Exhibit 10.18
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RECEIVABLES TRANSFER AGREEMENT
DATED AS OF FEBRUARY 14, 2003
AMONG
FSI RECEIVABLES COMPANY LLC, AS TRANSFEROR,
XXXXXX SCIENTIFIC INTERNATIONAL INC., AS SERVICER,
BLUE RIDGE ASSET FUNDING CORPORATION,
WACHOVIA BANK, NATIONAL ASSOCIATION, INDIVIDUALLY AND AS BLUE RIDGE AGENT,
LIBERTY STREET FUNDING CORP.,
THE BANK OF NOVA SCOTIA, INDIVIDUALLY AND AS LIBERTY STREET AGENT,
AND
WACHOVIA BANK, NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT
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TABLE OF CONTENTS
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ARTICLE I. TRANSFER ARRANGEMENTS........................................................................... 2
Section 1.1 Transfer Facility........................................................................ 2
Section 1.2 Increases................................................................................ 3
Section 1.3 Decreases................................................................................ 4
Section 1.4 Payment Requirements..................................................................... 4
Section 1.5 Computations............................................................................. 4
Section 1.6 Extension of Liquidity Termination Date.................................................. 4
ARTICLE II. PAYMENTS AND COLLECTIONS....................................................................... 5
Section 2.1 Payments................................................................................. 5
Section 2.2 Collections and Reinvestments prior to Amortization...................................... 6
Section 2.3 Collections Following Amortization....................................................... 6
Section 2.4 Payment Rescission....................................................................... 7
Section 2.5 Maximum Receivable Interests............................................................. 7
Section 2.6 Clean Up Call............................................................................ 8
ARTICLE III. CONDUIT FUNDING............................................................................... 8
Section 3.1 CP Costs................................................................................. 8
Section 3.2 CP Costs Payments........................................................................ 8
Section 3.3 Calculation of CP Costs.................................................................. 8
ARTICLE IV. LIQUIDITY BANK FUNDING......................................................................... 9
Section 4.1 Liquidity Bank Funding................................................................... 9
Section 4.2 Yield Payments........................................................................... 9
Section 4.3 Selection and Continuation of Tranche Periods............................................ 9
Section 4.4 Liquidity Bank Discount Rates............................................................ 9
Section 4.5 Suspension of the LIBO Rate.............................................................. 10
ARTICLE V. REPRESENTATIONS AND WARRANTIES.................................................................. 10
Section 5.1 Representations and Warranties of the Transferor Parties................................. 10
ARTICLE VI. CONDITIONS OF PURCHASES........................................................................ 15
Section 6.1 Conditions Precedent to Initial Incremental Transfer..................................... 15
Section 6.2 Conditions Precedent to All Transfers and Reinvestments.................................. 15
ARTICLE VII. COVENANTS..................................................................................... 16
Section 7.1 Affirmative Covenants of the Transferor Parties.......................................... 16
Section 7.2 Negative Covenants of the Transferor Parties............................................. 23
ARTICLE VIII. ADMINISTRATION AND COLLECTION................................................................ 25
Section 8.1 Designation of Servicer.................................................................. 25
Section 8.2 Duties of Servicer....................................................................... 26
Section 8.3 Collection Notices....................................................................... 27
Section 8.4 Responsibilities of Transferor........................................................... 28
Section 8.5 Reports.................................................................................. 28
Section 8.6 Servicing Fees........................................................................... 28
ARTICLE IX. AMORTIZATION EVENTS............................................................................ 29
Section 9.1 Amortization Events...................................................................... 29
Section 9.2 Remedies................................................................................. 31
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ARTICLE X. INDEMNIFICATION................................................................................. 31
Section 10.1 Indemnities by the Transferor Parties.................................................... 31
Section 10.2 Withholding Taxes........................................................................ 34
Section 10.3 Increased Cost and Reduced Return........................................................ 36
Section 10.4 Other Costs and Expenses................................................................. 37
ARTICLE XI. THE AGENTS..................................................................................... 37
Section 11.1 Appointment.............................................................................. 37
Section 11.2 Delegation of Duties..................................................................... 38
Section 11.3 Exculpatory Provisions................................................................... 39
Section 11.4 Reliance by Agents....................................................................... 39
Section 11.5 Notice of Amortization Events............................................................ 40
Section 11.6 Non-Reliance on Agents and Other Transferees............................................. 40
Section 11.7 Indemnification of Agents................................................................ 41
Section 11.8 Agents in their Individual Capacities.................................................... 42
Section 11.9 Successor Administrative Agent........................................................... 42
Section 11.10 Agents' Conflict Waivers................................................................. 42
Section 11.11 UCC Filings.............................................................................. 43
ARTICLE XII. ASSIGNMENTS; PARTICIPATIONS................................................................... 43
Section 12.1 Assignments.............................................................................. 43
Section 12.2 Participations........................................................................... 45
Section 12.3 Limitation on Assignments and Participations............................................. 45
ARTICLE XIII. MISCELLANEOUS................................................................................ 46
Section 13.1 Waivers and Amendments................................................................... 46
Section 13.2 Notices.................................................................................. 46
Section 13.3 Ratable Payments......................................................................... 46
Section 13.4 Protection of Ownership Interests of the Transferees..................................... 47
Section 13.5 Confidentiality.......................................................................... 47
Section 13.6 Bankruptcy Petition...................................................................... 48
Section 13.7 Limitation of Liability.................................................................. 48
Section 13.8 CHOICE OF LAW............................................................................ 48
Section 13.9 CONSENT TO JURISDICTION.................................................................. 49
Section 13.10 WAIVER OF JURY TRIAL..................................................................... 49
Section 13.11 Integration; Binding Effect; Survival of Terms........................................... 49
Section 13.12 Counterparts; Severability; Section References........................................... 50
Section 13.13 Characterization......................................................................... 50
Section 13.14 Nonrecourse Nature of Transactions....................................................... 50
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EXHIBITS AND SCHEDULES
Exhibit I Definitions
Exhibit II Form of Transfer Notice
Exhibit III Transferor's State of Organization; Chief Executive
Office; Locations of Records; Federal Employer and
Organizational Identification Numbers
Exhibit IV Names of Collection Banks; Collection Accounts
Exhibit V Form of Compliance Certificate
Exhibit VI Form of Assignment Agreement
Exhibit VII Credit and Collection Policy
Exhibit VIII Form of Performance Undertaking
Exhibit IX Form of Settlement Report
Exhibit X Form of Interim Settlement Report
Schedule A Commitments
Schedule B Closing Documents
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RECEIVABLES TRANSFER AGREEMENT
THIS RECEIVABLES TRANSFER AGREEMENT dated as of February 14,
2003, is among:
(a) FSI Receivables Company LLC, a Delaware limited
liability company formerly known as FSI Receivables Corp.
("TRANSFEROR"),
(b) Xxxxxx Scientific International Inc., a Delaware
corporation ("PARENT"), as initial Servicer,
(c) Blue Ridge Asset Funding Corporation, a Delaware
corporation ("BLUE RIDGE" or a "CONDUIT"), and Liberty Street Funding
Corp., a Delaware corporation ("XXXXXXX XXXXXX" or a "CONDUIT"),
(d) Wachovia Bank, National Association, a national
banking association ("WACHOVIA"), and its assigns (collectively, the
"BLUE RIDGE LIQUIDITY BANKS" and, together with Blue Ridge, the "BLUE
RIDGE GROUP"), The Bank of Nova Scotia, a Canadian chartered bank
acting through its New York Agency ("SCOTIABANK"), and its assigns
(collectively, the "LIBERTY STREET LIQUIDITY BANKS" and, together with
Liberty Street, the "LIBERTY STREET GROUP"),
(e) Wachovia, in its capacity as agent for the Blue Ridge
Group (the "BLUE RIDGE AGENT" or a "CO-AGENT"), Scotiabank, in its
capacity as agent for the Liberty Street Group (the "LIBERTY STREET
AGENT" or a "CO-AGENT"),
(f) Wachovia, in its capacity as administrative agent for
the Blue Ridge Group, the Liberty Street Group and each Co-Agent (in
such capacity, together with its successors and assigns, the
"ADMINISTRATIVE AGENT" and, together with each of the Co-Agents, the
"AGENTS").
UNLESS DEFINED ELSEWHERE HEREIN, CAPITALIZED TERMS USED IN THIS AGREEMENT SHALL
HAVE THE MEANINGS ASSIGNED TO SUCH TERMS IN EXHIBIT I (OR, IF NOT DEFINED IN
EXHIBIT I HERETO, THE MEANING ASSIGNED TO SUCH TERM IN EXHIBIT I TO THE
RECEIVABLES PURCHASE AGREEMENT).
PRELIMINARY STATEMENTS
Transferor desires to transfer and assign from time to time
Receivable Interests to certain of the Transferees.
Upon a Co-Agent's receipt of a notice of proposed transfer,
its Conduit may, in its absolute and sole discretion, acquire the
applicable Receivable Interest from Transferor, and in the event that
such Conduit declines to make any such acquisition and if so requested
by Transferor, no other Conduit is able to acquire such Receivable
Interest, the declining Conduit's Liquidity Banks shall, at the request
of Transferor, make such acquisition.
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Wachovia has been requested and is willing to act as Blue
Ridge Agent on behalf of the Blue Ridge Group in accordance with the
terms hereof.
Scotiabank has been requested and is willing to act as Liberty
Street Agent on behalf of the Liberty Street Group in accordance with
the terms hereof.
Wachovia has been requested and is willing to act as
Administrative Agent on behalf of the Transferees in accordance with
the terms hereof.
ARTICLE I.
TRANSFER ARRANGEMENTS
Section 1.1 Transfer Facility.
(a) On the terms and subject to the conditions set forth in
this Agreement:
(i) Transferor (or the Servicer on Transferor's behalf)
may from time to time on and after the Closing Date and prior to the
Amortization Date for each applicable Group, transfer and assign
Receivable Interests to one or more of the Groups of its choosing by
delivering a Transfer Notice to the applicable Co-Agents in accordance
with Section 1.2; and
(ii) Not later than 12:00 p.m. (New York time) on the
proposed date of transfer, each of the recipient Co-Agents shall
determine whether its Conduit will acquire its Group's Receivable
Interest, and in the event that any applicable Conduit elects not to
make any such acquisition, its Co-Agent shall promptly notify
Transferor and that Conduit's Liquidity Banks of such fact, whereupon,
except as set forth in Section 1.1(a)(iii), each of its Liquidity Banks
severally agrees to acquire on such proposed date of transfer its
Ratable Share of such Receivable Interest, on the terms and subject to
the conditions hereof, PROVIDED that (A) at no time may the Group
Invested Amount of any Group at any one time outstanding exceed such
Group's Group Limit, and (B) at no time may the Aggregate Invested
Amount outstanding hereunder exceed the lesser of the Transfer Limit
and the Adjusted Pool Balance.
(iii) In the event that pursuant to Section 1.1(a)(ii), a
Co-Agent notifies Transferor that its Conduit will not acquire its
Group's Receivable Interest on a proposed date of transfer (such
Conduit, a "DECLINING CONDUIT"), then, Transferor may offer that
Group's Receivable Interest to a different Group by delivery of another
written Transfer Notice (a "SUBSTITUTE TRANSFER NOTICE") to the
applicable Co-Agent not later than 1:00 p.m. (New York time). Following
receipt of a Substitute Transfer Notice, the recipient Co-Agent shall
promptly notify Transferor whether its Conduit will acquire the offered
Receivable Interest. If such Co-Agent notifies Transferor that its
Conduit will not acquire such Receivables Interest, then Transferor (A)
shall promptly and irrevocably cancel
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the Substitute Transfer Notice by written notice delivered to the
applicable Co-Agent not later than 2:00 p.m. (New York time) on such
date and (B) shall either (1) cancel the original Transfer Notice by
irrevocable written notice to the applicable Co-Agent delivered not
later than 2:00 p.m. (New York time) on such date, or (2) deliver a
further irrevocable written Transfer Notice (a "Second Transfer
Notice") to the Co-Agent that received the original Transfer Notice
with respect to the such Receivable Interest stating that the
Transferor elects to have the Receivable Interest acquired by such
Co-Agent's Group's Liquidity Banks, whereupon the applicable Liquidity
Banks shall be obligated to acquire their respective Ratable Shares of
such Receivable Interest on the next Business Day following the
delivery of the Second Transfer Notice.
(b) Each Group's Liquidity Banks' Commitments to
Transferor under this Agreement shall terminate on such Group's Amortization
Date (although their Liquidity Commitments to their respective Conduits may
continue beyond such date). Nothing contained in this Agreement shall, or shall
be deemed to, constitute a commitment by any Conduit to acquire any Receivable
Interest.
(c) Transferor may upon at least ten (10) Business Days'
irrevocable notice to the applicable Co-Agent, with a copy to the Administrative
Agent, terminate in whole or reduce in part the unused portion of any Group's
Group Limit; PROVIDED that (i) each partial reduction of a Group Limit shall be
in an aggregate amount at least equal to $10,000,000 and any larger integral
multiple of $1,000,000, (ii) in no event shall any Group's Group Limit be
reduced to less than $40,000,000 unless it is reduced to $0, (iii) each partial
reduction of a Group Limit shall reduce that Group's Liquidity Banks'
Commitments ratably in accordance with their respective Ratable Shares, and (iv)
each reduction of a Group Limit shall reduce the Transfer Limit in a like
amount.
Section 1.2 Increases. Transferor shall determine to which Groups
it will transfer Receivable Interests on any given Business Day and provide each
applicable Co-Agent (with a copy to the Administrative Agent) with at least one
(1) Business Day's prior written notice in the form set forth as Exhibit II
hereto of each Incremental Transfer (each, a "TRANSFER NOTICE"). If any Transfer
Notice is received by a Co-Agent later than 3:00 p.m. (New York time) on the
Business Day prior to the proposed transfer date, the acquisition by its Group
of a Receivable Interest on the following Business Day shall be on a
best-efforts basis only. Each Transfer Notice shall be subject to Section 6.2
hereof, shall be irrevocable, and shall specify:
(a) the participating Group(s),
(b) the requested Transfer Price(s) for each Receivable
Interest (which shall not be less than $1,000,000 for any Group) or, to
the extent that the then available Transfer Limit is less than such
amount, such lesser amount equal to such available portion of the
Transfer Limit),
(c) the proposed date of transfer, and
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(d) in case the Incremental Transfer is ultimately funded
by any Group's Liquidity Banks, the requested Discount Rate and Tranche
Period.
Following receipt of a Transfer Notice, each recipient Co-Agent will determine
whether its Conduit agrees to acquire the Receivable Interest being offered to
it. If any applicable Conduit declines to make a proposed acquisition and no
other Conduit elects to acquire such Receivable Interests, then following
delivery of a Second Transfer Notice in accordance with Section 1.1(a)(iii) the
Incremental Transfer to that Group will be funded by such Conduit's Liquidity
Banks. On the date of each Incremental Transfer, subject to prior satisfaction
of the applicable conditions precedent set forth in Article VI, each of the
applicable Conduits or its Liquidity Banks, as applicable, shall deposit to the
Facility Account, in immediately available funds, no later than 4:00 p.m. (New
York time), an amount equal to (i) in the case of a Conduit, the Transfer Price
for the Receivable Interest then being transferred to it or (ii) in the case of
a Liquidity Bank, such Liquidity Bank's Ratable Share of such Transfer Price.
Section 1.3 Decreases. Transferor shall provide each of the
affected Co-Agents with prior written notice in conformity with the Required
Notice Period (each, a "REDUCTION NOTICE") of any proposed reduction in its
Group's Group Invested Amount. Each Reduction Notice shall be irrevocable and
shall designate (a) the applicable Group or Groups, (b) the date (the "PROPOSED
REDUCTION DATE") upon which any such reduction shall occur (which date shall
give effect to the applicable Required Notice Period), and (c) the amount of
each applicable Group's Group Reduction. Only one (1) Reduction Notice per Group
shall be outstanding at any time.
Section 1.4 Payment Requirements. All amounts to be paid or
deposited by any Transferor Party pursuant to any provision of this Agreement
shall be paid or deposited in accordance with the terms hereof no later than
11:00 a.m. (New York time) on the day when due in immediately available funds,
and if not received before 11:00 a.m. (New York time) shall be deemed to be
received on the next succeeding Business Day. If such amounts are payable to the
Blue Ridge Agent, the Administrative Agent, or to a member of the Blue Ridge
Group, they shall be paid to account no. 8735-098787 at Wachovia Bank, National
Association, in Winston-Salem, North Carolina, ABA No. 000000000 until otherwise
notified by the Blue Ridge Agent or the Administrative Agent (the "BLUE RIDGE
GROUP ACCOUNT"). If such amounts are payable to the Liberty Street Agent or to a
member of the Liberty Street Group, they shall be paid to Liberty Street Funding
Corp.'s account no. 2158-13 at The Bank of Nova Scotia - New York Agency, in New
York, New York, ABA No. 026-002532, until otherwise notified by the Liberty
Street Agent (the "LIBERTY STREET GROUP ACCOUNT"). 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.
Section 1.5 Computations. All computations of Yield, per annum
fees calculated as part of any Conduit's CP Costs, and per annum fees hereunder
and under the Fee Letters, shall be made on the basis of a year of 360 days for
the actual number of days elapsed for the Calculation Period then most recently
ended.
Section 1.6 Extension of Liquidity Termination Date. If any
Conduit's Liquidity Banks fail to approve an extension of the applicable Group's
Liquidity Termination Date by the
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60th day prior thereto, the Transferor will first offer such Conduit's Group's
Group Limit to the other Conduits. If neither of the other Conduits wishes to
increase its Group Limit, the Transferor will then have until the originally
scheduled Liquidity Termination Date for such Group to find another A1/P1 or
better rated multi-seller commercial paper conduit (and liquidity providers) to
accept an assignment of the non-approving Conduit's and Liquidity Banks'
Receivable Interests and, as applicable, Commitments. If such replacements
cannot be located within such period, the applicable Conduit's and its Liquidity
Banks' Receivable Interests will amortize as originally scheduled, but the
remaining Conduits' Liquidity Banks' Liquidity Termination Dates will be
extended for another 364 days. If one or both of the other Conduits agrees to
increase its Group's Group Limit, or if such replacements are located, the
non-approving Conduit and its Liquidity Banks shall assign their investments and
commitments, as of the existing Liquidity Termination Date, to such other
Conduit(s) or replacements, as the case may be, whereupon its assignees'
Liquidity Termination Date, as well as the Liquidity Termination Date for all
remaining Conduits and their Liquidity Banks, shall be extended for 364-days.
ARTICLE II.
PAYMENTS AND COLLECTIONS
Section 2.1 Payments. Notwithstanding any limitation on recourse
contained in this Agreement, Transferor shall immediately pay to each of the
Co-Agents when due, for the account of the relevant Transferee or Transferees in
its Group, on a full recourse basis, all of the following (collectively, the
"OBLIGATIONS"):
(a) such fees as set forth in the Fee Letters (which fees
shall be sufficient to pay all fees owing to each Conduit's Liquidity
Banks),
(b) all CP Costs,
(c) all amounts payable as Yield,
(d) all amounts payable as Deemed Collections (which
shall be immediately due and payable by Transferor and applied to
reduce outstanding Aggregate Invested Amount hereunder in accordance
with Sections 2.2 and 2.3 hereof),
(e) all amounts required pursuant to Section 2.6,
(f) all amounts payable pursuant to Article X, if any,
(g) all Servicer costs and expenses, including the
Servicing Fee, in connection with servicing, administering and
collecting the Receivables, such amounts to be paid to the Servicer on
behalf of the Transferees,
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(h) all Broken Funding Costs (which shall be immediately
due and payable by Transferor upon the occurrence of any Group
Reduction giving rise thereto), and
(i) all Default Fees (which shall be immediately due and
payable by Transferor upon demand).
If Transferor fails to pay any of the Obligations when due, Transferor agrees to
pay, on demand, the Default Fee in respect thereof until paid. Notwithstanding
the foregoing, no provision of this Agreement or the Fee Letters shall require
the payment or permit the collection of any amounts hereunder in excess of the
maximum permitted by applicable law.
Section 2.2 Collections and Reinvestments prior to Amortization.
(a) On each day prior to a particular Group's
Amortization Date, such Group's Outstanding Percentage as of the end of the
prior Business Day of (i) all Deemed Collections and (ii) all Collections
received or deemed received pursuant to the definition of Deemed Collections by
any Transferor Party on such day (such Group's "GROUP COLLECTIONS") shall either
be set aside and held in trust by the Servicer for the payment of any accrued
and unpaid Aggregate Unpaids owing to the members of such Group or for a
Reinvestment by such Group as provided in this Section 2.2 (which obligation to
hold in trust shall be satisfied, prior to the applicable Settlement Date, upon
the marking by the Servicer on its books and records to reflect the interest of
the applicable Group in such Collections and Deemed Collections.
(b) If on any day prior to a particular Group's
Amortization Date, provided that no Amortization Event exists and is continuing,
any Group Collections are received for the account of such Group pursuant to
Section 2.2(a), Transferor hereby requests -- and the Transferees in that Group
hereby agree to make, simultaneously with such receipt -- a reinvestment (each,
a "REINVESTMENT") with all or a portion of such Group Collections such that
after giving effect to such receipt and Reinvestment, that Group's Group
Invested Amount will equal its Group Invested Amount immediately prior to such
receipt and Reinvestment.
(c) On each Settlement Date prior to the occurrence of a
particular Group's Amortization Date, the Servicer shall remit to the applicable
Group Account such Group's Group Collections set aside pursuant to Section
2.2(a) during the preceding Settlement Period that have not been subject to a
Reinvestment and apply such amounts (if not previously paid in accordance with
Section 2.1) to reduce unpaid Obligations owing to the members of that Group.
Once such Group's Obligations have been reduced to zero, any of its remaining
Group Collections shall (i) if applicable, be remitted to the applicable Group
Account no later than 11:00 a.m. (New York time) to the extent required to fund
any applicable Group Reduction on such Settlement Date and (ii) thereafter be
remitted to Transferor on such Settlement Date.
Section 2.3 Collections Following Amortization.
(a) On each day on or after the occurrence of an
Amortization Event which has not been waived but which has not yet resulted in
the occurrence of a particular Group's Amortization Date, such Group's Group
Collections shall be set aside in a separate segregated
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Collection Account and held in trust therein by the Servicer for the payment on
the next Settlement Date of any accrued and unpaid Aggregate Unpaids owing to
the members of such Group as provided in Section 2.3(b), or, in the event such
Amortization Event is waived, for Reinvestment pursuant to Section 2.2(b) on the
effective date of such waiver. On each day on or after the occurrence of a
particular Group's Amortization Date, such Group's Group Collections shall be
set aside in a separate segregated Collection Account and held in trust therein
by the Servicer for the payment on the next Settlement Date of any accrued and
unpaid Aggregate Unpaids owing to the members of such Group as provided in
Section 2.3(b).
(b) On each Settlement Date occurring on or after a
particular Group's Amortization Date, the Servicer shall remit to the applicable
Group Account such Group's Group Collections and apply such amounts in the
following order of priority:
FIRST, to payment of such Group's Outstanding Percentage as of
the end of the prior Business Day of all Servicer costs and expenses,
including the Servicing Fee, in connection with servicing,
administering and collecting the Receivables,
SECOND, to such Group's Outstanding Percentage as of the end
of the prior Business Day of the Administrative Agent's costs of
collection and enforcement of this Agreement,
THIRD, ratably to the payment of all accrued and unpaid fees
under such Group's Fee Letter, and to all CP Costs and Yield owing to
members of that Group,
FOURTH, ratably to reduction of the Group Invested Amount,
FIFTH, for the ratable payment of all other unpaid Obligations
(including, without limitation, any Default Fees owing to such Group),
and
SIXTH, after the Aggregate Unpaids owing to such Group have
been reduced to zero, to Transferor.
Section 2.4 Payment Rescission. No payment of any Aggregate
Unpaids shall be considered paid or applied hereunder to the extent that, at any
time, all or any portion of such payment or application is rescinded by
application of law or judicial authority, or must otherwise be returned or
refunded for any reason. Transferor shall remain obligated, only to the extent
it was obligated prior to such rescission, for the amount of any payment or
application so rescinded, returned or refunded, and shall promptly pay to the
applicable Co-Agent (for application to the Person or Persons who suffered such
rescission, return or refund) the full amount thereof, plus the Default Fee from
the date of any such rescission, return or refunding.
Section 2.5 Maximum Receivable Interests. Transferor shall ensure
that the Receivable Interests of all Transferees at no time exceed in the
aggregate 100%. If the aggregate of the Receivable Interests of the Transferees
exceeds 100%, Transferor shall pay to one or more of the Co-Agents within one
(1) Business Day an aggregate amount to be applied to reduce such
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Co-Agents' Group Invested Amount (as allocated by such Co-Agent), such that
after giving effect to such payment, the aggregate of the Receivable Interests
does not exceed 100%.
Section 2.6 Clean Up Call. In addition to Transferor's rights
pursuant to Sections 1.1(c) and 1.3, Transferor shall have the right (after
providing written notice to the Agents in accordance with the Required Notice
Period), on any Settlement Date following the reduction of the Aggregate
Invested Amount to a level that is less than 10.0% of the highest Transfer Limit
applicable at any time under this Agreement, to reacquire from the Transferees
all, but not less than all, of the then outstanding Receivable Interests. The
reacquisition price in respect thereof shall be an amount equal to the Aggregate
Unpaids through the date of such reacquisition, payable in immediately available
funds. Such reacquisition shall be without representation, warranty or recourse
of any kind by, on the part of, or against any Transferee or any Agent other
than a warranty that Transferee or any Agent has not created any Adverse Claims
with respect to the Receivable Interest.
ARTICLE III.
CONDUIT FUNDING
Section 3.1 CP Costs. Transferor shall pay CP Costs with respect
to the Invested Amount associated with each Receivable Interest of a Conduit
funded through the issuance of Commercial Paper for each day that any Invested
Amount in respect of such Receivable Interest is outstanding. Each Receivable
Interest of Blue Ridge or Liberty Street that is funded substantially with
Pooled Commercial Paper will accrue CP Costs each day on a pro rata basis, based
upon the percentage share the Invested Amount in respect of such Receivable
Interest represents in relation to all assets held by such Conduit and funded
substantially with related Pooled Commercial Paper
Section 3.2 CP Costs Payments. On each Settlement Date,
Transferor shall pay to each of the Co-Agents (for the benefit of its Conduit)
an aggregate amount equal to all accrued and unpaid CP Costs in respect of the
Invested Amount associated with all Receivable Interests funded with Commercial
Paper of such Conduit for the immediately preceding Settlement Period in
accordance with Article II.
Section 3.3 Calculation of CP Costs. Not later than the 5th
Business Day after the end of each Accrual Period, each Co-Agent shall calculate
the aggregate amount of CP Costs allocated to the Invested Amount of its
Conduit's Receivable Interests for the applicable Accrual Period and shall
notify Transferor of such aggregate amount. Such calculation shall represent
actual CP Costs for the Accrual Period then most recently ended in the case of
Blue Ridge or Liberty Street.
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ARTICLE IV.
LIQUIDITY BANK FUNDING
Section 4.1 Liquidity Bank Funding. Each Receivable Interest of
any Conduit's Liquidity Banks shall accrue Yield for each day during its Tranche
Period at either the LIBO Rate or the Alternate Base Rate in accordance with the
terms and conditions hereof. Until Transferor gives notice to the applicable
Co-Agent of another Discount Rate in accordance with Section 4.4, the initial
Discount Rate for any Receivable Interest transferred by a Conduit to its
Liquidity Banks pursuant to the terms and conditions of its Liquidity Agreement,
or funded by the Liquidity Banks pursuant to this Agreement, shall be the
Alternate Base Rate. If any Conduit's Liquidity Banks acquire by assignment from
such Conduit any Receivable Interest pursuant to the applicable Liquidity
Agreement, each Receivable Interest so assigned shall each be deemed to have a
new Tranche Period commencing on the date of any such assignment.
Section 4.2 Yield Payments. On the Settlement Date for each
Receivable Interest of a Conduit's Liquidity Banks, Transferor shall pay to the
applicable Co-Agent (for the ratable benefit of the Liquidity Banks in its
Group) an aggregate amount equal to the accrued and unpaid Yield for the entire
Tranche Period of each such Receivable Interest in accordance with Article II.
Section 4.3 Selection and Continuation of Tranche Periods.
(a) With consultation from (and approval by) the applicable
Co-Agent, Transferor shall from time to time request Tranche Periods for the
Receivable Interests of the Liquidity Banks in such Co-Agent's Group, PROVIDED
that if at any time such Liquidity Banks shall have a Receivable Interest
outstanding, Transferor shall always request Tranche Periods such that at least
one Tranche Period shall end on the date specified in clause (a) of the
definition of Settlement Date.
(b) Transferor or the applicable Co-Agent, upon notice to and
consent by the other received at least three (3) Business Days prior to the end
of a Tranche Period (the "TERMINATING TRANCHE") for any Receivable Interest,
may, effective on the last day of the Terminating Tranche: (i) divide any such
Receivable Interest into multiple Receivable Interests, (ii) combine any such
Receivable Interest with one or more other Receivable Interests that have a
Terminating Tranche ending on the same day as such Terminating Tranche or (iii)
combine any such Receivable Interest with a new Receivable Interest to be
acquired by such Co-Agent's Group on the day such Terminating Tranche ends,
PROVIDED that in no event may a Receivable Interest of a Conduit be combined
with a Receivable Interest of its Liquidity Banks.
Section 4.4 Liquidity Bank Discount Rates. Transferor may select
the LIBO Rate or the Alternate Base Rate for each Receivable Interest of any
Conduit's Liquidity Banks. Transferor shall by 12:00 p.m. (New York time): (i)
at least three (3) Business Days prior to the expiration of any Terminating
Tranche with respect to which the LIBO Rate is being requested as a new Discount
Rate and (ii) at least one (1) Business Day prior to the expiration of any
Terminating Tranche with respect to which the Alternate Base Rate is being
requested as a new
9
Discount Rate, give the applicable Co-Agent irrevocable notice of the new
Discount Rate and Tranche Period for the Receivable Interest associated with
such Terminating Tranche. Until Transferor gives notice to the applicable
Co-Agent of another Discount Rate, the initial Discount Rate for any Receivable
Interest transferred to the Liquidity Banks in its Group pursuant to the terms
and conditions of the applicable Liquidity Agreement shall be the Alternate Base
Rate.
Section 4.5 Suspension of the LIBO Rate
(a) If any Liquidity Bank notifies the applicable
Co-Agent that it has determined that funding its Ratable Share of the Receivable
Interests of the Liquidity Banks in its Group at a LIBO Rate would violate any
applicable law, rule, regulation, or directive of any governmental or regulatory
authority, due to a Regulatory Change, or that (i) deposits of a type and
maturity appropriate to match fund its Receivable Interests at such LIBO Rate
are not available or (ii) such LIBO Rate does not accurately reflect the cost of
acquiring or maintaining a Receivable Interest at such LIBO Rate, then such
Co-Agent shall suspend the availability of such LIBO Rate for its Group and
require Transferor to select the Alternate Base Rate for any Receivable Interest
of its Group funded by its Liquidity Banks.
(b) If less than all of the Liquidity Banks in a Group
give a notice to their applicable Co-Agent pursuant to Section 4.5(a), each
Liquidity Bank which gave such a notice shall be obliged, at the request of
Transferor, the applicable Conduit or the applicable Co-Agent, to assign all of
its rights and obligations hereunder to (i) another Liquidity Bank or (ii)
another funding entity nominated by Transferor or such Co-Agent that is
acceptable to the applicable Conduit and willing to participate in this
Agreement through the Liquidity Termination Date in the place of such notifying
Liquidity Bank; PROVIDED that (A) the notifying Liquidity Bank receives payment
in full, pursuant to an Assignment Agreement, of an amount equal to such
notifying Liquidity Bank's Ratable Share of the Invested Amount owing to all of
the Liquidity Banks in its Group and all accrued but unpaid fees and other costs
and expenses payable in respect of its Ratable Share of the Receivable Interests
of such Liquidity Banks, and (B) the replacement Liquidity Bank otherwise
satisfies the requirements of Section 12.1(b).
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of the Transferor
Parties. Each Transferor Party hereby represents and warrants to the Agents and
the Transferees, as to itself, as of the date hereof and as of the date of each
Incremental Transfer and the date of each Reinvestment that:
(a) Existence and Power. Such Transferor Party is duly
organized, validly existing and in good standing under the laws of its state of
organization. Except for Transferor, which has taken, on the date hereof, all
necessary steps to be qualified in New Hampshire, such Transferor Party is duly
qualified to do business and is in good standing as a foreign corporation or
limited liability company, as the case may be, and has and holds all corporate
power and all governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its business is
conducted except where the failure to so qualify or so
10
hold would not reasonably be expected to have a Material Adverse Effect on such
Transferor Party or the Receivables.
(b) Power and Authority; Due Authorization, Execution and
Delivery. The execution and delivery by such Transferor Party of this Agreement
and each other Transaction Document to which it is a party, and the performance
of its obligations hereunder and thereunder and, in the case of Transferor,
Transferor's use of the proceeds of transfers made hereunder, are within its
corporate powers and authority and have been duly authorized by all necessary
corporate action on its part. This Agreement and each other Transaction Document
to which such Transferor Party is a party has been duly executed and delivered
by such Transferor Party.
(c) No Conflict. The execution and delivery by such Transferor
Party of this Agreement and each other Transaction Document to which it is a
party, and the performance of its obligations hereunder and thereunder 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
except, in any case described in the foregoing clauses (ii), (iii) and (iv),
where such contravention or violation would not reasonably be expected to have a
Material Adverse Effect, and do not result in the creation or imposition of any
Adverse Claim on assets of such Transferor Party or its Subsidiaries (except as
created under the Transaction Documents); and no transaction contemplated hereby
requires compliance with any bulk sales act or similar law.
(d) 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 and delivery by such
Transferor Party of this Agreement and each other Transaction Document to which
it is a party and the performance of its obligations hereunder and thereunder.
(e) Actions, Suits. There are no actions, suits or proceedings
pending, or to the best of such Transferor Party's knowledge, threatened,
against or affecting such Transferor Party, or any of its properties, in or
before any court, arbitrator or other body, that would reasonably be expected to
have a Material Adverse Effect on such Transferor Party or the Receivables. Such
Transferor Party is not in default with respect to any order of any court,
arbitrator or governmental body if such default would result in a Material
Adverse Effect.
(f) Binding Effect. This Agreement and each other Transaction
Document to which such Transferor Party is a party constitute the legal, valid
and binding obligations of such Transferor Party enforceable against such
Transferor Party 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 and by
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
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(g) Accuracy of Information. All information heretofore
furnished by such Transferor Party or any of its Affiliates to any of the Agents
or the Transferees 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 such Transferor
Party or any of its Affiliates to any of the Agents or the Transferees will be,
true and accurate in every material respect on the date such information is
stated or certified (or, if such information specifies another date, such other
date) 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; PROVIDED, HOWEVER, with respect to projected
financial information and forward looking statements that involve factors such
as general economic and business conditions; industry trends; overseas
expansion; the loss of major customers and suppliers; the timing of orders
received from customers; cost and availability of energy and raw materials;
changes in business strategy or development plans; availability and quality of
management; and availability, terms and deployment of capital, if any, such
Transferor Party represents only that such information was prepared in good
faith based on assumptions believed to be reasonable at the time.
(h) Use of Proceeds. No use of the proceeds of any transfer
hereunder will violate the Securities Act of 1933, as amended, or the
regulations issued pursuant thereto, or the Securities Exchange Act of 1934, as
amended, or the regulations issued pursuant thereto, or Regulation T, U or X
promulgated by the Board of Governors of the Federal Reserve System.
(i) Good Title. Except with respect to the Purchased
Receivables (as defined in the recitals of the Receivables Purchase Agreement)
and associated Related Security on each of which all Adverse Claims will be
extinguished concurrently with the initial transfer under the Receivables
Purchase Agreement, Transferor shall be the legal and beneficial owner of the
Receivables and Related Security with respect thereto, free and clear of any
Adverse Claim, except as created by the Transaction Documents. There have been
duly filed or delivered for filing all financing statements or other similar
instruments or documents necessary under the UCC (or any comparable law) of all
appropriate jurisdictions to perfect Transferor's ownership interest in each
Receivable, the Collections and the Related Security.
(j) Perfection. This Agreement, together with the filing of
the financing statements contemplated hereby, is effective to, and shall, upon
each transfer hereunder, transfer to the Administrative Agent for the benefit of
the relevant Transferee or Transferees (and the Administrative Agent for the
benefit of such Transferee or Transferees shall acquire from Transferor) a valid
and perfected first priority undivided percentage ownership or security interest
in each Receivable existing or hereafter arising and in the Related Security and
Collections with respect thereto, free and clear of any Adverse Claim, except as
created or permitted by the Transactions Documents. There have been duly filed
or delivered for filing all financing statements or other similar instruments or
documents necessary under the UCC (or any comparable law) of all appropriate
jurisdictions to perfect the Administrative Agent's (on behalf of the
Transferees) ownership or security interest in the Receivables, the Related
Security and the Collections.
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(k) Places of Business and Locations of Records. Transferor's
state of organization and chief executive office and the offices where it or the
Servicer keeps all of the Records are located at the address(es) listed on
Exhibit III or such other locations of which the Agents have been notified in
accordance with Section 7.2(a) in jurisdictions where all action required by
Section 13.4(a) has been taken and completed. Transferor's Federal Employer
Identification Number and Organizational Identification Number (if any) are
correctly set forth on Exhibit III.
(l) Collections. The conditions and requirements set forth in
Section 7.1(j) and Section 8.2 have at all times been satisfied and duly
performed. The names and addresses of all Collection Banks, together with the
account numbers of the Collection Accounts of Transferor at each Collection Bank
and the post office box number of each Lock-Box, are listed on Exhibit IV (as
updated from time to time). Transferor 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 take dominion and control
of any such Lock-Box or Collection Account at a future time or upon the
occurrence of a future event.
(m) Material Adverse Effect. Except as otherwise disclosed in
any public filing or otherwise disclosed to the Agents, in each case prior to
the date hereof, each Transferor Party represents and warrants that since
September 30, 2002, no event has occurred that constitutes a Material Adverse
Effect.
(n) Names. In the past five (5) years, Transferor has not used
any corporate names, trade names or assumed names other than the name in which
it has executed this Agreement.
(o) Ownership of Transferor. Parent owns, directly or
indirectly, 100% of the issued and outstanding Equity Interests of Transferor.
Such capital stock is validly issued, fully paid and nonassessable, and there
are no options, warrants or other rights to acquire securities of Transferor.
(p) Not a Holding Company or an Investment Company. Such
Transferor Party is not a "holding company" or a "subsidiary holding company" of
a "holding company" within the meaning of the Public Utility Holding Company Act
of 1935, as amended, or any successor statute. Such Transferor Party is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, or any successor statute.
(q) Compliance with Law. Such Transferor Party has complied in
all respects with all applicable laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, except
where the failure to so comply would not reasonably be expected to have a
Material Adverse Effect. Each Receivable, together with the Contract related
thereto, does not contravene any laws, rules or regulations applicable thereto
(including, without limitation, laws, rules and regulations relating to truth in
lending, fair credit billing, fair credit reporting, equal credit opportunity,
fair debt collection practices and privacy), and no part of such Contract is in
violation of any such law, rule or regulation, except where such contravention
or violation would not reasonably be expected to have a Material Adverse Effect.
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(r) Compliance with Credit and Collection Policy. Such
Transferor Party has complied in all material respects with the Credit and
Collection Policy with regard to each Receivable and the related Contract, and
has not made any material change to such Credit and Collection Policy, except
such material change as to which the Agents have been notified in accordance
with Section 7.1(a)(vii).
(s) Payments to Applicable Originator. With respect to each
Receivable transferred to Transferor under the Receivables Purchase Agreement,
Transferor has given reasonably equivalent value to the applicable Originator in
consideration therefor and such transfer was not made for or on account of an
antecedent debt. No transfer by any Originator of any Receivable under the
Receivables Purchase Agreement is or may be voidable under any section of the
Bankruptcy Reform Act of 1978 (11 U.S.C. Sections 101 et seq.), as amended.
(t) Enforceability of Contracts. Each Contract with respect to
each Receivable is effective to create, and has created, a legal, valid and
binding obligation of the related Obligor to pay the Outstanding Balance of the
Receivable created thereunder and any accrued interest thereon, enforceable
against the Obligor 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 and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(u) Eligible Receivables. Each Receivable included in the Net
Pool Balance as an Eligible Receivable on a Settlement Report Date was an
Eligible Receivable on such date.
(v) Net Pool Balance. (i) On the date of each Incremental
Transfer or Reinvestment hereunder, immediately after giving effect thereto, the
Net Pool Balance as of the last day covered by the most recent Settlement Report
or Interim Settlement Report is at least equal to the sum of (A) the Aggregate
Invested Amount (as of the date of such transfer), plus (B) the Required
Reserves as of the last day covered by the most recent Settlement Report or
Interim Settlement Report, and (ii) immediately after giving effect to each
Reinvestment hereunder, since the last day covered by the most recent Settlement
Report or Interim Settlement Report, nothing has come to either Transferor
Party's attention to lead it to believe that it would reasonably be expected
that the Net Pool Balance does not equal or exceed the sum of (A) the Aggregate
Invested Amount as of such date, plus (B) the Required Reserves as of the last
day covered by the most recent Settlement Report or Interim Settlement Report.
(w) Accounting. Such Transferor Party will not, and will not
permit any controlled Affiliate to, financially account (whether in financial
statements or otherwise) for the transactions contemplated by the Receivables
Purchase Agreement in any manner other than the sale or other outright
conveyance or in any other respect account for or treat the transactions
contemplated by the Receivables Purchase Agreement in any manner other than as a
sale except to the extent that such transactions are not recognized on account
of consolidated financial reporting in accordance with generally accepted
accounting principles.
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ARTICLE VI.
CONDITIONS OF PURCHASES
Section 6.1 Conditions Precedent to Initial Incremental Transfer.
The obligation to make the initial Incremental Transfer of a Receivable Interest
under this Agreement is subject to satisfaction of the conditions precedent that
(a) in the case of the Transferor, the initial Purchase shall have occurred
under the Receivables Purchase Agreement on or before the Closing Date, and (b)
in the case of any other party hereto, (i) the Administrative Agent shall have
received on or before the Closing Date the documents listed on Schedule B, and
(ii) each of the Agents shall have received all fees and expenses required to be
paid on or before the Closing Date pursuant to the terms of this Agreement and
the applicable Fee Letter(s).
Section 6.2 Conditions Precedent to All Transfers and
Reinvestments. Each Incremental Transfer of a Receivable Interest and each
Reinvestment shall be subject to the further conditions precedent that (a) in
the case of each such Incremental Transfer or Reinvestment: (i) the Servicer
shall have delivered to the Co-Agents on or prior to the date of such transfer,
in form and substance reasonably satisfactory to each of the Co-Agents, all
Settlement Reports or Interim Settlement Reports as and when due under Section
8.5 and (ii) in the event that Transferor is requesting an Incremental Transfer
in excess of the amount that would be allowed by the most recently delivered
Settlement Report or Interim Settlement Report, as applicable, the Servicer
shall have delivered to the Co-Agents at least three (3) days prior to such
Incremental Transfer an Interim Settlement Report showing a sufficient Net Pool
Balance to support the requested Incremental Transfer; (b) the Amortization Date
for the Group for which such Incremental Transfer has been effected shall not
have occurred; (c) the Agents shall have received such other approvals, opinions
or documents as any of them may reasonably request and (d) on the date of each
such Incremental Transfer or Reinvestment and after giving effect thereto, the
following statements shall be true (and acceptance of the proceeds of such
Incremental Transfer or Reinvestment shall be deemed a representation and
warranty by Transferor that such statements are then true):
(i) the representations and warranties set forth
in Section 5.1 are true and correct in all material respects on and as of the
date of such Incremental Transfer or Reinvestment as though made on and as of
such date;
(ii) no event has occurred and is continuing, or
would result from such Incremental Transfer or Reinvestment, that will
constitute an Amortization Event, and no event has occurred and is continuing,
or would result from such Incremental Transfer or Reinvestment, that would
constitute a Potential Amortization Event; and
(iii) the Aggregate Invested Amount does not
exceed the Transfer Limit.
It is expressly understood that each Reinvestment shall, unless otherwise
directed by any Agent or Transferee, occur automatically on each day that the
Servicer shall receive any Collections without the requirement that any further
action be taken on the part of any Person and
15
notwithstanding the failure of Transferor to satisfy any of the foregoing
conditions precedent in respect of such Reinvestment. The failure of Transferor
to satisfy any of the foregoing conditions precedent in respect of any
Reinvestment shall give rise to a right of each Co-Agent, which right may be
exercised at any time on demand of such Co-Agent, to rescind the related
transfer and direct Transferor to pay to the Co-Agents for the benefit of the
Transferees in their respective Group's their respective Percentages of the
Collections prior to the Amortization Date that shall have been applied to the
affected Reinvestment.
ARTICLE VII.
COVENANTS
Section 7.1 Affirmative Covenants of the Transferor Parties.
From and after the Closing Date until the date on which the Aggregate Unpaids
have been paid in full and this Agreement terminates in accordance with its
terms, each Transferor Party hereby covenants, as to itself, as set forth below:
(a) Financial Reporting. Such Transferor Party will maintain,
for itself and each of its Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish or cause to be furnished to
the Agents:
(i) Annual Reporting. Within the earlier of (A)
100 days after the close of each fiscal year of the Parent or (B) one Business
Day following the filing of such annual financial statements with the Securities
and Exchange Commission, a consolidated balance sheet of the Parent and its
Subsidiaries as at the end of such fiscal year, together with related
consolidated statements of income and retained earnings and of cash flows for
such fiscal year, setting forth in comparative form consolidated figures for the
preceding fiscal year, all in reasonable detail and certified by independent
certified public accountants of recognized national standing and whose opinion
shall be to the effect that such consolidated financial statements have been
prepared in accordance with GAAP applied on a consistent basis (except for
changes with which such accountants concur), TOGETHER WITH an unaudited annual
balance sheet and income statement for the Transferor.
(ii) Quarterly Reporting. Within the earlier of
(A) 50 days after the close of each fiscal quarter of the Parent or (B) one
Business Day following the filing of such quarterly financial statements with
the Securities and Exchange Commission, a consolidated balance sheet of the
Parent and its Subsidiaries as at the end of such fiscal quarter, together with
related consolidated statements of income and retained earnings and of cash
flows for such fiscal quarter and for the elapsed portion of the fiscal year
ended with the last day of such fiscal quarter, setting forth in comparative
form consolidated figures for the corresponding period of the preceding fiscal
year (except the consolidated balance sheets shall be compared to the prior year
end), and all in reasonable form and detail acceptable to the Agents, TOGETHER
WITH an unaudited balance sheet and income statement for the Transferor for the
calendar year to date.
(iii) Compliance Certificate. Together with the
financial statements required hereunder, a compliance certificate in
substantially the form of Exhibit V signed by
16
such Transferor Party's Authorized Officer and dated the date of such annual
financial statement or such quarterly financial statement, as the case may be.
(iv) Other Information. Promptly upon the
furnishing thereof, copies of any filings and registrations with, and reports
to, the Securities and Exchange Commission by the Parent or any of its
Subsidiaries and copies of all financial statements, proxy statements, notices
and reports as the Parent or any of its Subsidiaries shall send generally to
analysts, the holders of their capital stock or of senior indebtedness (in each
case to the extent not theretofore delivered to the Agents pursuant to this
Agreement) and, with reasonable promptness, such other information and documents
(financial or otherwise) as the Agents may reasonably request from time to time;
PROVIDED, HOWEVER, that in no event will Parent or any of its Subsidiaries be
required to disclose any information pursuant to this clause (iv) other than
"material nonpublic information" required to be publicly disclosed pursuant to
Regulation FD of the Securities and Exchange Commission.
(v) Copies of Notices. Promptly 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 Agents or Conduits, copies of the same.
(vi) Change in Credit and Collection Policy. At
least ten (10) Business Days prior to the effectiveness of any material change
in or material amendment to the Credit and Collection Policy, a copy of the
Credit and Collection Policy then in effect and a notice (A) indicating such
change or amendment, and (B) if such proposed change or amendment would
reasonably be expected to materially and adversely affect the collectibility of
the Receivables or materially decrease the credit quality of any newly created
Receivables, requesting the Agents' consent thereto.
(vii) Other Information. Promptly, from time to
time, such other information, documents, records or reports relating to the
Receivables or the condition or operations, financial or otherwise, of such
Transferor Party as any of the Agents may from time to time reasonably request
in order to protect the interests of the Agents and the Transferees under or as
contemplated by this Agreement.
(b) Notices. Servicer will notify the Agents in writing of any
of the following promptly (but in any event within four (4) Business Days) upon
learning of the occurrence thereof, describing the same and, if applicable, the
steps being taken with respect thereto:
(i) Amortization Events or Potential
Amortization Events. The occurrence of each Amortization Event and each
Potential Amortization Event, by a statement of an Authorized Officer of such
Transferor Party.
(ii) Judgment and Proceedings. (A) The
institution of any litigation, arbitration proceeding or governmental proceeding
against Servicer, which would reasonably be expected to have a Material Adverse
Effect on Servicer or the Receivables serviced by it, or which seeks to enjoin
performance of or otherwise relates to the Transaction Documents, and (B)
17
the entry of any judgment or decree or the institution of any litigation,
arbitration proceeding or governmental proceeding against Transferor.
(iii) Material Adverse Effect. The occurrence of
any event or condition that has had, or would reasonably be expected to have, a
Material Adverse Effect.
(iv) Termination Date. The occurrence of the
"TERMINATION DATE" under and as defined in the Receivables Purchase Agreement
with respect to any Originator unless the Agents have consented thereto.
(v) Downgrade of Performance Guarantor. Any
downgrade in the rating of any Indebtedness of Performance Guarantor by S&P or
by Xxxxx'x, setting forth the Indebtedness affected and the nature of such
change.
(c) Compliance with Laws and Preservation of Corporate
Existence. Such Transferor Party 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, except where the failure to so
comply would not reasonably be expected to have a Material Adverse Effect. Such
Transferor Party will preserve and maintain its corporate existence, rights,
franchises and privileges in the jurisdiction of its incorporation, and qualify
and remain qualified in good standing as a foreign corporation in each
jurisdiction where such qualification is required, except where the failure to
so preserve and maintain or qualify would not have a Material Adverse Effect.
(d) Audits. Such Transferor Party will provide access to the
Agents from time to time to such information with respect to it and the
Receivables as any of the Agents may reasonably request upon reasonable notice
at the Servicer's place of business during normal business hours. Such
Transferor Party will, from time to time during regular business hours as
requested by any of the Agents upon reasonable notice (unless an Amortization
Event has occurred and is continuing in which case no notice shall be required)
and at the sole cost of such Transferor Party, permit each of the Agents, or its
agents or representatives (and shall cause each Originator to permit each of the
Agents or its agents or representatives): (i) to examine and make abstracts from
all Records in the possession or under the control of such Person relating to
the Receivables and the Related Security, including, without limitation, the
related Contracts; PROVIDED, HOWEVER, that the Agents may not make and retain
copies of any Contract, and (ii) to visit the offices and properties of such
Person for the purpose of examining such materials described in clause (i)
above, and to discuss matters relating to such Person's financial condition or
the origination and servicing of the Receivables and the Related Security or any
Person's performance under any of the Transaction Documents or any Person's
performance under the Contracts (subject to confidentiality restrictions in the
relevant Contracts) and, in each case, with any of the officers or employees of
Transferor or the Servicer having knowledge of such matters (each of the
foregoing examinations and visits, a "REVIEW"); PROVIDED, HOWEVER, that, so long
as no Amortization Event has occurred and is continuing and Parent maintains its
current unsecured debt rating of "BB-" from S&P and its current bank debt rating
of "Ba3" from Xxxxx'x, (A) the Transferor Parties shall only be responsible for
the costs and expenses of two (2) Reviews in any
18
one calendar year, and (B) the Agents will not request more than four (4)
Reviews in any one calendar year.
(e) Keeping and Marking of Records and Books.
(i) The Servicer 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 prompt identification of each new
Receivable and all Collections of and adjustments to each existing Receivable);
PROVIDED, HOWEVER, that nothing in this sentence shall require any Transferor
Party to retain records for a period longer than three (3) years after creation.
The Servicer will (and will cause each Originator to) give the Agents notice of
any material change in the administrative and operating procedures referred to
in the previous sentence to the extent that such change would reasonably be
expected to result in a Material Adverse Effect.
(ii) Such Transferor Party 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 Agents, describing the Receivable
Interests and (B) upon the request of any of the Agents following the occurrence
and during the continuation of an Amortization Event which is not waived in
writing by the Agents: (x) xxxx each Contract, if any, constituting an
instrument, promissory note, chattel paper, document or certificated security
(each, as defined in the UCC) with a legend describing the Receivable Interests
and (y) deliver to the Administrative Agent all Contracts that constitute
Chattel Paper or Instruments relating to the Receivables.
(f) Compliance with Contracts and Credit and Collection
Policy. Such Transferor Party will (and the Parent will require 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.
(g) Performance and Enforcement of Receivables Purchase
Agreement. Transferor will, and will require each Originator to, perform each of
their respective obligations and undertakings under and pursuant to the
Receivables Purchase Agreement, will transfer Receivables thereunder in strict
compliance with the terms thereof and shall take all action necessary or
reasonably appropriate to enforce the rights and remedies accorded to Transferor
under the Receivables Purchase Agreement. Transferor will take all actions
reasonably necessary to perfect and enforce its rights and interests (and the
rights and interests of the Agents and the Transferees as assignees of
Transferor) under the Receivables Purchase Agreement as any 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 the Receivables Purchase Agreement.
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(h) Ownership. Transferor will (or the Servicer will cause
each Originator to) take all necessary action to (i) vest legal and equitable
title to the Receivables, the Related Security and the Collections acquired
under the Receivables Purchase Agreement irrevocably in Transferor, free and
clear of any Adverse Claims other than Adverse Claims in favor of the
Administrative Agent and the Transferees (including, without limitation, the
filing of all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect Transferor's interest in such Receivables, Related Security and
Collections and such other action to perfect, protect or more fully evidence the
interest of Transferor therein as any Agent may reasonably request), and (ii)
establish and maintain, in favor of the Administrative Agent, for the benefit of
the Transferees, a valid and perfected first priority undivided percentage
ownership interest (and/or a valid and perfected first priority security
interest) in all Receivables, Related Security and Collections to the full
extent contemplated herein, free and clear of any Adverse Claims other than
Adverse Claims in favor of the Administrative Agent for the benefit of the
Transferees (including, without limitation, the filing of all financing
statements or other similar instruments or documents necessary under the UCC (or
any comparable law) of all appropriate jurisdictions to perfect the
Administrative Agent's (for the benefit of the Transferees) interest in such
Receivables, Related Security and Collections and such other action to perfect,
protect or more fully evidence the interest of the Administrative Agent for the
benefit of the Transferees as any Agent may reasonably request).
(i) Transferees' Reliance. Transferor acknowledges that the
Agents and the Transferees are entering into the transactions contemplated by
this Agreement in reliance upon Transferor's identity as a legal entity that is
separate (other than for certain tax purposes) from each of the Originators, the
Performance Guarantor and their respective Affiliates other than Transferor
(collectively, the "XXXXXX GROUP"). Therefore, from and after the date of
execution and delivery of this Agreement, Transferor shall take all reasonable
steps, including, without limitation, all steps that any Agent may from time to
time reasonably request, to maintain Transferor's identity as a separate legal
entity and to make it manifest to third parties that Transferor is an entity
with assets and liabilities distinct from those of the members of the Xxxxxx
Group thereof and not merely a division thereof (other than for certain tax
purposes). Without limiting the generality of the foregoing and in addition to
the other covenants set forth herein, Transferor will:
(A) conduct its own business in its own name and
require that all full-time employees of Transferor, if any, identify themselves
as such and not as employees of any member of the Xxxxxx Group (including,
without limitation, by means of providing appropriate employees with business or
identification cards identifying such employees as Transferor's employees);
(B) compensate all employees, consultants and
agents directly, from Transferor's own funds, for services provided to
Transferor by such employees, consultants and agents and, to the extent any
employee, consultant or agent of Transferor is also an employee, consultant or
agent of a member of the Xxxxxx Group, allocate the compensation of such
employee, consultant or agent between Transferor and the members of the Xxxxxx
Group on a basis that reflects the services rendered to Transferor and the
Xxxxxx Group;
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(C) clearly identify its offices (by signage or
otherwise) as its offices and, if such office is located in the offices of a
member of the Xxxxxx Group, Transferor shall lease such office at a fair market
rent;
(D) have a separate telephone number, which will
be answered only in its name and separate stationery, invoices and checks in its
own name;
(E) conduct all transactions with the members of
the Xxxxxx Group strictly on an arm's-length basis, allocate all overhead
expenses (including, without limitation, telephone and other utility charges)
for items shared between Transferor and the Xxxxxx Group 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;
(F) at all times have a Board of Directors
consisting of not less than three members, at least one member of which is an
Independent Director;
(G) observe all corporate formalities as a
distinct entity, and ensure that all corporate actions relating to (A) the
selection, maintenance or replacement of the Independent Director, (B) the
dissolution or liquidation of Transferor or (C) the initiation of, participation
in, acquiescence in or consent to any bankruptcy, insolvency, reorganization or
similar proceeding involving Transferor, are duly authorized by unanimous vote
of its Board of Directors (including the Independent Director);
(H) maintain Transferor's books and records
separate from those of the members of the Xxxxxx Group and otherwise identify
such books and records as its own assets rather than assets of a member of the
Xxxxxx Group (other than for certain tax purposes);
(I) prepare its financial statements separately
from those of the Xxxxxx Group and insure that any consolidated financial
statements of the Xxxxxx Group (or any member thereof) that include Transferor
and that are filed with the Securities and Exchange Commission or any other
governmental agency have notes clearly stating that Transferor is a separate
legal entity and that its assets will be available first and foremost to satisfy
the claims of the creditors of Transferor;
(J) except as herein specifically otherwise
provided, maintain the funds or other assets of Transferor separate from, and
not commingled with, those of the members of the Xxxxxx Group and only maintain
bank accounts or other depository accounts to which Transferor alone is the
account party, into which Transferor alone makes deposits and from which
Transferor alone (and/or the Administrative Agent hereunder) has the power to
make withdrawals;
(K) pay all of Transferor's operating expenses,
if any, from Transferor's own assets (except for certain payments by a member of
the Xxxxxx Group or other Persons pursuant to allocation arrangements that
comply with the requirements of this Section 7.1(i));
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(L) operate its business and activities such
that: it does 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 Receivables Purchase Agreement; and does not create,
incur, guarantee, assume or suffer to exist any indebtedness or other
liabilities, whether direct or contingent, other than (1) as a result of the
endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business, (2) the incurrence of
obligations under this Agreement or the other Transaction Documents, (3) the
incurrence of obligations, as expressly contemplated in the Receivables Purchase
Agreement, to make payment to Originators thereunder for the transfer of
Receivables from Originators under the Receivables Purchase Agreement, and (4)
the incurrence of operating expenses in the ordinary course of business of the
type otherwise contemplated by this Agreement;
(M) maintain its Organic Documents in conformity
with this Agreement, such that it does not amend, restate, supplement or
otherwise modify its Organic Documents in any respect that would reasonably be
expected to impair its ability to comply with the terms or provisions of any of
the Transaction Documents, including, without limitation, this Section 7.1(i);
(N) maintain the effectiveness of, and continue
to perform under the Receivables Purchase Agreement and the Performance
Undertaking, such that it does not amend, restate, supplement, cancel, terminate
or otherwise modify the Receivables Purchase Agreement or the Performance
Undertaking, or give any consent, waiver, directive or approval thereunder or
waive any default, action, omission or breach under the Receivables Purchase
Agreement or the Performance Undertaking or otherwise grant any indulgence
thereunder, without (in each case) the prior written consent of each of the
Agents;
(O) maintain its legal separate existence such
that it does 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, nor at any time create, have,
acquire, maintain or hold any interest in any Subsidiary;
(P) maintain at all times a Net Worth of at
least $50,000,000 and refrain from making any dividend, distribution, redemption
of capital stock or payment of any subordinated indebtedness which would cause
such Net Worth to cease to be so maintained; and
(Q) take such other actions as are necessary on
its part to ensure that the facts and assumptions set forth in the opinion
issued by Debevoise & Xxxxxxxx, as counsel for Transferor, in connection with
the closing or initial Incremental Transfer under this Agreement and relating to
substantive consolidation and true sale issues, and in the certificates
accompanying such opinion, remain true and correct in all material respects at
all times.
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(j) Collections. Such Transferor Party will cause (1) all
proceeds from all Lock-Boxes to be directly deposited by a Collection Bank into
a Collection Account and (2) each Lock-Box and Collection Account to be subject
at all times to a Collection Account Agreement that is in full force and effect.
In the event any payments relating to Receivables are remitted directly to
Transferor or any Affiliate of Transferor, Transferor will remit (or will cause
all such payments to be remitted) directly to a Collection Bank and deposited
into a Collection Account within two (2) Business Days following receipt
thereof, and, at all times prior to such remittance, Transferor will itself hold
or, if applicable, will cause such payments to be held in trust for the benefit
of the Agents and the Transferees to the extent of the Receivable Interests or
the Administrative Agent's security interest, as the case may be. Transferor
will maintain exclusive ownership, dominion and control (subject to the terms of
this Agreement) of each Lock-Box and Collection Account and shall not grant the
right to take dominion and control of any Lock-Box or Collection Account at a
future time or upon the occurrence of a future event to any Person, except to
the Administrative Agent as contemplated by this Agreement.
(k) Taxes. Such Transferor Party will file all material tax
returns and reports required by law to be filed by it and will timely pay all
material taxes and governmental charges at any time owing; PROVIDED, HOWEVER,
that no Transferor Party shall be required to pay any such taxes and
governmental charges which are not yet delinquent or are being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on its books unless
the failure to make any such payment (1) shall give rise to an immediate right
to foreclose on an Adverse Claim securing such amounts, (2) shall result in the
attachment of an Adverse Claim on the Receivables, the Collections or the
Related Security, or (3) would have a Material Adverse Effect.
(l) Payment to Originators. With respect to any Receivable
acquired by Transferor from an Originator, such sale shall be effected under,
and in strict compliance with the terms of, the Receivables Purchase Agreement,
including, without limitation, the terms relating to the amount and timing of
payments to be made to such Originator in respect of the transfer price for such
Receivable.
Section 7.2 Negative Covenants of the Transferor Parties. From
and after the Closing Date until the date on which the Aggregate Unpaids have
been paid in full and this Agreement terminates in accordance with its terms,
each Transferor Party hereby covenants, as to itself, as set forth below:
(a) Name Change, Offices and Records. Transferor will not
change its name, identity or legal structure (within the meaning of Section
9-507(c) of any applicable enactment of the UCC) or change its jurisdiction of
organization or organize in an additional jurisdiction or relocate its chief
executive office or any office where Records are kept unless it shall have: (i)
given the Agents at least two (2) days' prior written notice thereof and (ii)
delivered to the Administrative Agent all financing statements, instruments and
other documents reasonably requested by any of the Agents in connection with
such change or relocation.
(b) Change in Payment Instructions to Obligors. Except as may
be required by the Administrative Agent pursuant to Section 8.2(b), such
Transferor Party will not add or
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terminate any bank as a Collection Bank, or make any change in the instructions
to Obligors regarding payments to be made to any Lock-Box or Collection Account,
unless the Agents shall have received, at least ten (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 Collection Bank
or a Collection Account or Lock-Box, an executed Collection Account Agreement
with respect to the new Collection Account or Lock-Box; PROVIDED, HOWEVER, that
the Servicer may make changes in instructions to Obligors regarding payments if
such new instructions require such Obligor to make payments to another existing
Collection Account.
(c) Modifications to Contracts and Credit and Collection
Policy. Without the consent of each of the Agents, such Transferor Party will
not, and will not permit any Originator to, make any change to the Credit and
Collection Policy that could reasonably be expected to materially and adversely
affect the collectibility of the Receivables or materially decrease the credit
quality of any newly created Receivables. Except as provided in Section 8.2(d),
the Servicer will not, and will not permit any Originator to, 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. Transferor will 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 or Collections, 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 with respect thereto (other than,
in each case, the creation of the interests therein in favor of the
Administrative Agent and the Transferees provided for herein), and Transferor
will defend the right, title and interest of the Agents and the Transferees in,
to and under any of the foregoing property, against all claims of third parties
claiming through or under Transferor or any Originator.
(e) Net Pool Balance. At no time prior to the latest
Amortization Date for any Group shall Transferor permit the Net Pool Balance to
be less than an amount equal to the sum of (i) the Aggregate Invested Amount
plus (ii) the Required Reserves.
(f) Termination Date Determination. Transferor will not
designate the Termination Date (as defined in the Receivables Purchase
Agreement), or send any written notice to any Originator in respect thereof,
without the prior written consent of the Agents, except with respect to the
occurrence of such Termination Date arising pursuant to Section 5.1(d) of the
Receivables Purchase Agreement.
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(g) Restricted Junior Payments. From and after the occurrence
of any Amortization Event, Transferor will not make any Restricted Junior
Payment while any Aggregate Unpaids remain outstanding if the effect of such
Restricted Junior Payment would be to reduce Transferor's Net Worth below
$50,000,000.
(h) Transferor Indebtedness. Transferor will not incur or
permit to exist any Indebtedness except: (i) the Obligations, and (ii) other
current accounts payable arising in the ordinary course of business and not
overdue.
(i) Prohibition on Additional Negative Pledges. No Transferor
Party will enter into or assume any agreement (other than this Agreement and the
other Transaction Documents) prohibiting the creation or assumption of any
Adverse Claim upon the Receivable, Collections, and Related Security except as
contemplated by the Transaction Documents, or otherwise prohibiting or
restricting any transaction contemplated hereby or by the other Transaction
Documents.
(j) Amendments to Credit Agreement and Security Documents. No
Transferor Party shall execute or consent to any amendment, restatement or other
modification of or supplement to the Credit Agreement or any Security Document
(as defined therein) that (i) requires Transferor to assume, guarantee or
otherwise become absolutely or contingently liable for, all or any portion of
the Obligations (as defined therein), or to pledge collateral therefor, (ii)
provides that the facility contemplated by this Agreement is not permitted under
the terms of the Credit Agreement and Security Documents, or (iii) encumbers any
of the Securitized Assets (as defined in the Intercreditor Agreement), and
Transferor shall not assume, guarantee or otherwise become absolutely or
contingently liable for, all or any portion of the Obligations (as defined in
the Credit Agreement).
ARTICLE VIII.
ADMINISTRATION AND COLLECTION
Section 8.1 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 8.1. Parent is hereby
designated as, and hereby agrees to perform the duties and obligations of, the
Servicer pursuant to the terms of this Agreement. The Agents may at any time
designate as Servicer any Person to succeed Parent or any successor Servicer.
(b) Parent may delegate, and Parent hereby advises the
Transferees and the Agents that it has delegated, to the Originators, as
sub-servicers of the Servicer, certain of its duties and responsibilities as
Servicer hereunder in respect of the Receivables originated by such Originators.
Without the prior written consent of the Agents, neither Parent nor any of the
aforementioned permitted sub-servicers shall be permitted to delegate any of its
duties or responsibilities as Servicer to any Person other than (i) the
Transferor, (ii) the Originators and (iii) with respect to certain Defaulted
Receivables, outside collection agencies in accordance with its customary
practices. If the Agents shall designate as Servicer any Person other than
Parent,
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all duties and responsibilities theretofore delegated by Parent to any other
Originator may, at the discretion of any of the Agents, be terminated forthwith
on notice given by any Agent to the other Agents, Transferor and Parent (who
will be responsible for notifying the other Originators).
(c) Notwithstanding the foregoing subsection (b), (i) Parent
shall be and remain primarily liable to the Agents and the Transferees for the
full and prompt performance of all duties and responsibilities of the Servicer
hereunder and (ii) the Agents and the Transferees shall be entitled to deal
exclusively with Parent in matters relating to the discharge by the Servicer of
its duties and responsibilities hereunder. The Agents and the Transferees shall
not be required to give notice, demand or other communication to any Person
other than Parent in order for communication to the Servicer and its
sub-servicer or other delegate with respect thereto to be accomplished. Parent,
at all times that it is the Servicer, shall be responsible for providing any
sub-servicer or other delegate of the Servicer with any notice given to the
Servicer under this Agreement.
Section 8.2 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 will instruct all Obligors to pay all
Collections directly to a Lock-Box or Collection Account. The Servicer shall
effect a Collection Account Agreement in a form reasonably acceptable to the
Agents and Transferor with each bank party to a Collection Account at any time.
In the case of any remittances received in any Lock-Box or Collection Account
that shall have been identified, to the satisfaction of the Servicer, to not
constitute Collections or other proceeds of the Receivables or the Related
Security, the Servicer shall promptly remit such items to the Person identified
to it as being the owner of such remittances. From and after the date the
Administrative Agent delivers to any Collection Bank a Collection Notice
pursuant to Section 8.3, the Administrative Agent may request that the Servicer,
and the Servicer thereupon promptly shall instruct all Obligors with respect to
the Receivables, to remit all payments thereon to a new depositary account
specified by the Administrative Agent and, at all times thereafter, Transferor
and the Servicer shall use reasonable efforts not to deposit or otherwise
credit, and shall not authorize any other Person to deposit or otherwise credit
to such new depositary account any cash or payment item other than Collections.
No Collection Account Agreement may be amended, terminated or otherwise modified
without the prior written consent of the Agents; PROVIDED, HOWEVER, that so long
as no Amortization Event has occurred and not been waived by the Agents, the
Administrative Agent will not unreasonably withhold or delay its consent to the
closing of a Collection Account if the Obligors who otherwise would have made
payments to such Collection Account have been directed to make payments to
another Collection Account with respect to which a Collection Account Agreement
has been executed by all requisite parties.
(c) The Servicer shall administer the Collections in
accordance with the procedures described herein and in Article II; PROVIDED THAT
nothing in this sentence shall require
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the Servicer to segregate Collections on a daily basis from its other funds
prior to the occurrence of a Group's Amortization Date. The Servicer shall set
aside and hold in trust for the account of Transferor and the Transferees their
respective shares of the Collections in accordance with Article II. The Servicer
shall, upon the request of any Agent following an Amortization Event or a
Potential Amortization Event while any Aggregate Unpaids remain outstanding,
segregate, in a manner reasonably acceptable to such Agent, all cash, checks and
other instruments received by it from time to time constituting such Agent's
Group's Outstanding Percentage of Collections from the general funds of the
Servicer or Transferor prior to the remittance thereof in accordance with
Article II. 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 applicable Agent such allocable share of Collections of
Receivables set aside for the applicable Transferees on the first Business Day
following receipt by the Servicer of such Collections, duly endorsed or with
duly executed instruments of transfer.
(d) 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 determines 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 Agents
or the Transferees under this Agreement. Notwithstanding anything to the
contrary contained herein, following the occurrence of an Amortization Event
which is not waived in writing by each of the Agents, the Administrative Agent
may give reasonable direction to the Servicer to commence or settle any legal
action with respect to any Receivable or to foreclose upon or repossess any
Related Security.
(e) The Servicer shall hold in trust for Transferor and the
Transferees all Records that (i) evidence or relate to the Receivables, the
related Contracts and Related Security or (ii) are otherwise necessary or
desirable to collect the Receivables and shall, as soon as practicable upon
demand of any Agent following the occurrence of an Amortization Event which is
not waived in writing by each of the Agents, 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 Transferor any cash collections or other cash proceeds received with
respect to Indebtedness not constituting Receivables, Related Security,
Collections or proceeds of any of the foregoing. The Servicer shall, from time
to time at the request of any Transferee, furnish to the Transferees (promptly
after any such request) a calculation of the amounts set aside for the
Transferees pursuant to Article II.
(f) Any payment by an Obligor in respect of any indebtedness
owed by it to an Originator or Transferor 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 8.3 Collection Notices. While any Aggregate Unpaids
remain outstanding, at any time after the occurrence of an Amortization Event or
a Potential Amortization Event, in
27
either case which is not waived in writing by each of the Agents, the
Administrative Agent may, and shall at the direction of any of the Co-Agents,
date and deliver to the Collection Banks the Collection Notices. Transferor
hereby transfers to the Administrative Agent for the benefit of the Transferees,
effective when the Administrative Agent delivers such notice, the exclusive
ownership and control of each Lock-Box and the Collection Accounts. In case any
authorized signatory of Transferor whose signature appears on a Collection
Account Agreement shall cease to have such authority before the delivery of such
notice, such Collection Notice shall nevertheless be valid as if such authority
had remained in force. Transferor hereby authorizes the Administrative Agent,
and agrees that the Administrative Agent shall be entitled after the occurrence
of an Amortization Event to (i) endorse Transferor'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, for the benefit of the Agents and the Transferees, rather
than Transferor.
Section 8.4 Responsibilities of Transferor. Anything herein to
the contrary notwithstanding, the exercise by the Agents and the Transferees of
their rights hereunder shall not release the Servicer, any Originator or
Transferor from any of their duties or obligations with respect to any
Receivables or under the related Contracts. The Transferees 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 Transferor.
Section 8.5 Reports. The Servicer shall prepare and forward to
the Administrative Agent, who will promptly forward to the Co-Agents:
(a) on the 15th day of each month, or if such date is not
a Business Day, the next Business Day (the "MONTHLY REPORTING DATE"), a
Settlement Report, and
(b) at such other times as any Agent shall reasonably
request and with reasonable advance notice, (A) an Interim Settlement
Report and/or (B) a listing by Obligor of all Receivables together with
an aging of such Receivables.
Section 8.6 Servicing Fees. In consideration of Parent's
agreement to act as Servicer hereunder, the Transferees hereby agree that, (a)
so long as Parent shall continue to perform as Servicer hereunder, Transferor
shall pay over to Parent a fully earned and non-refundable servicing fee (the
"SERVICING FEE") on each Settlement Date, in arrears for the immediately
preceding month, equal to 1% per annum of the average aggregate Outstanding
Balance of all Receivables during such period, as compensation for its servicing
activities or (b) in the case of the Servicer not being a member of the Xxxxxx
Group, the Servicing Fee will be such reasonable rate as may be charged by the
successor Servicer.
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ARTICLE IX.
AMORTIZATION EVENTS
Section 9.1 Amortization Events. The occurrence of any one or
more of the following events shall constitute an Amortization Event:
(a) Any Transferor Party shall fail to make any payment or
deposit required hereunder when due.
(b) Any representation, warranty, certification or statement
made by any Transferor Party in this Agreement, any other Transaction Document
to which it is a party or in any other document delivered pursuant hereto or
thereto shall prove to have been incorrect in any material respect when made or
deemed made.
(c) (i) Failure of Transferor to pay any Indebtedness (other
than Aggregate Unpaids) when due taking into account any applicable grace
period, and failure of Performance Guarantor and/or any of its Subsidiaries
other than Transferor to pay Indebtedness in excess of the lesser of (x) the
amount set forth in the comparable event of default provision in the Credit
Agreement, and (y) $20,000,000 in aggregate principal amount when due taking in
to account any applicable grace period; or (ii) any Indebtedness described in
clause (i) shall be declared to be due and payable or required to be prepaid
(other than by a regularly scheduled payment) prior to the date of maturity
thereof.
(d) (i) Any Transferor Party or any of its Subsidiaries 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; (ii) any proceeding shall be instituted by any
Transferor Party or any of its Subsidiaries 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, (iii) any proceeding of the type described in the preceding clause
(ii) shall be instituted against any Transferor Party and shall continue
undismissed, or unstayed and in effect, for a period of 60 consecutive days; or
(iv) an order for relief in respect of such Person shall be entered in an
involuntary case under the federal bankruptcy laws or other similar laws now or
hereafter in effect, or (v) any Transferor Party or any of its Subsidiaries
shall take any corporate action to authorize any of the actions set forth in
clauses (i) or (ii) above in this subsection (d).
(e) (i) Transferor shall fail to comply with the terms of
Section 2.5 hereof, or (ii) any Transferor Party shall fail to perform or
observe any term, covenant or agreement hereunder (other than as referred to in
Section 9.1(a) or clause (i) of this Section 9.1(e)) which failure under this
clause (ii) continues for five (5) consecutive Business Days.
(f) As at the end of any calendar month:
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(i) the average of the Dilution Ratios for the
three months then most recently ended shall exceed 3.40%;
(ii) the average of the Delinquency Ratios for
the three months then most recently ended shall exceed (A)
3.00% at any time through and including the Calculation Period
ending June 30, 2003 or (B) 2.65% at any time thereafter; or
(iii) the average of the Default Ratios for the
three months then most recently ended shall exceed 2.75%.
(g) A Change of Control shall occur with respect to any
Transferor Party.
(h) (i) One or more final judgments or decrees for the
payment of money in excess of $11,624 shall be entered against Transferor or
(ii) one or more final judgments for the payment of money in an amount in excess
of the lesser of (A) the amount set forth in the comparable event of default
provision in the Credit Agreement, and (B) $20,000,000 in the aggregate for all
such judgments or decrees, shall be entered against Servicer or Performance
Guarantor on claims not covered by insurance or as to which the insurance
carrier has denied its responsibility, and such judgment shall not have been
vacated, discharged, stayed or satisfied and in effect for thirty (30)
consecutive days without a stay of execution
(i) Either (i) the "TERMINATION DATE" under and as defined in
the Receivables Purchase Agreement shall occur under the Receivables Purchase
Agreement or (ii) any Originator shall for any reason cease to transfer, or
cease to have the legal capacity to transfer, or otherwise be incapable of
transferring Receivables to Transferor under the Receivables Purchase Agreement.
(j) This Agreement shall terminate in whole or in part (except
in accordance with its terms), or shall cease to be effective or to be the
legally valid, binding and enforceable obligation of Transferor or Servicer, or
any Transferor Party shall directly or indirectly contest in any manner such
effectiveness, validity, binding nature or enforceability, or the Administrative
Agent for the benefit of the Transferees shall cease to have a valid and
perfected first priority security interest in the Receivables, the Related
Security and the Collections with respect thereto and the Collection Accounts.
(k) Performance Guarantor shall fail to perform or observe any
term, covenant or agreement required to be performed by it under the Performance
Undertaking, or the Performance Undertaking shall cease to be effective or to be
the legally valid, binding and enforceable obligation of Performance Guarantor,
or Performance Guarantor shall directly or indirectly contest in any manner such
effectiveness, validity, binding nature or enforceability.
(l) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Tax Code with regard to any of the Receivables,
Collections or Related Security, or the PBGC shall file notice of a lien
pursuant to Section 4068 of ERISA with regard to any of the Receivables,
Collections or Related Security, and, in either of the foregoing cases, such
lien shall not have been released within fourteen (14) days.
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(m) Any event shall occur which (i) materially and adversely
impairs the ability of the Originators to originate Receivables of a credit
quality that is at least equal to the credit quality of the Receivables sold or
contributed to Transferor on the date of this Agreement and (ii) has, or would
be reasonably expected to have, a Material Adverse Effect.
(n) On any Settlement Date, after giving effect to the
application of Collections in accordance with this Agreement, the Adjusted Pool
Balance is less than the Aggregate Invested Amount.
(o) (i) The Credit Agreement or any Security Document (as
defined therein) shall be amended, restated or otherwise supplemented or
modified in any manner that (A) requires Transferor to assume, guarantee or
otherwise become absolutely or contingently liable for, all or any portion of
the Obligations (as defined therein), or to pledge collateral therefor, (B)
provides that the facility contemplated by this Agreement is not permitted under
the terms of the Credit Agreement and Security Documents, or (C) encumbers any
of the Securitized Assets (as defined in the Intercreditor Agreement), or (ii)
Transferor shall assume, guarantee or otherwise become absolutely or
contingently liable for, all or any portion of the Obligations (as defined in
the Credit Agreement), or shall pledge collateral therefor.
Section 9.2 Remedies. Upon the occurrence and during the
continuation of an Amortization Event, the Administrative Agent may, and upon
the direction of any of the Co-Agents, shall, take any of the following actions:
(i) replace the Person then acting as Servicer, (ii) declare the Amortization
Date to have occurred, whereupon the Amortization Date shall forthwith occur,
without demand, protest or further notice of any kind, all of which are hereby
expressly waived by each Transferor Party; PROVIDED, HOWEVER, that upon the
occurrence of an Amortization Event described in Section 9.1(d)(ii), or of an
actual or deemed entry of an order for relief with respect to any Transferor
Party under the Federal Bankruptcy Code, the Amortization Date shall
automatically occur, without demand, protest or any notice of any kind, all of
which are hereby expressly waived by each Transferor Party, (iii) to the fullest
extent permitted by applicable law, declare that the Default Fee shall accrue
with respect to any of the Aggregate Unpaids outstanding at such time, (iv)
deliver the Collection Notices to the Collection Banks, and (v) notify Obligors
of the Transferees' interest in the Receivables. The aforementioned rights and
remedies shall be without limitation, and shall be in addition to all other
rights and remedies of the Agents and the Transferees otherwise available under
any other provision of this Agreement, by operation of law, at equity or
otherwise, all of which are hereby expressly preserved, including, without
limitation, all rights and remedies provided under the UCC (including the right
to foreclose upon and sell the Receivables and the Related Security, or any part
thereof), all of which rights shall be cumulative.
ARTICLE X.
INDEMNIFICATION
Section 10.1 Indemnities by the Transferor Parties. Without
limiting any other rights that any Agent or any Transferee may have hereunder or
under applicable law, (A) Transferor hereby agrees to indemnify (and pay upon
demand to) each of the Agents, the Transferees and
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their respective assigns, members, direct or indirect owners, 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 and
disbursements (all of the foregoing being collectively referred to as
"INDEMNIFIED AMOUNTS") awarded against or incurred by any of them relating to
the Transaction Documents or the transactions contemplated thereby, and (B) the
Servicer hereby agrees to indemnify (and pay upon demand to) each Indemnified
Party, for Indemnified Amounts awarded against or incurred by any of them
arising out of the Servicer's activities as Servicer hereunder or its written
agreement (in its individual capacity) to any amendment, waiver, supplement or
restatement of or to the Credit Agreement or associated Security Documents of
the types described in Section 9.1(o)(i), EXCLUDING, HOWEVER, in all of the
foregoing instances under the preceding clauses (A) and (B):
(a) Indemnified Amounts to the extent a final judgment of a
court of competent jurisdiction holds that such Indemnified Amounts resulted
from gross negligence or willful misconduct on the part of the Indemnified Party
or any other member of its Group;
(b) Indemnified Amounts to the extent the same includes losses
in respect of Receivables that are uncollectible on account of the insolvency,
bankruptcy or lack of creditworthiness of the related Obligor; and
(c) any withholding taxes which shall by governed by Section
10.2 or any Excluded Taxes;
PROVIDED, HOWEVER, that nothing contained in this sentence shall limit the
liability of any Transferor Party or limit the recourse of the Agents and the
Transferees to any Transferor Party for amounts otherwise specifically provided
to be paid by such Transferor Party under the terms of this Agreement. Without
limiting the generality of the foregoing indemnification, Transferor (and to the
extent any of the following arise from actions or inactions of the Servicer, the
Servicer) shall indemnify the Indemnified Parties for Indemnified Amounts (other
than Excluded Taxes) (including, without limitation, losses in respect of
uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to Transferor or the Servicer) relating to or resulting
from:
(i) any representation or warranty made by any
Transferor Party or any Originator (or any officers of any such Person) under or
in connection with this Agreement, any other Transaction Document or any other
information or report delivered by any such Person pursuant hereto or thereto,
which shall have been false or incorrect when made or deemed made;
(ii) the failure by any Transferor Party or any
Originator 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 any failure of any Originator to keep or perform any of its
obligations, express or implied, with respect to any Contract;
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(iii) any failure of any Transferor Party or any
Originator to perform its duties, covenants or other obligations in accordance
with the provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or
damage suit, or other similar claim arising out of or in connection with
merchandise, insurance or services that are the subject of any Contract or any
Receivable;
(v) any dispute, claim, offset or defense (other
than discharge in bankruptcy of the Obligor) of the Obligor to the payment of
any Receivable (including, without limitation, a defense based on such
Receivable or the related Contract not being 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; PROVIDED THAT this clause (v) shall not be construed to require
indemnity for the uncollectibility of any Receivable for credit-related reasons
relating to any Obligor;
(vi) [reserved];
(vii) any investigation, litigation or proceeding
related to or arising from this Agreement or any other Transaction Document, the
transactions contemplated hereby, the use of the proceeds of an Incremental
Transfer or a Reinvestment, the ownership of the Receivable Interests or any
other investigation, litigation or proceeding relating to any Transferor Party
or any Originator in which any Indemnified Party becomes involved as a result of
any of the transactions contemplated hereby;
(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 Amortization Event described in Section
9.1(d) or (o);
(x) any failure of Transferor to acquire and
maintain legal and equitable title to, and ownership of any Receivable and the
Related Security and Collections with respect thereto from any Originator, free
and clear of any Adverse Claim (other than as created hereunder); or any failure
of Transferor to give reasonably equivalent value to the applicable Originator
under the Receivables Purchase Agreement in consideration of the transfer by
such Originator of any Receivable, or any attempt by any Person to void such
transfer under statutory provisions or common law or equitable action;
(xi) any failure to vest and maintain vested in
the Administrative Agent for the benefit of the Transferees, or to transfer to
the Administrative Agent for the benefit of the Transferees, legal and equitable
title to, and ownership of, a first priority perfected undivided percentage
ownership interest (to the extent of the Receivable Interests contemplated
hereunder) or security interest in the Receivables, the Related Security and the
Collections, free and clear of any Adverse Claim (except as created by the
Transaction Documents);
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(xii) the failure to have filed, or any delay in
filing, financing statements or other similar instruments or documents under the
UCC of any applicable jurisdiction or other applicable laws with respect to any
Receivable, the Related Security and Collections with respect thereto, and the
proceeds of any thereof, whether at the time of any Incremental Transfer or
Reinvestment or at any subsequent time;
(xiii) except as otherwise permitted under the
Transaction Documents, any action or omission by any Transferor Party in
contravention of the Transaction Documents which reduces or impairs the rights
of the Agents or the Transferees with respect to any Receivable or the value of
any such Receivable;
(xiv) any attempt by any Person to void any
Incremental Transfer or Reinvestment hereunder under statutory provisions or
common law or equitable action; and
(xv) the failure of any Receivable included in
the calculation of the Net Pool Balance as an Eligible Receivable to be an
Eligible Receivable at the time so included.
Section 10.2 Withholding Taxes.
(a) Any and all payments made hereunder to any Indemnified
Party shall be made free and clear of and without deduction for any and all
current or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, except as required by law. If the
Transferor shall be required to deduct or withhold any taxes from or in respect
of any sum payable hereunder to any Indemnified Party: (A) the sum payable shall
be increased by the amount (an "ADDITIONAL AMOUNT") necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 10.2) such Indemnified Party shall receive an
amount equal to the sum it would have received had no such deductions been made,
(B) the Transferor shall make such deductions and (C) the Transferor shall pay
the full amount deducted to the relevant Governmental Authority in accordance
with applicable law.
(b) The Transferor shall indemnify each Indemnified Party
against any taxes described in Section 10.2(a) paid by such Indemnified Party as
a result of the failure of the Transferor to withhold and pay such taxes to the
relevant Governmental Authority when due.
(c) As soon as practicable after the date of any payment of
taxes by the Transferor to a Governmental Authority hereunder, the Transferor
will (to the extent available) deliver to the relevant Indemnified Party the
original or a certified copy of a receipt issued by such Governmental Authority
evidencing payment thereof.
(d) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in this Section 10.2
shall survive the termination of this Agreement.
(e) Notwithstanding any other provision of this Section 10.2,
the Transferor shall not be required to indemnify or pay any additional amounts
to any Indemnified Party pursuant to Section 10.2 with respect to taxes (i) if
the obligation to withhold with respect to such taxes
34
results from, or would not have occurred but for, the failure of such
Indemnified Party to deliver the forms described in this clause (i) (it being
understood that the Indemnified Party shall not have failed to comply with the
provisions of this clause (i) if it is legally unable to deliver the forms
described therein): for any period (A) in the case of an Indemnified Party that
is a Non-U.S. Transferee, a complete and properly executed Internal Revenue
Service Form W-8BEN or W-8ECI, as appropriate, or any successor form prescribed
by the Internal Revenue Service, certifying that such Non-U.S. Transferee is
entitled to benefits under an income tax treaty to which the United States is a
party which reduces the rate of withholding tax on payments due under this
Agreement and/or any of the other Transaction Documents or certifying that the
income receivable pursuant to this Agreement and/or any of the other Transaction
Documents is effectively connected with the conduct of a trade or business in
the United States, (B) in the case of an Indemnified Party that is not a
Non-U.S. Transferee, a complete and properly executed Internal Revenue Service
Form W-9 or any successor form prescribed by the Internal Revenue Service, (C)
any other complete and properly executed form or certificate required by any
taxing authority, reasonably requested by the Transferor (including any
certificate required by Sections 871(h) and 881(c) of the Tax Code), certifying
that such Indemnified Party is entitled to a complete or partial exemption from
tax on payments pursuant to this Agreement and/or any of the other Transaction
Documents and (D) in the case of foreign Person that is an "intermediary" within
the meaning of Treasury regulation section 1.1441-1(c)(15), a complete and
properly executed Internal Revenue Service Form W-8IMY and any related documents
required in conjunction with such W-8IMY, (ii) unless such taxes are due to a
change in an income tax treaty to which the United States is a party (other
than, in the case of a tax treaty which does not have a "limitation of benefits"
provision, the addition of a limitation of benefits provision to such treaty) or
the Tax Code occurring subsequent to the date of this Agreement, (iii) if the
Indemnified Party acquired its interest from a prior Indemnified Party and such
taxes are in effect and would apply to a payment to such subsequent Indemnified
Party as of the date such subsequent Indemnified Party became a party to this
Agreement, except to the extent the prior Indemnified Party would have been
entitled to indemnification or additional amounts with respect to such taxes,
(iv) if such taxes would not have been imposed if the only connection between
the Indemnified Party and the jurisdiction imposing such taxes was the
activities of such Indemnified Party pursuant to or in respect of this Agreement
(including entering into, lending money or extending credit pursuant to,
receiving payments under, or enforcing this Agreement) or (v) if such taxes
would not have been imposed but for the sale of a participating interest to a
Participant pursuant to Section 12.2. Should a Indemnified Party, which is
otherwise exempt from or subject to a reduced rate of withholding tax, become
subject to taxes because of its failure to deliver a form required hereunder,
the Transferor shall take such steps as the Indemnified Party shall reasonably
request to assist such Indemnified Party in recovering such taxes. Upon becoming
aware of a change in law (or interpretation) each Party hereto will use its best
effort to provide the other party with notice of such change.
(f) Any Indemnified Party claiming any indemnity payment or
additional amounts payable pursuant to this Section 10.2 shall use reasonable
efforts (consistent with legal and regulatory restrictions) to file any
certificate or document reasonably requested in writing by the Transferor or to
change the jurisdiction of its applicable lending office or administrative
office if the making of such a filing or change would avoid the need for or
reduce the amount of any such indemnity payment or additional amounts that may
thereafter accrue and would not, in
35
the good faith determination of such Indemnified Party, be otherwise
inconsistent with the internal policy or disadvantageous to such Indemnified
Party.
(g) Nothing contained in this Section 10.2 shall require an
Indemnified Party to make available any of its tax returns (or any other
information that it deems to be confidential or proprietary).
(h) If any Indemnified Party receiving an indemnification
payment hereunder with respect to taxes or liabilities arising therefrom shall
subsequently receive a refund from any taxing authority which is specifically
attributable to such indemnification payment, such Person shall promptly pay
such refund (net of any cost or expenses relating to such refund) to the
Transferor.
Section 10.3 Increased Cost and Reduced Return.
(a) If after the date hereof (or, in the case of a Person that
becomes a Funding Source after the date hereof, after the date such Person
becomes a Funding Source), any Funding Source shall be charged any fee, expense
or increased cost, or such Funding Source's return shall be reduced, 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) that 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 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
taxes excluded by Section 10.2) or (ii) that 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) that imposes or results in any other condition (other than with respect
to taxes) 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, then, such Funding Source shall notify the Agents and the Transferor within
90 days after any Regulatory Change giving rise to any such fee, expense,
increased cost or reduced return and, upon written demand by the applicable
Co-Agent setting forth in reasonable detail the basis for and computation of the
amount of such claim, Transferor shall pay to such Co-Agent, for the benefit of
the relevant Funding Source, such amounts charged to such Funding Source or such
amounts to otherwise compensate such Funding Source for such increased cost or
such reduction. Failure of any Funding Source to give notice within the 90-day
period following a Regulatory Change shall limit the applicable
36
Funding Source's right to reimbursement to any such fees, expenses, increased
costs or reduced returns that accrue or are incurred from and after the date on
which such notice is actually given.
(b) In the event that a Funding Source becomes entitled to
receive payment pursuant to this Section 10.3, the applicable Agent shall
request such Funding Source to take such actions (including, without limitation,
providing the Transferor and the Administrative Agent with any forms,
certificates or other documents) as may be reasonably necessary to reduce or
eliminate the imposition of such increased cost unless such actions would impose
on the Funding Source costs, additional costs or legal burdens deemed by the
Funding Source to be material.
Section 10.4 Other Costs and Expenses. Transferor shall pay to the
Agents and Conduits on demand all costs and out-of-pocket expenses (including
any stamp, documentary or similar taxes but not including any Excluded Taxes or
any other taxes covered by Section 10.1 or Section 10.2) 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, rating agency fees, the cost of
Conduit's or Agent's auditors auditing the books, records and procedures of
Transferor, reasonable fees and out-of-pocket expenses of legal counsel for
Conduits and the Agents with respect thereto and with respect to advising
Conduits and the Agents as to their respective rights and remedies under this
Agreement. Transferor shall pay to the Agents on demand any and all costs and
expenses of the Agents and the Transferees, 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 an Amortization Event. Scotia and Wachovia agree that Xxxxxx
& Xxxxxxx (and its successors, Xxxxxx & Xxxxxxx Illinois LLC and Xxxxxx &
Xxxxxxx LLP) shall be their sole outside legal counsel in connection with the
transactions contemplated hereby. Transferor shall have no obligation to pay any
of the aforementioned fees and expenses to any law firm other than Xxxxxx &
Xxxxxxx (and its successors, Xxxxxx & Xxxxxxx Illinois LLC and Xxxxxx & Xxxxxxx
LLP).
ARTICLE XI.
THE AGENTS
Section 11.1 Appointment.
(a) Each Transferee and Co-Agent hereby irrevocably designates
and appoints Wachovia Bank, National Association as Administrative Agent
hereunder and under the Intercreditor Agreement, and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
the Transaction Documents and to exercise such powers and perform such duties as
are expressly delegated to the Administrative Agent by the terms of the
Transaction Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Transferee or Co-Agent, and no implied covenants,
functions,
37
responsibilities, duties, obligations or liabilities on the part of the
Administrative Agent shall be read into this Agreement or otherwise exist
against the Administrative Agent.
(b) Each of Blue Ridge and the Blue Ridge Liquidity Banks
hereby irrevocably designates and appoints Wachovia Bank, National Association
as its Co-Agent hereunder, and authorizes such Co-Agent to take such action on
its behalf under the provisions of this Agreement, the Blue Ridge Fee Letter and
the Blue Ridge Liquidity Agreement and to exercise such powers and perform such
duties as are expressly delegated to such Co-Agent by the terms of this
Agreement, if any, together with such other powers as are reasonably incidental
thereto. Each of Liberty Street and the Liberty Street Liquidity Banks hereby
irrevocably designates and appoints Scotiabank as its Co-Agent hereunder, and
authorizes such Co-Agent to take such action on its behalf under the provisions
of this Agreement, the Liberty Street Fee Letter and the Liberty Street
Liquidity Agreement and to exercise such powers and perform such duties as are
expressly delegated to such Co-Agent by the terms of this Agreement, if any,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Fee Letters or the Liquidity Agreements, no Co-Agent shall have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Transferee, Liquidity Bank or other Agent, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities on
the part of such Co-Agent shall be read into this Agreement, the Fee Letters or
the Liquidity Agreements or otherwise exist against such Co-Agent.
(c) The provisions of this Article XI are solely for the
benefit of the Agents and the Transferees, and neither of the Transferor Parties
shall have any rights as a third-party beneficiary or otherwise under any of the
provisions of this Article XI, except that this Article XI shall not affect any
obligations which any Agent or any Transferee may have to either of the
Transferor Parties under the other provisions of this Agreement. Furthermore, no
Transferee or Liquidity Bank shall have any rights as a third-party beneficiary
or otherwise under any of the provisions hereof in respect of a Co-Agent which
is not the Co-Agent for such Person.
(d) In performing its functions and duties hereunder, the
Administrative Agent shall act solely as the agent of the Transferees and the
Co-Agents and does not assume nor shall be deemed to have assumed any obligation
or relationship of trust or agency with or for either of the Transferor Parties
or any of their respective successors and assigns. In performing its functions
and duties hereunder, each Co-Agent shall act solely as the agent of its
respective Conduit and its respective Liquidity Bank(s), and does not assume nor
shall be deemed to have assumed any obligation or relationship of trust or
agency with or for either of the Transferor Parties, any other Transferee,
Liquidity Bank or Agent, or any of their respective successors and assigns.
Section 11.2 Delegation of Duties. Each Agent may execute any of
its duties under the applicable Transaction Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
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Section 11.3 Exculpatory Provisions. No 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 or any Person described in
Section 11.2 under or in connection with the Transaction Documents (except for
its, their or such Person's own bad faith, gross negligence or willful
misconduct), or (ii) responsible in any manner to any of the Transferees or
other agents for any recitals, statements, representations or warranties made by
the Transferor contained in this Agreement or in any certificate, report,
statement or other document referred to or provided for in, or received under or
in connection with, this Agreement or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other
document furnished in connection herewith, or for any failure of either of the
Transferor Parties to perform its respective obligations hereunder, or for the
satisfaction of any condition specified in Article V, except receipt of items
required to be delivered to such Agent. No Agent shall be under any obligation
to any Transferee, Liquidity Bank or other Agent 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 to inspect the properties, books or
records of the Transferor Parties. This Section 11.3 is intended solely to
govern the relationship between each Agent, on the one hand, and the Transferees
and their respective Liquidity Banks, on the other.
Section 11.4 Reliance by Agents.
(a) Each Agent shall in all cases be entitled to rely, and
shall be fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Transferor Parties), independent accountants
and other experts selected by such Agent. Each Agent shall in all cases be fully
justified in failing or refusing to take any action under this Agreement or any
other document furnished in connection herewith unless it shall first receive
such advice or concurrence of (i) in the case of the Administrative Agent, each
of the Co-Agents (except where another provision of this Agreement specifically
authorizes the Administrative Agent to take action based on the instructions of
any of the Co-Agents) or (ii) in the case of a Co-Agent, such of its Transferees
and Liquidity Banks, as it shall determine to be appropriate under the relevant
circumstances, or it shall first be indemnified to its satisfaction by its
Constituent Liquidity Banks against any and all liability, cost and expense
which may be incurred by it by reason of taking or continuing to take any such
action.
(b) Any action taken by the Administrative Agent in accordance
with Section 11.4(a) shall be binding upon all Transferees and Agents.
(c) Each Co-Agent shall determine with its Conduit and, as
applicable, its Liquidity Banks, the number of such Persons which shall be
required to request or direct such Co-Agent to take action, or refrain from
taking action, under this Agreement on behalf of such Persons and whether any
consent of the rating agencies who rate such Conduit's Commercial Paper is
required (such Persons and, if applicable, rating agencies, a "VOTING BLOCK").
Such Co-Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement in accordance with a request of its
appropriate Voting Block, and such request and
39
any action taken or failure to act pursuant thereto shall be binding upon all of
such Co-Agent's Constituents.
(d) Unless otherwise advised in writing by a Co-Agent or by
any Transferee or Liquidity Bank on whose behalf such Co-Agent is purportedly
acting, each party to this Agreement may assume that (i) such Co-Agent is acting
for the benefit of each of its Constituent Transferees and, as applicable,
Liquidity Banks, as well as for the benefit of each permitted assignee from any
such Person, and (ii) each action taken by such Co-Agent has been duly
authorized and approved by all necessary action on the part of its Voting Block.
Each Conduit (or its Liquidity Banks) shall have the right to designate a new
Co-Agent (which may be itself) to act on its behalf and on behalf of its
assignees and transferees for purposes of this Agreement by giving to the Agents
and the Transferor Parties written notice thereof signed by such Transferee(s)
and the newly designated Co-Agent. Such notice shall be effective when receipt
thereof is acknowledged by the retiring Co-Agent and the Transferor Parties,
which acknowledgments shall not be withheld or unreasonably delayed, and
thereafter the party named as such therein shall be Co-Agent for such
Transferees under this Agreement. Each Co-Agent and its Transferees and
Liquidity Banks shall agree amongst themselves as to the circumstances and
procedures for removal and resignation of such Co-Agent.
Section 11.5 Notice of Amortization Events. No Agent shall be
deemed to have knowledge or notice of the occurrence of any Amortization Event
or Potential Amortization Event unless such Agent has received notice from
another Agent, a Transferee, a Liquidity Bank or a Transferor Party referring to
this Agreement, stating that an Amortization Event or Potential Amortization
Event has occurred hereunder and describing such Amortization Event or Potential
Amortization Event. In the event that any of the Agents receives such a notice,
it shall promptly give notice thereof to the other Agents for distribution, in
the case of a Co-Agent, to the members of its Group. The Administrative Agent
shall take such action with respect to such Amortization Event or Potential
Amortization Event as shall be directed by any of the Co-Agents.
Section 11.6 Non-Reliance on Agents and Other Transferees. Each of
the Transferees expressly acknowledges that no Agent, nor any of such Agent's
officers, directors, employees, agents, attorneys-in-fact or affiliates has made
any representations or warranties to it and that no act by any Agent hereafter
taken, including, without limitation, any review of the affairs of the
Transferor Parties, shall be deemed to constitute any representation or warranty
by such Agent. Each of the Transferees also represents and warrants to the
Agents and the other Transferees that it has, independently and without reliance
upon any such Person (or any of their Affiliates) 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 Transferor Parties and made its own
decision to enter into this Agreement. Each of the Transferees also represents
that it will, independently and without reliance upon any Agent or any other
Liquidity Bank or Transferee, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, prospects, financial and other condition and
creditworthiness of the Transferor Parties.
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None of the Agents or the Transferees, nor any of their respective Affiliates,
shall have any duty or responsibility to provide any party to this Agreement
with any credit or other information concerning the business, operations,
property, prospects, financial and other condition or creditworthiness of the
Transferor Parties which may come into the possession of such Person or any of
its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates, except that each of the Co-Agents shall promptly distribute to its
related Conduit (and, as applicable, its Liquidity Banks), copies of financial
and other information expressly provided to such Co-Agent by either of the
Transferor Parties pursuant to this Agreement for distribution to the Agents
and/or Transferees.
Section 11.7 Indemnification of Agents.
(a) Each Liquidity Bank agrees to indemnify the Administrative
Agent and its officers, directors, employees, representatives and agents (to the
extent not reimbursed by the Transferor Parties and without limiting the
obligation of the Transferor Parties to do so), ratably in accordance with their
respective Percentages or Invested Amount, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever (including,
without limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent or such Person in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether or not
the Administrative Agent in its capacity as Administrative Agent or such Person
shall be designated a party thereto) that may at any time be imposed on,
incurred by or asserted against the Administrative Agent or such Person as a
result of, or arising out of, or in any way related to or by reason of, any of
the transactions contemplated hereunder or the execution, delivery or
performance of this Agreement or any other document furnished in connection
herewith (but excluding any such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent resulting from the bad faith, gross negligence or willful misconduct of
the Administrative Agent or such Person).
(b) Each Liquidity Bank agrees to indemnify its Co-Agent and
such Co-Agent's officers, directors, employees, representatives and agents (to
the extent not reimbursed by the Transferor and without limiting the obligation
of the Transferor to do so), ratably in accordance with their respective
Percentages or Invested Amount, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (including, without
limitation, the fees and disbursements of counsel for such Co-Agent or such
Person in connection with any investigative, administrative or judicial
proceeding commenced or threatened, whether or not such Co-Agent in its capacity
as Co-Agent or such Person shall be designated a party thereto) that may at any
time be imposed on, incurred by or asserted against such Co-Agent or such Person
as a result of, or arising out of, or in any way related to or by reason of, any
of the transactions contemplated hereunder or the execution, delivery or
performance of this Agreement or any other document furnished in connection
herewith (but excluding any such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent resulting from the bad faith, gross negligence or willful misconduct of
such Co-Agent or such Person).
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Section 11.8 Agents in their Individual Capacities. Each of the
Agents in its individual capacity and its Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Transferor
Parties and any Obligor and their respective Affiliates as though such Agent
were not an Agent hereunder. With respect to its Invested Amount, if any,
pursuant to this Agreement, each Agent shall have the same rights and powers
under this Agreement as any Transferee and may exercise the same as though it
were not an Agent, and the terms "Transferee" and "Transferees" shall include
each of the Agents in their individual capacities.
Section 11.9 Successor Administrative Agent. The Administrative
Agent, upon fifteen (15) days' notice to the Transferor Parties, the Transferees
and the Co-Agents, may voluntarily resign and may be removed at any time, with
or without cause, and replaced by the Liberty Street Agent, whereupon the
Liberty Street Agent, subject to the approval by the Transferor, shall become
the successor Administrative Agent; PROVIDED, HOWEVER, that Wachovia shall not
voluntarily resign as the Administrative Agent so long as any of the Blue Ridge
Liquidity Banks' respective Commitments remain in effect or Blue Ridge has any
outstanding Receivable Interests hereunder. Upon resignation or replacement of
any Administrative Agent in accordance with this Section 11.9, the retiring
Administrative Agent shall execute such UCC-3 assignments and amendments, and
assignments and amendments of the Transaction Documents, as may be necessary to
give effect to its replacement by a successor Administrative Agent. After any
retiring Administrative Agent's resignation hereunder as Administrative Agent,
the provisions of this Article XI and Article XIII shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was Administrative
Agent under this Agreement.
Section 11.10 Agents' Conflict Waivers.
(a) Wachovia acts, or may in the future act, (i) as
administrative agent for Blue Ridge, (ii) as issuing and paying agent for Blue
Ridge's Commercial Paper Notes, (iii) to provide credit or liquidity enhancement
for the timely payment for Blue Ridge's Commercial Paper Notes and (iv) to
provide other services from time to time for Blue Ridge (collectively, the
"WACHOVIA ROLES"). Without limiting the generality of Sections 11.1 and 11.8,
each Agent, Transferee and Liquidity Bank hereby acknowledges and consents to
any and all Wachovia Roles and agrees that in connection with any Wachovia Role,
Wachovia 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 Blue Ridge, the giving of notice to Blue Ridge's
Liquidity Banks of a mandatory transfer pursuant to Blue Ridge's Liquidity
Agreement, and hereby acknowledges that neither Wachovia nor any of its
Affiliates has any fiduciary duties hereunder to any Transferee (other than Blue
Ridge) or to any of Blue Ridge's Liquidity Banks arising out of any Wachovia
Roles.
(b) Scotiabank and/or one of its affiliates acts, or may in
the future act, (i) as administrative agent for Liberty Street, (ii) as issuing
and paying agent for Liberty Street's Commercial Paper, (iii) to provide credit
or liquidity enhancement for the timely payment for Liberty Street's Commercial
Paper and (iv) to provide other services from time to time for Liberty Street
(collectively, the "SCOTIA ROLES"). Without limiting the generality of Sections
11.1 and 11.8, each of the Agents and the Transferees hereby acknowledges and
consents to any
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and all Scotia Roles and agrees that in connection with any Scotia Role,
Scotiabank and/or its affiliates 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 Liberty Street, the giving of notice to
Liberty Street's Liquidity Banks of a mandatory transfer pursuant to Liberty
Street's Liquidity Agreement, and hereby acknowledges that neither Scotiabank
nor any of its Affiliates has any fiduciary duties hereunder to any Transferee
or to any of Liberty Street's Liquidity Banks arising out of any Scotia Roles.
Section 11.11 UCC Filings. Each of the Secured Parties hereby
expressly recognizes and agrees that the Administrative Agent may be listed as
the assignee or secured party of record on the various UCC filings required to
be made under the Transaction Documents in order to perfect their respective
interests in the Collateral, that such listing shall be for administrative
convenience only in creating a record or nominee holder to take certain actions
hereunder on behalf of the Secured Parties and that such listing will not affect
in any way the status of the Secured Parties as the true parties in interest
with respect to the Receivable, Collections, and Related Security. In addition,
such listing shall impose no duties on the Administrative Agent other than those
expressly and specifically undertaken in accordance with this Article XI.
ARTICLE XII.
ASSIGNMENTS; PARTICIPATIONS
Section 12.1 Assignments.
(a) Subject to the provisions of Section 12.3, each of the
parties hereto hereby agrees and consents to the complete or partial assignment
by a Conduit of all or any portion of its rights under, interest in, title to
and obligations under this Agreement to such Conduit's Liquidity Banks pursuant
to its Liquidity Agreement and, with the prior written consent of the Transferor
which consent shall not be unreasonably withheld or delayed and shall not be
required if an Amortization Event has occurred and is continuing, to any other
Person that (i) is organized under the laws of the United States of America, one
of the states thereof or the District of Columbia and prior to the effectiveness
of the applicable Assignment Agreement deliver to Transferor two (2) duly
executed and completed Internal Revenue Service Form W-9 certifying that such
Person is a "United States person" within the meaning of Section 7701(a)(30) of
the Tax Code, or (ii) prior to the effectiveness of the applicable Assignment
Agreement delivers to Transferor two (2) duly originals of a completed and
executed Internal Revenue Service Form W-8BEN or W-8ECI, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Person is entitled to benefits under an income tax treaty to which the United
States is a party which reduces to zero the rate of withholding tax on payments
due under this Agreement and/or any of the other Transaction Documents or
certifying that the income receivable pursuant to this Agreement and/or any of
the other Transaction Documents is effectively connected with the conduct of a
trade or business in the United States, and upon such assignment, such Conduit
shall be released from its obligations so assigned. Further, each of the parties
hereto hereby agrees that any assignee of a Conduit of this Agreement or all or
any of the Receivable Interests of such Conduit shall have all of the rights and
benefits under this Agreement as if the term "CONDUIT" explicitly referred to
such party, and no such assignment
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shall in any way impair the rights and benefits of such Conduit hereunder.
Neither Transferor nor the Servicer shall have the right to assign its rights or
obligations under this Agreement; PROVIDED, HOWEVER, that (A) if the Servicer is
a Subsidiary directly or indirectly wholly owned by the Parent, the Servicer may
merge with another Subsidiary (other than the Transferor) directly or indirectly
wholly owned by the Parent, so long as (1) the surviving entity of such merger
expressly assumes the obligations of Servicer hereunder and (2) the Performance
Guarantor confirms that the guaranty under the Performance Undertaking covers
the obligations of such surviving entity as Servicer or (B) if the Servicer
provides 30 days' written notice to each of the Agents and each of the Agents
consents to such assignment, the Servicer may assign its rights and obligations
under this Agreement, so long as (1) the successor entity expressly assumes the
obligations of Servicer hereunder, and (2) the Performance Guarantor confirms
that the guaranty under the Performance Undertaking covers the obligations of
such successor entity as Servicer.
(b) Subject to the provisions of Section 12.3 and to the prior
written consent of the applicable Conduit, any Liquidity Bank may at any time
and from time to time assign to one or more Persons ("PURCHASING LIQUIDITY
BANKS") all or any portion of its rights under, interest in, title to and
obligations under this Agreement pursuant to an assignment agreement,
substantially in the form set forth in Exhibit VI hereto (the "ASSIGNMENT
AGREEMENT"), and a simultaneous ratable assignment pursuant to the applicable
Liquidity Agreement executed by such Purchasing Liquidity Bank and such selling
Liquidity Bank, with a copy thereof delivered to Transferor. Unless an
Amortization Event has occurred and is continuing, the prior written consent of
the Transferor, which consent shall not be unreasonably withheld or delayed,
shall also be required prior to the effective ness of any such Assignment. Each
assignee of a Liquidity Bank must (i) be a Qualifying Liquidity Bank, (ii) agree
to deliver to the applicable Co-Agent, promptly following any request therefor
by such Co-Agent or its Conduit, an enforceability opinion in form and substance
satisfactory to such Co-Agent and Conduit, (iii) shall be bound by the terms of
the Transaction Documents, including, without limitation, the Intercreditor
Agreement, and (iv) either (A) be organized under the laws of the United States
of America, one of the states thereof or the District of Columbia and, prior to
the effectiveness of the applicable Assignment Agreement, deliver to Transferor
two (2) duly completed and executed Internal Revenue Service Form W-9 certifying
that such assignee is a "United States person" within the meaning of Section
7701(a)(30) of the Tax Code, or (B) prior to the effectiveness of the applicable
Assignment Agreement deliver to Transferor two (2) duly completed and executed
Internal Revenue Service Form W-8BEN or W-8ECI, as appropriate, or any successor
form prescribed by the Internal Revenue Service, certifying that such assignee
is entitled to benefits under an income tax treaty to which the United States is
a party which reduces to zero the rate of withholding tax on payments due under
this Agreement and/or any of the other Transaction Documents or certifying that
the income receivable pursuant to this Agreement and/or any of the other
Transaction Documents is effectively connected with the conduct of a trade or
business in the United States. Upon delivery of the executed Assignment
Agreement, and an assignment pursuant to the applicable Liquidity Agreement to
such Co-Agent, such selling Liquidity Bank shall be released from its
obligations hereunder and under the applicable Liquidity Agreement to the extent
of such assignment. Thereafter the Purchasing Liquidity Bank shall for all
purposes be a Liquidity Bank party to this Agreement and shall have all the
rights and obligations of a Liquidity Bank under this Agreement and the
applicable Liquidity Agreement to the same extent
44
as if it were an original party hereto and thereto, and no further consent or
action by Transferor, the Transferees or the Agents shall be required.
(c) Any Person making an assignment of all or any portion of
its rights under, interest in, title to and obligations under this Agreement
shall provide to the Administrative Agent and the Transferor, in a written
notice, the name of the Person to whom such assignment was made and any other
information reasonably requested by the Administrative Agent or the Transferor.
The Administrative Agent shall, as agent for the Transferor, keep a register of
each such assignment permitted hereby and each assignee shall be treated as the
holder of the interest assigned to it for all purposes.
Section 12.2 Participations. Subject to the provisions of
Section 12.3, any Liquidity Bank may, in the ordinary course of its business,
and subject to the terms of the applicable Liquidity Agreement, at any time sell
to one or more Persons that (a) are organized under the laws of the United
States of America, one of the states thereof or the District of Columbia and
prior to the effectiveness of the applicable participation deliver to such
Liquidity Bank two (2) duly completed and executed Internal Revenue Service Form
W-9 certifying that such Person is a "United States person" within the meaning
of Section 7701(a)(30) of the Tax Code, or (b) prior to the effectiveness of the
applicable participation deliver to Transferor two (2) duly completed and
executed Internal Revenue Service Form W-8BEN or W-8ECI, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Person is entitled to benefits under an income tax treaty to which the United
States is a party which reduces to zero the rate of withholding tax on payments
due under this Agreement and/or any of the other Transaction Documents or
certifying that the income receivable pursuant to this Agreement and/or any of
the other Transaction Documents is effectively connected with the conduct of a
trade or business in the United States (each such Person, a "PARTICIPANT")
participating interests in its Ratable Share of the Commitments and Receivable
Interests of the Liquidity Banks in its Group. Notwithstanding any such sale by
a Liquidity Bank of a participating interest to a Participant, such Liquidity
Bank's rights and obligations under this Agreement shall remain unchanged, such
Liquidity Bank shall remain solely responsible for the performance of its
obligations hereunder, and each of the parties hereto shall continue to deal
solely and directly with such Liquidity Bank in connection with such Liquidity
Bank's rights and obligations under this Agreement. Each Liquidity Bank agrees
that any agreement between such Liquidity Bank and any such Participant in
respect of such participating interest shall not restrict such Liquidity Bank's
right to agree to any amendment, supplement, waiver or modification to this
Agreement, except for any amendment, supplement, waiver or modification
described in Section 13.1(b)(i).
Section 12.3 Limitation on Assignments and Participations. Neither
the Transferees nor the Transferor shall allow any Receivable Interests or any
participating interest therein to become (i) traded on an established securities
market (as defined in U.S. Department of Treasury (the "TREASURY") regulations
section 1.7704-1(b)) or (ii) readily tradable on a secondary market or the
substantial equivalent thereof (as defined in Treasury regulations section
1.7704-1(c)), and no Transferee shall transfer, assign or participate any
Receivable Interest or any participating interest therein in any such
established securities market or any such secondary market or the substantial
equivalent thereof. In addition, neither the Receivable Interests nor any
participating interest therein may be issued or sold in a transaction or
transactions that are required to be
45
registered under the Securities Act of 1933 (15 U.S.C. 77a et seq.). Any
assignment or transfer of the Receivable Interests or any participating interest
therein in violation of the foregoing restrictions will be void.
ARTICLE XIII.
MISCELLANEOUS
Section 13.1 Waivers and Amendments.
(a) No failure or delay on the part of any Agent or any
Transferee 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 signed by the Transferor and
each of the Agents.
Section 13.2 Notices. Except as provided in this Section 13.2, 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 or at such other
address or telecopy number as such Person may hereafter specify for the purpose
of notice to each of the other parties hereto. Each such notice or other
communication shall be effective (i) if given by telecopy, upon the receipt
thereof, (ii) if given by mail, three (3) Business Days after the time such
communication is deposited in the mail with first class postage prepaid or (iii)
if given by any other means, when received at the address specified in this
Section 13.2. Transferor hereby authorizes the Administrative Agent to effect
transfers 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 Transferor. Transferor agrees to deliver promptly to
the Administrative Agent a written confirmation of each telephonic notice signed
by an authorized officer of Transferor; PROVIDED, 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 13.3 Ratable Payments. If any Transferee, whether by
setoff or otherwise, has payment made to it with respect to any portion of the
Aggregate Unpaids owing to such Transferee (other than payments received
pursuant to Section 10.3 or 10.4) in a greater proportion than that received by
any other Transferee entitled to receive a ratable share of such Aggregate
Unpaids, such Transferee agrees, promptly upon demand, to transfer for cash
without recourse or warranty a portion of such Aggregate Unpaids held by the
other Transferees so that after such transfer each Transferee will hold its
ratable proportion of such Aggregate Unpaids;
46
provided that if all or any portion of such excess amount is thereafter
recovered from such Transferee, such transfer shall be rescinded and the
transfer price restored to the extent of such recovery, but without interest.
Section 13.4 Protection of Ownership Interests of the Transferees.
(a) Transferor 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 reasonably request, to perfect, protect or more fully evidence the
Receivable Interests, or to enable the Administrative Agent or the Transferees
to exercise and enforce their rights and remedies hereunder. At any time after
the occurrence of an Amortization Event, the Administrative Agent may, or the
Administrative Agent may direct Transferor or the Servicer to, notify the
Obligors of Receivables, at Transferor's expense, of the ownership or security
interests of the Transferees 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. Transferor or the
Servicer (as applicable) shall, at any Transferee's request, withhold the
identity of such Transferee in any such notification.
(b) If any Transferor Party fails to perform any of its
obligations hereunder, the Administrative Agent or any Transferee may (but shall
not be required to) perform, or cause performance of, such obligations, and the
Administrative Agent's or such Transferee's costs and expenses incurred in
connection therewith shall be payable by Transferor as provided in Section 10.4.
Each Transferor Party 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 such Transferor Party (i) to execute on behalf of Transferor as debtor and to
file (or to file without Transferor's signature to the extent permitted by
applicable law) 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 Transferees 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 Transferees in the Receivables. This appointment is coupled
with an interest and is irrevocable.
Section 13.5 Confidentiality.
(a) Each Transferor Party, Agent and Transferee and any of
their respective affiliates shall maintain and shall cause each of its employees
and officers to maintain the confidential or proprietary information with
respect to the Agents and Conduits and their respective businesses obtained by
it or them in connection with the structuring, negotiating and execution of the
transactions contemplated herein, except that such Transferor Party, Agent or
Transferee and its officers and employees may disclose such information to its
external accountants and attorneys, its rating agencies, to the banks from time
to time party to the Credit Agreement, in connection with the enforcement
hereof, and as required by 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), including disclosure in its
47
required filings with the Securities and Exchange Commission, PROVIDED that any
person shall be permitted to disclose to any and all persons, without limitation
of any kind, the structure and tax aspects of the transaction, and all materials
of any kind (including opinions or other tax aspects) related to such structure
and tax aspects.
(b) Anything herein to the contrary notwithstanding, each
Transferor Party hereby consents to the disclosure of any nonpublic information
with respect to it (i) to the Agents or the Transferees by each other, (ii) by
the Agents or the Transferees to any prospective or actual assignee or
participant of any of them and (iii) by each of the Co-Agents to any rating
agency, Commercial Paper dealer or provider of a surety, guaranty or credit or
liquidity enhancement to its Conduit or any entity organized for the purpose of
purchasing, or making loans secured by, financial assets for which such Co-Agent
acts as the administrative agent and to any officers, directors, members, direct
or indirect owners, employees, outside accountants and attorneys of any of the
foregoing, PROVIDED that each such Person is informed of the confidential nature
of such information and agrees to keep it confidential in accordance with the
terms hereof. In addition, the Transferees and the Agents 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) or in connection with the
enforcement hereof.
Section 13.6 Bankruptcy Petition. Each of Transferor, the
Servicer, the Agents and the other Transferees hereby covenants and agrees that,
prior to the date that is one year and one day after the payment in full of all
outstanding indebtedness of a Conduit, it will not institute against, or join
any other Person in instituting against, such Conduit 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. This Section 13.6 shall survive termination of this Agreement.
Section 13.7 Limitation of Liability. Except with respect to any
claim arising out of the willful misconduct or gross negligence of any Agent or
any Transferee, no claim may be made by any Transferor Party or any other Person
against any Agent or Transferee or their respective Affiliates, directors,
members, direct or indirect owners, 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 each Transferor Party 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 13.8 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401
ET SEQ. OF THE GENERAL OBLIGATIONS LAW AND EXCEPT TO THE EXTENT THAT THE
PERFECTION OF THE RECEIVABLE INTERESTS OR ANY SECURITY INTEREST GRANTED HEREIN
IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
48
Section 13.9 CONSENT TO JURISDICTION. EACH TRANSFEROR PARTY HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR STATE COURT SITTING IN NEW YORK, NEW YORK, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED
BY SUCH PERSON PURSUANT TO THIS AGREEMENT AND EACH TRANSFEROR PARTY 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 ANY AGENT OR ANY TRANSFEREE TO BRING
PROCEEDINGS AGAINST ANY TRANSFEROR PARTY IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY TRANSFEROR PARTY AGAINST ANY AGENT
OR ANY TRANSFEREE OR ANY AFFILIATE OF ANY AGENT OR ANY TRANSFEREE INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH TRANSFEROR PARTY
PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW YORK, NEW
YORK.
Section 13.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO 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 ANY
TRANSFEROR PARTY PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED
HEREUNDER OR THEREUNDER.
Section 13.11 Integration; Binding Effect; Survival of Terms.
(a) This Agreement and each other Transaction Document 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) This Agreement and the Intercreditor Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns (including any trustee in bankruptcy). This
Agreement shall create and constitute the continuing obligations of the parties
hereto in accordance with its terms and shall remain in full force and effect
until terminated in accordance with its terms; PROVIDED, HOWEVER, that the
rights and remedies with respect to (i) any breach of any representation and
warranty made by any Transferor Party pursuant to Article V, (ii) the
indemnification and payment provisions of Article X, and (iii) Sections 13.5,
13.6 and 13.14 shall be continuing and shall survive any termination of this
Agreement.
49
Section 13.12 Counterparts; Severability; Section References. 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. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of a signature page to this Agreement. Any provisions of
this Agreement which are prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. Unless otherwise
expressly indicated, all references herein to "ARTICLE," "SECTION," "SCHEDULE"
or "EXHIBIT" shall mean articles and sections of, and schedules and exhibits to,
this Agreement.
Section 13.13 Characterization.
(a) It is the intention of the parties hereto that each
transfer hereunder shall constitute and be treated as an absolute and
irrevocable sale, which transfer shall provide the applicable Transferee 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 Transferor; PROVIDED, HOWEVER, that (i)
Transferor shall be liable to each Transferee and the Administrative Agent for
all representations, warranties, covenants and indemnities made by Transferor
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 Transferee or any Agent or
any assignee thereof of any obligation of Transferor or any Originator or any
other Person arising in connection with the Receivables, the Related Security,
or the related Contracts, or any other obligations of Transferor or any
Originator.
(b) In addition to any ownership interest which the
Administrative Agent may from time to time acquire pursuant hereto, Transferor
hereby grants to the Administrative Agent for the ratable benefit of the
Transferees a valid and perfected security interest in all of Transferor's
right, title and interest in, to and under all Receivables now existing or
hereafter arising, the Collections, each Lock-Box, each Collection Account, all
Related Security, all other rights and payments relating to such Receivables,
and all proceeds of any thereof prior to all other liens on and security
interests therein to secure the prompt and complete payment of the Aggregate
Unpaids. The Administrative Agent and the Transferees shall have, in addition to
the rights and remedies that they may have under this Agreement, all other
rights and remedies provided to a secured creditor under the UCC and other
applicable law, which rights and remedies shall be cumulative.
(c) Notwithstanding the foregoing the Transferor, Transferees
and the Agents hereby agree to treat the Receivables Interests as indebtedness
for purposes of United States federal and state income tax or state franchise
tax to the extent permitted by applicable law.
Section 13.14 Nonrecourse Nature of Transactions. Each of the
parties hereto hereby acknowledges and agrees that all transactions with the
Conduits hereunder shall be without recourse of any kind to such Conduit. Each
Conduit shall have no obligation to pay any amounts
50
owing hereunder unless and until such Conduit has received such amounts pursuant
to the Receivable Interests or the Liquidity Agreement. In addition, each party
agrees that each Conduit shall have no obligation to pay any party, any amounts
constituting fees, a reimbursement for expenses or indemnities, (collectively,
"EXPENSE CLAIMS") and such Expense Claims shall not constitute a claim against
such Conduit (as defined in Section 101 of Title 11 of the United States
Bankruptcy Code), unless or until such Conduit has received amounts sufficient
to pay such Expense Claims pursuant to the Receivable Interests or the Liquidity
Agreement and such amounts are not required to pay the commercial paper of such
Conduit. This provision shall survive termination of the Agreement.
(Signature pages follow)
51
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.
FSI RECEIVABLES COMPANY LLC, AS TRANSFEROR
By:_________________________________
Name:
Title:
ADDRESS:
FSI Receivables Company LLC
Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Xxxx X. XxXxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
WITH A COPY TO:
Xxxxxx Scientific Company L.L.C.
0000 Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
52
XXXXXX SCIENTIFIC INTERNATIONAL INC., AS SERVICER
By:_________________________________
Name:
Title:
ADDRESS:
Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
WITH A COPY TO:
Xxxxxx Scientific Company L.L.C.
0000 Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
53
BLUE RIDGE ASSET FUNDING CORPORATION
BY: WACHOVIA SECURITIES, INC., AS ATTORNEY-IN-FACT
By:_________________________________
Name:
Title:
ADDRESS:
Blue Ridge Asset Funding Corporation
c/o Wachovia Bank, National Association
000 X. Xxxxxxx Xxxxxx
XXX XXX 0 XX00000
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxx Xx.
Tel.: (000) 000-0000
Fax: (000) 000-0000
WITH A COPY TO:
Blue Ridge Asset Funding Corporation
c/o AMACAR Group, L.L.C.
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Tel.: (000) 000-0000
Fax: (000) 000-0000
54
WACHOVIA BANK, NATIONAL ASSOCIATION, INDIVIDUALLY, AS BLUE RIDGE AGENT AND AS
ADMINISTRATIVE AGENT
By:_________________________________
Name:
Title:
ADDRESS:
Wachovia Bank, National Association
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
XX - 8047
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Tel.: (000) 000-0000
Fax: (000) 000-0000
00
XXXXXXX XXXXXX XXXXXXX XXXX.
By:_________________________________
Name:
Title:
ADDRESS:
Liberty Street Funding Corp.
c/o Global Securitization Services, LLC
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
WITH A COPY TO:
The Bank of Nova Scotia
Xxx Xxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxx, Director
Tel: (000) 000-0000
Fax: (000) 000-0000
00
XXX XXXX XX XXXX XXXXXX, INDIVIDUALLY AND AS LIBERTY STREET AGENT
By:_________________________________
Name:
Title:
ADDRESS:
The Bank of Nova Scotia
Xxx Xxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx, Director [FOR TRANSFER NOTICES]
Tel: (000) 000-0000
Fax: (000) 000-0000
and
Attention: Xxxx Xxxx, Director [FOR ALL OTHER PURPOSES]
Tel: (000) 000-0000
Fax: (000) 000-0000
57
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):
"ACCRUAL PERIOD" means each calendar month, PROVIDED THAT the
initial Accrual Period hereunder means the period from (and including) the date
of the initial transfer hereunder to (and including) the last day of the
calendar month thereafter.
"ACCRUED VOLUME REBATE" means, on any date of determination,
the amount of volume rebate expense that Xxxxxx Xxxxxxxx L.L.C. has accrued in
accordance with GAAP.
"ADJUSTED DILUTION RATIO" means, at any time, the rolling
average of the Dilution Ratios for the twelve (12) Calculation Periods then most
recently ended.
"ADJUSTED POOL BALANCE" means, on any date of determination,
the Net Pool Balance minus the Required Reserves.
"ADMINISTRATIVE AGENT" has the meaning set forth in the
preamble to this Agreement.
"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.
"AFFECTED LIQUIDITY BANK" has the meaning specified in Section
12.1(c).
"AFFILIATE" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such Person or any Subsidiary of such 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.
"AGENTS" has the meaning set forth in the preamble to this
Agreement.
"AGGREGATE INVESTED AMOUNT" means, on any date of
determination, the aggregate amount of the Invested Amount of all Receivable
Interests outstanding on such date.
"AGGREGATE REDUCTION" means the aggregate of all Group
Reductions occurring on any date.
58
"AGGREGATE UNPAIDS" means, at any time, an amount equal to the
sum of the Aggregate Invested Amount and all unpaid Obligations (whether due or
accrued) at such time.
"AGREEMENT" means this Receivables Transfer Agreement, as it
may be amended or modified and in effect from time to time.
"ALTERNATE BASE RATE" means for any day, the rate per annum
equal to the higher as of such day of (i) each Co-Agent's Prime Rate, or (ii)
0.50 basis points above the Federal Funds Effective Rate. For purposes of
determining the Alternate Base Rate for any day, changes in any Co-Agent's Prime
Rate or the Federal Funds Effective Rate shall be effective on the date of each
such change.
"AMORTIZATION DATE" means, as to each Group, the earliest to
occur of (i) the Business Day immediately prior to the occurrence of an
Amortization Event set forth in Section 9.1(d)(ii), (ii) the Business Day
specified in a written notice from the applicable Co-Agent following the
occurrence of any other Amortization Event, (iii) the date which is 30 days
after the applicable Co-Agent's receipt of written notice from Transferor that
it wishes to terminate that Group's involvement in the facility evidenced by
this Agreement, and (iv) its Liquidity Termination Date.
"AMORTIZATION EVENT" has the meaning specified in Article IX.
"ASSIGNMENT AGREEMENT" has the meaning set forth in Section
12.1(b).
"AUTHORIZED OFFICER" means, with respect to any Person, its
president, corporate controller, treasurer or chief financial officer.
"BLUE RIDGE" has the meaning specified in the preamble to this
Agreement.
"BLUE RIDGE FEE LETTER" means that certain Blue Ridge Fee
Letter dated as of the date hereof by and among Transferor, the Blue Ridge Agent
and the Administrative Agent.
"BLUE RIDGE GROUP ACCOUNT" has the meaning specified in
Section 1.4.
"BLUE RIDGE LIQUIDITY AGREEMENT" means the Liquidity Asset
Transfer Agreement dated as of the date hereof among Blue Ridge, the Blue Ridge
Agent, and the Blue Ridge Liquidity Banks from time to time party thereto, as
the same may be amended, restated, supplemented, replaced or otherwise modified
from time to time.
"BROKEN FUNDING COSTS" means for any Receivable Interest
(other than one accruing Yield at the Alternate Base Rate) which: (i) has its
Invested Amount reduced without compliance by Transferor with the notice
requirements hereunder (or, in the case of any Receivable Interest of a
Liquidity Bank that is accruing Yield at a LIBO Rate, which has its Invested
Amount reduced on any day other than the last day of the applicable Tranche
Period) or (ii) does not become subject to a Group Reduction following the
delivery of any Reduction Notice or (iii) is assigned under a Liquidity
Agreement or terminated prior to the date on which it was originally scheduled
to end or (iv) is reduced on a day when a Conduit has no commercial paper
maturing relative to such Receivable Interest, an amount equal to the excess, if
any, of (A)
59
the CP Costs or Yield (as applicable) that would have accrued during the
remainder of the Tranche Periods or the tranche periods for Commercial Paper
determined by the applicable Co-Agent to relate to such Receivable Interest (as
applicable) subsequent to the date of such reduction, assignment or termination
(or in respect of clause (ii) above, the date such Group Reduction was
designated to occur pursuant to the Reduction Notice) of the Invested Amount of
such Receivable Interest if such reduction, assignment or termination had not
occurred or such Reduction Notice had not been delivered, over (B) the sum of
(x) to the extent all or a portion of such Invested Amount is allocated to
another Receivable Interest, the amount of CP Costs or Yield actually accrued
during the remainder of such period on such Invested Amount for the new
Receivable Interest, and (y) to the extent such Invested Amount is not allocated
to another Receivable Interest, the income, if any, actually received during the
remainder of such period by the holder of such Receivable Interest from
investing the portion of such Invested Amount not so allocated. In the event
that the amount referred to in clause (B) exceeds the amount referred to in
clause (A), the relevant Transferee or Transferees agree to pay to Transferor
the amount of such excess. All Broken Funding Costs shall be due and payable
hereunder within 7 days following written demand, setting forth in reasonable
detail a calculation of the amount thereof.
"BUSINESS DAY" means any day on which banks are not authorized
or required to close in New York, New York, Atlanta, Georgia, or Boston,
Massachusetts and The Depository Trust Company of New York is open for business,
and, 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.
"CALCULATION PERIOD" means a calendar month.
"CHANGE OF CONTROL" means (a) Performance Guarantor ceases to
own, directly or indirectly, 100% of the outstanding voting equity interests of
Transferor, or (b) the occurrence of a "Change in Control" under and as defined
in the Credit Agreement; PROVIDED, HOWEVER, that if the Credit Agreement ceases
to define "Change in Control," such term shall be defined as set forth in the
Credit Agreement immediately prior to the amendment, restatement or replacement
which resulted in such term's deletion from the definitions therein.
"CO-AGENT" has the meaning set forth in the preamble to this
Agreement.
"CO-AGENTS' FEE LETTER" means that certain Co-Agents' Fee
Letter dated as of February 14, 2003 by and among Transferor and the Co-Agents,
as the same may be amended, restated or otherwise modified from time to time.
"COLLECTION ACCOUNT" means each concentration account,
depositary account, lock-box account or similar account in which any Collections
are collected or deposited and which is listed on Exhibit IV as updated from
time to time.
"COLLECTION ACCOUNT AGREEMENT" means an agreement in form
reasonably acceptable to the Agents and Transferor among an Originator,
Transferor, the Administrative Agent and a Collection Bank with respect to a
Collection Account and/or Lock-Box.
"COLLECTION BANK" means, at any time, any of the banks holding
one or more Collection Accounts.
60
"COLLECTION NOTICE" means a notice from the Administrative
Agent to a Collection Bank.
"COLLECTIONS" means, with respect to any Receivable, all cash
collections and other cash proceeds in respect of such Receivable, including,
without limitation, all yield, Finance Charges or other related amounts accruing
in respect thereof and all cash proceeds of Related Security with respect to
such Receivable.
"COMMERCIAL PAPER" means promissory notes of a Conduit issued
by or on behalf of such Conduit in the commercial paper market.
"COMMITMENT" means, for each Liquidity Bank, the commitment of
such Liquidity Bank to acquire Receivable Interests from Transferor in an amount
not to exceed (i) in the aggregate, the amount set forth opposite such Liquidity
Bank's name on Schedule A to this Agreement, as such amount may be modified in
accordance with the terms hereof (including, without limitation, any termination
of Commitments pursuant to Section 13.6 hereof) and (ii) with respect to any
individual transfer hereunder, its Ratable Share of the Transfer Price therefor.
"CONDUIT" has the meaning set forth in the preamble to this
Agreement.
"CONSTITUENTS" means, as to any Co-Agent, the Conduit
represented by it as specified in the preamble to this Agreement, and each of
such Conduit's Liquidity Banks, and the term "CONSTITUENT" when used as an
adjective shall have a correlative meaning.
"CONTINGENT OBLIGATION" of a Person means any agreement,
undertaking or arrangement by which such Person assumes, guarantees, endorses,
contingently agrees to transfer 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, invoices or other writings pursuant to which such
Receivable arises or which evidences such Receivable.
"CP COSTS" means:
(a) for Blue Ridge for each day, the sum of (i) (A) discount
or yield accrued on Blue Ridge's Pooled Commercial Paper on such day, plus (B)
any and all accrued commissions in respect of placement agents and Commercial
Paper dealers, and issuing and paying agent fees incurred, in respect of Blue
Ridge's Pooled Commercial Paper for such day, plus (C) other costs associated
with funding small or odd-lot amounts with respect to all receivable transfer
facilities which are funded by Blue Ridge's Pooled Commercial Paper for such
day, minus (D) any accrual of income net of expenses received on such day from
investment of collections received under all receivable transfer facilities
funded substantially with Blue Ridge's Pooled Commercial Paper, minus (E) any
payment received on such day by such Conduit net of expenses in respect of
Broken Funding Costs related to the prepayment of any Receivable Interest of
Blue Ridge
61
pursuant to the terms of any receivable transfer facilities funded substantially
with its Pooled Commercial Paper, plus (ii) the Program Fee. In addition to the
foregoing costs, if Transferor shall request any Incremental Transfer during any
period of time determined by the Blue Ridge Agent in its sole discretion to
result in incrementally higher CP Costs applicable to such Incremental Transfer,
the Invested Amount associated with any such Incremental Transfer shall, during
such period, be deemed to be funded by Blue Ridge in a special pool (which may
include capital associated with other receivable transfer facilities) for
purposes of determining such additional CP Costs applicable only to such special
pool and charged each day during such period against such Invested Amount; and
(b) for Liberty Street, for any Settlement Period for any
Receivable Interest owned by Liberty Street if and to the extent Liberty Street
funds its acquisition or maintenance thereof by the issuance of Commercial Paper
during such Settlement Period, the per annum rate equivalent to the weighted
average cost of such Commercial Paper (as determined by the Liberty Street
Agent) which shall include commissions of placement agents and dealers,
incremental carrying costs incurred with respect to Commercial Paper maturing on
dates other than those on which corresponding funds are received by Liberty
Street, other borrowings by Liberty Street (other than under any commercial
paper program support agreement of Liberty Street) and any other costs
associated with the issuance of Commercial Paper or related to the issuance of
Commercial Paper that are allocated, in whole or in part, by Liberty Street or
the Liberty Street Agent to fund or maintain such Receivable Interest (and which
may be also allocated in part to the funding of other assets of Liberty Street),
plus all Broken Funding Costs incurred during such Settlement Period relating to
any prepayment of any Invested Amount during such Settlement Period; PROVIDED,
HOWEVER, that if any component of such rate is a discount rate, in calculating
the "CP COSTS" for such Receivable Interest for such Settlement Period, Liberty
Street shall for such component use the rate resulting from converting such
discount rate to an interest bearing equivalent rate per annum
"CREDIT AND COLLECTION POLICY" means the Originators' credit
and collection policies and practices relating to Contracts and Receivables
existing on the date hereof and summarized in Exhibit VII hereto, as modified
from time to time in accordance with this Agreement.
"CUT-OFF DATE" means the last day of a Calculation Period.
"DAYS SALES OUTSTANDING" means, as of any day, an amount equal
to the product of (x) 91, multiplied by (y) the amount obtained by dividing (i)
the aggregate outstanding balance of Receivables as of the most recent Cut-Off
Date, by (ii) the aggregate Outstanding Balance of Receivables created during
the three (3) months including and immediately preceding such Cut-Off Date.
"DEEMED COLLECTIONS" means the aggregate of all amounts
Transferor shall have been deemed to have received as a Collection of a
Receivable. Transferor shall be deemed to have received a Collection of a
Receivable if at any time the Outstanding Balance of any such Receivable is
either (a) reduced as a result of any defective or rejected goods or services,
any cash discount or any other adjustment Transferor or any Affiliate thereof
(other than cash Collections on account of the Receivables) or (b) reduced or
canceled as a result of a setoff in
62
respect of any claim by any Person (whether such claim arises out of the same or
a related transaction or an unrelated transaction), in each of the foregoing
cases, to the extent of such reduction or cancellation, and Transferor shall be
deemed to have received a Collection of a Receivable in full if at any time any
of the representations or warranties in Section 5.1(g) (to the extent it relates
to such Receivable) or any of Sections 5.1(i), (j), (t) and (u) were not true
when made with respect to any Receivable.
"DEFAULT FEE" means with respect to any amount due and payable
by Transferor in respect of any Aggregate Unpaids, an amount equal to the
interest on any such unpaid Aggregate Unpaids at a rate per annum equal to 2%
above the Alternate Base Rate.
"DEFAULT HORIZON RATIO" means, as of any Cut-Off Date, the
ratio (expressed as a decimal) computed by dividing (i) the aggregate sales
generated by the Originators during the 4.0 months ending on such Cut-Off Date,
by (ii) the Net Pool Balance as of such Cut-off Date.
"DEFAULT RATIO" means, as of any Cut-Off Date, the ratio
(expressed as a percentage) computed by dividing (x) the total amount of
Receivables which became Defaulted Receivables during the month that includes
such Cut-Off Date, by (y) the aggregate sales generated by the Originators
during the month occurring five (5) months prior to the month ending on such
Cut-Off Date.
"DEFAULTED RECEIVABLE" means a Receivable: (i) as to which the
obligor thereof has suffered an event of bankruptcy; (ii) which, consistent with
the Originators' credit and collection policies, should be written off as
uncollectible; or (iii) as to which any payment, or part thereof, remains unpaid
for 151 days or more from the original invoice date.
"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 at such time.
"DELINQUENT RECEIVABLE" means a Receivable as to which any
payment, or part thereof, remains unpaid for 121-150 days past the original
invoice date.
"DILUTION HORIZON RATIO" means, as of any Cut-off Date, a
ratio (expressed as a decimal), computed by dividing (i) the aggregate sales
generated by the Originators during the 1.33 months ending on such Cut-Off Date,
by (ii) the Net Pool Balance as of such Cut-Off Date.
"DILUTION RATIO" means, as of any Cut-Off Date, a ratio
(expressed as a percentage), computed by dividing (i) the total amount of
decreases in outstanding principal balances due to Dilutions during the month
ending on such Cut-Off Date, by (ii) the aggregate sales generated by the
Originators during the month immediately prior to the current month ending on
such Cut-Off Date.
"DILUTION RESERVE" means, for any month, the product
(expressed as a percentage) of: (a) the sum of (i) 2 times the Adjusted Dilution
Ratio as of the immediately preceding Cut-Off Date, plus (ii) the Dilution
Volatility Component as of the immediately preceding Cut-Off Date, times (b) the
Dilution Horizon Ratio as of the immediately preceding Cut-Off Date.
63
"DILUTION VOLATILITY COMPONENT" means the product (expressed
as a percentage) of (i) the difference between (a) the highest three (3)-month
rolling average Dilution Ratio over the past 12 months and (b) the Adjusted
Dilution Ratio, and (ii) a fraction, the numerator of which is equal to the
amount calculated in (i)(a) of this definition and the denominator of which is
equal to the amount calculated in (i)(b) of this definition.
"DILUTIONS" means, at any time, the aggregate amount of
reductions or cancellations described in clause (a) of the definition of "Deemed
Collections".
"DISCOUNT RATE" means, the LIBO Rate or the Alternate Base
Rate, as applicable, with respect to each Receivable Interest of the Liquidity
Banks.
"DOWNGRADED LIQUIDITY BANK" means a Liquidity Bank which has
been the subject of a Downgrading Event.
"DOWNGRADING EVENT" with respect to any Person means the
lowering of the rating with regard to the short-term securities of such Person
to below (i) A-1 by S&P, or (ii) P-1 by Moody's.
"ELIGIBLE RECEIVABLE" means, at any time, a Receivable:
(a) the Obligor of which (i) if a natural person, is a
resident of the United States or Puerto Rico or, if a corporation or
other business organization, is organized under the laws of the United
States, Puerto Rico or any political subdivision of the foregoing and
has its chief executive office in the United States or Puerto Rico; and
(ii) is not an Affiliate of any of the parties hereto,
(b) which is not owing from an Obligor as to which more
than 35% of the aggregate outstanding principal balance of all
Receivables owing from such Obligor are Defaulted Receivables,
(c) which was not (on the date it was acquired by
Transferor from the applicable Originator) and is not (on any
subsequent date on which it is included in the Net Pool Balance) (i)
91-150 days past the original invoice date therefor, or (ii) a
Defaulted Receivable,
(d) which by its terms is due and payable within 90 days
of the original invoice date therefor,
(e) which is an "account" or a "payment intangible"
within the meaning of Article 9 of the UCC of all applicable
jurisdictions,
(f) which is denominated and payable only in United
States dollars in the United States,
(g) which arises under a contract or is evidenced by an
invoice which, together with such Receivable, is in full force and
effect and constitutes the legal, valid and binding obligation of the
related Obligor enforceable against such
64
Obligor in accordance with its terms subject to no offset, counterclaim
or other defense,
(h) which is not subject to a confidentiality provision
that purports to restrict the ability of the Administrative Agent to
exercise its rights under the Agreement, including, without limitation,
its right to review the contract,
(i) which represents an obligation to pay a specified sum
of money, contingent only upon the sale of goods or the provision of
services by the applicable Originator,
(j) which, together with any contract or invoice related
thereto, 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,
(k) which satisfies all applicable requirements of the
Originators' credit and collection policies,
(l) which was generated in the ordinary course of the
applicable Originator's business,
(m) which arises solely from the sale of goods or the
provision of services to the related Obligor by the applicable
Originator, and not by any other Person (in whole or in part),
(n) as to which the Administrative Agent has not notified
Transferor 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,
(o) which is not subject to any dispute, counterclaim,
right of rescission, set-off, counterclaim or any other defense
(including defenses arising out of violations of usury laws) of the
applicable Obligor against 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
(except with respect to sale discounts granted on the applicable
invoice, or defective goods returned in accordance with the applicable
Originator's customary practices and policies); PROVIDED, HOWEVER, that
(i) if such dispute, offset, counterclaim or defense affects only a
portion of the outstanding principal balance of such Receivable, then
such Receivable may be deemed an Eligible Receivable to the extent of
the portion of such outstanding principal balance which is not so
affected; (ii) Receivables of any Obligor which has any accounts
payable by the applicable Originator or by a wholly-owned subsidiary of
such Originator (thus
65
giving rise to a potential offset against such Receivables) may be
treated as Eligible Receivables to the extent that the Obligor of such
Receivables has agreed pursuant to a written agreement in form and
substance satisfactory to the Agents, that such Receivables shall not
be subject to such offset; and (iii) rights of offset against
Receivables as to which the Obligor is a government or governmental
agency shall not render such Receivables ineligible under this clause
(o) unless an offset is actually asserted or effected,
(p) as to which the applicable Originator 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,
(q) as to which each of the representations and
warranties contained in Section 5.1(g) (to the extent it relates to
such Receivable) or any of Sections 5.1(i), (j), (r), (s), (t) and (u)
is true and correct, and
(s) all right, title and interest to and in which,
together with all "supporting obligations" as defined in the UCC as in
effect in the State of New York, has been validly transferred by the
applicable Originator to Transferor under and in accordance with the
Receivables Purchase Agreement, and Transferor has good and marketable
title thereto free and clear of any Adverse Claim (except as created
hereunder).
"EQUITY INTERESTS" means, with respect to any Person, any and
all shares, interests, participations or other equivalents, including membership
interests (however designated, whether voting or non-voting), of capital of such
Person, including, if such Person is a partnership, partnership interests
(whether general or limited) and any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, such partnership, whether outstanding on the date
hereof or issued after the date of this Agreement.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations issued thereunder.
"EXCLUDED TAXES" means (A) franchise taxes, excise taxes,
branch profits taxes and taxes based on or measured by all or part of the gross
or net income of any Indemnified Party, in each case, imposed (i) by the United
States or any political subdivision or taxing authority thereof or therein or
(ii) by the jurisdiction under the laws of which the Indemnified Party is
organized or has its applicable lending or administrative office or any
political subdivision of any thereof and (B) taxes that would not have been
imposed if the only connection between the Indemnified Party and the
jurisdiction imposing such taxes was the activities of such Indemnified Party
pursuant to or in respect of this Agreement (including entering into, lending
money or extending credit pursuant to, receiving payments under, or enforcing
this Agreement).
"FACILITY ACCOUNT" means Transferor's account no. 037-7094,
ABA no. 00000000 at Mellon Bank in Pittsburgh, PA.
66
"FEDERAL BANKRUPTCY CODE" means Title 11 of the United States
Code entitled "Bankruptcy," as amended and any successor statute thereto.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate per annum 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. Government 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 11:30 a.m. (New York time) for such day on such transactions
received by the applicable Co-Agent from three federal funds brokers of
recognized standing selected by it.
"FEDERAL GOVERNMENT RECEIVABLES" means any Receivables which
constitute obligations incurred by or on behalf of the federal government of the
United States or any agency thereof.
"FEE LETTERS" means, collectively, the Co-Agents' Fee Letter,
the Blue Ridge Fee Letter, the Liberty Street Fee Letter.
"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.
"FSI" has the meaning specified in the preamble to this
Agreement.
"FUNDING AGREEMENT" means this Agreement and any agreement or
instrument executed by any Funding Source with or for the benefit of Conduit.
"FUNDING SOURCE" means (i) any Liquidity Bank or (ii) any
insurance company, bank or other funding entity providing liquidity, credit
enhancement or back-up transfer support or facilities to Conduit.
"GAAP" means generally accepted accounting principles in
effect in the United States of America as of the date of this Agreement.
"GOVERNMENTAL AUTHORITY" means any federal, state, local or
foreign court or governmental agency, authority, instrumentality, or regulatory
body.
"GROUP" means the Blue Ridge Group or the Liberty Street
Group.
"GROUP ACCOUNT" means the Blue Ridge Group Account or the
Liberty Street Group Account.
"GROUP COLLECTIONS" has the meaning specified in Section 2.2.
"GROUP INVESTED AMOUNT" means, as to any Group on any date of
determination, the aggregate of the Invested Amounts associated with all of such
Group's Receivable Interests.
67
"GROUP LIMIT" means, as to any Group on any date of
determination, an amount equal to the sum of such Group's Liquidity Banks'
Commitments under this Agreement.
"GROUP REDUCTION" means the amount by which the Group Invested
Amount of any Group is to be reduced on any date.
"INCREMENTAL TRANSFER" means a transfer of a Receivable
Interest which increases the total outstanding Aggregate Invested Amount
hereunder (and shall include the initial transfer 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 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 and (vii) Contingent Obligations.
"INDEPENDENT DIRECTOR" shall mean a member of the Board of
Directors of Transferor who is not at such time, and has not been at any time
during the preceding five (5) years, (A) a director, officer, employee or
Affiliate of any Transferor Party, any Originator, or any of their respective
Subsidiaries or Affiliates, or (B) the beneficial owner (at the time of such
individual's appointment as an Independent Director or at any time thereafter
while serving as an Independent Director) of any of the outstanding common
shares of any Transferor Party, any Originator, or any of their respective
Subsidiaries or Affiliates, having general voting rights, or a spouse, parent,
child or sibling of any of the foregoing.
"INTERCREDITOR AGREEMENT" means that certain Intercreditor
Agreement dated as of February 14, 2003, by and between JPMorgan Chase Bank, as
Collateral Agent under the Security Agreement referred to in the Credit
Agreement, and the Administrative Agent, as the same may be amended, restated,
or otherwise modified from time to time.
"INTERIM SETTLEMENT REPORT" means a report, in substantially
the form of Exhibit X hereto.
"INVESTED AMOUNT" of any Transferee's Receivable Interest
means, at any time, (A) the Transfer Price of such Receivable Interest, minus
(B) the sum of the aggregate amount of Collections and other payments received
by the applicable Co-Agent which in each case are applied to reduce such
Invested Amount in accordance with the terms and conditions of this Agreement;
PROVIDED THAT such Invested Amount shall be restored (in accordance with Section
2.4) in the amount of any Collections or other payments so received and applied
if at any time the distribution of such Collections or payments are rescinded,
returned or refunded for any reason.
"LIBERTY STREET" has the meaning provided in the preamble of
this Agreement.
68
"LIBERTY STREET AGENT" has the meaning provided in the
preamble of this Agreement.
"LIBERTY STREET FEE LETTER" means that certain Liberty Street
Fee Letter dated as of the date hereof by and between Transferor and Liberty
Street.
"LIBERTY STREET GROUP ACCOUNT" has the meaning specified in
Section 1.4.
"LIBERTY STREET LIQUIDITY AGREEMENT" means the Liquidity Asset
Transfer Agreement dated as of the date hereof among Liberty Street, the Liberty
Street Agent, and the Liberty Street Liquidity Banks from time to time party
thereto, as the same may be amended, restated, supplemented, replaced or
otherwise modified from time to time.
"LIBO RATE" means, for any Tranche Period, the rate per annum
determined on the basis of the offered rate for deposits in U.S. dollars of
amounts equal or comparable to the Invested Amount of the related Receivable
Interest offered for a term comparable to such Tranche Period, which rates
appear on a Bloomberg L.P. terminal, displayed under the address "US0001M
Q " or "US0001W Q ," as the case may be, effective as of
11:00 A.M., London time, two Business Days prior to the first day of such
Tranche Period, PROVIDED that if no such offered rates appear on such page, the
LIBO Rate for such Tranche Period will be the arithmetic average (rounded
upwards, if necessary, to the next higher 1/100th of 1%) of rates quoted by not
less than two major banks in New York, New York, selected by the applicable
Co-Agent, at approximately 10:00 a.m.(New York time), two Business Days prior to
the first day of such Tranche Period, for deposits in U.S. dollars offered by
leading European banks for a period comparable to such Tranche Period in an
amount comparable to the Invested Amount allocated to such Tranche Period,
divided by (b) one minus the maximum aggregate reserve requirement (including
all basic, supplemental, marginal or other reserves) which is imposed against
any Liquidity 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 (expressed as a decimal), applicable to such Tranche
Period plus (ii) the Program Fee per annum. The LIBO Rate shall be rounded, if
necessary, to the next higher 1/16 of 1%.
"LIQUIDITY AGREEMENTS" means the Liberty Street Liquidity
Agreement and Blue Ridge Liquidity Agreement.
"LIQUIDITY BANKS" means, collectively, the Blue Ridge
Liquidity Banks and the Liberty Street Liquidity Banks.
"LIQUIDITY COMMITMENT" means, as to each Liquidity Bank, its
commitment to its Conduit under the applicable Liquidity Agreement, which
commitment shall equal at least 102% of its Commitment hereunder.
"LIQUIDITY TERMINATION DATE" means, as to each Conduit, the
earlier to occur of the following:
(a) the date on which such Conduit's Liquidity Banks'
Liquidity Commitments expire (i.e., 364 days after the date of this
Agreement unless
69
extended by such Liquidity Banks), cease to be available to the
applicable Conduit or otherwise cease to be in full force and effect;
or
(b) the date on which a Downgrading Event with respect to a
Liquidity Bank to such Conduit shall have occurred and been continuing
for not less than 30 days, and either (i) the Downgraded Liquidity Bank
shall not have been replaced by a Qualified Liquidity Bank pursuant to
such Conduit's Liquidity Agreement, or (ii) the Liquidity Commitment of
such Downgraded Liquidity Bank shall not have been funded or
collateralized in such a manner that will avoid a reduction in or
withdrawal of the credit rating applied to the Commercial Paper to
which such Liquidity Agreement applies by any of the rating agencies
then rating such Commercial Paper.
"LOCK-BOX" means each locked postal box with respect to which
a bank who has executed a Collection Account Agreement has been granted
exclusive access for the purpose of retrieving and processing payments made on
the Receivables and which is listed on Exhibit IV.
"LOSS RESERVE" means, for any month, the product (expressed as
a percentage) of (a) 2.0, times (b) the highest three-month rolling average
Default Ratio during the 12 months ending on the immediately preceding Cut-Off
Date, times (c) the Default Horizon Ratio as of the immediately preceding
Cut-Off Date.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(i) the financial condition or operations of (a) the Performance Guarantor and
its subsidiaries taken as a whole or (b) Transferor, (ii) the ability of any
Transferor Party to perform its obligations under this Agreement or the
Performance Guarantor to perform its obligations under the Performance
Undertaking, (iii) the legality, validity or enforceability of this Agreement or
any other Transaction Document, (iv) the Administrative Agent's security
interest in the Receivables generally or in any significant portion of the
Receivables or the proceeds thereof, or (v) the collectibility of the
Receivables generally or of any material portion of the Receivables.
"MONTHLY REPORTING DATE" shall have the meaning set forth in
Section 8.5.
"MOODY'S" means Xxxxx'x Investors Service, Inc. and its
successors.
"NET POOL BALANCE" means, at any time, Total Accounts
Receivable, MINUS the aggregate Outstanding Balance of all Receivables that are
not Eligible Receivables at such time, MINUS the aggregate amount by which the
Outstanding Balance of all Eligible Receivables of each Obligor and its
Affiliates exceeds the Obligor Concentration Limit for such Obligor, MINUS the
amount of Accrued Volume Rebate at such time.
"NON-U.S. TRANSFEREE" means each Transferee that is not a
"United States person" within the meaning of Section 7701(a)(30) of the Tax
Code.
"OBLIGATIONS" shall have the meaning set forth in Section 2.1.
"OBLIGOR" means a Person obligated to make payments pursuant
to a Contract.
70
"OBLIGOR CONCENTRATION LIMIT" means, at any time:
(a) with respect to all Federal Government Receivables,
3% of the aggregate Outstanding Balance of all Eligible Receivables; and
(b) with respect to all other Receivables in relation to
the aggregate outstanding principal balance thereof which are owed by any single
Obligor and its affiliates (if any), the applicable concentration limit shall be
determined as follows for Obligors who have short term unsecured debt ratings
currently assigned to them by S&P and Moody's, the applicable concentration
limit shall be determined according to the following table:
ALLOWABLE % OF ELIGIBLE
S&P RATING XXXXX'X RATING RECEIVABLES
-------------------------------- ------------------------- ----------------------------
A-1+ P-1 10%
-------------------------------- ------------------------- ----------------------------
A-1 P-1 8%
-------------------------------- ------------------------- ----------------------------
A-2 P-2 6%
-------------------------------- ------------------------- ----------------------------
A-3 P-3 3%
-------------------------------- ------------------------- ----------------------------
Below A-3 or Not Rated by either Below P-3 or Not Rated by
S&P or Moody's either S&P or Moody's 3%
-------------------------------- ------------------------- ----------------------------
; PROVIDED, HOWEVER, that (i) if any Obligor has a split rating, the applicable
rating will be the lower of the two, (ii) if any Obligor is rated only by one of
S&P or Moody's, the applicable Obligor Concentration Limit shall be the one set
forth one line below the sole applicable rating agency's rating in the table
above, and (iii) subject to rating agency approval, upon Transferor's request
from time to time, the Agents may agree to a higher percentage of Eligible
Receivables for a particular Obligor and its affiliates (each such higher
percentage, a "SPECIAL CONCENTRATION LIMIT"), it being understood that any
Special Concentration Limit may be cancelled by the Administrative Agent at the
direction of any Co-Agent upon not less than ten (10) Business Days' written
notice to Transferor.
"ORGANIC DOCUMENT" means, relative to any Person, its
certificate of incorporation, its by-laws, its partnership agreement, its
memorandum and articles of association, its limited liability company agreement
and/or operating agreement, share designations or similar organization documents
and all shareholder agreements, voting trusts and similar arrangements
applicable to any of its authorized Equity Interests.
"ORIGINATOR" has the meaning specified in the Receivables
Purchase Agreement.
"OUTSTANDING BALANCE" of any Receivable at any time means the
then outstanding principal balance thereof.
"OUTSTANDING PERCENTAGE" means, as to each Group on any date
of determination, (a) at any time while the Aggregate Invested Amount is greater
than $0, the ratio which the sum of its members' Invested Amounts as of the
close of business on the preceding Business Day bears to the Aggregate Invested
Amount as of the close of business on the
71
preceding Business Day, and (b) at any time while the Aggregate Invested Amount
is $0, the ratio which its Group Limit bears to the Transfer Limit.
"PARENT" means Xxxxxx Scientific International Inc., a
Delaware corporation.
"PARTICIPANT" has the meaning set forth in Section 12.2.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PERFORMANCE GUARANTOR" means Parent and its successors.
"PERFORMANCE UNDERTAKING" means that certain Performance
Undertaking, dated as of February 14, 2003, by Performance Guarantor in favor of
Transferor, substantially in the form of Exhibit VIII, as the same may be
amended, restated or otherwise modified from time to time.
"PERSON" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"POOLED COMMERCIAL PAPER" means Commercial Paper notes of a
Conduit subject to any particular pooling arrangement by such Conduit, but
excluding Commercial Paper issued by such Conduit for a tenor and in an amount
specifically requested or allocated by any Person in connection with any
agreement effected by such Conduit.
"POTENTIAL AMORTIZATION EVENT" means an event which, with the
passage of time or the giving of notice, or both, would constitute an
Amortization Event.
"PRIME RATE" means, as to any Group, a rate per annum equal to
the prime rate of interest announced from time to time by the applicable
Co-Agent or its parent at its main office in the United States (which is not
necessarily the lowest rate charged to any customer), changing when and as said
prime rate changes.
"PROGRAM FEE" has the meaning set forth in the Fee Letters.
"PROPOSED REDUCTION DATE" has the meaning set forth in Section
1.3.
"PURCHASING LIQUIDITY BANK" has the meaning set forth in
Section 12.1(b).
"QUALIFYING LIQUIDITY BANK" means a Liquidity Bank with a
rating of its short-term securities equal to or higher than (i) A-1 by S&P and
(ii) P-1 by Moody's.
"RATABLE SHARE" means with respect to any Liquidity Bank, the
ratio which its Commitment bears to the sum of the Commitments of all Liquidity
Banks for the same Conduit.
"RECEIVABLE" means each "Receivable" under and as defined in
the Receivables Purchase Agreement in which Transferor now has or hereafter
acquires any right, title or interest.
72
"RECEIVABLE INTEREST" means, at any time, an undivided
percentage ownership interest (computed as set forth below) associated with a
designated amount of Invested Amount, selected pursuant to the terms and
conditions hereof in (i) each Receivable arising prior to the time of the most
recent computation or recomputation of such undivided interest, (ii) all Related
Security with respect to each such Receivable, and (iii) all Collections with
respect to, and other proceeds of, each such Receivable. Each such undivided
percentage interest shall equal:
IA
----------------------
NPB - RR
WHERE:
IA = the Invested Amount of such Receivable Interest.
RR = the Required Reserve.
NPB = the Net Pool Balance.
Such undivided percentage ownership interest shall be initially computed on its
date of transfer. Thereafter, until the Amortization Date, each Receivable
Interest shall be automatically recomputed (or deemed to be recomputed) on each
day prior to the Amortization Date. The variable percentage represented by any
Receivable Interest as computed (or deemed recomputed) as of the close of the
business day immediately preceding the Amortization Date shall remain constant
at all times thereafter.
"RECEIVABLES PURCHASE AGREEMENT" means that certain Amended
and Restated Receivables Purchase Agreement, dated as of February 14, 2003,
among Parent, as Originator Agent, Originators and Transferor, as the same may
be amended, restated or otherwise modified from time to 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) in the possession or control of any
Transferor Party relating to such Receivable, any Related Security therefor and
the related Obligor.
"REDUCTION NOTICE" has the meaning set forth in Section 1.3.
"REGULATORY CHANGE" has the meaning set forth in Section
10.3(a).
"REINVESTMENT" has the meaning set forth in Section 2.2.
"RELATED SECURITY" means, with respect to any Receivable:
(i) all "Related Security" under and as defined in the
Receivables Purchase Agreement in which Transferor now has or hereafter acquires
any right, title or interest,
73
(ii) all of Transferor's right, title and interest in, to
and under the Receivables Purchase Agreement in respect of such Receivable and
all of Transferor's right, title and interest in, to and under the Performance
Undertaking, and
(iii) all proceeds of any of the foregoing.
"REQUIRED NOTICE PERIOD" means the number of days required
notice set forth opposite the applicable Group Reduction amount in the table
below:
GROUP REDUCTION REQUIRED NOTICE PERIOD
--------------- ----------------------
less than or equal to $25 1 Business Day
million
greater than $25 million 2 Business Days
"REQUIRED RESERVE" means, on any day during a month, the
product of (a) the greater of (i) the Required Reserve Factor Floor or (ii) the
sum of the Loss Reserve, the Yield Reserve, the Dilution Reserve and the
Servicing Reserve, times (b) the Net Pool Balance as of the Cut-Off Date
immediately preceding such month.
"REQUIRED RESERVE FACTOR FLOOR" means, for any month, the sum
(expressed as a percentage) of (a) 15%, plus (b) the product of the Adjusted
Dilution Ratio and the Dilution Horizon Ratio, PLUS (c) the Yield Reserve, plus
(d) Servicing Reserve, in each case, as of the immediately preceding Cut-Off
Date, PLUS (e) if Parent fails to maintain its current unsecured debt rating of
"BB-" from S&P or its current bank debt rating of "Ba3" from Moody's, 10%.
"RESPONSE DATE" has the meaning set forth in Section 1.5 of
this Agreement.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of
capital stock of Transferor now or hereafter outstanding, except a dividend
payable solely in shares of that class of stock or in any junior class of stock
of Transferor, (ii) any redemption, retirement, sinking fund or similar payment,
transfer or other acquisition for value, direct or indirect, of any shares of
any class of capital stock of Transferor now or hereafter outstanding, (iii) any
payment or prepayment of principal of, premium, if any, or interest, fees or
other charges on or with respect to, and any redemption, transfer, retirement,
defeasance, sinking fund or similar payment and any claim for rescission with
respect to the Subordinated Loans (as defined in the Receivables Purchase
Agreement), (iv) any payment made to redeem, transfer, retransfer or retire, or
to obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of capital stock of Transferor now or hereafter
outstanding, and (v) any payment of management fees by Transferor (except for
reasonable management fees to an Originator or its Affiliates in reimbursement
of actual management services performed); PROVIDED, HOWEVER, that payment of the
Facility Fee (under and as defined in the Receivable Purchase Agreement) shall
not constitute a Restricted Junior Payment.
"S&P" means Standard & Poor's Ratings Group, a division of The
XxXxxx-Xxxx Companies, Inc.
74
"SCOTIABANK" has the meaning provided in the preamble of this
Agreement.
"SERVICER" means at any time the Person (which may be the
Administrative Agent) then authorized pursuant to Article VIII to service,
administer and collect Receivables.
"SERVICING FEE" has the meaning set forth in Section 8.6.
"SERVICING RESERVE" means, for any month, the product
(expressed as a percentage) of (a) 1%, times (b) a fraction, the numerator of
which is the highest Days Sales Outstanding for the most recent 12 months and
the denominator of which is 360.
"SETTLEMENT DATE" means (a) two (2) Business Days after each
Settlement Report Date, and (b) the last day of the relevant Tranche Period in
respect of each Receivable Interest of the Liquidity Banks.
"SETTLEMENT PERIOD" means (a) in respect of each Receivable
Interest of a Conduit, the immediately preceding Accrual Period, and (b) in
respect of each Receivable Interest of the Liquidity Banks, the entire Tranche
Period of such Receivable Interest.
"SETTLEMENT REPORT" means a report, in substantially the form
of Exhibit IX hereto (appropriately completed), furnished by the Servicer to the
Co-Agents pursuant to Section 8.5.
"SETTLEMENT REPORT DATE" means each Monthly Reporting Date and
each other date, if any, on which an Interim Settlement Report is required to be
delivered under Section 8.5.
"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, limited liability company,
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.
"TAX CODE" means the Internal Revenue Code of 1986, as the
same may be amended from time to time.
"TERMINATING TRANCHE" has the meaning set forth in Section
4.3(b).
"TOTAL ACCOUNTS RECEIVABLE" means, on any date of
determination, the aggregate Outstanding Balance of all Receivables.
"TRANCHE PERIOD" means, with respect to any Receivable
Interest held by a Liquidity Bank:
(a) if Yield for such Receivable Interest is calculated
on the basis of a LIBO Rate, a period of one month or one week beginning on a
Business Day as may be specified by Transferor pursuant to this Agreement. If a
one-month Tranche Period is selected, such Tranche Period shall end on the day
in the applicable succeeding calendar month which corresponds
75
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; or
(b) if Yield for such Receivable Interest is calculated
on the basis of the Alternate Base Rate, a period commencing on a Business Day
selected by Transferor, PROVIDED that no such period shall exceed one month.
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 of longer than 1 week which correspond to a
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 which commences before the
applicable Group's Amortization Date and would otherwise end on a date occurring
after such Amortization Date, such Tranche Period shall end on the Amortization
Date. The duration of each Tranche Period which commences after the applicable
Group's Amortization Date shall be of such duration as selected by the
applicable Co-Agent.
"TRANSACTION DOCUMENTS" means, collectively, this Agreement,
each Transfer Notice, the Receivables Purchase Agreement, each Collection
Account Agreement, each Joinder Agreement, the Performance Undertaking, the Fee
Letters, the Liquidity Agreements, the Intercreditor Agreement, and all other
instruments, documents and agreements executed and delivered in connection
herewith.
"TRANSFER LIMIT" means $225,000,000.
"TRANSFER NOTICE" has the meaning set forth in Section 1.2.
"TRANSFER PRICE" means, with respect to any Incremental
Transfer of a Receivable Interest, the amount paid to Transferor for such
Receivable Interest which shall not exceed the least of (i) the amount requested
by Transferor in the applicable Transfer Notice, (ii) the unused portion of the
Transfer Limit on the applicable transfer date and (iii) the excess, if any, of
the Adjusted Pool Balance on the applicable transfer date over the aggregate
outstanding amount of Aggregate Invested Amount determined as of the date of the
most recent Settlement Report, taking into account such proposed Incremental
Transfer.
"TRANSFEREES" means, collectively, the Conduits and the
Liquidity Banks.
"TRANSFEROR" has the meaning set forth in the preamble to this
Agreement.
"TRANSFEROR PARTIES" means, collectively, (a) Transferor and
(b) at any time that Parent or one of its Affiliates is acting as Performance
Guarantor and/or Servicer, Parent.
"UCC" means the Uniform Commercial Code as from time to time
in effect in the specified jurisdiction.
"YIELD" means for each respective Tranche Period relating to
Receivable Interests of the Liquidity Banks, an amount equal to the product of
the applicable Discount Rate for each
76
Receivable Interest multiplied by the Invested Amount of such Receivable
Interest for each day elapsed during such Tranche Period, annualized on a 360
day basis.
"YIELD RESERVE" means, for any month, the product (expressed
as a percentage) of (i) 1.5 times (ii) the Alternate Base Rate as of the
immediately preceding Cut-Off Date times (iii) a fraction the numerator of which
is the highest Days Sales Outstanding for the most recent 12 months and the
denominator of which is 360.
ALL ACCOUNTING TERMS NOT SPECIFICALLY DEFINED HEREIN SHALL BE
CONSTRUED IN ACCORDANCE WITH GAAP. ALL TERMS USED IN ARTICLE 9 OF THE UCC IN THE
STATE OF NEW YORK, AND NOT SPECIFICALLY DEFINED HEREIN, ARE USED HEREIN AS
DEFINED IN SUCH ARTICLE 9.
77
EXHIBIT II
FORM OF [SECOND] TRANSFER NOTICE
[DATE]
[Insert Name and Address of
Applicable Co-Agent(s)]
RE: [SECOND] TRANSFER NOTICE
Ladies and Gentlemen:
Reference is hereby made to the Receivables Transfer
Agreement, dated as of February 14, 2003 among FSI Receivables Company LLC
("TRANSFEROR"), Xxxxxx Scientific International Inc., as initial Servicer,
Liberty Street Funding Corp., Blue Ridge Asset Funding Corporation, The Bank of
Nova Scotia, individually and as Liberty Street Agent, and Wachovia Bank,
National Association, individually, as Blue Ridge Agent and as Administrative
Agent (the "TRANSFER AGREEMENT"). Capitalized terms used herein shall have the
meanings assigned to such terms in the Transfer Agreement.
The above-named Co-Agents are hereby notified of the following
Incremental Transfer:
DATE OF TRANSFER: _______________________
TRANSFER PRICE: $______________________
a) Blue Ridge Group's Share of the above
Transfer Price $___________________
b) Liberty Street Group's Share of the above
Transfer Price $___________________
REQUESTED DISCOUNT RATE (IF NOT FUNDED Alternate Base Rate
THROUGH COMMERCIAL PAPER): [followed by the LIBO
Rate 3 Business Days
thereafter]
REQUESTED TRANCHE PERIOD (IF APPLICABLE):
a) Blue Ridge Group ______________________
b) Liberty Street Group ______________________
Please credit the Transfer Price in immediately available
funds to the following account:
78
[Account Name]
[Account No.]
[Bank Name & Address]
[ABA #]
Reference:
Telephone advice to: [Name] @ tel. no. ( ) _______________.
Please advise [Name] at telephone no. ( ) _________________
not later than 12:00 noon (New York time) if your Conduit will not be acquiring
its share of this transfer.
In connection with the Incremental Transfer to be made on the
above listed "Date of Transfer" (the "TRANSFER DATE"), Transferor hereby
certifies that the following statements are true on the date hereof, and will be
true on the Transfer Date (before and after giving effect to the proposed
Incremental Transfer):
(i) the representations and warranties set forth in Section
5.1 of the Transfer Agreement are true and correct in all material respects on
and as of the Transfer Date as though made on and as of such date;
(ii) no event has occurred and is continuing, or would result
from such Incremental Transfer, that will constitute an Amortization Event, and
no event has occurred and is continuing, or would result from such Incremental
Transfer, that would constitute a Potential Amortization Event; and
(iii) the Aggregate Invested Amount does not exceed the
Transfer Limit.
Very truly yours,
FSI RECEIVABLES COMPANY LLC
By:_____________________________
Name:
Title:
79
EXHIBIT III
TRANSFEROR'S STATE OF ORGANIZATION; CHIEF EXECUTIVE OFFICE;
LOCATIONS OF RECORDS; FEDERAL EMPLOYER AND ORGANIZATIONAL IDENTIFICATION
NUMBERS, PRIOR NAMES
FSI RECEIVABLES COMPANY LLC (FORMERLY FSI RECEIVABLES CORP.)
- Jurisdiction of Organization: Delaware
- Location of Chief Executive Office:
Xxxxxxx Xxxx
Xxxxxxx, XX 00000
- Location of Records: Hampton, NH
- Federal Employer Identification Number: 00-0000000
- Organizational Identification Number: None
- Legal, Trade and Assumed Names: None
- Prior Names: FSI Receivables Corp.
80
EXHIBIT IV
NAMES OF COLLECTION BANKS; COLLECTION ACCOUNTS
As of 12/31/02
Entity Bank Location Lockbox #
------ ---- -------- ---------
Xxxxxx Scientific Company L.L.C. Mellon Pittsburgh 360153
Xxxxxx Scientific Company L.L.C. Mellon Pittsburgh 371743
Xxxxxx Scientific Company L.L.C. Mellon Chicago 10119
Xxxxxx Scientific Company L.L.C. Mellon Los Angeles 21160
Xxxxxx Xxxxxxxx L.L.C.* Mellon Pittsburgh 371926
Xxxx-Xxxxxx Instrument Co.* Mellon Chicago 10464
Xxxxxx Clinical Services Inc.* Mellon Philadelphia 4155
* = to be transferred into Buyer's name on or before the
Closing Date
81
EXHIBIT V
FORM OF COMPLIANCE CERTIFICATE
To: Wachovia Bank, National Association, as Blue Ridge Agent and Administrative
Agent The Bank of Nova Scotia, New York Agency, as Liberty Street Agent
This Compliance Certificate is furnished pursuant to that
certain Receivables Transfer Agreement dated as of February 14, 2003 among FSI
Receivables Company LLC ("TRANSFEROR"), Xxxxxx Scientific International Inc., as
initial Servicer, Liberty Street Funding Corp., Blue Ridge Asset Funding
Corporation, The Bank of Nova Scotia, New York Agent, as Liberty street Agent,
Wachovia Bank, National Association, individually, as Blue Ridge Agent and as
Administrative Agent (the "AGREEMENT").
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _________________ of
Transferor.
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 Transferor and its Subsidiaries 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 an Amortization Event or Potential Amortization Event, 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 in paragraph 4 below.
4. 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 Transferor has taken, is
taking, or proposes to take with respect to each such condition or
event:__________________
The foregoing certifications, together with the financial
statements delivered with this Certificate, are made and delivered this ___ day
of ______________, 200_.
82
EXHIBIT VI
FORM OF ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT (this "ASSIGNMENT AGREEMENT") is
entered into as of the ___ day of ____________, ____, by and between
_____________________ ("ASSIGNOR") and __________________ ("ASSIGNEE").
PRELIMINARY STATEMENTS
A. This Assignment Agreement is being executed and
delivered in accordance with Section 12.1(b) of that certain Receivables
Transfer Agreement dated as of February 14, 2003 by and among FSI Receivables
Company LLC ("TRANSFEROR"), Xxxxxx Scientific International Inc., as initial
Servicer, Blue Ridge Asset Funding Corporation, Liberty Street Funding Corp.,
The Bank of Nova Scotia, a Canadian chartered bank acting through its New York
Agency, individually and as Liberty Street Agent, and Wachovia Bank, National
Association, individually, as Blue Ridge Agent and as Administrative Agent (as
amended, modified or restated from time to time, the "TRANSFER AGREEMENT"), and
pursuant to Section ___ of that certain [Liquidity Asset Transfer Agreement]
dated as of February 14, 2003, by and among Conduit (hereinafter defined), its
Liquidity Banks and its Co-Agent (as amended, modified or restated from time to
time, the "LIQUIDITY AGREEMENT"). As used herein, "CONDUIT" means [Blue Ridge
Asset Funding Corporation/Liberty Street Funding Corp.] and its applicable
"CO-AGENT" is _____________________________. Capitalized terms used and not
otherwise defined herein are used with the meanings set forth or incorporated by
reference in the Transfer Agreement.
B. Assignor is a [Blue Ridge/Liberty Street] Liquidity
Bank party to the Transfer Agreement and the Liquidity Agreement, and Assignee
wishes to become a [Blue Ridge/Liberty Street] Liquidity Bank thereunder; and
C. Assignor is selling and assigning to Assignee an
undivided ____________% (the "TRANSFERRED PERCENTAGE") interest in all of
Assignor's rights and obligations under the Transfer Agreement, the Liquidity
Agreement and the other Transaction Documents, including, without limitation,
Assignor's Commitment[, Liquidity/Transfer Commitment] and (if applicable) the
Invested Amount of Assignor's Receivable Interests as set forth herein.
AGREEMENT
The parties hereto hereby agree as follows:
1. The sale, transfer and assignment effected by this
Assignment Agreement shall become effective (the "ASSIGNMENT EFFECTIVE DATE")
two (2) Business Days (or such other date selected by the Administrative Agent
in its sole discretion) following the date on which a notice substantially in
the form of Schedule II to this Assignment Agreement ("EFFECTIVE NOTICE") is
delivered by the applicable Co-Agent to its Conduit, Assignor and Assignee. From
and after the Assignment Effective Date, Assignee shall be a [Blue Ridge/Liberty
Street]
83
Liquidity Bank party to the Transfer Agreement and Liquidity Agreement for all
purposes thereof as if Assignee were an original party thereto and Assignee
agrees to be bound by all of the terms and provisions contained therein.
2. If Assignor has no outstanding Invested Amount under
the Transfer Agreement or Liquidity Agreement, on the Assignment Effective Date,
Assignor shall be deemed to have hereby transferred and assigned to Assignee,
without recourse, representation or warranty (except as provided in paragraph 6
below), and the Assignee shall be deemed to have hereby irrevocably taken,
received and assumed from Assignor, the Transferred Percentage of Assignor's
Commitment[, Liquidity/Transfer Commitment] and all rights and obligations
associated therewith under the terms of the Transfer Agreement and/or the
Liquidity Agreement, including, without limitation, the Transferred Percentage
of Assignor's future funding obligations under Section 4.1 of the Transfer
Agreement and under the Liquidity Agreement.
3. If Assignor has any outstanding Invested Amount under
the Transfer Agreement or the Liquidity Agreement, at or before 12:00 noon,
local time of Assignor, on the Assignment Effective Date Assignee shall pay to
Assignor, in immediately available funds, an amount equal to the sum of (i) the
Transferred Percentage of the outstanding Invested Amount of Assignor's
Receivable Interests (such amount, being hereinafter referred to as the
"ASSIGNEE'S INVESTED AMOUNT"); (ii) all accrued but unpaid (whether or not then
due) Yield attributable to Assignee's Invested Amount; and (iii) accruing but
unpaid fees and other costs and expenses payable in respect of Assignee's
Invested Amount for the period commencing upon each date such unpaid amounts
commence accruing, to and including the Assignment Effective Date (the
"ASSIGNEE'S ACQUISITION COST"); whereupon, Assignor shall be deemed to have
sold, transferred and assigned to Assignee, without recourse, representation or
warranty (except as provided in paragraph 6 below), and Assignee shall be deemed
to have hereby irrevocably taken, received and assumed from Assignor, the
Transferred Percentage of Assignor's Commitment and the Invested Amount of
Assignor's Receivable Interests (if applicable) and all related rights and
obligations under the Transfer Agreement and the Transaction Documents,
including, without limitation, the Transferred Percentage of Assignor's future
funding obligations under Section 4.1 of the Transfer Agreement and under the
Liquidity Agreement.
4. Concurrently with the execution and delivery hereof,
Assignor will provide to Assignee copies of all documents requested by Assignee
which were delivered to Assignor pursuant to the Transfer Agreement.
5. Each of the parties to this Assignment Agreement
agrees that at any time and from time to time upon the written request of any
other party, it will execute and deliver such further documents and do such
further acts and things as such other party may reasonably request in order to
effect the purposes of this Assignment Agreement.
6. By executing and delivering this Assignment
Agreement, Assignor and Assignee confirm to and agree with each other, the
applicable Co-Agent and the [Blue Ridge/Liberty Street] Liquidity Banks as
follows: (a) other than the representation and warranty that it has not created
any Adverse Claim upon any interest being transferred hereunder, Assignor makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made by any other Person in or in
connection with the
84
Transfer Agreement, the Liquidity Agreement or the other Transaction Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of Assignee, the Transfer Agreement or any other instrument or document
furnished pursuant thereto or the perfection, priority, condition, value or
sufficiency of any collateral; (b) Assignor makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Transferor, any Obligor, any Affiliate of Transferor or the performance or
observance by Transferor, any Obligor, any Affiliate of Transferor of any of
their respective obligations under the Transaction Documents or any other
instrument or document furnished pursuant thereto or in connection therewith;
(c) Assignee confirms that it has received a copy of the Transfer Agreement, the
Liquidity Agreement, the Intercreditor Agreement and copies of such other
Transaction Documents, and other documents and information as it has requested
and deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement; (d) Assignee will, independently and without
reliance upon any Agent, any Transferee, Transferor or any other Liquidity Bank
or Transferee and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Transfer Agreement, the Liquidity Agreement and the
other Transaction Documents; (e) Assignee appoints and authorizes the
Administrative Agent and the applicable Co-Agent to take such action as agent on
its behalf and to exercise such powers under the Transaction Documents as are
delegated to such Agents by the terms thereof, together with such powers as are
reasonably incidental thereto; and (f) Assignee agrees that it will perform in
accordance with their terms all of the obligations which, by the terms of the
Transfer Agreement, the Liquidity Agreement, the Intercreditor Agreement and the
other Transaction Documents, are required to be performed by it as a Liquidity
Bank or, when applicable, as a Transferee.
7. Each party hereto represents and warrants to and
agrees with the Agents that it is aware of and will comply with and be bound by
the provisions of the Liquidity Agreement, the Intercreditor Agreement and the
Transfer Agreement, including, without limitation, Sections 4.1, 12.1 and 13.6
of the Transfer Agreement.
8. Schedule I hereto sets forth the revised Commitment
[and Liquidity/Transfer Commitment] of Assignor and the Commitment [and
Liquidity/Transfer Commitment] of Assignee, as well as administrative
information with respect to Assignee.
9. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
10. Assignee hereby covenants and agrees that, prior to
the date which is one year and one day after the payment in full of all senior
indebtedness for borrowed money of Conduit, it will not institute against, or
join any other Person in instituting against, Conduit 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.
85
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment Agreement to be executed by their respective duly authorized officers
of the date hereof.
[ASSIGNOR]
By: _________________________
Title:
[ASSIGNEE]
By: __________________________
Title:
86
SCHEDULE I TO ASSIGNMENT AGREEMENT
LIST OF LENDING OFFICES, ADDRESSES
FOR NOTICES AND COMMITMENT AMOUNTS
DATE: _____________, ______
TRANSFERRED PERCENTAGE: ____________%
LIQUIDITY TERMINATION DATE: ______________
--------------------------------------------------------------------------------------------------------------------
X-0 X-0 X-0 X-0
--------------------------------------------------------------------------------------------------------------------
ASSIGNOR COMMITMENT/ COMMITMENT/ OUTSTANDING INVESTED RATABLE SHARE OF
[LIQUIDITY/ [LIQUIDITY/TRANSFER] AMOUNT (IF ANY) OUTSTANDING INVESTED
TRANSFER] COMMITMENT COMMITMENT (AFTER AMOUNT
(PRIOR TO GIVING GIVING EFFECT TO THE
EFFECT TO THE ASSIGNMENT AGREEMENT)
ASSIGNMENT AGREEMENT)
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
X-0 X-0 X-0
--------------------------------------------------------------------------------------------------------------------
ASSIGNEE COMMITMENT/ OUTSTANDING INVESTED RATABLE SHARE OF
[LIQUIDITY/TRANSFER] AMOUNT (IF ANY) OUTSTANDING INVESTED
COMMITMENT (AFTER AMOUNT
GIVING EFFECT TO THE
ASSIGNMENT AGREEMENT)
--------------------------------------------------------------------------------------------------------------------
ADDRESS FOR NOTICES
___________________
___________________
Attention:
Phone:
Fax:
87
SCHEDULE II TO ASSIGNMENT AGREEMENT
EFFECTIVE NOTICE
TO: ________________________, Assignor
________________________
________________________
________________________
TO: ________________________, Assignee
________________________
________________________
________________________
The undersigned, as the applicable Co-Agent under the
Receivables Transfer Agreement dated as of February 14, 2003 by and among FSI
Receivables Company LLC ("TRANSFEROR"), Xxxxxx Scientific International Inc., as
initial Servicer, Liberty Street Funding Corp., Blue Ridge Asset Funding
Corporation, The Bank of Nova Scotia, a Canadian chartered bank acting through
its New York Agency , individually and as Liberty Street Agent, and Wachovia
Bank, National Association, individually, as Blue Ridge Agent and as
Administrative Agent, hereby acknowledges receipt of executed counterparts of a
completed Assignment Agreement dated as of ____________, ____ between
__________________, as Assignor, and __________________, as Assignee. Terms
defined in such Assignment Agreement are used herein as therein defined.
1. Pursuant to such Assignment Agreement, you are
advised that the Assignment Effective Date will be ______________, ____.
2. [Blue Ridge/Liberty Street] hereby consents to the
Assignment Agreement as required by Section 12.1(b) of the Transfer Agreement
[and Section ___ of the Liquidity Agreement].
[3. Pursuant to such Assignment Agreement, the Assignee
is required to pay $____________ to Assignor at or before 12:00 noon (local time
of Assignor) on the Assignment Effective Date in immediately available funds.]
Very truly yours,
_________________________,
as [Blue Ridge/Liberty Street] Agent
By: __________________________
Title: _______________________
00
[XXXX XXXXX XXXXX FUNDING
CORPORATION/LIBERTY STREET FUNDING CORP.]
By: ____________________________
Authorized Signatory
THE FOREGOING ASSIGNMENT IS HEREBY CONSENTED TO:
[FSI RECEIVABLES COMPANY LLC](1)
By: _________________________________________
Name:
Title:
[INSERT NAME OF APPLICABLE CONDUIT]
By: _________________________________________
Name:
Title:
_____________________
(1) Delete if Transferor does not have consent right under Section 12.1 due to
the existence of an Amortization Event.
89
EXHIBIT VII
CREDIT AND COLLECTION POLICY
SEE EXHIBIT V TO RECEIVABLES PURCHASE AGREEMENT
90
EXHIBIT VIII
[FORM OF] PERFORMANCE UNDERTAKING
THIS PERFORMANCE UNDERTAKING (this "UNDERTAKING"), dated as of
February 14, 2003, is executed by Xxxxxx Scientific International Inc., a
Delaware corporation (the "PERFORMANCE GUARANTOR"), in favor of FSI Receivables
Company LLC, a Delaware limited liability company (the "SPV"), and its assigns
(collectively, together with their respective successors and assigns,
"RECIPIENT").
RECITALS
1. Performance Guarantor, in its capacity as Originator
Agent, Xxxx-Xxxxxx Instrument Company, an Illinois corporation, Xxxxxx Clinical
Services Inc., a Pennsylvania corporation, Xxxxxx Xxxxxxxx L.L.C., a Delaware
limited liability company, and Xxxxxx Scientific Company L.L.C., a Delaware
limited liability company (each of the foregoing other than Performance
Guarantor, together with each other Subsidiary of Performance Guarantor that
hereafter becomes an "Originator" under the Purchase Agreement hereinafter
described, a "SUBSIDIARY ORIGINATOR" and collectively, the "SUBSIDIARY
ORIGINATORS"), and the SPV, are parties to an Amended and Restated Receivables
Purchase Agreement, dated as of February 14, 2003 (as further amended, restated
or otherwise modified from time to time, the "PURCHASE AGREEMENT"), pursuant to
which each of the Subsidiary Originators, subject to the terms and conditions
contained therein, plans to sell its right, title and interest in its
Receivables and Related Security (each, as therein defined) to SPV.
2. Performance Guarantor owns, directly or indirectly,
100% of the Equity Interests of each of the Subsidiary Originators, and each of
the Subsidiary Originators -- and, accordingly, Performance Guarantor -- is
expected to receive substantial benefits from its sale or contribution of
Receivables and Related Security to the SPV pursuant to the Purchase Agreement
(which benefits are hereby acknowledged by Performance Guarantor).
3. As an inducement to Recipient to acquire the
Subsidiary Originators' Receivables and Related Security pursuant to the
Purchase Agreement, Performance Guarantor has agreed to guaranty the due and
punctual performance by each of the Subsidiary Originators of its obligations
under the Purchase Agreement.
AGREEMENT
NOW, THEREFORE, Performance Guarantor hereby agrees as
follows:
Section 1. Definitions. Unless otherwise defined herein,
capitalized terms used in this Undertaking shall have the meanings assigned to
such terms in the Purchase Agreement or the Transfer Agreement referred to
therein, as applicable. In addition:
"GUARANTEED OBLIGATIONS" means, collectively, all covenants,
agreements, terms, conditions and indemnities to be performed and
observed by any of the Subsidiary Originators under the Purchase
Agreement and each other document
91
executed and delivered by such Subsidiary Originator pursuant thereto,
including, without limitation, the due and punctual payment of all sums
which are or may become due and owing by such Subsidiary Originator
under the Purchase Agreement, whether for fees, expenses (including
counsel fees), indemnified amounts or otherwise, whether upon any
termination or for any other reason and whether such Subsidiary
Originator is an initial party to the Purchase Agreement or is
hereafter added as an Originator thereunder by means of a Joinder
Agreement or an amendment.
Section 2. Guaranty of Performance of Guaranteed Obligations.
Performance Guarantor hereby guarantees to Recipient, the full and punctual
payment and performance by each of the Subsidiary Originators of its Guaranteed
Obligations. This Undertaking is an absolute, unconditional and continuing
guaranty of the full and punctual performance of all Guaranteed Obligations and
is in no way conditioned upon any requirement that Recipient first attempt to
collect any amounts owing from any Subsidiary Originator under the Guaranteed
Obligations or from any other Person or resort to any collateral security, any
credit on the books of Recipient in favor of any Subsidiary Originator or any
other Person or other means of obtaining payment or performance. Should any
Subsidiary Originator default in the payment or performance of any of its
Guaranteed Obligations, Recipient may demand the immediate performance by
Performance Guarantor of the Guaranteed Obligations, whereupon the Guaranteed
Obligations will become forthwith due to Recipient, without additional demand or
notice of any nature (other than as expressly provided herein), all of which are
hereby expressly waived by Performance Guarantor. Notwithstanding the foregoing,
this Undertaking is not a guarantee of the collection of any of the Receivables
and Performance Guarantor shall not be responsible for any Guaranteed
Obligations to the extent the failure to perform such Guaranteed Obligations by
any of the Subsidiary Originators results from Receivables being uncollectible
on account of the insolvency, bankruptcy or lack of creditworthiness of the
related Obligor; PROVIDED THAT nothing herein shall relieve any Subsidiary
Originator from performing in full its Guaranteed Obligations under the Purchase
Agreement or Performance Guarantor of its undertaking hereunder with respect to
the full performance of such duties.
Section 3. Performance Guarantor's Further Agreements to Pay.
Performance Guarantor further agrees, as the principal obligor and not as a
guarantor only, to pay to Recipient, forthwith upon demand in funds immediately
available to Recipient, all reasonable costs and expenses (including court costs
and reasonable legal expenses) incurred or expended by Recipient in connection
with the Guaranteed Obligations, this Undertaking and the enforcement thereof,
together with interest on amounts recoverable under this Undertaking from the
time when such amounts become due until payment, at a rate of interest (computed
for the actual number of days elapsed based on a 360 day year) equal to the
Prime Rate plus 2% per annum, such rate of interest changing when and as the
Prime Rate changes.
Section 4. Waivers by Performance Guarantor. Performance
Guarantor waives notice of acceptance of this Undertaking, notice of the
addition of any Subsidiary Originator as an additional Originator under the
Purchase Agreement, notice of the removal of any Subsidiary Originator as an
Originator under the Purchase Agreement, notice of any action taken or omitted
by Recipient in reliance on this Undertaking, and any requirement that Recipient
be diligent or prompt in making demands under this Undertaking, giving notice of
any Termination Event,
92
Amortization Event, other default or omission by any Subsidiary Originator or
asserting any other rights of Recipient under this Undertaking. Performance
Guarantor warrants that it has adequate means to obtain from each of the
Subsidiary Originators, on a continuing basis, information concerning the
financial condition of any of the Subsidiary Originators, and that it is not
relying on Recipient to provide such information, now or in the future.
Performance Guarantor also irrevocably waives to the extent permitted by
applicable law all defenses (i) that at any time may be available in respect of
the Guaranteed Obligations by virtue of any statute of limitations, valuation,
stay, moratorium law or other similar law now or hereafter in effect or (ii)
that arise under the law of suretyship, including impairment of collateral.
Recipient shall be at liberty, without giving notice to or obtaining the assent
of Performance Guarantor and without relieving Performance Guarantor of any
liability under this Undertaking, to deal with each of the Subsidiary
Originators and with each other party who now is or after the date hereof
becomes liable in any manner for any of the Guaranteed Obligations, in such
manner as Recipient in its sole discretion deems fit, and to this end
Performance Guarantor agrees that the validity and enforceability of this
Undertaking, including without limitation, the provisions of Section 7 hereof,
shall not be impaired or affected by any of the following: (a) any extension,
modification or renewal of, or indulgence with respect to, or substitutions for,
the Guaranteed Obligations or any part thereof or any agreement relating thereto
at any time; (b) any failure or omission to enforce any right, power or remedy
with respect to the Guaranteed Obligations or any part thereof or any agreement
relating thereto, or any collateral securing the Guaranteed Obligations or any
part thereof; (c) any waiver of any right, power or remedy or of any Termination
Event, Amortization Event, or default with respect to the Guaranteed Obligations
or any part thereof or any agreement relating thereto; (d) any release,
surrender, compromise, settlement, waiver, subordination or modification, with
or without consideration, of any other obligation of any person or entity with
respect to the Guaranteed Obligations or any part thereof; (e) the
enforceability or validity of the Guaranteed Obligations or any part thereof or
the genuineness, enforceability or validity of any agreement relating thereto or
with respect to the Guaranteed Obligations or any part thereof; (f) the
application of payments received from any source to the payment of any payment
obligations of any Subsidiary Originator or any part thereof or amounts which
are not covered by this Undertaking even though Recipient might lawfully have
elected to apply such payments to any part or all of the payment obligations of
any Subsidiary Originator or to amounts which are not covered by this
Undertaking; (g) the existence of any claim, setoff or other rights which
Performance Guarantor may have at any time against any Subsidiary Originator in
connection herewith or any unrelated transaction; (h) any assignment or transfer
of the Guaranteed Obligations or any part thereof as permitted pursuant to the
Transfer Agreement; or (i) any addition of Originators to the Purchase Agreement
by means of a Joinder Agreement or amendment; (j) any failure on the part of any
Subsidiary Originator to perform or comply with any term of the Transaction
Documents or any other document executed in connection therewith or delivered
thereunder, all whether or not Performance Guarantor shall have had notice or
knowledge of any act or omission referred to in the foregoing clauses (a)
through (j) of this Section 4.
Section 5. Unenforceability of Guaranteed Obligations Against
the Applicable Subsidiary Originator. Notwithstanding (a) any change of
ownership of any Subsidiary Originator or the insolvency, bankruptcy or any
other change in the legal status of any Subsidiary Originator; (b) the change in
or the imposition of any law, decree, regulation or other governmental act which
does or might impair, delay or in any way affect the validity,
93
enforceability or the payment when due of the Guaranteed Obligations; (c) the
failure of any Subsidiary Originator or Performance Guarantor to maintain in
full force, validity or effect or to obtain or renew when required all
governmental and other approvals, licenses or consents required in connection
with the Guaranteed Obligations or this Undertaking, or to take any other action
required in connection with the performance of all obligations pursuant to the
Guaranteed Obligations or this Undertaking; or (d) if any of the moneys included
in the Guaranteed Obligations have become irrecoverable from any Subsidiary
Originator for any other reason other than final payment in full of the payment
Obligations in accordance with their terms, this Undertaking shall nevertheless
be binding on Performance Guarantor. This Undertaking shall be in addition to
any other guaranty or other security for the Guaranteed Obligations, and it
shall not be rendered unenforceable by the invalidity of any such other guaranty
or security. In the event that acceleration of the time for payment of any of
the Guaranteed Obligations is stayed upon the insolvency, bankruptcy or
reorganization of any Subsidiary Originator or for any other reason with respect
to any Subsidiary Originator, all such amounts then due and owing with respect
to the Guaranteed Obligations under the terms of the Purchase Agreement, or any
other agreement evidencing, securing or otherwise executed in connection with
the Guaranteed Obligations, shall be immediately due and payable by Performance
Guarantor.
Section 6. Representations and Warranties. Performance
Guarantor hereby represents and warrants to Recipient that:
(a) Authorization, Execution and Delivery; Binding
Effect. The execution and delivery by Performance Guarantor of this
Undertaking, and the performance of its obligations hereunder, are
within its corporate powers and authority and have been duly authorized
by all necessary corporate action on its part. This Undertaking has
been duly executed and delivered by Performance Guarantor. This
Undertaking constitutes the legal, valid and binding obligation of
Performance Guarantor enforceable against Performance Guarantor 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 and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(b) No Conflict; Government Consent. The execution and
delivery by Performance Guarantor of this Undertaking, and the
performance of its obligations hereunder 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 Performance Guarantor or its Subsidiaries
(except as created hereunder) except, in any case, where such
contravention or violation could not reasonably be expected to have a
Material Adverse Effect.
Section 7. Subrogation. Notwithstanding anything to the
contrary contained herein, until the Guaranteed Obligations are paid in full
Performance Guarantor: (a) will not
94
enforce or otherwise exercise any right of subrogation to any of the rights of
the SPV, any of the Agents or any of the Transferees against any of the
Subsidiary Originators, (b) will not claim any setoff, recoupment or
counterclaim against any of the Subsidiary Originators in respect of any
liability of Performance Guarantor to such Subsidiary Originator or, after the
occurrence of any default in the payment or performance of any of the Guaranteed
Obligations, demand, xxx for or otherwise attempt to collect on any indebtedness
of any of the Subsidiary Originators now or hereafter owed to Performance
Guarantor and (c) waives any benefit of and any right to participate in any
Receivables or Related Security in which Recipient has an interest. The
provisions of this Section 7 shall be supplemental to and not in derogation of
any rights and remedies of Recipient under any separate subordination agreement
which Recipient may at any time and from time to time enter into with
Performance Guarantor.
Section 8. Termination of Performance Undertaking. Performance
Guarantor's obligations hereunder shall continue in full force and effect until
all Aggregate Unpaids are finally paid and satisfied in full and the Transfer
Agreement is terminated, PROVIDED THAT this Undertaking shall continue to be
effective or shall be reinstated, as the case may be, if at any time payment or
other satisfaction of any of the Guaranteed Obligations is rescinded or must
otherwise be restored or returned upon the bankruptcy, insolvency, or
reorganization of any of the Subsidiary Originators or otherwise, as though such
payment had not been made or other satisfaction occurred, whether or not
Recipient is in possession of this Undertaking. No invalidity, irregularity or
unenforceability by reason of the federal bankruptcy code or any insolvency or
other similar law, or any law or order of any government or agency thereof
purporting to reduce, amend or otherwise affect the Guaranteed Obligations shall
impair, affect, be a defense to or claim against the obligations of Performance
Guarantor under this Undertaking.
Section 9. Effect of Bankruptcy. This Performance Undertaking
shall survive the insolvency of each Subsidiary Originator and the commencement
of any case or proceeding by or against any Subsidiary Originator under the
federal bankruptcy code or other federal, state or other applicable bankruptcy,
insolvency or reorganization statutes. No automatic stay under the federal
bankruptcy code with respect to any Subsidiary Originator or other federal,
state or other applicable bankruptcy, insolvency or reorganization statutes to
which any Subsidiary Originator is subject shall postpone the obligations of
Performance Guarantor under this Undertaking.
Section 10. Setoff. Regardless of the other means of obtaining
payment of any of the Guaranteed Obligations, Recipient is hereby authorized at
any time and from time to time after the occurrence and during the continuation
of a Termination Event or an Amortization Event, to the fullest extent permitted
by law, to set off and apply any deposits and other sums against the obligations
of Performance Guarantor due and owing under this Undertaking.
Section 11. Taxes. All payments to be made by Performance
Guarantor hereunder shall be made free and clear of and without deduction for
any and all current or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, except as required by
law. If Performance Guarantor shall be required to deduct or withhold any taxes
from or in respect of any sum payable hereunder to Recipient: (A) the sum
payable shall be increased by the amount necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 11) Recipient shall receive
95
an amount equal to the sum it would have received had no such deductions been
made, (B) Performance Guarantor shall make such deductions and (C) Performance
Guarantor shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
Section 12. Further Assurances. Performance Guarantor agrees
to do all such things and execute all such documents as Recipient may reasonably
consider necessary or in the Recipient's reasonable judgment desirable to give
full effect to this Undertaking and to perfect and preserve the rights and
powers of Recipient hereunder.
Section 13. Successors and Assigns. This Performance
Undertaking shall be binding upon Performance Guarantor, its successors and
permitted assigns, and shall inure to the benefit of and be enforceable by
Recipient. Without limiting the generality of the foregoing sentence, the SPV
may pledge or assign, and hereby notifies Performance Guarantor that it has
pledged and assigned, this Performance Undertaking to the Administrative Agent,
for the benefit of the Transferees, as security for the Aggregate Unpaids under
the Transfer Agreement, and Performance Guarantor hereby acknowledges that the
Administrative Agent, may enforce this Performance Undertaking, on behalf of the
SPV, with the same force and effect as though the Administrative Agent were the
originally-named Recipient hereunder. Performance Guarantor may not assign or
transfer any of its obligations hereunder without the prior written consent of
the SPV and each of the Agents.
Section 14. Amendments and Waivers. No amendment or waiver of
any provision of this Undertaking nor consent to any departure by Performance
Guarantor therefrom shall be effective unless the same shall be in writing and
signed by Recipient, each of the Agents and Performance Guarantor. No failure on
the part of Recipient to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right.
Section 15. Notices. All notices and other communications
provided for hereunder shall be made in writing and shall be addressed as
follows: if to Performance Guarantor, at the Originator Agent's address set
forth beneath its signature to the Purchase Agreement, and if to Recipient, at
the addresses set forth beneath its signature to the Transfer Agreement, or at
such other addresses as each of Performance Guarantor or any Recipient may
designate in writing to the other. Each such notice or other communication shall
be effective (1) if given by telecopy, upon the receipt thereof, (2) if given by
mail, three (3) Business Days after the time such communication is deposited in
the mail with first class postage prepaid or (3) if given by any other means,
when received at the address specified in this Section 15.
Section 16. GOVERNING LAW. THIS UNDERTAKING SHALL BE GOVERNED
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401
ET SEQ. OF THE GENERAL OBLIGATIONS LAW.
Section 17. Miscellaneous. This Undertaking constitutes the
entire agreement of Performance Guarantor with respect to the matters set forth
herein. The rights and remedies
96
herein provided are cumulative and not exclusive of any remedies provided by law
or any other agreement, and this Undertaking shall be in addition to any other
guaranty of or collateral security for any of the Guaranteed Obligations. The
provisions of this Undertaking are severable, and in any action or proceeding
involving any state corporate law, or any state or federal bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of Performance Guarantor hereunder would otherwise
be held or determined to be avoidable, invalid or unenforceable on account of
the amount of Performance Guarantor's liability under this Undertaking, then,
notwithstanding any other provision of this Undertaking to the contrary, the
amount of such liability shall, without any further action by Performance
Guarantor or Recipient, be automatically limited and reduced to the highest
amount that is valid and enforceable as determined in such action or proceeding.
Any provisions of this Undertaking which are prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Unless otherwise specified, references herein to "SECTION"
shall mean a reference to sections of this Undertaking.
IN WITNESS WHEREOF, Performance Guarantor has caused this
Undertaking to be executed and delivered as of the date first above written.
XXXXXX SCIENTIFIC INTERNATIONAL INC.
By: ______________________________
Name: ____________________________
Title: ___________________________
97
EXHIBIT IX
FORM OF SETTLEMENT REPORT
[ATTACHED]
98
FSI Receivables Company
L.L.C.
For the Month Ended:
12/31/02
(Page 1)
($)
I . Portfolio Information
1. Beginning of Month Balance: (Total A/R Outstanding) $ 304,416
---------
2. Gross Sales (Domestic & Foreign): $ 220,343
---------
3. Deduct:
a. Total Collections: $ 232,483
---------
b. Dilution $ 4,761
---------
c. Write Offs $ 411
---------
d. Payments to Customers $ 0
---------
4.
a. Calculated Ending A/R Balance [(1) + (2) - (3 a,b,c,d,e)+(3f)]: $ 287,105
---------
b. Reported Ending A/R Balance $ 324,298
---------
c. Difference (If any) $ (37,193)
---------
d. Reconciling Items $ 41,130
---------
Difference (If any) $ 3,938
5. Deduct:
a. Defaulted Receivables $27,608
-------
b. Cross-Aged $14,628
-------
c. Contras $ 1,353
-------
d. Customer Deductions $ 2,319
-------
e. Disputed Receivables $ 1,530
-------
f. Term > 90 Days $ 201
-------
g. Unapplied Cash & Credits $15,714
-------
h. Foreign Receivables $ 8,516
-------
i. Intecompany Receivables $ 2,459
-------
j. Payments to Customers $ 0
-------
k. Total Ineligibles $ 74,329
---------
6. Eligible Receivables [(4 b) - (5.c.)]: $ 249,969
---------
7. Deduct: Excess Concentration: $ 2,747
---------
Deduct: Excess Federal Government: $ 406
---------
Deduct: Accrued Volume Rebates $ 81
---------
8. Net Pool Balance [(6) -(7)]: $ 246,736
---------
9. AGING CURRENT ONE MONTH TWO MONTHS THREE MONTHS
SCHEDULE: MONTH % PRIOR PRIOR PRIOR
------------------------------------------------------------------------------------------------
a. 0-30 Days Past Invoice $184,754 56.97% $210,238 $ 218,416 $ 203,144
b. 31-60 Days Past Invoice $ 73,195 22.57% $ 76,220 $ 71,238 $ 83,526
c. 61-90 Days Past Invoice $ 24,616 7.59% $ 22,834 $ 22,754 $ 25,828
d. 91-120 Days Past Invoice $ 13,281 4.10% $ 11,674 $ 11,760 $ 11,745
e. 121-150 Days Past Invoice $ 6,673 2.06% $ 6,241 $ 6,648 $ 5,820
f. 151-180 Days Past Invoice $ 4,195 1.29% $ 4,436 $ 3,834 $ 5,483
g. 181+ Days Past Invoice $ 17,582 5.42% $ 20,780 $ 23,062 $ 23,049
------------------------------------------------------------------------------------------------
h. Total: $324,296 100.00% $352,425 $ 357,712 $ 358,597
-------- ------ -------- ---------- ------------
99
FSI Receivables Company L.L.C.
For the Month Ended:
12/31/02
(Page 2)
($)
II. Calculations Reflecting Current Activity
10. CP Proceeds Outstanding $ 0
--------
11. Required Reserve % 22.88%
--------
12. Required Reserve [(8) x (11)]: $ 56,452
--------
13. Funding Availability [(8) - (12)]: $190,284
--------
III. Compliance
14. Asset Interest [(10) + (12)/(8)] < 100% : In Compliance 22.9%
--------
15. 3M Avg. Delinquency Ratio In Compliance 2.19%
--------
16. 3M Avg. Default Ratio In Compliance 1.75%
--------
17. 3M Avg. Dilution Ratio In Compliance 2.20%
--------
18. Facility Limit [(13)<= $225,000 In Compliance
100
EXHIBIT X
FORM OF INTERIM SETTLEMENT REPORT
[SAME AS EXHIBIT IX]
101
SCHEDULE A
COMMITMENTS OF THE LIQUIDITY BANKS
LIQUIDITY BANK COMMITMENT
Scotiabank $100,000,000
Wachovia $125,000,000
102
SCHEDULE B
DOCUMENTS TO BE DELIVERED TO THE ADMINISTRATIVE AGENT
ON OR PRIOR TO THE CLOSING DATE
1. Each of the documents and opinions listed on Schedule
A to the Receivables Purchase Agreement.
2. The Performance Undertaking, duly executed by the
Performance Guarantor.
3. Executed copies of the Agreement, duly executed by
the parties thereto.
4. Copy of the Resolutions of the Board of Directors of
each Transferor Party and Originator certified by its Secretary, authorizing
such Person's execution, delivery and performance of the Transaction Documents
to which it is a party
5. Copies of each Transferor Party's and Originator's
publicly filed Organic Documents certified by the Secretary of State of its
jurisdiction of organization on or within thirty (30) days prior to the date of
this Agreement.
6. Good Standing Certificate for each Transferor Party
and Originator issued by the Secretaries of State of its state of incorporation
and each jurisdiction where it has material operations.
7. A certificate of the Assistant Secretary of each
Transferor Party and Performance Guarantor certifying (i) the names and
signatures of the officers authorized on its behalf to execute this Agreement
and any other documents to be delivered by it hereunder and (ii) a copy of such
Person's Organic Documents that are not publicly filed.
8. Pre-filing state and federal tax lien, judgment lien
and UCC lien searches against Transferor from the applicable central and local
filing offices in its jurisdiction of organization.
9. Copies of proper financing statements, duly filed
under the UCC on or before the date of the initial Incremental Transfer in all
jurisdictions as may be necessary under the UCC of all appropriate jurisdictions
or any comparable law in order to perfect the ownership interests contemplated
by this Agreement.
10. Copies of proper UCC termination statements, if any,
necessary to release all security interests and other rights of any Person in
the Receivables, Contracts or Related Security.
11. Executed copies of Collection Account Agreements for
each Lock-Box and Collection Account.
103
12. A favorable opinion of legal counsel for the
Transferor Parties and Originators reasonably acceptable to the Agents covering
such matters as any of the Agents may reasonably request.
13. If requested by any Conduit or its Co-Agent, a
favorable opinion of legal counsel for each Liquidity Bank in such Conduit's
Group, reasonably acceptable to such Co-Agent which addresses due authorization,
execution and enforceability against such Liquidity Bank of the applicable
Liquidity Agreement.
14. A Compliance Certificate.
15. The Fee Letters
16. The Liquidity Agreements.
17. A Settlement Report as at the last day of the
calendar month ended at least two weeks prior to the initial transfer.
18. Executed copies of (i) all consents from and
authorizations by any Persons and (ii) all waivers and amendments to existing
credit facilities, that are necessary in connection with this Agreement.
19. For each Transferee who is a "United States person"
within the meaning of Section 7701(a)(30) of the Tax Code, two duly completed
copies of the Internal Revenue Service Form W-9, one of which copies will be
provided to Transferor. For each Transferee and Agent who is not a "United
States person" within the meaning of Section 7701(a)(30) of the Tax Code and
that is receiving payments directly from Transferor or any of its Affiliates
under the Transaction Documents, two duly completed copies of Internal Revenue
Service Form W-8BEN or W-8ECI, as applicable, certifying in either case that
such Transferee or Agent is entitled to receive payments under the Agreement
and/or any of the other Transaction Documents without deduction or withholding
of any United States federal income taxes, one of which copies will be provided
to Transferor.
20. Letters from each of the rating agencies that rate
Liberty Street's Commercial Paper confirming that the transaction contemplated
hereby will not change the ratings of such Commercial Paper.
104
