals of any such Contract) relating to the Receivables.
(iii) The Seller will note in its financial statements that
Receivable Interests have been sold to the Purchasers hereunder, and will
cause (a) Xxxxxxxx to note in its financial statements that its Receivables
have been sold to the Seller and (b) Hohe to note in its financial
statements that the "Purchased Receivables" under and as defined in the
Hohe Transfer Agreement have been sold to Xxxxxxxx.
(f) Compliance with Contracts and Credit and Collection Policy. The
Seller will, and will cause each Originator to, timely and fully (i) perform and
comply in all material respects with all provisions, covenants and other
promises required to be observed by it under the Contracts related to the
Receivables, and (ii) comply in all material respects with the Credit and
Collection Policy in regard to each Receivable and the related Contract. The
Seller will, and will cause each Originator to, pay when due any taxes payable
in connection with the Receivables.
(g) Purchase of Receivables from Originators. With respect to each
Receivable purchased under a Transfer Agreement, the Seller shall take (or shall
cause the applicable Originator to take) all actions necessary to vest legal and
equitable title to such Receivable, the Related Security and the Hohe Discount
irrevocably in the Seller, including, without limitation, the filing of all
financing statements or other similar instruments or documents necessary under
the UCC (and any comparable law in the United States, Germany, Canada, Belgium,
Spain, Sweden or any other country in which an Obligor of an Eligible Receivable
may be located) of all applicable jurisdictions to perfect the Seller's interest
in such Receivable and such other action to perfect, protect or more fully
evidence the interest of the Seller as the Administrative Agent may reasonably
request.
(h) Ownership Interest. The Seller shall take all necessary action to
establish and maintain a valid and perfected first priority undivided percentage
ownership interest in the Receivables, the Related Security, the Hohe Discount
and Collections with respect to any of the foregoing, to the full extent
contemplated herein, in favor of the Administrative Agent and the Purchasers,
including, without limitation, taking such action to perfect, protect or more
fully evidence the interest of the Administrative Agent and the Purchasers
hereunder as the Administrative Agent may reasonably request.
(i) Payment to the Originators. With respect to any Receivable purchased
by the Seller from Xxxxxxxx, such sale shall be effected under, and in strict
compliance with the terms of, the Xxxxxxxx Transfer Agreement, including,
without limitation, the terms relating to the amount and timing of payments to
be made to Xxxxxxxx in respect of the purchase price for such Receivable. With
respect to any Receivable purchased by Xxxxxxxx from Hohe, the Seller shall
cause Xxxxxxxx to effect such sale under, and in strict compliance with the
terms of, the Hohe
Page 17
Transfer Agreement, including, without limitation, the terms relating to the
amount and timing of payments to be made to Hohe in respect of the purchase
price for such Receivable.
(j) Performance and Enforcement of Transfer Agreements. The Seller shall
timely perform the obligations required to be performed by the Seller, and shall
vigorously enforce the rights and remedies accorded to the Seller, under each
Transfer Agreement. The Seller shall take all actions to perfect and enforce its
rights and interests (and the rights and interests of the Purchasers and the
Administrative Agent, as assignees of the Seller) under each Transfer Agreement
as the Administrative Agent may from time to time reasonably request, including,
without limitation, making claims to which it may be entitled under any
indemnity, reimbursement or similar provision contained in either Transfer
Agreement.
(k) Purchasers' Reliance. The Seller acknowledges that the Purchasers are
entering into the transactions contemplated by this Agreement in reliance upon
the Seller's identity as a legal entity that is separate from Xxxxxxxx, Hohe and
other Affiliates of the Seller. Therefore, from and after the date of execution
and delivery of this Agreement, the Seller shall take all reasonable steps
including, without limitation, all steps that the Administrative Agent or any
Purchaser may from time to time reasonably request to maintain the Seller's
identity as a separate legal entity and to make it manifest to third parties
that the Seller is an entity with assets and liabilities distinct from those of
its Affiliates and not just a division of any such Affiliate. Without limiting
the generality of the foregoing and in addition to the other covenants set forth
herein, the Seller shall:
(i) conduct its own business in its own name and require that all
full-time employees of the Seller identify themselves as such and not as
employees of any of its Affiliates (including, without limitation, by means
of providing appropriate employees with business or identification cards
identifying such employees as the Seller's employees);
(ii) compensate all employees, consultants and agents directly, from
the Seller's bank accounts, for services provided to the Seller by such
employees, consultants and agents and, to the extent any employee,
consultant or agent of the Seller is also an employee, consultant or agent
of an Affiliate of the Seller, allocate the compensation of such employee,
consultant or agent between the Seller and such Affiliate on a basis which
reflects the services rendered to the Seller and such Affiliate; provided,
however, that the Seller may enter into written agreements with any
Affiliate which allow such Affiliate to pay any employee, consultant or
agent on behalf of the Seller provided the Seller agrees to reimburse such
Affiliate for its allocable share of such payment;
(iii) (A) maintain office space separate and apart from that of any of
its Affiliates (even if such office space is subleased from or is on or
near premises occupied by any of its Affiliates), (B) clearly identify its
offices (by signage or otherwise) as its offices, (C) own or lease pursuant
to written leases all office furniture and equipment necessary
Page 18
to operate its business and (D) have a separate telephone number, which
will be answered only in its name and separate stationery, invoices and
checks in its own name;
(iv) conduct all transactions with each of its Affiliates (including,
without limitation, any delegation of its obligations hereunder as
Servicer) strictly on an arm's-length basis, and allocate all overhead
expenses (including, without limitation, telephone and other utility
charges) for items shared between the Seller and such Affiliate on the
basis of actual use to the extent practicable and, to the extent such
allocation is not practicable, on a basis reasonably related to actual use;
(v) at all times have at least one member of its Board of Directors
and one officer who (A) meets the qualifications set forth in the Michigan
Compiled Laws Annotated (S) 450.1107(3), as in effect on the date hereof,
(B) is not a customer or supplier of the Seller or any of its Affiliates
and (C) is not a shareholder (whether direct, indirect or beneficial)
holding more than 1% of the oustanding stock of any Affiliate;
(vi) observe all corporate formalities as a distinct entity, ensure
that all corporate actions are duly authorized by unanimous vote of its
Board of Directors, and maintain the Seller's books and records separate
from those of each of its Affiliates and otherwise readily identifiable as
its own assets rather than assets of any of its Affiliates;
(vii) prepare its financial statements separately from those of its
Affiliates and ensure that any consolidated financial statements of either
Originator or any Affiliate thereof that include the Seller have detailed
notes clearly stating that the Seller is a separate corporate entity and
that its assets will be available first and foremost to satisfy the claims
of the creditors of the Seller;
(viii) except as herein specifically otherwise provided, not
commingle funds or other assets of the Seller with those of any of its
Affiliates and not maintain bank accounts or other depository accounts to
which any of its Affiliates is an account party, into which any of its
Affiliates makes deposits or from which any of its Affiliates has the power
to make withdrawals;
(ix) not permit any of its Affiliates to pay any of its operating
expenses (except pursuant to allocation arrangements that comply with the
requirements of this Section 5.1(k));
(x) refrain from paying dividends or making distributions, loans or
other advances to any of its Affiliates (except that, commencing after
October 15, 1997, dividends which are duly authorized by its Board of
Directors and are in compliance with applicable law may be payable no more
than once each calendar year so long as (i) such dividend is payable after
October 15 of such year and (ii) no event has occurred and is continuing,
or would result from such dividend, which constitutes a Servicer Default or
Potential Servicer Default);
Page 19
(xi) refrain from filing or otherwise initiating or supporting the
filing of a motion in any bankruptcy or other insolvency proceedings
involving the Seller, Donnelly, Hohe, or any other Affiliate of Seller, to
substantively consolidate the Seller with any such Affiliate;
(xii) refrain from (A) guaranteeing any obligation of any of its
Affiliates (B) having its obligations guaranteed by any of its Affiliates,
(C) holding itself out as responsible for debts of any of its Affiliates or
for the decisions or actions with respect to the affairs of any of its
Affiliates, and (D) being directly or indirectly named as a direct or
contingent beneficiary or loss payee on any insurance policy covering the
property of any Affiliate; and
(xiii) maintain in place all policies and procedures, and take and
continue to take all action, described in the facts and assumptions set
forth in the opinion letter issued by Xxxxxx Xxxxxxxxx Xxxxxxx and Xxxxxxx
LLP of even date herewith relating to true sale and substantive
consolidation issues, and in any certificates accompanying such opinion
letter.
(l) Collections. The Seller shall instruct (or cause the applicable
Originators to instruct) all Obligors to pay all Collections directly to a lock-
box listed on Exhibit III or, in the case of wire-transfers on Deutsche Xxxx-
denominated Receivables, to the concentration account therefor specified on
Exhibit III. In the case of payments remitted to any such lock-box, the Seller
shall cause all proceeds from such lock-box to be deposited directly by a
Collection Bank into a concentration account or a depositary account listed on
Exhibit III. The Seller shall maintain exclusive dominion and control (subject
to the terms of this Agreement) to each such lock-box, concentration account and
depositary account. In the case of any Collections received by the Seller or an
Originator, the Seller shall remit (or shall cause such Originator to remit)
such Collections to a Collection Account not later than the Business Day
immediately following the date of receipt of such Collections, and, at all times
prior to such remittance, the Seller shall itself hold (or, if applicable, shall
cause such Originator to hold) such Collections in trust, for the exclusive
benefit of the Purchasers and the Administrative Agent.
(m) Minimum Net Worth. The Seller shall at all times maintain a net
worth of not less than $2,850,000.
(n) German Credit and Collection Policy. By no later than the date
which is 90 days from the date hereof, the Seller shall deliver to the
Administrative Agent a written credit and collection policy, in form and
substance satisfactory to the Administrative Agent, summarizing its credit and
collection policies and practices relating to Deutsche Xxxx-denominated
Receivables and Contracts related thereto.
Section 5.2. Negative Covenants of Seller. Until the date on which the
Aggregate Unpaids have been indefeasibly paid in full, the Seller hereby
covenants, individually and in its capacity as Servicer, that:
Page 20
(a) Name Change, Offices, Records and Books of Accounts. The Seller will
not change its name, identity or corporate structure (within the meaning of
Section 9-402(7) of any applicable enactment of the UCC) or relocate its chief
executive office or any office where Records are kept unless it shall have: (i)
given the Administrative Agent at least 45 days prior notice thereof and (ii)
delivered to the Administrative Agent all financing statements, instruments and
other documents reasonably requested by the Administrative Agent in connection
with such change or relocation.
(b) Change in Payment Instructions to Obligors. The Seller will not add
or terminate any bank as a Collection Bank from those listed in Exhibit III, or
make any change in its instructions to Obligors regarding payments to be made to
the Seller or payments to be made to any lock-box, Collection Account or
Collection Bank, unless the Administrative Agent shall have received, at least
10 days before the proposed effective date therefor, (i) written notice of such
addition, termination or change and (ii) with respect to the addition of a lock-
box, Collection Account or Collection Bank, an executed account agreement and an
executed Collection Account Agreement from such Collection Bank relating
thereto; provided, however, that the Seller may make changes in instructions to
Obligors regarding payments if such new instructions require such Obligor to
make payments to another existing lock-box or Collection Account that is subject
to a Collection Account Agreement then in effect.
(c) Modifications to Contracts and Credit and Collection Policy. The
Seller will not make any change to the Credit and Collection Policy which would
be reasonably likely to adversely affect the collectibility of any material
portion of the Receivables or decrease the credit quality of any newly created
Receivables. Except as provided in Section 6.2(c), the Seller, acting as
Servicer or otherwise, will not extend, amend or otherwise modify the terms of
any Receivable or any Contract related thereto other than in accordance with the
Credit and Collection Policy.
(d) Sales, Liens, Etc. The Seller shall not sell, assign (by operation of
law or otherwise) or otherwise dispose of, or grant any option with respect to,
or create or suffer to exist any Adverse Claim upon (including, without
limitation, the filing of any financing statement) or with respect to, any
Receivable, Related Security, Hohe Discount or Collections in respect thereof,
or upon or with respect to any Contract under which any Receivable arises, or
any lock-box or Collection Account or assign any right to receive income in
respect thereof (other than, in each case, the creation of the interests therein
in favor of the Administrative Agent and the Purchasers provided for herein),
and the Seller shall defend the right, title and interest of the Administrative
Agent and the Purchasers in, to and under any of the foregoing property, against
all claims of third parties claiming through or under the Seller or either
Originator.
(e) Nature of Business; Other Agreements; Other Indebtedness. The Seller
shall not engage in any business or activity of any kind or enter into any
transaction or indenture, mortgage, instrument, agreement, contract, lease or
other undertaking other than the transactions contemplated and authorized by
this Agreement and the Transfer Agreements. Without limiting the generality of
the foregoing, the Seller shall not create, incur, guarantee, assume or suffer
Page 21
to exist any indebtedness or other liabilities, whether direct or contingent,
other than (i) as a result of the endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business, (ii) the incurrence of obligations under this Agreement or as
expressly contemplated in the Xxxxxxxx Transfer Agreement to make payment to
Xxxxxxxx for the purchase of Receivables thereunder and (iii) the incurrence of
operating expenses in the ordinary course of business of the type otherwise
contemplated in Section 5.1(k) of this Agreement.
(f) Amendments to Transfer Agreements. The Seller shall not, without the
prior written consent of the Administrative Agent, (i) cancel or terminate
either Transfer Agreement, (ii) give any consent, waiver, directive or approval
under either Transfer Agreement, (iii) waive any default, action, omission or
breach under either Transfer Agreement, or otherwise grant any indulgence
thereunder, or (iv) amend, supplement or otherwise modify any of the terms of
either Transfer Agreement.
(g) Amendments to Corporate Documents. The Seller shall not amend its
Certificate of Incorporation or By-Laws in any respect that would impair its
ability to comply with the terms or provisions of any of the Transaction
Documents, including, without limitation, Section 5.1(k) of this Agreement.
(h) Merger. The Seller shall not merge or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one transaction or
in a series of transactions, and except as otherwise contemplated herein) all or
substantially all of its assets (whether now owned or hereafter acquired) to, or
acquire all or substantially all of the assets of, any Person.
(i) Subsidiaries. The Seller shall not establish, create, acquire or
permit to exist any Subsidiary.
(j) Deposits. The Seller shall not deposit or otherwise credit, and shall
not permit an Originator or any other Person to deposit or otherwise credit, to
any lock-box or Collection Account any cash or payment item other than
Collections. Notwithstanding the foregoing, Hohe may, from time to time until
the Administrative Agent shall otherwise direct in a written notice to the
Seller, instruct its Obligors to remit payments on receivables, including
receivables that do not constitute "Receivables" under this Agreement, to one or
more of the lock-boxes or concentration accounts identified on Exhibit III;
provided that (i) each such lock-box and concentration account shall be in the
name of, and under the exclusive dominion and control of, the Seller, and (ii)
at all such times a written agreement among the Seller and the Originators,
satisfactory in form and substance to the Administrative Agent, shall be in
effect setting forth the procedures implemented for the identification and
allocation of collections on such receivables as among the Seller and the
Originators.
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ARTICLE VI
ADMINISTRATION AND COLLECTION
Section 6.1. Designation of Servicer. (a) The servicing, administration
and collection of the Receivables shall be conducted by such Person (the
"Servicer") so designated from time to time in accordance with this Section 6.1.
The Seller is hereby designated as, and hereby agrees to perform the duties and
obligations of, the Servicer pursuant to the terms of this Agreement. The
Administrative Agent may, and at the direction of the Required Investors shall,
at any time following the occurrence of a Servicer Default, designate as
Servicer any Person to succeed the Seller or any successor Servicer.
(b) The Seller is permitted to delegate, and the Seller hereby advises the
Purchasers and the Administrative Agent that it has delegated, to each
Originator, as a subservicer of the Servicer, certain of its duties and
responsibilities as Servicer hereunder in respect of the Receivables transferred
by such Originator to Xxxxxxxx or the Seller, as applicable. Notwithstanding the
foregoing, (i) the Seller shall be and remain primarily liable to the
Administrative Agent and the Purchasers for the full and prompt performance of
all duties and responsibilities of the Servicer hereunder and (ii) the
Administrative Agent and the Purchasers shall be entitled to deal exclusively
with the Seller in matters relating to the discharge by the Servicer of its
duties and responsibilities hereunder, and the Administrative Agent and the
Purchasers shall not be required to give notice, demand or other communication
to any Person other than the Seller in order for communication to the Servicer
and its respective delegates and subservicers in respect thereof to be
accomplished. The Seller, at all times that it is the Servicer, shall be
responsible for providing its delegates and subservicers with any notice given
under this Agreement.
(c) Without the prior written consent of the Required Investors, (i) the
Seller shall not be permitted to delegate any of its duties or responsibilities
as Servicer to any Person other than an Originator, and then such delegation
shall be limited to the activities of Servicer hereunder as the same may relate
to the Receivables originated by such Originator, and (ii) no Originator shall
be permitted to further delegate to any other Person any of the duties or
responsibilities of the Servicer delegated to it by the Seller. If at any time
the Administrative Agent shall designate as Servicer any Person other than the
Seller, all duties and responsibilities theretofore delegated by the Seller to
either Originator may, at the discretion of the Administrative Agent, be
terminated forthwith on notice given by the Administrative Agent to the Seller.
Section 6.2. Duties of Servicer. (a) The Servicer shall take or cause to
be taken all such actions as may be necessary or advisable to collect each
Receivable from time to time, all in accordance with applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Credit and Collection Policy.
(b) The Servicer shall administer the Collections in accordance with the
procedures described herein and in Article I. The Servicer shall set aside and
hold in trust for the account of the Seller and the Purchasers their respective
shares of the Collections of Receivables in
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accordance with Section 1.7. The Servicer shall upon the request of the
Administrative Agent after the occurrence of a Liquidation Day, segregate, in a
manner acceptable to the Administrative Agent, all cash, checks and other
instruments received by it from time to time constituting Collections from the
general funds of the Servicer or the Seller prior to the remittance thereof in
accordance with Section 1.7. If the Servicer shall be required to segregate
Collections pursuant to the preceding sentence, the Servicer shall segregate and
deposit with a bank designated by the Administrative Agent such allocable share
of Collections of Receivables set aside for the Purchasers on the first Business
Day following receipt by the Servicer of such Collections, duly endorsed or with
duly executed instruments of transfer.
(c) The Servicer, may, in accordance with the Credit and Collection
Policy, extend the maturity of any Receivable or adjust the Outstanding Balance
of any Receivable as the Servicer may determine to be appropriate to maximize
Collections thereof; provided, however, that such extension or adjustment shall
not alter the status of such Receivable as a Delinquent Receivable or Defaulted
Receivable or limit the rights of the Administrative Agent or the Purchasers
under this Agreement. Notwithstanding anything to the contrary contained herein,
the Administrative Agent shall have the absolute and unlimited right to direct
the Servicer to commence or settle any legal action with respect to any
Receivable or to foreclose upon or repossess any Related Security.
(d) The Servicer shall hold in trust for the Seller and the Purchasers, in
accordance with their respective Receivable Interests, all Records that evidence
or relate to the Receivables, the related Contracts and Related Security or that
are otherwise necessary or desirable to collect the Receivables and shall, as
soon as practicable upon demand of the Administrative Agent, deliver or make
available to the Administrative Agent all such Records, at a place selected by
the Administrative Agent. The Servicer shall, as soon as practicable following
receipt thereof, turn over to the Seller (i) that portion of Collections of
Receivables representing the Seller's undivided fractional ownership interest
therein, less, in the event the Seller is not the Servicer, all reasonable out-
of-pocket costs and expenses of the Servicer of servicing, administering and
collecting the Receivables, and (ii) any cash collections or other cash proceeds
received with respect to Indebtedness not constituting Receivables. The Servicer
shall, from time to time at the request of any Purchaser, furnish to the
Purchasers (promptly after any such request) a calculation of the amounts set
aside for the Purchasers pursuant to Section 1.7.
(e) Any payment by an Obligor in respect of any indebtedness owed by it to
the Seller shall, except as otherwise specified by such Obligor or otherwise
required by contract or law and unless otherwise instructed by the
Administrative Agent, be applied as a Collection of any Receivable of such
Obligor (starting with the oldest such Receivable) to the extent of any amounts
then due and payable thereunder before being applied to any other receivable or
other obligation of such Obligor.
Section 6.3. Collection Notices. The Administrative Agent is authorized
at any time to date and to deliver (and, at the direction of the Required
Investors, the Administrative Agent shall date and deliver) to the Collection
Banks, a Collection Notice under any Collection
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Account Agreement. The Seller hereby transfers to the Administrative Agent for
the benefit of the Purchasers, effective when the Administrative Agent delivers
such notice, the exclusive ownership and control of the Collection Accounts. In
case any authorized signatory of the Seller whose signature appears on a
Collection Account Agreement shall cease to have such authority before the
delivery of such Collection Notice, such Collection Notice shall nevertheless be
valid as if such authority had remained in force. The Seller hereby authorizes
the Administrative Agent, and agrees that the Administrative Agent shall be
entitled to (i) endorse the Seller's (or, under authority granted to the Seller
under either Transfer Agreement, an Originator's) name on checks and other
instruments representing Collections, (ii) enforce the Receivables, the related
Contracts and the Related Security and (iii) take such action as shall be
necessary or desirable to cause all cash, checks and other instruments
constituting Collections of Receivables to come into the possession of the
Administrative Agent rather than the Seller or an Originator.
Section 6.4. Responsibilities of the Seller. Anything herein to the
contrary notwithstanding, the exercise by the Administrative Agent and the
Purchasers of their rights hereunder shall not release the Servicer or the
Seller from any of their duties or obligations with respect to any Receivables
or under the related Contracts. The Purchasers shall have no obligation or
liability with respect to any Receivables or related Contracts, nor shall any of
them be obligated to perform the obligations of the Seller.
Section 6.5. Reports. On or before the seventh Business Day of each month
and at such other times as the Administrative Agent shall reasonably request,
the Servicer shall prepare and forward to the Administrative Agent (i) a
Settlement Report as of the end of the immediately preceding fiscal month of
Xxxxxxxx and (ii) if requested by the Administrative Agent, a listing by Obligor
of all Receivables together with an aging of such Receivables.
ARTICLE VII
SERVICER DEFAULTS
The occurrence of any one or more of the following events shall constitute
a Servicer Default:
(a) Any Designated Servicer or the Seller shall fail (i) to make any
payment or deposit required hereunder when due and such failure shall remain
unremedied for one Business Day, (ii) to perform or observe in any material
respect any term, covenant or agreement hereunder relating to the Receivables,
the Related Security, the Hohe Discount or the Collections or (iii) to perform
or observe in any material respect any term, covenant or agreement hereunder
(other than as referred to in clause (i) or (ii) of this paragraph (a)) and such
failure shall remain unremedied for five Business Days.
(b) Any representation, warranty, certification or statement made by the
Seller, any Designated Servicer or either Originator in this Agreement, any
other Transaction Document or
Page 25
in any other document delivered pursuant hereto shall prove to have been
incorrect in any material respect when made or deemed made.
(c)(i) The Seller, any Designated Servicer or either Originator 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 (ii) any proceeding shall be instituted by or
against the Seller, any Designated Servicer (other than Xxxxxxxx) or Hohe
seeking to adjudicate it bankrupt or insolvent, or seeking liquidation, winding
up, reorganization, arrangement, adjustment, protection, relief or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee or other similar official for it or
any substantial part of its property; or (iii) any proceeding shall be
instituted by or against Xxxxxxxx seeking to adjudicate it bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee or other similar official for it or any substantial part of its property
unless (A) such proceeding is instituted against Xxxxxxxx and is being contested
by Xxxxxxxx in good faith and by appropriate proceedings, (B) within two
Michigan business days of the institution of such proceeding Xxxxxxxx shall have
obtained a court order (which may include an interim order) satisfactory to the
Administrative Agent and the Required Investors authorizing the continued
transfer of "Receivables", "Related Assets" and "Collections" under the Xxxxxxxx
Transfer Agreement and Receivable Interests hereunder in the manner (and with
the effect) contemplated herein following commencement of such proceeding and
granting protection to the Seller and the Purchasers against subsequent
avoidance or subordination of such transfers by the trustee or any other Person
in connection with such proceeding and (C) such proceeding shall be dismissed
within 30 days of the institution thereof; or (iv) the Seller, any Designated
Servicer or either Originator shall take any corporate action to authorize any
of the actions set forth in clause (i) or (iii) above in this subsection (c);
(d) As at the end of any calendar month, the Delinquency Ratio shall have
exceeded 10% for two consecutive months.
(e) As at the end of any calendar month, the Loss-to-Liquidation Ratio
shall exceed 1%.
(f) Either Originator (i) shall fail to perform or observe in any material
respect any term, covenant or agreement contained in any other Transaction
Document, after giving effect to any grace period therefor, or (ii) shall for
any reason cease to transfer, or cease to have the legal capacity or otherwise
be incapable of transferring, Receivables to the applicable transferee under any
Transfer Agreement to which it is party, any "Termination Event" or "Potential
Termination Event" shall occur under the Xxxxxxxx Transfer Agreement, or any
"German Servicer Default" or "Potential German Servicer Default" shall occur
under the Hohe Transfer Agreement.
(g) A Change of Control shall occur.
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ARTICLE VIII
INDEMNIFICATION
Section 8.1. Indemnities by the Seller. Without limiting any other
rights which the Administrative Agent or any Purchaser may have hereunder or
under applicable law, the Seller hereby agrees to indemnify the Administrative
Agent and each Purchaser and their respective officers, directors, agents and
employees (each an "Indemnified Party") from and against any and all damages,
losses, claims, taxes, liabilities, costs, expenses and for all other amounts
payable, including reasonable attorneys' fees (which attorneys may be employees
of the Administrative Agent or such Purchaser) and reasonable disbursements (all
of the foregoing being collectively referred to as "Indemnified Amounts")
awarded against or incurred by any of them arising out of or as a result of this
Agreement or the acquisition, either directly or indirectly, by a Purchaser of
an interest in the Receivables, excluding, however:
(i) Indemnified Amounts to the extent final judgment of a court of
competent jurisdiction holds such Indemnified Amounts resulted from gross
negligence or willful misconduct on the part of the Indemnified Party
seeking indemnification;
(ii) Indemnified Amounts to the extent the same includes losses in
respect of Eligible Receivables which are uncollectible on account of the
insolvency, bankruptcy or lack of creditworthiness of the related Obligor;
or
(iii) taxes imposed by the jurisdiction in which such Indemnified
Party's principal executive office is located, on or measured by the
overall net income of such Indemnified Party to the extent that the
computation of such taxes is consistent with the Intended Characterization;
provided, however, that nothing contained in this sentence shall limit the
liability of the Seller or the Servicer or limit the recourse of the Purchasers
to the Seller or Servicer for amounts otherwise specifically provided to be paid
by the Seller or the Servicer under the terms of this Agreement. Without
limiting the generality of the foregoing indemnification, the Seller shall
indemnify the Administrative Agent and the Purchasers for Indemnified Amounts
(including, without limitation, losses in respect of uncollectible receivables,
regardless of whether reimbursement therefor would constitute recourse to the
Seller or the Servicer) relating to or resulting from:
(i) any representation or warranty made by the Seller, either
Originator or the Servicer (or any officers of the Seller,
either Originator or the Servicer) under or in connection with
this Agreement, any other Transaction Document, any Settlement
Report or any other information or report delivered by the
Seller, either Originator or the Servicer pursuant hereto or
thereto, which shall have been false or incorrect when made or
deemed made;
Page 27
(ii) the failure by the Seller, either Originator or the Servicer
to comply with any applicable law, rule or regulation with
respect to any Receivable or Contract related thereto, or the
nonconformity of any Receivable or Contract included therein
with any such applicable law, rule or regulation or the
failure of the Seller, either Originator or the Servicer to
timely and fully comply with any provision, covenant or other
promise required to be observed by it under any Contract;
(iii) any failure of the Seller, either Originator or the Servicer
to perform its duties or obligations in accordance with the
provisions of this Agreement or any other Transaction
Document;
(iv) any products liability or similar claim arising out of or in
connection with merchandise, insurance or services which are
the subject of any Contract;
(v) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of any Obligor to the payment of
any Receivable (including, without limitation, a defense based
on such Receivable or the related Contract not being a legal,
valid and binding obligation of such Obligor enforceable
against it in accordance with its terms), or any other claim
resulting from the sale of the merchandise or service related
to such Receivable or the furnishing or failure to furnish
such merchandise or services;
(vi) the commingling of Collections of Receivables at any time
with other funds;
(vii) any investigation, litigation or proceeding related to or
arising from this Agreement or any other Transaction Document,
the transactions contemplated hereby or thereby, the use of
the proceeds of a purchase, the ownership of the Receivable
Interests or any other investigation, litigation or proceeding
relating to the Seller or either Originator in which any
Indemnified Party becomes involved as a result of any of the
transactions contemplated hereby or thereby;
(viii) any inability to litigate any claim against any Obligor in
respect of any Receivable as a result of such Obligor being
immune from civil and commercial law and suit on the grounds
of sovereignty or otherwise from any legal action, suit or
proceeding;
(ix) any Servicer Default described in paragraph (c) of Article
VII;
(x) the failure to vest and maintain vested in the Administrative
Agent and the Purchasers, or to transfer to the Administrative
Agent and the Purchasers,
Page 28
legal and equitable title to, and ownership of, a first
priority perfected undivided percentage ownership (to the
extent of the Receivable Interests contemplated hereunder) in
the Receivables, the Related Security, the Hohe Discount and
the Collections, free and clear of any Adverse Claim; or the
failure of the Seller or any Originator to cause Collections
to be transferable to any location outside of Germany without
any set-off, deduction or other charge or encumbrance; or the
failure of the Seller or any Originator to deliver Collections
to the Servicer at any time;and
(xi) any failure of the Seller or Xxxxxxxx to give reasonably
equivalent value to an Originator under a Transfer Agreement
in consideration of the transfer by such Originator of any
Receivable, or any attempt by any Person to void any such
transfer under statutory provisions or common law or equitable
action, including, without limitation, any provision of the
Bankruptcy Code.
If any claim which may give rise to a claim for indemnity under this
Section 8.1 is asserted against any Indemnified Party, such Indemnified Party
shall give the Seller written notice of that claim. In the event any third party
brings an action or proceeding against any Indemnified Party in respect of which
indemnity may be sought under this Section 8.1, such Indemnified Party promptly
shall give notice of that action or proceeding to the Seller and upon receipt of
any such notice the Seller shall have the right and, if so requested by such
Indemnified Party, the obligation to assume the defense of the action or
proceeding; provided, that (i) failure of a party to give such notice shall not
relieve the Seller from any of its obligations under this Section 8.1 unless
that failure prejudices the defense of the action or proceeding by the Seller
and (ii) the Seller shall not have the right to assume the defense of any such
action or proceeding unless (a) no Servicer Default has occurred and is
continuing and (b) the Seller has acknowledged to such Indemnified Party in
writing its obligation to pay any indemnity claim hereunder arising in
connection with such action or proceeding and has paid any Indemnified Amounts
already incurred by the applicable Indemnified Parties in connection with such
action or proceeding. At its own expense, an Indemnified Party may employ
separate counsel and participate in any defense assumed by the Seller. Each
Indemnified Party shall obtain the Seller's prior written consent to any
settlement or compromise of any action or proceeding in respect of which
indemnity may be sought hereunder.
Section 8.2. Increased Cost and Reduced Return. If after the date
hereof, any Funding Source shall be charged any fee, expense or increased cost
on account of the adoption of any applicable law, rule or regulation (including
any applicable law, rule or regulation regarding capital adequacy) or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency (a "Regulatory Change"): (i) which subjects
any Funding Source to any charge or withholding on or with respect to any
Funding Agreement or a Funding Source's obligations under a Funding
Page 29
Agreement, or on or with respect to the Receivables, or changes the basis of
taxation of payments to any Funding Source of any amounts payable under any
Funding Agreement (except for changes in the rate of tax on the overall net
income of a Funding Source) or (ii) which imposes, modifies or deems applicable
any reserve, assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the account of a Funding
Source, or credit extended by a Funding Source pursuant to a Funding Agreement
or (iii) which imposes any other condition the result of which is to increase
the cost to a Funding Source of performing its obligations under a Funding
Agreement, or to reduce the rate of return on a Funding Source's capital as a
consequence of its obligations under a Funding Agreement, or to reduce the
amount of any sum received or receivable by a Funding Source under a Funding
Agreement or to require any payment calculated by reference to the amount of
interests or loans held or interest received by it and such cost described in
clause (i), (ii) or (iii) arises in connection with any of the transactions
contemplated in this Agreement, then, upon demand by the Administrative Agent,
the Seller shall pay to the Administrative Agent, for the benefit of the
relevant Funding Source, a reasonable allocation of the aggregate of such
amounts charged to such Funding Source or compensate such Funding Source for a
reasonable allocation of the aggregate of such reduction. A statement as to such
amount, prepared in good faith and in reasonable detail by the Administrative
Agent and submitted by the Administrative Agent to the Seller, shall be
conclusive and binding for all purposes absent manifest error in computation.
Section 8.3. Other Costs and Expenses. The Seller shall pay to the
Administrative Agent and Falcon on demand all reasonable costs and reasonable
out-of-pocket expenses in connection with the preparation, execution, delivery
and administration of this Agreement, the transactions contemplated hereby and
the other documents to be delivered hereunder, including without limitation, the
reasonable cost of Falcon's auditors auditing the books, records and procedures
of the Seller, reasonable fees and reasonable out-of-pocket expenses of legal
counsel for Falcon and the Administrative Agent (which such counsel may be
employees of Falcon or the Administrative Agent) with respect thereto and with
respect to advising Falcon and the Administrative Agent as to their respective
rights and remedies under this Agreement. The Seller shall pay to the
Administrative Agent on demand any and all reasonable costs and expenses of the
Administrative Agent and the Purchasers, if any, including reasonable counsel
fees and expenses in connection with the enforcement of this Agreement and the
other documents delivered hereunder and in connection with any restructuring or
workout of this Agreement or such documents, or the administration of this
Agreement following a Servicer Default. The Seller shall reimburse Falcon on
demand for all other reasonable costs and expenses incurred by Falcon or any
shareholder of Falcon ("Other Costs"), including, without limitation, the
reasonable cost of auditing Falcon's books by certified public accountants, the
cost of rating the Commercial Paper by independent financial rating agencies,
and the reasonable fees and out-of-pocket expenses of counsel for Falcon or any
counsel for any shareholder of Falcon with respect to advising Falcon or such
shareholder as to matters relating to Falcon's operations.
Section 8.4. Allocations. Falcon shall allocate the liability for Other
Costs among the Seller and other Persons with whom Falcon has entered into
agreements to purchase interests in receivables ("Other Sellers") on the basis
of the relation that the Aggregate Capital hereunder
Page 30
bears to the aggregate "Capital" or similar investment under all such
agreements, or on such other reasonable basis as Falcon may use for such purpose
in accordance with its customary practice. If any Other Costs are attributable
to the Seller and not attributable to any Other Seller, the Seller shall be
solely liable for such Other Costs. However, if Other Costs are attributable to
Other Sellers and not attributable to the Seller, such Other Sellers shall be
solely liable for such Other Costs. All allocations to be made pursuant to the
foregoing provisions of this Article VIII shall be made by Falcon in its sole
discretion and shall be binding on the Seller and the Servicer.
ARTICLE IX
THE ADMINISTRATIVE AGENT
Section 9.1. Authorization and Action. Each Purchaser hereby designates
and appoints First Chicago to act as its agent hereunder and under each other
Transaction Document, and authorizes the Administrative Agent to take such
actions as agent on its behalf and to exercise such powers as are delegated to
the Administrative Agent by the terms of this Agreement and the other
Transaction Documents together with such powers as are reasonably incidental
thereto. The Administrative Agent shall not have any duties or responsibilities,
except those expressly set forth herein or in any other Transaction Document, or
any fiduciary relationship with any Purchaser, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities on the part of
the Administrative Agent shall be read into this Agreement or any other
Transaction Document or otherwise exist for the Administrative Agent. In
performing its functions and duties hereunder and under the other Transaction
Documents, the Administrative Agent shall act solely as agent for the Purchasers
and does not assume nor shall be deemed to have assumed any obligation or
relationship of trust or agency with or for the Seller or any of its successors
or assigns. The Administrative Agent shall not be required to take any action
which exposes the Administrative Agent to personal liability or which is
contrary to this Agreement, any other Transaction Document or applicable law.
The appointment and authority of the Administrative Agent hereunder shall
terminate upon the indefeasible payment in full of all Aggregate Unpaids. Each
Purchaser hereby authorizes the Administrative Agent to execute on behalf of
such Purchaser (the terms of which shall be binding on such Purchaser) each of
the Uniform Commercial Code financing statements, together with such other
instruments or documents determined by the Administrative Agent to be necessary
or desirable in order to perfect, evidence or more fully protect the interest of
the Purchasers contemplated hereunder.
Section 9.2. Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement and each other Transaction Document by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. As between the Administrative
Agent and each Purchaser, the Administrative Agent shall not be responsible for
the negligence or misconduct of any agents or attorneys-in-fact selected by it
with reasonable care.
Page 31
Section 9.3. Exculpatory Provisions. Neither the Administrative Agent nor
any of its directors, officers, agents or employees shall be (i) liable for any
action lawfully taken or omitted to be taken by it or them under or in
connection with this Agreement or any other Transaction Document (except for
its, their or such Person's own gross negligence or willful misconduct), or (ii)
responsible in any manner to any of the Purchasers for any recitals, statements,
representations or warranties made by the Seller contained in this Agreement,
any other Transaction Document or any certificate, report, statement or other
document referred to or provided for in, or received under or in connection
with, this Agreement, or any other Transaction Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement, or any other Transaction Document or any other document furnished in
connection herewith or therewith, or for any failure of the Seller to perform
its obligations hereunder or thereunder, or for the satisfaction of any
condition specified in Article IV, or for the perfection, priority, condition,
value or sufficiency or any collateral pledged in connection herewith. The
Administrative Agent shall not be under any obligation to any Purchaser to
ascertain or to inquire as to the observance or performance of any of the
agreements or covenants contained in, or conditions of, this Agreement or any
other Transaction Document, or to inspect the properties, books or records of
the Seller. The Administrative Agent shall not be deemed to have knowledge of
any Servicer Default or Potential Servicer Default unless the Administrative
Agent has received notice from the Seller or a Purchaser.
Section 9.4. Reliance by Administrative Agent. The Administrative Agent
shall in all cases be entitled to rely, and shall be fully protected in relying,
upon any document or conversation believed by it to be genuine and correct and
to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation, counsel
to the Seller), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall in all cases be fully
justified in failing or refusing to take any action under this Agreement or any
other Transaction Document unless it shall first receive such advice or
concurrence of Falcon or the Required Investors or all of the Purchasers, as
applicable, as it deems appropriate and it shall first be indemnified to its
satisfaction by the Purchasers, provided that unless and until the
Administrative Agent shall have received such advice, the Administrative Agent
may take or refrain from taking any action, as the Administrative Agent shall
deem advisable and in the best interests of the Purchasers. The Administrative
Agent shall in all cases be fully protected in acting, or in refraining from
acting, in accordance with a request of Falcon or the Required Investors or all
of the Purchasers, as applicable, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Purchasers.
Section 9.5. Non-Reliance on Administrative Agent and Other Purchasers.
Each Purchaser expressly acknowledges that neither the Administrative Agent, nor
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
the Administrative Agent hereafter taken, including, without limitation, any
review of the affairs of the Seller, shall be deemed to constitute any
representation or warranty by the Administrative Agent. Each Purchaser
represents and warrants to the Administrative Agent that it has and will,
independently and without reliance upon the
Page 32
Administrative Agent or any other Purchaser and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, prospects, financial and
other conditions and creditworthiness of the Seller and made its own decision to
enter into this Agreement, the other Transaction Documents and all other
documents related hereto or thereto.
Section 9.6. Reimbursement and Indemnification. The Investors agree to
reimburse and indemnify the Administrative Agent and its officers, directors,
employees, representatives and agents ratably according to their Pro Rata
Shares, to the extent not paid or reimbursed by the Seller (i) for any amounts
for which the Administrative Agent, acting in its capacity as Administrative
Agent, is entitled to reimbursement by the Seller hereunder and (ii) for any
other expenses incurred by the Administrative Agent, in its capacity as
Administrative Agent and acting on behalf of the Purchasers, in connection with
the administration and enforcement of this Agreement and the other Transaction
Documents, but excluding any such expenses to the extent the final judgment of a
court of competent jurisdiction holds that such expenses resulted from gross
negligence or willful misconduct on the part of the Administrative Agent.
Section 9.7. Administrative Agent in its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Seller or any Affiliate of
the Seller as though the Administrative Agent were not the Administrative Agent
hereunder. With respect to the acquisition of Receivable Interests pursuant to
this Agreement, the Administrative Agent shall have the same rights and powers
under this Agreement as any Purchaser and may exercise the same as though it
were not the Administrative Agent, and the terms "Investor," "Purchaser,"
"Investors" and "Purchasers" shall include the Administrative Agent in its
individual capacity.
Section 9.8. Successor Administrative Agent. The Administrative Agent may,
upon five days' notice to the Seller and the Purchasers, and the Administrative
Agent will, upon the direction of all of the Purchasers resign as Administrative
Agent. If the Administrative Agent shall resign, then the Required Investors
during such five-day period shall either (i) appoint from among the Purchasers a
successor agent or (ii) with the consent of the Seller, appoint a Person other
than a Purchaser as the successor agent. If for any reason no successor
Administrative Agent is appointed by the Required Investors during such five-day
period, then effective upon the termination of such five day period, the
Purchasers shall perform all of the duties of the Administrative Agent hereunder
and under the other Transaction Documents and the Seller shall make all payments
in respect of the Aggregate Unpaids directly to the applicable Purchasers and
for all purposes shall deal directly with the Purchasers. After the
effectiveness of any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the retiring Administrative Agent shall be discharged from
its duties and obligations hereunder and under the other Transaction Documents
and the provisions of this Article IX and Article VIII shall continue in effect
for its benefit with respect to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement and under the other
Transaction Documents.
Page 33
ARTICLE X
ASSIGNMENTS; PARTICIPATIONS
Section 10.1. Assignments. (a) The Seller and each Investor hereby agree
and consent to the complete or partial assignment by Falcon of all of its rights
under, interest in, title to and obligations under this Agreement to (i) the
Investors pursuant to Section 2.1, (ii) any Person that is a special purpose
corporation in respect of which First Chicago is then serving as administrative
or managing agent or in any similar capacity or (iii) with the prior written
consent of the Seller (which consent shall not be unreasonably withheld), any
other Person. In each case, upon such assignment, Falcon shall be released from
its obligations so assigned. Further, the Seller and each Investor hereby agree
that any assignee of Falcon of this Agreement or all or any of the Receivable
Interests of Falcon shall have all of the rights and benefits under this
Agreement as if the term "Falcon" explicitly referred to such party, and no such
assignment shall in any way impair the rights and benefits of Falcon hereunder.
The Seller shall not have the right to assign its rights or obligations under
this Agreement.
(b) Any Investor may at any time and from time to time assign to one or
more Persons ("Purchasing Investors") all or any part of its rights and
obligations under this Agreement pursuant to an assignment agreement, in a form
and substance satisfactory to the Administrative Agent (the "Assignment
Agreement"), executed by such Purchasing Investor and such selling Investor.
The consent of Falcon, the Administrative Agent and the Seller (the Seller's
consent not to be unreasonably withheld) shall be required prior to the
effectiveness of any such assignment. Each assignee of an Investor must have a
short-term debt rating of A-1 or better by Standard & Poor's Ratings Group and
P-1 by Xxxxx'x Investors Service, Inc. and must agree to deliver to the
Administrative Agent, promptly following any request therefor by the
Administrative Agent or Falcon, an enforceability opinion in form and substance
satisfactory to the Administrative Agent and Falcon. Upon delivery of the
executed Assignment Agreement to the Administrative Agent, such selling Investor
shall be released from its obligations hereunder to the extent of such
assignment. Thereafter the Purchasing Investor shall for all purposes be an
Investor party to this Agreement and shall have all the rights and obligations
of an Investor under this Agreement to the same extent as if it were an original
party hereto and no further consent or action by the Seller, the Purchasers or
the Administrative Agent shall be required.
(c) Each of the Investors agrees that in the event that it shall cease to
have a short-term debt rating of A-1 or better by Standard & Poor's Corporation
and P-1 by Xxxxx'x Investors Service, Inc. (an "Affected Investor"), such
Affected Investor shall be obliged, at the request of Falcon or the
Administrative Agent, to assign all of its rights and obligations hereunder to
(x) another Investor or (y) another financial institution nominated by the
Administrative Agent and acceptable to Falcon and the Seller (the Seller's
consent not to be unreasonably withheld), and willing to participate in this
Agreement through the Liquidity Termination Date in the place of such Affected
Investor; provided that the Affected Investor receives payment in full, pursuant
to an Assignment Agreement, of an amount equal to such Investor's Pro Rata Share
of the
Page 34
Capital and Discount owing to the Investors and all accruing but unpaid fees and
other costs and expenses payable in respect of its Pro Rata Share of the
Receivable Interests.
Section 10.2. Participations. Any Investor may, in the ordinary course of
its business at any time sell to one or more Persons (each a "Participant")
participating interests in its Pro Rata Share of the Receivable Interests of the
Investors, its obligation to pay Falcon its Acquisition Amounts or any other
interest of such Investor hereunder. Notwithstanding any such sale by an
Investor of a participating interest to a Participant, such Investor's rights
and obligations under this Agreement shall remain unchanged, such Investor shall
remain solely responsible for the performance of its obligations hereunder, and
the Seller, Falcon and the Administrative Agent shall continue to deal solely
and directly with such Investor in connection with such Investor's rights and
obligations under this Agreement. Each Investor agrees that any agreement
between such Investor and any such Participant in respect of such participating
interest shall not restrict such Investor's right to agree to any amendment,
supplement, waiver or modification to this Agreement, except for any amendment,
supplement, waiver or modification described in clause (i) of Section 11.1(b).
ARTICLE XI
MISCELLANEOUS
Section 11.1. Waivers and Amendments. (a) No failure or delay on the part
of the Administrative Agent or any Purchaser in exercising any power, right or
remedy under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power, right or remedy preclude any other
further exercise thereof or the exercise of any other power, right or remedy.
The rights and remedies herein provided shall be cumulative and nonexclusive of
any rights or remedies provided by law. Any waiver of this Agreement shall be
effective only in the specific instance and for the specific purpose for which
given.
(b) No provision of this Agreement may be amended, supplemented, modified
or waived except in writing in accordance with the provisions of this Section
11.1(b). Falcon, the Seller and the Administrative Agent, at the direction of
the Required Investors, may enter into written modifications or waivers of any
provisions of this Agreement, provided, however, that no such modification or
waiver shall:
(i) without the consent of each affected Purchaser, (A) extend the
Liquidity Termination Date or the date of any payment or deposit of
Collections by the Seller or the Servicer, (B) reduce the rate or extend
the time of payment of Discount (or any component thereof), (C) reduce any
fee payable to the Administrative Agent for the benefit of the Purchasers,
(D) except pursuant to Article X hereof, change the amount of the Capital
of any Purchaser, an Investor's Pro Rata Share or an Investor's Commitment,
(E) amend, modify or waive any provision of the definition of Required
Investors or this Section 11.1(b), (F) consent to or permit the assignment
or transfer by the Seller of any of its rights and obligations under this
Agreement, (G) change the definition of "Eligible Receivable" or "Aggregate
Reserve" (H) amend any hedging or
Page 35
currency exchange arrangement that shall have been entered into in
connection with any DM Purchase hereunder, or (I) amend or modify any
defined term (or any defined term used directly or indirectly in such
defined term) used in clauses (A) through (H) above in a manner which would
circumvent the intention of the restrictions set forth in such clauses; or
(ii) without the written consent of the then Administrative Agent,
amend, modify or waive any provision of this Agreement if the effect
thereof is to affect the rights or duties of such Administrative Agent.
Notwithstanding the foregoing, (i) without the consent of the Investors, the
Administrative Agent may, with the consent of the Seller, amend this Agreement
solely to add additional Persons as Investors hereunder and (ii) without the
consent of the Seller, the Administrative Agent, each Investor and Falcon may
enter into amendments to modify any of the terms or provisions of Article II,
Article IX, Article X, Section 11.13 or any other provision of this Agreement,
provided that such amendment has no negative impact upon the Seller. Any
modification or waiver made in accordance with this Section 11.1 shall apply to
each of the Purchasers equally and shall be binding upon the Seller, the
Purchasers and the Administrative Agent.
Section 11.2 Notices. (a) Except as provided in subsection (b) below, all
communications and notices provided for hereunder shall be in writing (including
bank wire, telecopy or electronic facsimile transmission or similar writing) and
shall be given to the other parties hereto at their respective addresses or
telecopy numbers set forth on the signature pages hereof. All such
communications and notices shall, when mailed, telecopied, telegraphed, telexed
or cabled, be effective when received through the mails, transmitted by
telecopy, delivered to the telegraph company, confirmed by telex answerback or
delivered to the cable company, respectively, except that communications and
notices to the Administrative Agent or any Purchaser pursuant to Article I or II
shall not be effective until received by the intended recipient.
(b) The Seller hereby authorizes the Administrative Agent to effect
purchases and Tranche Period and Discount Rate selections based on telephonic
notices made by any Person whom the Administrative Agent in good faith believes
to be acting on behalf of the Seller. The Seller agrees to deliver promptly to
the Administrative Agent a written confirmation of each telephonic notice signed
by an authorized officer of the Seller. However, the absence of such
confirmation shall not affect the validity of such notice. If the written
confirmation differs from the action taken by the Administrative Agent, the
records of the Administrative Agent shall govern absent manifest error.
Section 11.3. Ratable Payments. If any Purchaser, whether by setoff or
otherwise, has payment made to it with respect to any portion of the Aggregate
Unpaids owing to such Purchaser (other than payments received pursuant to
Section 8.2 or 8.3) in a greater proportion than that received by any other
Purchaser entitled to receive a ratable share of such Aggregate Unpaids, such
Purchaser agrees, promptly upon demand, to purchase for cash without recourse
Page 36
or warranty a portion of the Aggregate Unpaids held by the other Purchasers so
that after such purchase each Purchaser will hold its ratable proportion of the
Aggregate Unpaids; provided that if all or any portion of such excess amount is
thereafter recovered from such Purchaser, such purchase shall be rescinded and
the purchase price restored to the extent of such recovery, but without
interest.
Section 11.4. Protection of Ownership Interests of the Purchasers. (a)
The Seller agrees that from time to time, at its expense, it will promptly
execute and deliver all instruments and documents, and take all actions, that
may be necessary or desirable, or that the Administrative Agent may request, to
perfect, protect or more fully evidence the Receivable Interests, or to enable
the Administrative Agent or the Purchasers to exercise and enforce their rights
and remedies hereunder. At any time following the occurrence of a Servicer
Default, the Administrative Agent may, or the Administrative Agent may direct
the Seller to (and the Seller thereupon shall), notify the Obligors of
Receivables, at any time and at the Seller's expense, of the ownership interests
of the Purchasers under this Agreement and may also direct that payments of all
amounts due or that become due under any or all Receivables be made directly to
the Administrative Agent or its designee; provided that in the case of any
Receivables denominated in Deutsche Marks, the Administrative Agent may direct
the Seller to (and the Seller thereupon shall) notify the Obligors of such
Receivables, at any time and at the Seller's expense, of the Seller's and the
Purchasers' interest therein to the extent determined by the Administrative
Agent to be necessary or desirable in accordance with Section 5.1(h). The Seller
shall, at any Purchaser's request, withhold the identity of such Purchaser in
any such notification.
(b) If the Seller or the Servicer fails to perform any of its obligations
hereunder, the Administrative Agent or any Purchaser may (but shall not be
required to) perform, or cause performance of, such obligation; and the
Administrative Agent's or such Purchaser's reasonable costs and expenses
incurred in connection therewith shall be payable by the Seller (if the Servicer
that fails to so perform is the Seller or an Affiliate thereof) as provided in
Section 8.3, as applicable. The Seller and the Servicer each irrevocably
authorizes the Administrative Agent at any time and from time to time in the
sole discretion of the Administrative Agent, and appoints the Administrative
Agent as its attorney-in-fact, to act on behalf of the Seller and the Servicer
(i) to execute on behalf of the Seller as debtor and to file financing
statements necessary or desirable in the Administrative Agent's sole discretion
to perfect and to maintain the perfection and priority of the interest of the
Purchasers in the Receivables and (ii) to file a carbon, photographic or other
reproduction of this Agreement or any financing statement with respect to the
Receivables as a financing statement in such offices as the Administrative Agent
in its sole discretion deems necessary or desirable to perfect and to maintain
the perfection and priority of the interests of the Purchasers in the
Receivables. This appointment is coupled with an interest and is irrevocable.
Section 11.5. Confidentiality. (a) The Seller and each Investor shall
maintain and shall cause each of their respective employees and officers to
maintain the confidentiality of this Agreement and the other confidential
proprietary information with respect to the Administrative
Page 37
Agent and Falcon and their respective businesses obtained by any of them in
connection with the structuring, negotiating and execution of the transactions
contemplated herein, except that the Seller, each Investor and their respective
officers and employees may disclose such information to their respective
external accountants and attorneys and as required by any applicable law or
order of any judicial or administrative proceeding.
(b) Anything herein to the contrary notwithstanding, the Seller hereby
consents to the disclosure of any nonpublic information with respect to it (i)
to the Administrative Agent, the Investors or Falcon by each other, (ii) by the
Administrative Agent or the Purchasers to any prospective or actual assignee or
participant of any of them or (iii) by the Administrative Agent to any rating
agency, Commercial Paper dealer or provider of a surety, guaranty or credit or
liquidity enhancement to Falcon or any entity organized for the purpose of
purchasing, or making loans secured by, financial assets for which First Chicago
acts as the administrative agent and to any officers, directors, employees,
outside accountants and attorneys of any of the foregoing, provided each such
Person is informed of the confidential nature of such information. In addition,
the Purchasers and the Administrative Agent may disclose any such nonpublic
information pursuant to any law, rule, regulation, direction, request or order
of any judicial, administrative or regulatory authority or proceedings (whether
or not having the force or effect of law).
Section 11.6. Bankruptcy Petition. The Seller, the Administrative Agent
and each Investor hereby covenants and agrees that, prior to the date which is
one year and one day after the payment in full of all outstanding senior
Indebtedness of Falcon, it will not institute against, or join any other Person
in instituting against, Falcon any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceeding under the laws
of the United States or any state of the United States.
Section 11.7. Limitation of Liability. Except with respect to any claim
arising out of the willful misconduct or gross negligence of Falcon, the
Administrative Agent or any Investor, no claim may be made by the Seller, the
Servicer or any other Person against Falcon, the Administrative Agent or any
Investor or their respective Affiliates, directors, officers, employees,
attorneys or agents for any special, indirect, consequential or punitive damages
in respect of any claim for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated by this Agreement, or
any act, omission or event occurring in connection therewith; and the Seller
hereby waives, releases, and agrees not to xxx upon any claim for any such
damages, whether or not accrued and whether or not known or suspected to exist
in its favor.
SECTION 11.8. CHOICE OF LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
ILLINOIS.
SECTION 11.9. CONSENT TO JURISDICTION. THE SELLER HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY
Page 38
UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN CHICAGO IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT
EXECUTED BY THE SELLER PURSUANT TO THIS AGREEMENT AND THE SELLER HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY
PURCHASER TO BRING PROCEEDINGS AGAINST THE SELLER IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY THE SELLER AGAINST THE ADMINISTRATIVE
AGENT OR ANY PURCHASER OR ANY AFFILIATE OF THE ADMINISTRATIVE AGENT OR A
PURCHASER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT
OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY THE
SELLER PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO,
ILLINOIS.
SECTION 11.10. WAIVER OF JURY TRIAL. THE ADMINISTRATIVE AGENT, THE SELLER
AND EACH PURCHASER HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
THIS AGREEMENT, ANY DOCUMENT EXECUTED BY THE SELLER PURSUANT TO THIS AGREEMENT
OR THE RELATIONSHIP ESTABLISHED HEREUNDER OR THEREUNDER.
Section 11.11. Integration; Survival of Terms.
(a) This Agreement, the Collection Account Agreements and the Fee Letter
contain the final and complete integration of all prior expressions by
the parties hereto with respect to the subject matter hereof and shall
constitute the entire agreement among the parties hereto with respect
to the subject matter hereof superseding all prior oral or written
understandings.
(b) The provisions of Article VIII and Section 11.6 shall survive any
termination of this Agreement.
Section 11.12. Counterparts; Severability. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and
Page 39
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
Section 11.13. First Chicago Roles. Each of the Investors acknowledges
that First Chicago acts, or may in the future act, (i) as administrative agent
for Falcon, (ii) as issuing and paying agent for the Commercial Paper, (iii) to
provide credit or liquidity enhancement for the timely payment for the
Commercial Paper and (iv) to provide other services from time to time for Falcon
(collectively, the "First Chicago Roles"). Without limiting the generality of
this Section 11.13, each Investor hereby acknowledges and consents to any and
all First Chicago Roles and agrees that in connection with any First Chicago
Role, First Chicago may take, or refrain from taking, any action which it, in
its discretion, deems appropriate, including, without limitation, in its role as
administrative agent for Falcon, the giving of notice to the Administrative
Agent of a mandatory purchase pursuant to Section 2.1.
Section 11.14. Characterization. (a) It is the intention of the parties
hereto that each purchase hereunder shall constitute an absolute and irrevocable
sale, which purchase shall provide the applicable Purchaser with the full
benefits of ownership of the applicable Receivable Interest. Except as
specifically provided in this Agreement, each sale of a Receivable Interest
hereunder is made without recourse to the Seller; provided, however, that (i)
the Seller shall be liable to each Purchaser and the Administrative Agent for
all representations, warranties and covenants made by the Seller pursuant to the
terms of this Agreement, and (ii) such sale does not constitute and is not
intended to result in an assumption by any Purchaser or the Administrative Agent
or any assignee thereof of any obligation of the Seller or either Originator or
any other person arising in connection with the Receivables, the Related
Security, or the related Contracts, or any other obligations of the Seller or
either Originator.
(b) If the conveyance by the Seller to the Purchasers of interests in
Receivables hereunder shall be characterized as a secured loan and not a sale,
it is the intention of the parties hereto that this Agreement shall constitute a
security agreement under applicable law, and that the Seller shall be deemed to
have granted to the Administrative Agent for the ratable benefit of the
Purchasers a duly perfected security interest in all of the Seller's right,
title and interest in, to and under the Receivables, the Collections, each
Collection Account, all Related Security, all payments on or with respect to
such Receivables, all Hohe Discount, all other rights relating to and payments
made in respect of the Receivables, and all proceeds of any thereof prior to all
other liens on and security interests therein. After a Servicer Default, the
Administrative Agent and the Purchasers shall have, in addition to the rights
and remedies which they may have under this Agreement, all other rights and
remedies provided to a secured creditor after default under the UCC and other
applicable law, which rights and remedies shall be cumulative.
Page 40
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
XXXXXXXX RECEIVABLES CORPORATION
By:/s/ Xxxxxxx X. Xxxxxxxx
---------------------------
Xxxxxxx X. Xxxxxxxx
President
000 X. 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
FALCON ASSET SECURITIZATION CORPORATION
By: /s/ Signature
-----------------------------------
Authorized Signatory
c/o The First National Bank
of Chicago, as Administrative Agent
Suite 0596, 0-00
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
THE FIRST NATIONAL BANK OF CHICAGO, as
Administrative Agent
By:/s/ Signature
---------------------------------------
Title: Authorized Agent
-----------------------------------
The First National Bank of Chicago
Suite 0596, 0-00
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Page 41
COMMITMENTS INVESTORS
----------- ---------
$25,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Signature
------------------------------
Title: Authorized Agent
---------------------------
The First National Bank of Chicago
Suite 0596, 0-00
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
$25,000,000 DRESDNER BANK AG NEW YORK AND
GRAND CAYMAN BRANCHES
By: /s/ Signature
------------------------------
Title: Vice President
---------------------------
By: /s/ Signature
-------------------------------
Title: Executive Vice President
----------------------------
000 X. XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
_____________
_____________
$50,000,000 PURCHASE LIMIT
Page 42
EXHIBITS AND SCHEDULES
EXHIBIT I DEFINITIONS
EXHIBIT II PRINCIPAL PLACE OF BUSINESS OF THE SELLER; LOCATION(S)
OF RECORDS; FEDERAL EMPLOYER IDENTIFICATION NUMBERS; NAMES
EXHIBIT III LOCK-BOXES; CONCENTRATION ACCOUNTS; DEPOSITARY ACCOUNTS
EXHIBIT IV FORM OF COMPLIANCE CERTIFICATE
EXHIBIT V FORM OF COLLECTION ACCOUNT AGREEMENT
EXHIBIT VI CREDIT AND COLLECTION POLICY
EXHIBIT VII FORM OF CONTRACT(S)
EXHIBIT VIII FORM OF SETTLEMENT REPORT
EXHIBIT IX FORM OF PURCHASE NOTICE
EXHIBIT X FORM OF LEGEND
EXHIBIT XI ELIGIBLE DM OBLIGORS
EXHIBIT XII FORM OF OBLIGOR NOTIFICATION
SCHEDULE A LIST OF DOCUMENTS TO BE DELIVERED TO THE ADMINISTRATIVE AGENT
PRIOR TO THE INITIAL PURCHASE
Page 43
EXHIBIT I
DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Acquisition Amount" means, on the date of any purchase from Falcon of
Receivable Interests pursuant to Section 2.1, (i) with respect to each Investor
other than First Chicago, the lesser of (a) such Investor's Pro Rata Share of
the Falcon Transfer Price and (b) such Investor's unused Commitment and (ii)
with respect to First Chicago, the difference between (a) the Falcon Transfer
Price and (b) the aggregate amount payable by all other Investors on such date
pursuant to clause (i) above.
"Adjusted Liquidity Price" means, in determining the Falcon Transfer Price
for any Receivable Interest, an amount equal to
[ NDR ]
(i) DC + (ii) RI [-------------- ]
[1 + (.50 X .25)]
where:
RI = the undivided percentage interest evidenced by such Receivable
Interest.
DC = the Deemed Collections.
NDR = the Outstanding Balance of all non-Defaulted Receivables.
Each of the foregoing shall be determined from the most recent Settlement Report
received from the Servicer. For this purpose, "Deemed Collections" shall be an
amount equal to the sum of the aggregate amount of all Dollar-denominated Deemed
Collections and the aggregate Dollar Equivalent of all Deutsche Xxxx-denominated
Deemed Collections.
"Administrative Agent" means First Chicago in its capacity as
administrative agent for the Purchasers pursuant to Article IX, and not in its
individual capacity as an Investor, and any successor Administrative Agent
appointed pursuant to Article IX.
"Adverse Claim" means a lien, security interest, charge or encumbrance, or
other right or claim in, of or on any Person's assets or properties in favor of
any other Person.
Page 44
"Affiliate" means any Person directly or indirectly controlling, controlled
by, or under direct or indirect common control with, another Person or any
Subsidiary of such other Person. A Person shall be deemed to control another
Person if the controlling Person owns 10% or more of any class of voting
securities of the controlled Person or possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of stock, by contract or otherwise.
"Aggregate Capital" means, at any time, the sum at such time of (i) the
Dollar amount of all Capital associated with Receivable Interests that shall
have arisen by reason of Dollar Purchases and (ii) the Dollar Equivalent amount
of all Capital associated with Receivable Interests that shall have arisen by
reason of DM Purchases.
"Aggregate Reserve" means, [____________].
"Aggregate Unpaids" means, at any time, an amount equal to the sum of all
accrued and unpaid Discount, Capital and all other amounts owed (whether due or
accrued) hereunder or under the Fee Letter to the Administrative Agent and the
Purchasers at such time.
"Agreement" means this Receivables Purchase Agreement, as it may be amended
or modified and in effect from time to time.
"Average Collection Period" means at any time that period of days equal to
the average maturity of the Receivables calculated by the Servicer in the then
most recent Settlement Report; provided that if the Administrative Agent shall
disagree with any such calculation, the Administrative Agent may recalculate the
Average Collection Period.
"Bankruptcy Code" means Title 11 of the United States Code, as it may be
amended from time to time.
"Base Rate" means, (i) prior to the occurrence of a Servicer Default, a
Dollar rate per annum equal to the corporate base rate, prime rate or base rate
of interest, as applicable, announced by the Reference Bank from time to time,
changing when and as such rate changes, and (ii) at all times after the
occurrence of a Servicer Default, such rate plus [__]% per annum.
"Business Day" means any day on which banks are not authorized or required
to close in New York, New York or Chicago, Illinois and The Depository Trust
Company of New York is open for business, and (i) if the applicable Business Day
relates to any computation or payment to be made with respect to the LIBO Rate,
any day on which dealings in Dollar deposits are carried on in the London
interbank market and (ii) if the applicable Business Day relates to any payment
or deposit to be made in Deutsche Marks, any DM Purchase or a Receivable
Interest arising therefrom, the delivery of any Settlement Report under Section
6.5, or any conversion of Dollars into Deutsche Marks or Deutsche Marks into
Dollars, any day on which dealings in Dollars and Deutsche Marks are carried on
in the London interbank market
Page 45
and on which banks are not authorized or required to close in London, England,
Frankfurt, Germany or Munich, Germany.
"Capital" of any Receivable Interest means, at any time, (a)(i) in the case
of any Receivable Interest arising from a Dollar Purchase, the Purchase Price in
Dollars of such Receivable Interest, and (ii) in the case of any Receivable
Interest arising from a DM Purchase, the Purchase Price in Deutsche Marks of
such Receivable Interest, minus (b) the sum of the aggregate amount of
Collections and other payments received by the Administrative Agent which in
each case are applied to reduce such Capital; provided that such Capital shall
be restored in the amount of any Collections or payments so received and applied
if at any time the distribution of such Collections or payments are rescinded or
must otherwise be returned for any reason.
"Capital Limit" means, at any time, the amount of Aggregate Capital at
such time that would cause the following calculation to equal 1.00:
C
--------
NRB - AR
where:
C = the Aggregate Capital of in respect of all Receivable
Interests at such time.
NRB = the Net Receivables Balance.
AR = the Aggregate Reserve.
"Change of Control" means (i) the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 20% or more of the outstanding shares of voting stock
of Xxxxxxxx; (ii) Xxxxxxxx shall cease to own, free and clear of all Adverse
Claims, at least 66 2/3% of the outstanding shares of voting stock (or
comparable equity interest) of Hohe on a fully diluted basis; or (iii) Xxxxxxxx
shall cease to own, free and clear of all Adverse Claims, all of the outstanding
shares of voting stock of the Seller on a fully diluted basis.
"Charged-Off Receivable" means a Receivable: (i) as to which the Obligor
thereof has taken any action, or suffered any event to occur, of the type
described in paragraph (c) of Article VII (as if references to the Seller
therein refer to such Obligor); (ii) as to which the Obligor thereof, if a
natural person, is deceased, (iii) which, consistent with the Credit and
Collection Policy, would be written off the Seller's books as uncollectible,
(iv) which has been
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identified by the Seller as uncollectible or (v) as to which any payment, or
part thereof, remains unpaid for 365 days or more from the original due date for
such payment.
"Collection Account" means each concentration account, depositary account,
lock-box account or similar account in which any Collections are collected or
deposited.
"Collection Account Agreement" means, in relation to any actual or proposed
Collection Account, an agreement in substantially the form of Exhibit V hereto.
"Collection Bank" means, at any time, any of the banks or other financial
institutions holding one or more Collection Accounts.
"Collection Notice" means a notice, in substantially the form of Collection
Notice contained in Exhibit V hereto, from the Administrative Agent to a
Collection Bank.
"Collections" means, with respect to any Receivable or any Hohe Discount,
all cash collections and other cash proceeds in respect of such Receivable or
such Hohe Discount, including, without limitation, all cash proceeds of Related
Security with respect thereto, and all amounts payable to the Purchasers by the
Seller pursuant to Section 1.8.
"Commercial Paper" means promissory notes of Falcon issued by Falcon in the
commercial paper market.
"Commitment" means, for each Investor, the commitment of such Investor to
purchase its Pro Rata Share of Receivable Interests from (i) the Seller and (ii)
Falcon, such Pro Rata Share not to exceed, in the aggregate, the Dollar amount
set forth opposite such Investor's name on the signature pages of this
Agreement, as such amount may be modified in accordance with the terms hereof.
"Concentration Limit" means, at any time, for any Obligor, an amount equal
to [___]% of the Outstanding Balance of all Eligible Receivables at such time,
or such other amount (a "Special Concentration Limit") for such Obligor
designated by the Administrative Agent with the consent of the Required
Investors; provided that, in the case of an Obligor and any Affiliate of such
Obligor, the Concentration Limit shall be calculated as if such Obligor and such
Affiliate are one Obligor; and provided, further, that Falcon or the Required
Investors may, upon not less than three Business Days' notice to the Seller,
cancel any Special Concentration Limit. As of the date of this Agreement, and
subject to the foregoing, each of the following Obligors (together in each case
with its respective Affiliates) shall have a Special Concentration Limit at all
times equal to the lesser of (i) an amount equal to [__]% of the Outstanding
Balance of all Eligible Receivables at such time and (ii) the respective amount
set forth below:
[TABLE]
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"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or application for a letter of credit.
"Contract" means, with respect to any Receivable, any and all instruments,
agreements, leases, invoices, shipping releases, general terms or conditions or
other writings pursuant to which such Receivable arises or which evidences such
Receivable.
"Coverage Exchange Rate" means, with respect to an amount of Deutsche Marks
during any Fixed Exchange Period, the forward rate of exchange quoted by the
Administrative Agent for the amount in question in the London interbank foreign
exchange market at or about 11:00 a.m. London time two Business Days prior to
the first day of such Fixed Exchange Period for the purchase of Deutsche Marks
with Dollars on the last day of such Fixed Exchange Period.
"CP Rate" means, the rate, requested by the Seller and agreed to by Falcon,
equivalent to the rate (or if more than one rate, the weighted average of the
rates) at which Commercial Paper having a term equal to the relevant Tranche
Period may be sold by any placement agent or commercial paper dealer reasonably
selected by Falcon, as agreed between each such dealer or agent and Falcon plus
any and all applicable issuing and paying agent fees and commissions of
placement agents and commercial paper dealers in respect of such Commercial
Paper; provided, however, that if the rate (or rates) as agreed between any such
agent or dealer and Falcon is a discount rate (or rates), the "CP Rate" for such
Tranche Period shall be the rate (or if more than one rate, the weighted average
of the rates) resulting from Falcon's converting such discount rate (or rates)
to an interest-bearing equivalent rate per annum.
"Credit and Collection Policy" means the Seller's credit and collection
policies and practices relating to Contracts and Receivables existing on the
date hereof, which policies and practices (i) in the case of Dollar-denominated
Receivables, are summarized in Exhibit VI hereto and (ii) in the case of
Deutsche Xxxx-denominated Receivables, shall be summarized in the written credit
and collection policy delivered to the Administrative Agent by the Seller in
accordance with Section 5.1(n), in each case as such policies and practices may
be modified from time to time in accordance with this Agreement.
"Currency Allocation Percentage" means, at any time, with respect to any
Receivable Interest, a ratio (expressed as a percentage) equal to (i) the
Capital of such Receivable Interest, divided by (ii) the aggregate Capital of
all Receivable Interests (including such Receivable Interest) denominated in the
same currency as such Receivable Interest.
"Deemed Collections" means the aggregate of all amounts owing to Falcon
pursuant to Sections 1.8 and 8.1.
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"Default Fee" means with respect to any amount due and payable by the
Seller hereunder or under the Fee Letter, an amount equal to interest on any
such amount at a rate per annum equal to 2% above the Base Rate, together with
any loss, cost or expense incurred by the Administrative Agent or any Purchaser
in connection with the extension or delay of settlement on any foreign exchange
contract related to such due and payable amount, provided, however, that such
interest rate will not at any time exceed the maximum rate permitted by
applicable law.
"Defaulted Receivable" means a Receivable as to which any payment, or part
thereof, remains unpaid for 90 days or more from the original due date for such
payment.
"Delinquency Ratio" means, at any time, a percentage equal to (i) the
aggregate Outstanding Balance of all Receivables that were Delinquent
Receivables at such time divided by (ii) the aggregate Outstanding Balance of
all Receivables (other than Receivables owed by an Affiliate of the applicable
Originator) at such time.
"Delinquent Receivable" means a Receivable (other than a Receivable owed by
an Affiliate of the applicable Originator) as to which any payment, or part
thereof, remains unpaid for 60 days or more from the original due date for such
payment.
"Designated Obligor" means an Obligor indicated by the Administrative Agent
to the Seller in writing.
"Designated Servicer" means, at any time, each of the following: (i) the
Servicer, if other than the Administrative Agent or a Purchaser at such time,
and (ii) each Originator, if any responsibility of the Servicer hereunder shall
have been delegated to such Originator.
"Deutsche Marks" means the lawful currency of Germany.
"Dilution Ratio" means, as of the last day of any calendar month, a
percentage equal to (i) the aggregate amount (in Dollars or Dollar Equivalents)
of Dilutions which shall have occurred during such month, divided by (ii) the
aggregate amount of new Receivables (in Dollars or Dollar Equivalents) arising
during such month.
"Dilution Factor" means, at any time, a percentage equal to the product of
(a) two, multiplied by (b) the highest average of the Dilution Ratios for any
three month period during the immediately preceding twelve months.
"Dilutions" means, at any time, the aggregate amount of reductions in the
Outstanding Balances of the Receivables as a result of any setoff, discount,
return, pricing or warranty adjustment or otherwise, other than cash Collections
on account of such Receivables.
"Discount" means, for each Receivable Interest for any Tranche Period:
Page 49
AD
DR x C x --
yr
where:
DR = the Discount Rate for such Receivable Interest for such
Tranche Period;
C = the Capital of such Receivable Interest during such Tranche
Period;
AD = the actual number of days elapsed during such Tranche
Period;
yr = (i) in the case of any Receivable Interest arising from a
Dollar Purchase, 360, and (ii) in the case of any Receivable
Interest arising from a DM Purchase, such number of days as
shall apply to the applicable Discount Rate as derived from
the hedging or exchange arrangements that the applicable
Purchaser shall have entered into to fund and maintain such
Receivable Interest during such Tranche Period;
provided, that no provision of this Agreement shall require the payment or
permit the collection of Discount in excess of the maximum permitted by
applicable law; and provided, further, that Discount for any Tranche Period
shall not be considered paid by any distribution to the extent that at any time
all or a portion of such distribution is rescinded or must otherwise be returned
for any reason.
"Discount Rate" means for any Tranche Period, (i) in the case of any
Receivable Interest that shall have arisen from a Dollar Purchase, the LIBO
Rate, the CP Rate or the Base Rate, as applicable, and (ii) in the case of any
Receivable Interest that shall have arisen by reason of any DM Purchase, such
rate per annum as shall have been notified to the Seller by the Administrative
Agent on or prior to the first day of such Tranche Period in accordance with
Section 1.3(c); provided in each case that from and after the occurrence of a
Servicer Default, the Discount Rate in respect of each Receivable Interest and
Tranche Period shall be the Base Rate.
"Discount Factor" means [__]%.
"DM Purchase" means a Purchase in respect of which the Purchase Price is
payable in Deutsche Marks.
"Dollars" and the sign "$" each means lawful money of the United States.
Page 50
"Dollar Equivalent" means, at any time in relation to an amount denominated
in Deutsche Marks, the amount of Dollars required to purchase such amount
denominated in Deutsche Marks at the Applicable Exchange Rate. "Applicable
Exchange Rate" means, at any time, (i) for purposes of calculating the
"Dilution Ratio", the "Loss-to-Liquidation Ratio", the "Aggregate Capital", or
the "Outstanding Balance" of any Receivable, the Spot Exchange Rate in effect
at such time and (ii) for all other purposes, the Coverage Exchange Rate in
effect at such time.
"Dollar Purchase" means a Purchase in respect of which the Purchase Price
is payable in Dollars.
"Xxxxxxxx" means Xxxxxxxx Corporation, a Michigan corporation.
"Xxxxxxxx Transfer Agreement" means that certain Receivables Purchase
Agreement of even date herewith between the Seller, as purchaser, and Xxxxxxxx,
as seller, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"Early Collection Fee" means, for any Receivable Interest which has its
Capital reduced, or its Tranche Period terminated prior to the date on which it
was originally scheduled to end, the sum of (a) the excess, if any, of (i) the
Discount that would have accrued during the remainder of the Tranche Period
subsequent to the date of such reduction or termination on the Capital of such
Receivable Interest if such reduction or termination had not occurred, over (ii)
the sum of (A) to the extent all or a portion of such Capital is allocated to
another Receivable Interest, the Discount actually accrued during such period on
such Capital for the new Receivable Interest, and (B) to the extent such Capital
is not allocated to another Receivable Interest, the income, if any, actually
received during such period by the holder of such Receivable Interest from
investing the portion of such Capital not so allocated and (b) if applicable,
the cost associated with the early reduction or termination of any foreign
currency of exchange transaction that shall have been entered into by the
Administrative Agent or any Purchaser in connection with the funding or
maintenance of such Receivable Interest.
"Eligible DM Obligor" means each of the Persons listed on Exhibit XI
hereto, and any other Person as the Seller may from time to time request and as
the Administrative Agent, in its sole discretion, may agree in writing.
"Eligible Receivable" means, at any time, a Receivable:
(i) the Obligor of which (a) is a corporation or other business
organization, organized under the laws of the United States or Germany or
any political subdivision thereof and has its chief executive office in the
United States or Germany; provided that (A) in the case of any Dollar-
denominated Receivables, such Obligor may be organized under the laws of,
and have its chief executive office in, Canada, and (B) in the case of any
Deutsche Xxxx-denominated Receivables, such Obligor may be organized under
the laws of, and have its chief executive office in, Belgium, Spain, Sweden
or any other country as may be approved in writing by the Administrative
Agent with the consent of
Page 51
the Required Investors, such approval and consent to be given by the
Administrative Agent and the Required Investors, respectively, in their
sole discretion; (b) is not an Affiliate of any of the parties hereto; (c)
is not a Designated Obligor; and (d) is not a government or a governmental
subdivision or agency,
(ii) the Obligor of which is not the Obligor of any Charged-Off
Receivable and, if such Obligor is the Obligor of any Defaulted
Receivables, the aggregate Outstanding Balance of such Defaulted
Receivables does not exceed an amount equal to 30% of the Outstanding
Balance of all Receivables of such Obligor at such time,
(iii) which is not a Defaulted Receivable, a Charged-Off Receivable or
Delinquent Receivable,
(iv) which by its terms is due and payable within 60 days of the
original billing date therefor and has not had its payment terms extended,
(v) which is an account receivable representing all or part of the
sales price of merchandise, insurance and services within the meaning of
Section 3(c)(5) of the Investment Company Act of 1940, as amended,
(vi) a purchase of which with the proceeds of notes would constitute a
"current transaction" within the meaning of Section 3(a)(3) of the
Securities Act of 1933, as amended,
(vii) which is an "account" within the meaning of Section 9-106 of the
UCC of all applicable jurisdictions,
(viii) which is denominated and payable only in Dollars in the United
States or Deutsche Marks in Germany,
(ix) which arises under a Contract in substantially the form of one
of the form contracts or, in the case of a Deutsche Xxxx-denominated
Receivable, Standard Terms set forth on Exhibit VII hereto or otherwise
approved by the Administrative Agent in writing, which, together with such
Receivable, is in full force and effect and constitutes the legal, valid
and binding obligation of the related Obligor enforceable by the Seller and
its assignees against such Obligor in accordance with its terms and, in the
case of a Deutsche Xxxx-denominated Receivable, has not been amended,
supplemented or superseded in any material respect, or in any respect
whatsoever which could affect the collectibility, transferability or
ownership of such Receivable by any other agreements or communications
between such Obligor and the Seller other than the relevant Obligor
Notification,
(x) which arises under a Contract which (A) does not require the
Obligor under such Contract to consent to the transfer, sale or assignment
of the rights and duties of
Page 52
the applicable Originator or any of its assignees under such Contract or,
if any such consent is required, the Obligor shall have duly executed and
delivered either (x) a consent to such transfer, sale or assignment or (y)
a valid waiver of such requirement, and (B) does not contain a
confidentiality provision that would have the effect of restricting the
ability of the Administrative Agent or any Purchaser to exercise its rights
under this Agreement, including, without limitation, its right to review
the Contract,
(xi) which arises under a Contract that contains an obligation to
pay a specified sum of money, contingent only upon the sale of goods or the
provision of services by an Originator,
(xii) which is not subject to any right of rescission, set-off,
counterclaim, any other defense (including defenses arising out of
violations of usury laws) of the applicable Obligor or the applicable
Originator or any other Adverse Claim, and the Obligor thereon holds no
right as against such Originator to cause such Originator to repurchase the
goods or merchandise the sale of which shall have given rise to such
Receivable,
(xiii) as to which the applicable Originator of such Receivable has
satisfied and fully performed all obligations on its part with respect to
such Receivable required to be fulfilled by it, and no further action is
required to be performed by any Person with respect thereto other than
payment thereon by the applicable Obligor,
(xiv) all right, title and interest to and in which has been validly
transferred by the applicable Originator directly or indirectly to the
Seller under and in accordance with the applicable Transfer Agreement, and
the Seller has good and marketable title thereto free and clear of any
Adverse Claim, including but not limited to, any Adverse Claim arising
pursuant to a retention of title arrangement (verlangerter
Eigentumsvorbehalt) or global security assignment (kreditsicherende
Globalzession),
(xv) which, together with the Contract related thereto, was created
in compliance with each, and does not contravene any, law, rule or
regulation applicable thereto (including, without limitation, any law, rule
and regulation relating to truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection practices
and privacy) and with respect to which no part of the Contract related
thereto is in violation of any such law, rule or regulation,
(xvi) which satisfies all applicable requirements of the Credit and
Collection Policy,
(xvii) which was generated in the ordinary course of the applicable
Originator's business in connection with the purchase of goods or services
by the applicable Obligor from such Originator,
Page 53
(xviii) which arises solely from the sale or the provision of services
to the related Obligor by the Originator that shall have transferred such
Receivable directly or indirectly to the Seller, and not by any other
Person (in whole or in part),
(xix) in the case of any Receivable other than a Dollar-denominated
Receivable,
(a) such Receivable shall have arisen pursuant to a commercial
transaction (Handelsgeschaft) between Hohe and the relevant
Obligor and is not included in any current account arrangement
(Kontokorrentabrede) between Xxxxxxxx and the related Obligor,
(b) such Obligor is an Eligible DM Obligor,
(c) the shipping release in respect of which, if the related
Obligor is organized under, or has its chief executive office in,
any country other than Germany contains the legend set forth in
Exhibit X hereto in the relevant language of the jurisdiction
where such Obligor is resident (or, if different, into the
language (or languages) in which such Obligor conducts its
business with Hohe), an d
(d) in respect of which either (1) Hohe has delivered an Obligor
Notification to the related Obligor and such Obligor Notification
has been duly signed by Hohe, the Seller and a duly authorized
signatory on behalf of such Obligor, and has been returned to
Hohe not later than December 20, 1996, or (2) the related Obligor
has confirmed in writing that it will pay all amounts in respect
of such Receivable directly into the German Collection Account,
and (in either case) the relevant Obligor in respect of which is
in compliance with any obligation to make payments into the
German Collection Account with respect to other Eligible
Receivables of such Obligor, and
(xx) as to which the Administrative Agent has not notified the Seller
that the Administrative Agent has determined that such Receivable or class
of Receivables is not acceptable as an Eligible Receivable, including,
without limitation, because such Receivable arises under a Contract that is
not acceptable to the Administrative Agent.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Facility Account" means the Seller's Account No. 549-0286 at First Chicago
or, in the case of any DM Purchase, such other account as the Administrative
Agent may from time to time advise the Seller.
Page 54
"Facility Termination Date" means the earliest of (i) the Liquidity
Termination Date, (ii) the date the Seller shall exercise its right to
repurchase the outstanding Receivable Interests pursuant to Section 1.11, (iii)
any date selected by the Seller on not less than 30 days' prior written notice
to the Administrative Agent, (iv) the date of the occurrence of any Servicer
Default involving the Seller and of the type described in paragraph (c) of
Article VII, and (v) any date following the occurrence, and during the
continuance, of any Servicer Default which the Required Investors declare to be
the Facility Termination Date.
"Falcon Residual" means the sum of the Falcon Transfer Price Reductions.
"Falcon Transfer Price" means, with respect to the assignment by Falcon of
one or more Receivable Interests to the Administrative Agent for the benefit of
the Investors pursuant to Section 2.1, the sum of (i) the lesser of (a) the
aggregate Dollar and Dollar Equivalent amount of the Capital of each Receivable
Interest and (b) the Adjusted Liquidity Price of each Receivable Interest and
(ii) the aggregate Dollar and Dollar Equivalent amount of all accrued and unpaid
Discount for such Receivable Interests.
"Falcon Transfer Price Reduction" means in connection with the assignment
of a Receivable Interest by Falcon to the Administrative Agent for the benefit
of the Investors, the positive difference between (i) the Capital of such
Receivable Interest and (ii) the Adjusted Liquidity Price for such Receivable
Interest.
"Federal Funds Effective Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period equal to (a) the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the preceding
Business Day) by the Federal Reserve Bank of New York in the Composite Closing
Quotations for U.S. Governments Securities; or (b) if such rate is not so
published for any day which is a Business Day, the average of the quotations at
approximately 10:30 a.m. (Chicago time) for such day on such transactions
received by the Reference Bank from three federal funds brokers of recognized
standing selected by it.
"Fee Letter" means that certain letter agreement dated as of the date
hereof between the Seller and the Administrative Agent, as it may be amended or
modified and in effect from time to time.
"Finance Charges" means, with respect to a Contract, any finance, interest,
late payment charges or similar charges owing by an Obligor pursuant to such
Contract.
"First Chicago" means The First National Bank of Chicago in its individual
capacity and its successors.
"Fixed Exchange Period" means a period commencing on the date in any
calendar month on which a DM Purchase may be made and ending on the date in the
next following calendar
Page 55
month on which a DM Purchase may be made, in each case such date being
determined in accordance with the terms of Section 1.2 (and whether or not a
purchase is in fact being made on such date or the Facility Termination Date has
occurred on or prior to such date); provided that (i) if at any time a Fixed
Exchange Period would otherwise be of a duration that is less than 30 days, the
Administrative Agent may direct that such Fixed Exchange Period have a longer
duration not to exceed 60 days, as the Administrative Agent may elect, and (ii)
the Administrative Agent may at any time, on written notice given to the Seller,
direct that the Fixed Exchange Periods in effect be of a duration shorter than
one calendar month (and may be as short as a period of one day). Fixed Exchange
Periods shall occur sequentially, with each Fixed Exchange Period commencing on
the expiration of the immediately preceding Fixed Exchange Period and ending on
the commencement of the immediately next following Fixed Exchange Period.
"Funding Agreement" means this Agreement and any agreement or instrument
executed by any Funding Source with or for the benefit of Falcon.
"Funding Source" means (i) any Investor or (ii) any insurance company, bank
or other financial institution providing liquidity, credit enhancement or back-
up purchase support or facilities to, or currency hedging or exchange
arrangement for the benefit of, Falcon.
"German Collection Account" has the meaning assigned to that term in the
Hohe Transfer Agreement.
"Germany" means the Federal Republic of Germany.
"Hedge Factor" means, at any time, [__________].
"Hohe" means Xxxxxxxx Hohe GmbH & Co. KG, a company organized under the
laws of Germany.
"Hohe Discount" means all "Discount" now or at any time hereafter payable
by Hohe under the Hohe Transfer Agreement, together with any "Default Fee"
payable by Hohe in respect thereof.
"Hohe Transfer Agreement" means that certain Receivables Purchase Agreement
of even date herewith between Xxxxxxxx, as purchaser, and Hohe, as Seller, as
the same may be amended, restated, supplemented or otherwise modified from time
to time.
"Incremental Purchase" means a purchase of one or more Receivable Interests
which increases the total outstanding Capital hereunder.
"Indebtedness" of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in
Page 56
the trade), (iii) obligations, whether or not assumed, secured by liens or
payable out of the proceeds or production from property now or hereafter owned
or acquired by such Person, (iv) obligations which are evidenced by notes,
acceptances, or other instruments, (v) capitalized lease obligations, (vi) net
liabilities under interest rate swap, exchange or cap agreements, (vii)
Contingent Obligations and (viii) liabilities in respect of unfunded vested
benefits under plans covered by Title IV of ERISA.
"Intended Characterization" means, for income tax purposes, the
characterization of the acquisition by the Purchasers of Receivable Interests as
a loan or loans by the Purchasers to the Seller secured by the Receivables, the
Related Security, the Hohe Discount and the Collections.
"Investor Fee" means, for each Investor, a fee agreed to in writing by the
Administrative Agent or Falcon and such Investor.
"Investors" means the financial institutions listed on the signature pages
of this Agreement under the heading "Investors" and their respective successors
and assigns.
"LIBO Rate" means the rate per annum equal to the sum of (i) (a) the rate
at which deposits in U.S. Dollars are offered by the Reference Bank to first-
class banks in the London interbank market at approximately 11:00 a.m. (London
time) two Business Days prior to the first day of the relevant Tranche Period,
such deposits being in the approximate amount of the Capital of the Receivable
Interest to be funded or maintained, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Tranche Period plus (ii)
[_____]% per annum. The LIBO Rate shall be rounded, if necessary, to the next
higher 1/16 of 1%.
"Liquidation Day" means, for any Receivable Interest, the earliest to occur
of (i) any Business Day so designated by the Administrative Agent or the
Required Investors on or at any time following any day on which the conditions
precedent set forth in Section 4.2 are not satisfied, (ii) any Business Day so
designated by the Seller or Falcon after the occurrence of the Termination Date,
(iii) the Business Day immediately prior to the occurrence of a Servicer Default
set forth in paragraph (c) of Article VII and (iv) in the case of any Receivable
Interest that shall have arisen by reason of a DM Purchase, declaration of the
Liquidation Day therefor by the Administrative Agent in accordance with Section
1.3(e).
"Liquidity Termination Date" means November 13, 1997, or such later date as
shall then be in effect in accordance with Section 1.12.
"Loss-to-Liquidation Ratio" means, as at the last day of any calendar
month, a percentage equal to (i) the amount (in Dollars and Dollar Equivalents)
of Charged-Off Receivables which became Charged-Off Receivables during the three
calendar months then most recently ended, divided by (ii) the aggregate amount
(in Dollars and Dollar Equivalents) of Collections in respect of Receivables
during such three month period.
Page 57
"Material Adverse Effect" means a material adverse effect on (i) the
financial condition, business or operations of the Seller or either Originator,
(ii) the ability of the Seller or either Originator to perform its obligations
under any Transaction Document, (iii) the legality, validity or enforceability
of this Agreement, any Transaction Document or any Collection Account Agreement
or Collection Notice relating to a Collection Account into which a material
portion of Collections are deposited, (iv) the Seller's or any Purchaser's
interest in the Receivables generally or in any significant portion of the
Receivables, the Related Security, the Hohe Discount or the Collections with
respect thereto, or (v) the collectibility of the Receivables generally or of
any material portion of the Receivables.
"Net Receivables Balance" means, at any time, the Outstanding Balance of
Eligible Receivables at such time reduced by the aggregate amount by which the
Outstanding Balance of all Eligible Receivables of each Obligor and its
Affiliates exceeds the Concentration Limit for such Obligor.
"Obligor" means a Person obligated to make payments pursuant to a Contract.
"Obligor Notification" means a notification in the form of Exhibit XII
attached hereto.
"Originator" means either of Xxxxxxxx or Hohe.
"Outstanding Balance" of any Receivable at any time means (i) in the case
of any Receivable denominated in Dollars, the then outstanding principal balance
thereof and (b) in the case of any Receivable denominated in Deutsche Marks, the
Dollar Equivalent of the then outstanding principal balance thereof.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture or other entity, or a government or any political subdivision or agency
thereof.
"Potential Servicer Default" means an event which, with the passage of time
or the giving of notice, or both, would constitute a Servicer Default.
"Pro Rata Share" means, for each Investor, the Commitment of such Investor
divided by the Purchase Limit, adjusted as necessary to give affect to the
application of the terms of Section 2.5.
"Purchase Date" has the meaning specified in Section 1.2.
"Purchase Limit" means the aggregate of the Commitments of the Investors
hereunder.
"Purchase Price" means, with respect to any Incremental Purchase of a
Receivable Interest, the amount paid to the Seller for such Receivable Interest.
Page 58
"Purchaser" means Falcon or an Investor, as applicable.
"Receivable" means the indebtedness and other obligations owed (at the time
it arises) to an Originator and owned, transferred to or otherwise held by the
Seller, whether constituting an account, chattel paper, instrument or general
intangible, arising in connection with the sale of goods or the rendering of
services by such Originator, and includes, without limitation, the obligation to
pay any Finance Charges with respect thereto. Indebtedness and other rights and
obligations arising from any one transaction, including, without limitation,
indebtedness and other rights and obligations represented by an individual
invoice, shall constitute a Receivable separate from a Receivable consisting of
the indebtedness and other rights and obligations arising from any other
transaction.
"Receivable Interest" means, at any time, an undivided percentage ownership
interest associated with a designated amount of Capital, Discount Rate and
Tranche Period selected pursuant to Section 1.3 in (i) all Receivables arising
prior to the time of the most recent computation or recomputation of such
undivided interest pursuant to Section 1.4, (ii) all Related Security with
respect to such Receivables, (iii) all Hohe Discount, and (iv) all Collections
with respect to, and other proceeds of, any of the foregoing. From and after
the date of the initial purchase hereunder, the aggregate Receivable Interests
hereunder shall at all times equal 100%. As among Purchasers, any allocation
of Collections in respect of any Receivable Interests (other than in the
circumstances when the applicable Currency Allocation Percentage is required to
be applied) shall be made ratably such that the percentage allocated to each
such Receivable Interest is equal to (i) the Dollar or Dollar Equivalent amount
of Capital assigned to such Receivable Interest, divided by (ii) the aggregate
Capital (in Dollars and Dollar Equivalents) assigned to all Receivable Interests
at such time.
"Records" means, with respect to any Receivable, all Contracts and other
documents, books, records and other information (including, without limitation,
computer programs, tapes, disks, punch cards, data processing software and
related property and rights) relating to such Receivable, any Related Security
therefor and the related Obligor.
"Reduction Percentage" means, for any Receivable Interest acquired by the
Investors from Falcon for less than the Dollar or Dollar Equivalent amount of
Capital of such Receivable Interest, a percentage equal to a fraction the
numerator of which is the Falcon Transfer Price Reduction for such Receivable
Interest and the denominator of which is the Dollar or Dollar Equivalent amount
of Capital of such Receivable Interest.
"Reference Bank" means First Chicago or such other bank as the
Administrative Agent shall designate with the consent of the Seller.
"Required Investors" means, (i) at any time that a Servicer Default has
occurred and is continuing, Investors with Commitments in excess of 66-2/3% of
the Purchase Limit and (ii) at any other time, the Investor then acting as
Administrative Agent.
Page 59
"Related Security" means, with respect to any Receivable:
(i) all of the Seller's present or future interest in the
inventory and goods (including returned or repossessed inventory or goods),
if any, the financing or lease of which gave rise to such Receivable, and
all insurance contracts with respect thereto, including, but not limited
to, all of the Seller's present or future claims for re-delivery and/or
return of such inventory and or goods,
(ii) all other security interests or liens and property subject
thereto from time to time, if any, purporting to secure payment of such
Receivable, whether pursuant to the Contract related to such Receivable or
otherwise, together with all financing statements and security agreements
describing any collateral securing such Receivable,
(iii) all guaranties, insurance and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Receivable whether pursuant to the Contract related to such
Receivable or otherwise,
(iv) all service contracts and other contracts and agreements
associated with such Receivables,
(v) all Records related to such Receivables,
(vi) all of the Seller's right, title and interest in, to and
under each Transfer Agreement, the Servicing Agreement and each instrument,
document or agreement executed in connection the foregoing in favor of or
otherwise for the benefit of the Seller (or, if different, the applicable
transferee thereunder);
(vii) all of the Seller's retention of title rights relating to
such Receivable; and
(viii) all proceeds of any of the foregoing.
"Reserve Requirement" means the maximum aggregate reserve requirement
(including all basic, supplemental, marginal and other reserves) which is
imposed against the Reference Bank in respect of Eurocurrency liabilities, as
defined in Regulation D of the Board of Governors of the Federal Reserve System
as in effect from time to time.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Servicer" means at any time the Person (which may be the Administrative
Agent) then authorized pursuant to Article VI to service, administer and collect
Receivables.
"Servicer Default" has the meaning specified in Article VII.
Page 60
"Servicing Agreement" means that certain Servicing Agreement of even date
herewith between the Seller and Xxxxxxxx, as the same may be amended, restated,
supplemented or otherwise modified from time to time.
"Settlement Report" means a report, in substantially the form of Exhibit
VIII hereto (appropriately completed), furnished by the Servicer to the
Administrative Agent pursuant to Section 6.5.
"Spot Exchange Rate" means, with respect to an amount of Deutsche Marks on
any date, the spot rate of exchange at which Deutsche Marks may be converted
into Dollars on such date, as determined by reference to the selling exchange
rate published in the Wall Street Journal on such date (or, if such date is not
a Business Day, on the next preceding Business Day); provided, that in the
event such rate is not so published, the "Spot Exchange Rate" for such date
shall be the rate of exchange quoted by the Administrative Agent in the London
interbank foreign exchange market at or about 11:00 a.m. London time on such
date (or, if such date is not a Business Day, on the next preceding Business
Day) for the spot purchase of such amount of Deutsche Marks with Dollars.
"Standard Terms" means any standard terms and conditions which govern the
sale of any products or provision of any services by Hohe to an Eligible DM
Obligor.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, association, joint venture or similar business
organization more than 50% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled. Unless otherwise
expressly provided, all references herein to a "Subsidiary" shall mean a
Subsidiary of the Seller.
"Termination Date" means, for any Receivable Interest, the Facility
Termination Date, and, solely with respect to a Receivable Interest of Falcon,
that Business Day so designated by the Seller or Falcon by notice to the other.
"Tranche Period" means (a) with respect to any Receivable Interest that
shall have arisen from a Dollar Purchase:
(i) if Discount for such Receivable Interest is calculated with
respect to the CP Rate, a period of days not to exceed 270 days commencing
on a Business Day requested by the Seller and agreed to by Falcon;
(ii) if Discount for such Receivable Interest is calculated on the
basis of the LIBO Rate, a period of one, two or three months, or such other
period as may be mutually agreeable to the Administrative Agent and the
Seller, commencing on a Business Day selected by the Seller or the
Administrative Agent pursuant to this Agreement. Such Tranche Period shall
end on the day in the applicable succeeding calendar month which
Page 61
corresponds numerically to the beginning day of such Tranche Period,
provided, however, that if there is no such numerically corresponding day
in such succeeding month, such Tranche Period shall end on the last
Business Day of such succeeding month; and
(iii) if Discount for such Receivable Interest is calculated on the
basis of the Base Rate, a period of 30 days commencing on a Business Day
selected by the Seller;
(b) with respect to any Receivable Interest that shall have arisen from a
DM Purchase:
(i) a Fixed Exchange Period, or
(ii) such other period of time as the Seller may, with the prior
consent of the Administrative Agent, select.
If any Tranche Period would end on a day which is not a Business Day, such
Tranche Period shall end on the next succeeding Business Day, provided, however,
that in the case of Tranche Periods corresponding to the LIBO Rate, if such next
succeeding Business Day falls in a new month, such Tranche Period shall end on
the immediately preceding Business Day. In the case of any Tranche Period for
any Receivable Interest of which commences before the Termination Date and would
otherwise end on a date occurring after the Termination Date, such Tranche
Period shall end on the Termination Date. The duration of each Tranche Period
which commences after the Termination Date shall be of such duration as selected
by the Administrative Agent.
"Transaction Documents" means, collectively, this Agreement, the Transfer
Agreements, the Servicing Agreement, each Collections Account Agreement, and all
other instruments, documents and agreements executed and delivered by the Seller
or either Originator in connection herewith.
"Transfer Agreement" means either the Xxxxxxxx Transfer Agreement or the
Hohe Transfer Agreement.
"UCC" means the Uniform Commercial Code as from time to time in effect in
the specified jurisdiction.
All accounting terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles. All terms used in
Article 9 of the UCC in the State of Illinois, and not specifically defined
herein, are used herein as defined in such Article 9.
Page 62
EXHIBIT II
PLACES OF BUSINESS OF THE SELLER; LOCATIONS OF RECORDS;
FEDERAL EMPLOYER IDENTIFICATION NUMBER(S); NAME(S)
Principal Place of Business; Chief Executive Office
None, except: 000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Location of Records:
None, except: 000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Xxxxxxxxxx 00, X-00000
Xxxxxxxxxx, Xxxxxxx
Federal Employer Identification Number:
00-0000000
Corporate Names, Trade Names, Assumed Names:
None, except: Xxxxxxxx Receivables Corporation
Page 63
EXHIBIT III
LOCK-BOXES;
CONCENTRATION ACCOUNTS; AND DEPOSITARY ACCOUNTS
None, except:
a. NBD Bank
000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Xxxx-Xxx Xx. 00000
Account No. 964-733
b. Bank One, Columbus, NA
000 X. Xxxxx
Xxxxxxxx, XX 00000-0000
Lock-Box No. 432710938
Checking Account No. 931296050
c. The First National Bank of Chicago, Frankfurt branch
Niederlassung Frankfurt
BLZ 503 304 00
Account No. 100-7173
Page 64
EXHIBIT IV
[On Letterhead of Seller]
FORM OF COMPLIANCE CERTIFICATE
To: The First National Bank of Chicago, as Administrative Agent
This Compliance Certificate is furnished pursuant to that certain
Receivables Purchase Agreement dated as of November 14, 1996, among Xxxxxxxx
Receivables Corporation (the "Seller"), the Purchasers party thereto and The
First National Bank of Chicago, as Administrative Agent for such Purchasers (the
"Agreement").
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _____________________ of the Seller;
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Seller during the accounting period covered by the
attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I have
no knowledge of, the existence of any condition or event which constitutes a
Servicer Default or Potential Servicer Default, as each such term is defined
under the Agreement, during or at the end of the accounting period covered by
the attached financial statements or as of the date of this Certificate, except
as set forth below; and
4. Schedule I attached hereto sets forth financial data and computations
evidencing the compliance with certain covenants of the Purchase Agreement, all
of which data and computations are true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Seller has taken, is taking, or proposes to
take with respect to each such condition or event:
The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this ____ day of ______________,
19___.
---------------------------
SCHEDULE I TO COMPLIANCE REPORT
Page 65
A. Schedule of Compliance as of __________, 19____ with Section [5.1(m)] of
the Agreement. Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the Purchase
Agreement.
This schedule relates to the month ended: _______________
Minimum Net Worth:
-----------------
1. Total assets: _________.
2. Total liabilities: ________.
3. Net Worth (item 1- item 2): _______________.
4. Net Worth [equals or exceeds] [is less than] $2,850,000.
Page 66
EXHIBIT V-A
FORM OF COLLECTION ACCOUNT AGREEMENT
FOR COLLECTION ACCOUNTS
LOCATED IN THE UNITED STATES
[On letterhead of Seller]
__________ 19__
[Lock-Box Bank/Concentration Bank/Depositary Bank]
Re: Xxxxxxxx Receivables Corporation
[and name of applicable Originator]
Ladies and Gentlemen:
You have exclusive control of P.O. Box #_____________ in [city, state, zip
code] (the "Lock-Box") for the purpose of receiving mail and processing payments
therefrom pursuant to that certain [name of lock-box agreement] between you and
_______ [Name of Originator] dated _________ (the "Agreement"). You hereby
confirm your agreement to perform the services described therein. Among the
services you have agreed to perform therein, is to endorse all checks and other
evidences of payment, and credit such payments to our checking account no.
__________ maintained with you in the name of [Originator] (the "Lock-Box
Account").
[Originator] hereby transfers and assigns all of its right, title and
interest in and to, and exclusive ownership and control over, the Lock-Box and
the Lock-Box Account to Xxxxxxxx Receivables Corporation (the "Seller"). We
hereby request that the name of the Lock-Box Account be changed to Xxxxxxxx
Receivables Corporation, as "Collection Agent" for the benefit of The First
National Bank of Chicago ("FNBC"), as Administrative Agent under that certain
Receivables Purchase Agreement (the "Receivables Purchase Agreement") dated as
of November 14, 1996 among the Seller, Falcon Asset Securitization Corporation,
certain financial institutions parties thereto and FNBC.
The Seller hereby irrevocably instructs you, and you hereby agree, that
upon receiving notice from FNBC in the form attached hereto as Annex A: (i) the
name of the Lock-Box Account will be changed to FNBC for itself and as agent (or
any designee of FNBC) and FNBC will have exclusive ownership of and access to
such Lock-Box Account, and neither we nor any of our affiliates will have any
control of such Lock-Box Account or any access thereto, (ii) you will either
continue to send the funds from the Lock-Box to the Lock-Box Account, or will
redirect the funds as FNBC may otherwise request, (iii) you will transfer monies
on deposit in the Lock-Box Account, at any time, as directed by FNBC, (iv) all
services to be performed by you under the Agreement will be performed on behalf
of FNBC, and (v) copies of all
Page 67
correspondence or other mail which you have agreed to send us will also be sent
to FNBC at the following address:
The First National Bank of Chicago
Suite 0596, 21st Floor
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Credit Manager, Asset Backed
Securities Division
Moreover, upon such notice, FNBC for itself and as agent will have all
rights and remedies given to us under the Agreement. We agree, however, to
continue to pay all fees and other assessments due thereunder at any time.
You hereby acknowledge that monies deposited in the Lock-Box Account or any
other account established with you by FNBC for the purpose of receiving funds
from the Lock-Box are subject to the liens of FNBC for itself and as agent under
the Receivables Purchase Agreement, and will not be subject to deduction, set-
off, banker's lien or any other right you or any other party may have against
us, except that you may debit the Lock-Box Account for any items deposited
therein that are returned or otherwise not collected and for all charges, fees,
commissions and expenses incurred by you in providing services hereunder, all in
accordance with your customary practices for the charge back of returned items
and expenses.
This letter agreement and the rights and obligations of the parties
hereunder will be governed by and construed and interpreted in accordance with
the laws of the State of Illinois. This letter agreement may be executed in any
number of counterparts and all of such counterparts taken together will be
deemed to constitute one and the same instrument. All references herein to "we"
or "us" refer to [Originator] and Xxxxxxxx Receivables Corporation.
This letter agreement contains the entire agreement between the parties,
and may not be altered, modified, terminated or amended in any respect, nor may
any right, power or privilege of any party hereunder be waived or released or
discharged, except upon execution by all parties hereto of a written instrument
so providing. In the event that any provision in this letter agreement is in
conflict with, or inconsistent with, any provision of the Agreement, this letter
agreement will exclusively govern and control. Each party agrees to take all
actions reasonably requested by any other party to carry out the purposes of
this letter agreement or to preserve and protect the rights of each party
hereunder.
Page 68
Please indicate your agreement to the terms of this letter agreement by
signing in the space provided below. This letter agreement' will become
effective immediately upon execution of a counterpart of this letter agreement
by all parties hereto.
Very truly yours,
[ORIGINATOR]
By
---------------------------------------
Title
-------------------------------------
XXXXXXXX RECEIVABLES CORPORATION
By
----------------------------------------
Title
-------------------------------------
Acknowledged and agreed to
this ____ day of _______, 1996
[COLLECTION BANK]
By:
Title:
Acknowledged and agreed to
this ____ day of _______, 1996
THE FIRST NATIONAL BANK OF
CHICAGO (as Administrative Agent)
By
--------------------------------
Title
-----------------------------
Page 69
ANNEX A
FORM OF COLLECTION NOTICE
[On letterhead of FNBC]
_____________________, 19__
[Collection Bank/Depositary Bank/Concentration Bank]
Re: Xxxxxxxx Receivables Corporation
Ladies and Gentlemen:
We hereby notify you that we are exercising our rights pursuant to that
certain letter agreement among [Originator], Xxxxxxxx Receivables Corporation,
you and us, to have the name of, and to have exclusive ownership and control of,
account number ____________ (the "Lock-Box Account") maintained with you,
transferred to us. [Lock-Box Account will henceforth be a zero-balance account,
and funds deposited in the Lock-Box Account should be sent at the end of each
day to _______________.] You have further agreed to perform all other services
you are performing under that certain agreement dated ____________ between you
and [Originator] on our behalf.
We appreciate your cooperation in this matter.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
(as Administrative Agent)
By:
---------------------------------
Title:
-----------------------------
Page 70
EXHIBIT V-B
FORM OF COLLECTION ACCOUNT AGREEMENT
FOR COLLECTION ACCOUNTS LOCATED IN GERMANY
[LETTERHEAD OF XXXXXXXX RECEIVABLES CORPORATION]
[Date]
[Name and Address of Bank]
Dear Sirs,
Account No. [____________]
We refer to Account No. 0000000 (the "Account") opened with your bank in the
name of Xxxxxxxx Receivables Corporation ("DRC"), on trust for the benefit of
The First National Bank of Chicago (in its capacity as administrative agent of
Falcon Asset Securitization Corporation ("Falcon"), the "Administrative Agent")
acting on behalf of Falcon and certain other persons. We hereby notify you that,
in connection with certain transactions involving certain of the trade account
receivables (the "Receivables") of Xxxxxxxx Hohe GmbH & Co. KG ("Hohe"), Hohe
has sold and assigned to its parent company, Xxxxxxxx Corporation, the
Receivables, together with all payments of all amounts due with respect to the
Receivables. Xxxxxxxx Corporation has resold and reassigned or will resell and
reassign the Receivables, together with all payments of all amounts due with
respect thereto, to its wholly-owned subsidiary, DRC. DRC will in turn sell
interests in the Receivables to Falcon and certain other persons.
The obligors of the Receivables have been notified of the sale of the
Receivables to Xxxxxxxx Corporation and to DRC. Nevertheless, the obligors may
make payments in respect of the Receivables in the name of Hohe, although such
payments will be made to the Account.
In connection with the foregoing, we hereby instruct you, as of the date of this
Agreement: (i) to collect the monies, checks, instruments and other items of
payment mailed to or otherwise paid to the Account including, for the avoidance
of doubt, any monies, checks, instruments and other items of payment with Hohe
as the named payee; and (ii) endorse all checks and other evidences of payment,
deposit into or otherwise credit to the Account all such monies, checks,
instruments and other items of payment including, for the avoidance of doubt,
any monies, checks, instruments and other items of payment with Hohe as the
named payee. In respect of any monies, checks, instruments and other items of
payment with Hohe as the named payee, Hohe, by its signature below,
Page 71
acknowledges and consents to your acting in accordance with the foregoing
instructions in the name of Hohe and on its behalf, and undertakes to ratify and
confirm any actions taken by you in the name of Hohe in accordance with the
foregoing instructions.
In addition, we hereby request that the following terms and conditions shall
apply with respect to the Account:
1. The Administrative Agent shall be granted a revocable power of attorney
(widerrufliche Kontovollmacht), pursuant to which the Administrative Agent
shall be entitled to operate the Account and withdraw any and all monies on
deposit in the Account from time to time pursuant to your normal withdrawal
procedures and the mandate signed by us in relation to the Account. The
Administrative Agent may operate the Account as our agent only on the
signatures of certain duly authorized officers of the Administrative
Agent. As at the date of this letter, those duly authorized officers
are: [ ]. The signature of any one of the aforesaid
persons is required to authorize any transaction related to the Account.
The specimen signature of each of the aforesaid authorized signatories is
set out in Annex A to this letter. Any change in the list of authorized
signatories of the Administrative Agent will not be binding on you until
notified to you in writing, signed by an existing authorized signatory of
the Administrative Agent.
2. Hohe, shall, until you have received the Notification (as defined below)
from the Administrative Agent, be granted a revocable power of attorney
(widerrufliche Kontovollmacht) (the "Hohe Power of Attorney"), pursuant to
which Hohe shall be entitled to operate the Account and withdraw any and
all monies on deposit in the Account from time to time pursuant to your
normal withdrawal procedures and the mandate signed by us in relation to
the Account. Hohe may operate the Account as our agent only on the
signatures of certain duly authorized officers of Hohe. As at the date of
this letter, those duly authorized officers are: [ ].
[The signatures of any [two] of the aforesaid persons are required to
authorize any transaction related to the Account.]/1/ The specimen
signature of each of the aforesaid authorized signatories is set out in
Annex A to this letter. Any change in the list of authorized signatories of
Hohe will not be binding on you until notified to you in writing, signed by
an officer of each of DRC, the Administrative Agent and Hohe.
3. If at any time the Administrative Agent delivers to you a written notice in
the form of Annex B to this letter (which may be in the form of a facsimile
and which shall be signed by an officer or director of the Administrative
Agent) (the "Notification"), then the Hohe Power of Attorney shall
terminate and (i) you shall no longer permit Hohe or any authorized
signatory on the Account who is an officer of Hohe to make any further
withdrawals of monies from the Account or otherwise deal with the Account
or authorize any transactions relating to the Account, (ii) the name of the
Account will be changed to the name of the
------------
/1/ Complete information in square brackets as appropriate
Page 72
Administrative Agent and the Administrative Agent will have exclusive
ownership and access to the Account, including the rights to make
withdrawals therefrom, (iii) you will transfer monies on deposit in the
Account, at any time, as directed by the Administrative Agent and (iv)
copies of all correspondence or other mail which you have agreed to send us
will also be sent to the Administrative Agent at the following address:
The First National Bank of Chicago
Suite 0956, 0-00
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
XXX
Fax: 0 000-000-0000
4. We hereby agree that you shall in no event be held liable for any
transactions relating to the Account that were authorized by an authorized
signatory of Hohe prior to your receipt of the Notification.
5. Hohe has no authority to withdraw more monies from the Account than are on
deposit therein at such time, and you are expressly requested to
countermand any withdrawals that would so overdraw the Account.
6. You hereby represent and warrant to us that, as of the date of your
signature below, you are not aware of any liens, security interests,
charges, encumbrances or other rights or claims of any persons or entities
to the Account other than ourselves, the Administrative Agent and the
rights of Hohe created pursuant to this letter. You hereby agree that you
will notify us immediately upon your becoming aware of any such liens,
security interests, charges, encumbrances or other rights or claims of any
third persons or entities arising on or with respect to the Account.
7. You hereby agree that you will not exercise, and you hereby waive, any
right of combination, consolidation, merger, set-off, lien, security
interest, charge or encumbrance whatsoever which you may have in respect of
any monies standing or accruing to the credit of the Account. You further
acknowledge and agree that the terms and conditions of this letter shall
prevail in the event of any conflict between such terms and conditions and
your standard terms and conditions applicable to the opening, operating and
holding of the Account (including any standard account mandate).
Please acknowledge your consent and agreement to the terms and conditions set-
forth in this letter by signing where indicated below and returning one of the
signed originals of this letter to DRC at [ ] and to
the Administrative Agent at [ ].
Yours faithfully,
Page 73
XXXXXXXX RECEIVABLES CORPORATION
By: ______________________
Title: ___________________
ACKNOWLEDGED AND AGREED:
[Relevant Bank]
By:_____________________________
Title:____________________________
Date:____________________________
THE FIRST NATIONAL BANK
OF CHICAGO, as Administrative Agent
By:_____________________________
Title:____________________________
Date:____________________________
XXXXXXXX HOHE GmbH & CO. KG
By:_____________________________
Title:____________________________
Date:____________________________
Page 74
XXXXXXXX CORPORATION
By:_____________________________
Title:____________________________
Date:____________________________
FALCON ASSET SECURITIZATION CORPORATION
By:_____________________________
Title:____________________________
Date:____________________________
Page 75
ANNEX A
AUTHORIZED SIGNATORIES
HOHE
----
Name Specimen Signature
---- ------------------
[ ] ______________________________
[ ] ______________________________
[ ] ______________________________
[ ] ______________________________
ADMINISTRATIVE AGENT
--------------------
Name Specimen Signature
---- ------------------
[ ] ______________________________
[ ] ______________________________
[ ] ______________________________
[ ] ______________________________
Page 76
ANNEX B
FORM OF NOTIFICATION
[On letterhead of FNBC]
_____________________, 19__
[Collection Bank]
Re: Xxxxxxxx Receivables Corporation
Ladies and Gentlemen:
We hereby notify you that we are exercising our rights pursuant to that
certain letter agreement among Xxxxxxxx Receivables Corporation, you and us, to
instruct you that (i) you shall no longer permit Xxxxxxxx Hohe GmbH & Co. KG
("Hohe") or any authorized signatory on account number ____________ (the
"Account") who is an officer of Hohe to make any further withdrawals of monies
from the Account or otherwise deal with the Account or authorize any
transactions relating to the Account and (ii) we are exercising our rights to
have the name of, and to have exclusive ownership and control of, the Account
transferred to us. The Account will henceforth be a zero-balance account, and
funds deposited in the Account should be sent at the end of each day to
_______________.
We appreciate your cooperation in this matter.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
(as Administrative Agent)
By:___________________________________
Title:__________________
Page 77
EXHIBIT VI
CREDIT AND COLLECTION POLICY
(Attached)
Page 78
EXHIBIT VII
FORM OF CONTRACT(S)
(Attached)
Page 79
EXHIBIT VIII
FORM OF SETTLEMENT REPORT
(Attached)
Page 80
EXHIBIT IX
FORM OF PURCHASE NOTICE
[On Letterhead of Seller]
[Date]
The First National Bank of Chicago,
as Administrative Agent for the Purchasers parties
to the Receivables Purchase Agreement
referred to below
Suite 0596, 0-00
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Asset-Backed Markets
Gentlemen:
The undersigned, XXXXXXXX RECEIVABLES CORPORATION, refers to the
Receivables Purchase Agreement, dated as of November 14, 1996 (the "Receivables
Purchase Agreement", the terms defined therein being used herein as therein
defined), among the undersigned, Falcon Asset Securitization Corporation
("Falcon"), certain Investors parties thereto and The First National Bank of
Chicago, as Administrative Agent for Falcon and such Investors, and hereby gives
you notice, irrevocably, pursuant to Section 1.2 of the Receivables Purchase
Agreement that the undersigned hereby requests a Purchase under the Receivables
Purchase Agreement, and in that connection sets forth below the information
relating to such Purchase (the "Proposed Purchase") as required by Section 1.2
of the Receivables Purchase Agreement:
(i) The Business Day of the Proposed Purchase is ___________, 19__.
(ii) The requested Purchase Price in respect of the Proposed
Purchase is [$_____________] [DM___________].
(iii) The requested Purchaser[s] in respect of the Proposed Purchase
[is Falcon] [are the Investors].
(iii) The duration of the initial Tranche Period for the Proposed
Purchase is ____________ [days] [months].
Page 81
(iv) The Discount Rate related to such initial Tranche Period is
requested to be the [CP] [LIBO] [Base] Rate.
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed Purchase
(before and after giving effect to the Proposed Purchase):
(A) the representations and warranties set forth in Article III of
the Receivables Purchase Agreement are correct on and as of
such date, as though made on and as of such date;
(B) no event has occurred, or would result from the Proposed
Purchase that will constitute a Servicer Default, and no event
has occurred and is continuing, or would result from such
Proposed Purchase, that would constitute a Potential Servicer
Default; and
(iii) the Liquidity Termination Date shall not have occurred, the
Aggregate Capital shall not exceed the Purchase Limit and the
Aggregate Capital shall not exceed the Capital Limit.
[A Settlement Report is attached hereto and made a part hereof.]/2/
Very truly yours,
XXXXXXXX RECEIVABLES CORPORATION
By__________________________________
Title:
------------
/2/ If requested by the Administrative Agent.
Page 82
EXHIBIT X
FORM OF LEGEND
The Receivable evidenced by this Invoice/shipping documentation has been sold
and assigned to Xxxxxxxx Corporation and resold and reassigned by Xxxxxxxx
Corporation to Xxxxxxxx Receivables Corporation and the amount payable in
respect hereof should be paid in accordance with our letter to you dated [date
of relevant Obligor Notification].
Page 83
EXHIBIT XI
LIST OF ELIGIBLE DM OBLIGORS
Name of
Eligible Obligor Address
---------------- -------
Audi AG 85045 Ingolstadt, Germany
Bayerische Motorenwerke AG Xxxxxxxx 00 00 00
00000 Xxxxxxx, Xxxxxxx
Ford Werke XX Xxxxx-Xxxx-Xxxxxxx 0
00000 Xxxx, Xxxxxxx
Xxxxxxx Xxxxxxx XxxX Xxxxxxxx 0000
00000 Xxxxxxxxx, Xxxxxxx
Xxxxxx XxxX Xxxxxxxx 0000
00000 Xxx, Xxxxxxx
Opel Xxxx AG Xxxxxxxx 00 00
00000 Xxxxxxxxxxx, Xxxxxxx
Porsche Dr. Ing. H.C.F. AG Xxxxxxxx 00 00 00
00000 Xxxxxxxxx, Xxxxxxx
Rowenta Werke GmbH Xxxxxxxx 00 00 00
00000 Xxxxxxxxx, Xxxxxxx
X00-0 Xxxx
Xxxx Xxxxxxxxxx XX 00000 Trollhaettan, Sweden
Saechsische Automobilbau GmbH Xxxxxxxx 000
00000 Xxxxx, Xxxxxxx
--------------------------------------------------------------------
Page 84
Volkswagenwerk AG Xxxxxxxx
00000 Xxxxxxxxx, Xxxxxxx
Volkswagenwerk Bruxelles S.A. 000, Xxxxxxxxx xx xx Xxxxxxxx Xxxxx
0000 Xxxxxxxxx, Xxxxxxx
Volvo Car Corporation 40508 Goteborg, Sweden
Volvo Cars Europe Industry Xxxxxxxx 0 00
0000 Xxxx, Xxxxxxx
Xxxx Xxxxxxxx GmbH Xxxxxxxx 00 00
00000 Xxxxxxxx, Xxxxxxx
Page 85
EXHIBIT XII
FORM OF OBLIGOR NOTIFICATION
(Attached)
Page 86
SCHEDULE A
DOCUMENTS TO BE DELIVERED TO THE ADMINISTRATIVE AGENT
ON OR PRIOR TO THE INITIAL PURCHASE
(Attached)
Page 87
================================================================================
================================================================================
RECEIVABLES PURCHASE AGREEMENT
Dated as of November 14, 1996
Among
XXXXXXXX RECEIVABLES CORPORATION
as Seller
and
FALCON ASSET SECURITIZATION CORPORATION
and
THE FINANCIAL INSTITUTIONS PARTY HERETO,
as Investors
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent
================================================================================
================================================================================
TABLE OF CONTENTS
-----------------
PAGE
----
ARTICLE I
AMOUNTS AND TERMS OF THE PURCHASES................................. Page 1
Section 1.1. Purchase Facility................................... Page 2
Section 1.2. Making Purchases.................................... Page 2
Section 1.3. Selection of Tranche Periods and Discount Rates..... Page 2
Section 1.4. Percentage Evidenced by Receivable Interests........ Page 4
Section 1.5. Dividing or Combining Receivable Interests.......... Page 4
Section 1.6. Reinvestment Purchases.............................. Page 4
Section 1.7. Liquidation Settlement Procedures................... Page 5
Section 1.8. Deemed Collections.................................. Page 6
Section 1.9. Discount; Payments and Computations, Etc............ Page 6
Section 1.10. Capital Limit....................................... Page 7
Section 1.11. Seller's Extinguishment............................. Page 7
Section 1.12. Extensions of the Liquidity Termination Date........ Page 7
ARTICLE II
LIQUIDITY FACILITY................................................. Page 8
Section 2.1. Transfer to Investors............................... Page 8
Section 2.2. Transfer Price Reduction Discount................... Page 8
Section 2.3. Payments to Falcon.................................. Page 8
Section 2.4. Limitation on Commitment to Purchase from Falcon.... Page 8
Section 2.5. Defaulting Investors................................ Page 9
Section 2.6. Hedging Arrangements................................ Page 9
ARTICLE III
REPRESENTATIONS AND WARRANTIES..................................... Page 9
Section 3.1. Seller Representations and Warranties............... Page 9
Section 3.2. Investor Representations and Warranties............. Page 13
ARTICLE IV
CONDITIONS OF PURCHASES............................................ Page 14
Section 4.1. Conditions Precedent to Initial Purchase............ Page 14
Section 4.2. Conditions Precedent to All Purchases and
Reinvestments....................................... Page 14
ARTICLE V
COVENANTS.......................................................... Page 15
Section 5.1. Affirmative Covenants of Seller..................... Page 15
Section 5.2. Negative Covenants of Seller........................ Page 21
ARTICLE VI
ADMINISTRATION AND COLLECTION...................................... Page 23
-i-
Section 6.1. Designation of Servicer............................. Page 23
Section 6.2. Duties of Servicer.................................. Page 24
Section 6.3. Collection Notices.................................. Page 25
Section 6.4. Responsibilities of the Seller...................... Page 25
Section 6.5. Reports............................................. Page 25
ARTICLE VII
SERVICER DEFAULTS.................................................. Page 26
ARTICLE VIII
INDEMNIFICATION.................................................... Page 27
Section 8.1. Indemnities by the Seller........................... Page 27
Section 8.2. Increased Cost and Reduced Return................... Page 30
Section 8.3. Other Costs and Expenses............................ Page 30
Section 8.4. Allocations......................................... Page 31
ARTICLE IX
THE ADMINISTRATIVE AGENT........................................... Page 31
Section 9.1. Authorization and Action............................ Page 31
Section 9.2. Delegation of Duties................................ Page 32
Section 9.3. Exculpatory Provisions.............................. Page 32
Section 9.4. Reliance by Administrative Agent.................... Page 32
Section 9.5. Non-Reliance on Administrative Agent and
Other Purchasers.................................... Page 33
Section 9.6. Reimbursement and Indemnification................... Page 33
Section 9.7. Administrative Agent in its Individual Capacity..... Page 33
Section 9.8. Successor Administrative Agent...................... Page 34
ARTICLE X
ASSIGNMENTS; PARTICIPATIONS........................................ Page 34
Section 10.1. Assignments......................................... Page 34
Section 10.2. Participations...................................... Page 35
ARTICLE XI
MISCELLANEOUS...................................................... Page 35
Section 11.1. Waivers and Amendments.............................. Page 35
Section 11.2 Notices............................................. Page 36
Section 11.3. Ratable Payments.................................... Page 37
Section 11.4. Protection of Ownership Interests of the
Purchasers.......................................... Page 37
Section 11.5. Confidentiality..................................... Page 38
Section 11.6. Bankruptcy Petition................................. Page 38
Section 11.7. Limitation of Liability............................. Page 39
SECTION 11.8. CHOICE OF LAW....................................... Page 39
SECTION 11.9. CONSENT TO JURISDICTION............................. Page 39
SECTION 11.10. WAIVER OF JURY TRIAL................................ Page 39
-ii-
Section 11.11. Integration; Survival of Terms...................... Page 40
Section 11.12. Counterparts; Severability.......................... Page 40
Section 11.13. First Chicago Roles................................. Page 40
Section 11.14. Characterization.................................... Page 40
-iii-
EXHIBITS AND SCHEDULES
EXHIBIT I DEFINITIONS
EXHIBIT II PRINCIPAL PLACE OF BUSINESS OF THE SELLER; LOCATION(S) OF
RECORDS; FEDERAL EMPLOYER IDENTIFICATION NUMBERS; NAMES
EXHIBIT III LOCK-BOXES; CONCENTRATION ACCOUNTS; DEPOSITARY ACCOUNTS
EXHIBIT IV FORM OF COMPLIANCE CERTIFICATE
EXHIBIT V FORM OF COLLECTION ACCOUNT AGREEMENT
EXHIBIT VI CREDIT AND COLLECTION POLICY
EXHIBIT VII FORM OF CONTRACT(S)
EXHIBIT VIII FORM OF SETTLEMENT REPORT
EXHIBIT IX FORM OF PURCHASE NOTICE
EXHIBIT X FORM OF LEGEND
EXHIBIT XI ELIGIBLE DM OBLIGORS
EXHIBIT XII FORM OF OBLIGOR NOTIFICATION
SCHEDULE A LIST OF DOCUMENTS TO BE DELIVERED TO THE ADMINISTRATIVE AGENT
PRIOR TO THE INITIAL PURCHASE
-iv-
