Exhibit 10.10
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SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
DATED AS OF DECEMBER 6, 2004
AMONG
BWA RECEIVABLES CORPORATION,
AS BORROWER,
BORGWARNER INC.,
AS COLLECTION AGENT,
ABN AMRO BANK N.V.,
AS AGENT,
THE BANKS FROM TIME TO TIME PARTY HERETO,
AND
WINDMILL FUNDING CORPORATION
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TABLE OF CONTENTS
SECTION HEADING PAGE
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ARTICLE I DEFINITIONS............................................ 1
Section 1.1. Certain Defined Terms.................................. 1
Section 1.2. Other Terms............................................ 21
Section 1.3. Computation of Time Periods............................ 22
ARTICLE II LOANS TO BORROWER AND SETTLEMENTS...................... 23
Section 2.1. Loans.................................................. 23
Section 2.2. Optional Liquidations.................................. 24
Section 2.3. Selection of Interest Rates and Tranche Periods........ 24
Section 2.4. Fees and Other Costs and Expenses...................... 25
Section 2.5. Maintenance of Secured Interest; Deemed Collection..... 26
Section 2.6. Reduction in Commitments............................... 26
Section 2.7. Optional Prepayments................................... 27
Section 2.8. Assignment of Purchase Agreement....................... 27
ARTICLE III SALES TO AND FROM WINDMILL; ALLOCATIONS................ 27
Section 3.1. Required Loans from Windmill........................... 27
Section 3.2. Loans by Windmill...................................... 28
Section 3.3. Allocations and Distributions.......................... 28
ARTICLE IV REPRESENTATIONS AND WARRANTIES......................... 30
Section 4.1. Representations and Warranties......................... 30
Section 4.2. Reaffirmation of Representations and Warranties........ 32
ARTICLE V CONDITIONS PRECEDENT AND SUBSEQUENT.................... 33
Section 5.1. Conditions to Closing.................................. 33
Section 5.3. Condition to Each Loan................................. 33
ARTICLE VI COVENANTS.............................................. 33
Section 6.1. Affirmative Covenants of the Borrower.................. 33
Section 6.2. Negative Covenants of the Borrower..................... 37
ARTICLE VII ADMINISTRATION AND COLLECTIONS......................... 39
Section 7.1. Appointment of Collection Agent........................ 39
Section 7.2. Duties of Collection Agent............................. 40
Section 7.3. Lock-Box Arrangements.................................. 41
Section 7.4. Enforcement Rights..................................... 42
Section 7.5. Responsibilities of the Borrower....................... 43
Section 7.6. Collection Agent Fee................................... 44
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Section 7.7. Indemnities by the Collection Agent.................... 44
ARTICLE VIII TERMINATION EVENTS..................................... 45
Section 8.1. Termination Events..................................... 45
ARTICLE IX INDEMNIFICATION........................................ 48
Section 9.1. Indemnities by the Borrower............................ 48
Section 9.2. Tax Indemnification and Characterization............... 50
Section 9.3. Increased Cost and Reduced Return...................... 51
Section 9.4. Other Costs and Expenses............................... 52
Section 9.5. Withholding Taxes...................................... 53
Section 9.6. Allocations............................................ 54
ARTICLE X THE AGENT.............................................. 54
Section 10.1. Appointment............................................ 54
Section 10.2. Delegation of Duties................................... 55
Section 10.3. Exculpatory Provisions................................. 55
Section 10.4. Reliance by Agent...................................... 55
Section 10.5. Notice of Termination.................................. 56
Section 10.6. Non-Reliance on Agent and Other Lenders................ 56
Section 10.7. Indemnification........................................ 56
Section 10.8. Agent in Its Individual Capacity....................... 57
Section 10.9. Successor Agent........................................ 57
Section 10.10. ABN AMRO Conflict Waiver............................... 57
Section 10.11. Certain Actions........................................ 58
ARTICLE XI MISCELLANEOUS.......................................... 58
Section 11.1. Term of Agreement...................................... 58
Section 11.2. Waivers; Amendments.................................... 58
Section 11.3. Notices................................................ 60
Section 11.4. Governing Law; Submission to Jurisdiction;
Integration............................................ 60
Section 11.5. Severability; Counterparts............................. 61
Section 11.6. Successors and Assigns; Participations; Assignments.... 61
Section 11.7. Further Assurances..................................... 63
Section 11.8. Right of Setoff........................................ 63
Section 11.9. Waiver of Confidentiality.............................. 64
Section 11.10. Confidentiality of Agreement........................... 64
Section 11.11. Bankruptcy Petition Against Windmill................... 65
Section 11.12. Limitation of Liability................................ 65
Section 11.13. Headings............................................... 65
Section 11.14. WAIVER OF TRIAL BY JURY................................ 65
Section 11.15. Administrator.......................................... 65
Section 11.16. No Recourse............................................ 65
Section 11.17. Reliance on Information Obtained from Third Parties.... 66
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Section 11.18. Excess Funds........................................... 66
Section 11.19. Enforceability of Receivables.......................... 66
Section 11.20. Integration............................................ 67
Section 11.21. Elimination of Program LOC Provider.................... 67
Section 11.22. Original Receivables Loan Agreement.................... 67
Signature................................................................ 68
EXHIBITS
Exhibit A Credit and Collection Policy
Exhibit B-1 Form of Contract
Exhibit B-2 Contract Terms
Exhibit C Lock-Boxes and Lock-Box Banks
Exhibit D Form of Lock-Box Letter
Exhibit E Form of Periodic Report
Exhibit F Form of Assignment-From a Bank to Windmill
Exhibit G Addresses of Borrower and Originators
Exhibit H Borrower's and ▇▇▇▇-▇▇▇▇▇▇ Entities' Corporate Names;
Trade Names; Assumed Names
Exhibit I Intentionally Omitted
Exhibit J Form of Compliance Certificate
Exhibit K Form of Loan Request
Exhibit L Activities to Maintain Separate Corporate Existence of ▇▇▇▇-▇▇▇▇▇▇
Entities
Exhibit M Form of Transfer Supplement for Bank Commitment
Exhibit N Form of Transfer Supplement for Windmill
SCHEDULES
Schedule I Banks and Bank Commitments
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SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
SECOND AMENDED AND RESTATED RECEIVABLES LOAN AGREEMENT, dated as of
December 6, 2004, among the banks which are or may become a party to this
Agreement (the "Banks"), Windmill Funding Corporation, a Delaware corporation
("Windmill"), ABN AMRO Bank N.V., as agent for the Lenders (the "Agent"), BWA
Receivables Corporation, a Delaware corporation (the "Borrower") and BorgWarner
Inc., a Delaware corporation (the "Collection Agent").
PRELIMINARY STATEMENTS
The Borrower, Agent, the Banks from time to time party thereto, Windmill
and ABN AMRO Bank N.V., as provider of the Program LOC (the "Program LOC
Provider") are parties to an Amended and Restated Receivables Loan Agreement,
dated as of December 23, 1998 (as heretofore amended the "Original Receivables
Loan Agreement");
Subject to and upon the terms and conditions set forth herein, the parties
desire to remove the Program LOC Provider and to amend and restate the Original
Receivables Loan Agreement in the form of this Agreement. This Agreement amends
and replaces in its entirety the Original Receivables Loan Agreement and, from
and after the date hereof, all references made to the Original Receivables Loan
Agreement in any Transaction Document or in any other instrument or document
shall, without more, be deemed to refer to this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements contained herein
and the other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ABN AMRO" shall mean ABN AMRO Bank N.V., in its individual capacity and
not in its capacity as the Agent.
"ABN AMRO Prime Rate" shall mean at the time any determination thereof is
to be made, a rate per annum equal to the greater (redetermined daily) of: (i)
the floating commercial loan rate of ABN AMRO for Dollars announced from time to
time, changing as and when said rate changes, and (ii) the Federal Funds
Effective Rate plus three fourths of one percent (0.75%). The ABN AMRO Prime
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer by ABN AMRO. ABN AMRO may make commercial
loans or other loans at rates of interest at, above or below the ABN AMRO Prime
Rate.
"ABN AMRO Roles" shall have the meaning ascribed to such term in Section
10.10.
"Administration Agreement" shall mean that certain Second Amended and
Restated Administration Agreement by and between the Management Company and the
Administrator, dated as of May 1, 2003.
"Administrator" shall mean ABN AMRO, in its capacity as Administrator under
the Administration Agreement, and any successor thereto.
"Adverse Claim" shall mean a lien, security interest, charge, mortgage,
pledge, hypothecation, assignment or encumbrance, or any other right or claim,
in, of or on any Person's assets or properties in favor of any other Person.
"Affected Assets" shall mean each and every Receivable, Related Account and
Related Security, if any, with respect thereto, each and every Collection, with
respect thereto, and proceeds of any of the foregoing.
"Affected Bank" shall have the meaning ascribed to such term in Section
11.6(d).
"Affiliate" shall mean, with respect to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person or a Subsidiary of such Person. For purposes of this
definition, a Person shall be deemed to be "controlled by" another Person if
such other Person possesses, directly or indirectly, power to either (i) vote
ten percent (10%) or more of the securities having ordinary voting power for the
election of directors of such Person or (ii) direct or cause the direction of
the management and policies of such Person whether by contract or otherwise.
"Agent" shall have the meaning ascribed to such term in the first paragraph
of this Agreement.
"Agent's Account" means the account designated to the Borrower and the
Lenders by the Agent.
"Aggregate Commitment" shall mean an amount equal to Fifty One Million
Dollars ($51,000,000), as such amount may be reduced pursuant to Section 2.6.
"Aggregate Loan Amount" means the sum of the Loan Amounts of all Lenders.
"Aggregate Unpaids" shall mean, at any time, an amount equal to the sum of
(i) the aggregate accrued and unpaid Interest with respect to all Tranche
Periods at such time, plus (ii) the Aggregate Loan Amount at such time, plus
(iii) all other amounts owed (whether due or accrued) hereunder by the Borrower
to the Agent, Windmill, any Bank, the Collection Agent or any other Person at
such time.
"Agreement" shall mean this Second Amended and Restated Receivables Loan
Agreement.
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"Allocated Commercial Paper" means commercial paper notes issued by
Windmill for a tenor and in an amount specifically requested by any Person in
connection with a Receivable Purchase Facility.
"Approved Obligor" shall mean each of Ford Motor Company, General Motors
Corporation, Daimler Chrysler Corporation, New Venture Gear, Caterpillar
Corporation and the wholly-owned Subsidiaries of each of the foregoing.
"Approved Obligor Limit" means (i) for any Obligor with a long-term
unsecured debt rating (a "Rating") of A- or higher by S&P and A3 or higher by
▇▇▇▇▇'▇, 50% of the Outstanding Balance of all Eligible Receivables, (ii) for
any Obligor with a Rating of at least BBB+ by S&P and at least Baa1 by ▇▇▇▇▇'▇,
30 % of the Outstanding Balance of all Eligible Receivables, (iii) for any
Obligor with a Rating of at least BBB by S&P and at least Baa2 by ▇▇▇▇▇'▇, 15%
of the Outstanding Balance of all Eligible Receivables, (iv) for any Obligor
with a Rating of at least BBB- by S&P and at least Baa3 by ▇▇▇▇▇'▇, 7.5% of the
Outstanding Balance of all Eligible Receivables, (v) for any Obligor with a
Rating lower than BBB- by S&P or lower than Baa3 by ▇▇▇▇▇'▇, or for any Obligor
for which S&P or ▇▇▇▇▇'▇ has withdrawn or suspended its Rating, 3.33% of
Outstanding Balance of all Eligible Receivables. The Receivables of Unrated
Affiliates may be treated as Receivables of the Related Rated Entities for
purposes of this definition provided that the aggregate Outstanding Balance of
Receivables so treated shall not exceed 10% of the Outstanding Balance of all
Eligible Receivables. Notwithstanding the foregoing, for so long as a majority
of the equity in New Venture Gear is owned by Daimler Chrysler Corporation the
"Approved Obligor Limit" for New Venture Gear shall be the greater of (i) the
Approved Obligor Limit then applicable to Daimler Chrysler Corporation less the
Outstanding Balance of all Eligible Receivables owned by Daimler Chrysler, and
(ii) 3.33% of the Outstanding Balance of all Eligible Receivables. For purposes
of this definition the term "Unrated Affiliate" means an entity that is an
Affiliate of an entity described in clause (i) of the definition of Related
Rated Entity or 100% of the equity in which is owned by an entity described in
clause (ii) of the definition of Related Rated Entity, and "Related Rated
Entity" means (i) an Obligor that has Ratings, or (ii) an organization that is
organized under the laws of a foreign country that has Ratings.
"Assigned Windmill Settlement" means, for each Committed Lender for any
Put, the product of such Committed Lender's Purchase Percentage and the amount
of the Windmill Settlement being transferred pursuant to such Put.
"Average Collection Period" shall mean, at any time, a period of days equal
to the product of (a) a fraction (i) the numerator of which shall be the amount
set forth in the most recent Periodic Report with respect to the preceding month
as the "Beginning Balance" (ii) and the denominator of which shall be the
Collections received during such preceding month as set forth in such Periodic
Report, multiplied by (b) thirty (30).
"Bank Commitment" shall mean at any time, for any Bank, the amount set
forth opposite such Bank's name on Schedule I under the heading "Bank
Commitment" and adjusted in accordance with Section 11.6(c), as such amount may
be reduced pursuant to Section 2.6.
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"Bank Termination Date" shall mean the earliest to occur of (i) the date of
the occurrence of a Termination Event described in Section 8.1(f), (ii) the date
that the Agent designates as the Bank Termination Date in a written notice to
the Borrower given at any time after the occurrence of any other Termination
Event, (iii) that Business Day designated by the Borrower as the Bank
Termination Date with no less than five (5) Business Days prior written notice
to the Agent, and (iv) April 29, 2005.
"Bankruptcy Event" means, for any Person, that (a) such Person makes a
general assignment for the benefit of creditors or any proceeding is instituted
by or against such Person seeking to adjudicate it bankrupt or insolvent, or
seeking the liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee or other
similar official for it or any substantial part of its property or (b) such
Person takes any corporate action to authorize any such action.
"Banks" shall have the meaning ascribed to such term in the first paragraph
of this Agreement.
"▇▇▇▇-▇▇▇▇▇▇ Entities" shall mean the Parent, each Originator and the
Borrower.
"Borrower" shall have the meaning ascribed to such term in the first
paragraph of this Agreement.
"Borrower Account" shall mean the Borrower's account number 92-35671 at The
First National Bank of Chicago or such other account designated by the Borrower
in writing to the Agent with at least ten (10) days prior notice.
"Borrowing" shall mean the incurrence by the Borrower of a Loan.
"Break Funding Costs" means for any Pool Funded Loan Interest amounts
payable to Windmill under the applicable Receivables Purchase Facility in
connection with any prepayment or amortization of amounts payable thereunder in
excess of the amount of the investment or loan prepaid or amortized and accrued
and unpaid interest or discount thereon.
"Business Day" shall mean generally any day excluding Saturday, Sunday and
any day which is a day on which banking institutions located in New York, New
York or Chicago, Illinois are authorized or required by law or other
governmental action to close and excluding any day which is a holiday on the
Federal Reserve calendar and with respect to any matters relating to the
Eurodollar Rate or a Eurodollar Tranche Period, a Business Day on which dealings
in Dollars are carried on in the London interbank market.
"Capitalized Lease" shall mean any lease of property, real or personal, by
a Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP.
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"Charge-Off" shall mean any Receivable that has been (in accordance with
the objective criteria of the Credit and Collection Policy then in effect) or
should have been charged-off or written-off by the Borrower.
"Collection" shall mean, with respect to each Receivable, any cash
collections or other cash proceeds of such Receivable, including any Finance
Charges paid thereon and any cash proceeds received from the Related Security
with respect to such Receivable and any amount deemed to have been received by
the Borrower or the Collection Agent with respect to such Receivable pursuant to
Section 2.5(b) or otherwise.
"Collection Agent" shall have the meaning ascribed to such term in Section
7.1.
"Collection Agent Fee" shall mean a fee equal to Two Thousand Dollars
($2,000) per month payable in accordance with Section 7.6.
"Collection Reserve Percentage" shall mean, at any time, two percent (2%).
"Commitment" means, for each Bank, its Bank Commitment.
"Committed Lenders" is defined in Section 2.1(b).
"Concentration Factor" shall mean, at any time, an amount equal to three
and thirty three hundredths of one percent (3.33%) of the Aggregate Loan Amount
at such time.
"Contract" shall mean, with respect to any Receivable, any and all
contracts, understandings, instruments, agreements, leases, invoices, notes, or
other writings pursuant to which such Receivable arises or which evidences such
Receivable or under which an Obligor becomes or is obligated to make payment in
respect of such Receivable.
"Coverage Percentage" shall mean at any time a percentage equal to the sum
of (i) one hundred percent (100%), plus (ii) the Reserve Percentage,
redetermined each time the Eligible Receivables Balance is redetermined.
"CP Dealers" shall mean each Person which Windmill elects to hire as a
placement agent or commercial paper dealer as of and after the effective date of
such hiring.
"CP Rate" shall mean, with respect to any CP Tranche Period, the rate
equivalent to the rate per annum (or if more than one rate, the weighted average
of the rates) at which commercial paper having a term equal to such CP Tranche
Period may be sold by any CP Dealer selected by Windmill, as agreed between each
such CP Dealer and Windmill; provided, however, that if the rate (or rates) as
agreed between any such CP Dealer and Windmill is a discount rate (or rates),
the "CP Rate" for such CP Tranche Period shall be the rate (or, if more than one
rate, the weighted average of the rates) resulting from Windmill's converting
such discount rate (or rates) to an interest-bearing equivalent rate per annum.
The CP Rate shall be calculated in a manner which includes the costs and
expenses to Windmill of issuing the related commercial paper notes, including
all dealer commissions thereon and note issuance costs in connection therewith.
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"CP Tranche" shall mean a Tranche as to which Interest is calculated at, or
by reference to, a CP Rate.
"CP Tranche Period" shall mean, with respect to a CP Tranche, a period of
days commencing on a Business Day as selected by the Borrower or the Agent (but
not to exceed two hundred seventy (270) days.
"Credit and Collection Policy" shall mean the Borrower's credit and
collection policy and practices relating to Contracts and Receivables existing
on the date hereof and attached as Exhibit A, as modified in writing from time
to time in accordance with the terms of this Agreement.
"Deemed Collections" is defined in Section 2.5(c).
"Default Ratio" shall mean, at any time of determination, the ratio
(expressed as a percentage) of (i) the aggregate Outstanding Balance of all
Defaulted Receivables (other than Charge-Offs and Excluded Receivables) at such
time, to (ii) the aggregate Outstanding Balance of all Receivables (other than
Charge-Offs and Excluded Receivables) at such time.
"Defaulted Receivable" shall mean any Receivable (i) as to which all or any
portion of any amount payable thereon remains unpaid for more than ninety (90)
days from the original due date for such payment, or (ii) as to which the
Obligor thereof has taken any action, or suffered any event to occur, of the
type described in Section 8.1(f) (as if references to any ▇▇▇▇-▇▇▇▇▇▇ Entity
therein referred to such Obligor).
"Delinquency Ratio" shall mean, at any time of determination, the ratio
(expressed as a percentage) of (i) the aggregate Outstanding Balance of all
Delinquent Receivables (other than Excluded Receivables) at such time, to (ii)
the aggregate Outstanding Balance of all Receivables (other than Charge-Offs and
Excluded Receivables) at such time.
"Delinquent Receivable" shall mean a Receivable as to which any payment, or
part thereof, remains unpaid for more than thirty (30) days but no more than
ninety (90) days from the original due date for such payment.
"Deposit Date" means each day on which any Collections are deposited in any
Lock-Box Account or on which the Collection Agent receives any Collections.
"Depositary" shall mean JPMorgan Chase Bank, in its capacity as Depositary
under that certain Second Amended and Restated Depositary Agreement between
Windmill and the Depositary, dated as of May 1, 2003.
"Designated Financial Officer" shall mean, with respect to any Person, an
officer of such Person.
"Designated Obligor" shall mean, at any time, each Obligor other than any
Obligor that the Agent (upon the direction of the Required Banks) has notified
the Borrower in writing at least
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three (3) Business Days prior to such time shall not be considered a Designated
Obligor, which writing shall describe the basis for such determination.
"Desired Increase" shall have the meaning ascribed to such term in Section
3.2.
"Dilution Ratio" shall mean, for any period of determination, the ratio
(expressed as a percentage) of (a) the aggregate amount of payments owed by the
Borrower pursuant to Section 2.5 (other than amounts owed with respect to
Tooling Receivables and Retroactive Pricing Adjustment Receivables) during such
period, to (b) the aggregate amount of Collections (other than Collections from
Tooling Receivables or Retroactive Pricing Adjustment Receivables) received
during such period.
"Dilution Reserve Percentage" shall mean, at any time, three times the
average Dilution Ratio for the calendar month covered by the most recent
Periodic Report delivered by the Borrower hereunder and for the two calendar
months immediately preceding such calendar month.
"Discount Period" means, with respect to any Settlement Date or the Bank
Termination Date, the period from and including the preceding Settlement Date
(or if none, the date that the first Loan is made hereunder) to but not
including such Settlement Date or Bank Termination Date, as applicable.
"Dollar" and "$" shall mean lawful money of the United States of America.
"Downgrading Event" shall mean, (a) with respect to any Person (other than
New Venture Gear), that any one of the following has occurred with respect to
such Person: (i) any long-term unsecured indebtedness of such Person (that is
not subordinated to the general indebtedness of such Person) is rated less than
BBB by S&P or Baa2 by ▇▇▇▇▇'▇ or BBB by Fitch, (ii) any short-term indebtedness
of such Person is rated less than A-2 by S&P or P-2 by ▇▇▇▇▇'▇ or (iii) for the
long-term unsecured indebtedness of any Person (that is not subordinated to the
general indebtedness of such Person) that is not rated by ▇▇▇▇▇'▇, S&P or Fitch,
notice by the Agent that a "Downgrading Event" has occurred with respect to such
Person and (b) with respect to New Venture Gear, that any one of the following
has occurred with respect to DaimlerChrysler AG: (i) any long-term unsecured
indebtedness of DaimlerChrysler AG (that is not subordinated to the general
indebtedness of DaimlerChrysler AG) is rated less than BBB by S&P or Baa2 by
▇▇▇▇▇'▇ or BBB by Fitch, (ii) any short-term indebtedness of DaimlerChrysler AG
is rated less than A-2 by S&P or P-2 by ▇▇▇▇▇'▇, (iii) for the long-term
unsecured indebtedness of DaimlerChrysler AG (that is not subordinated to the
general indebtedness of DaimlerChrysler AG) that is not rated by ▇▇▇▇▇'▇, S&P or
Fitch, notice by the Agent that a "Downgrading Event" has occurred with respect
to DaimlerChrysler AG or (iv) at any time DaimlerChrysler AG does not own a
majority of the issued and outstanding shares of the voting capital stock of New
Venture Gear.
"Early Collection Fee" shall mean, for each Lender and each CP Tranche
Period or Eurodollar Tranche Period during which any Loan Amount allocated to
such Tranche Period is reduced, or which is terminated prior to the end of the
period for which it was originally scheduled to last (the amount of such
reduction or, in the case of a termination of a Tranche
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Period, the amount of the Loan Amount allocated to such Tranche Period being
referred to as the "Allocated Amount"), the excess, if any, of (i) the Interest
that would have accrued during the remainder of such Tranche Period subsequent
to the date of such reduction or termination on the Allocated Amount if such
reduction or termination had not occurred, over (ii) the sum of (a) to the
extent the Allocated Amount is allocated to another Tranche Period, the Interest
actually accrued on the portion of the Allocated Amount so allocated during the
remainder of such Tranche Period, plus (b) to the extent the Allocated Amount is
not allocated to another Tranche Period, the income, if any, actually received
by such Lender from investing the portion of the Allocated Amount not so
allocated.
"Effective Date" shall have the meaning ascribed to such term in Section
5.1.
"Eligible Receivable" means, at any time, any Receivable:
(i) the Obligor of which: (a) if a natural person, is a resident of
the USA or, if a corporation or other business organization, (1) is
organized under the laws of the USA and has its chief executive office in
the USA or (2) does not have its chief executive office in the USA or is
not organized under the laws of the USA but (i) is organized under the laws
of and has its chief executive office in a member country of the
Organization of Economic Cooperation and Development, and (ii) the parent
of such Obligor has its chief executive office in the USA and is organized
under the laws of the USA (a "Permitted Foreign Obligor"); (b) is not an
Affiliate of any of the parties hereto; (c) is a Designated Obligor; and
(d) is not a government or governmental subdivision or agency,
(ii) the Obligor of which is not the Obligor of any Charge-Off,
(iii) the Obligor of which is not the Obligor of Receivables (other
than Retroactive Pricing Adjustment Receivables) for which any payment, or
part thereof, remains unpaid for more than sixty (60) days from the
original due date for such payment, which Receivables have an aggregate
Outstanding Balance in excess of ten percent (10%) of the aggregate
Outstanding Balance of all such Obligor's Receivables (other than
Retroactive Pricing Adjustment Receivables),
(iv) which is not a Tooling Receivable, a Retroactive Pricing
Adjustment Receivable, a Defaulted Receivable, a Charge-Off, or a
Receivable for which any payment, or part thereof, remains unpaid for more
than sixty (60) days from the original due date for such payment,
(v) which, according to the Contract related thereto, requires a
payment within sixty (60) days of the original billing date (which shall
not be later than the date on which the goods giving rise to such
Receivable are shipped or delivered to the related Obligor or the services
giving rise to such Receivable are rendered to the related Obligor)
therefor,
(vi) which is an "account" within the meaning of Section 9-106 of the
UCC of all applicable jurisdictions,
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(vii) which is denominated and payable only in Dollars in the USA,
(viii) which arises under a duly authorized Contract which either is
in substantially the form of one of the forms of contract set forth on
Exhibit B-1 or complies with the Contract terms set forth on Exhibit B-2 or
is otherwise approved by the Agent in writing, and, in any case, which
Contract has not been modified or restructured and is in full force and
effect and constitutes the legal, valid and binding obligation of the
related Obligor enforceable against such Obligor in accordance with its
terms subject to no offset, counterclaim or other defense,
(ix) which arises under a Contract which (A) does not require the
Obligor under such Contract to consent to the transfer, sale or assignment
of the rights of the applicable Originator under such Contract and (B) does
not contain a confidentiality provision that purports to restrict the
ability of the Agent or any Lender to exercise its rights under this
Agreement, including its right to review the Contract,
(x) which arises under a Contract that contains an obligation of the
related Obligor to pay a specified sum of money, which obligation has been
fully earned by the sale of goods or the provision of services by an
Originator and is subject to no contingencies, and which Contract is not an
executory contract or unexpired lease, in each case, within the meaning of
Section 365 of the Federal Bankruptcy Code,
(xi) which, together with the Contract related thereto, does not
contravene any laws, rules or regulations applicable thereto (including
laws, rules and regulations relating to truth in lending, fair credit
billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy) and with respect to which no part of the
Contract related thereto is in violation of any such law, rule or
regulation,
(xii) which (A) satisfies all applicable objective requirements of the
Credit and Collection Policy, and (B) complies with such other objective
criteria and requirements that the Agent deems necessary, as the Agent may
from time to time specify to the Borrower in a written notice at least five
(5) days prior to the effectiveness of such other objective criteria and
requirements,
(xiii) which arises in the ordinary course of business of an
Originator,
(xiv) which was validly purchased by the Borrower from an Originator
pursuant to a Purchase Agreement, which purchase is not voidable, including
pursuant to Section 548 of the Federal Bankruptcy Code or similar laws
regarding fraudulent conveyances or fraudulent transfers, and which
purchase vests in the Borrower a valid and perfected first priority
ownership interest therein,
(xv) which arises solely from the sale of goods or the rendering of
services to the related Obligor by an Originator and not by any other
Person (in whole or in part),
-9-
(xvi) as to which the Agent has not notified the Borrower in writing
that the Agent, Windmill or the Required Banks have determined, in its or
their reasonable business judgment, that such Receivable or class of
Receivables of which such Receivable is a part is not acceptable as an
Eligible Receivable, including because such Receivable arises under a
Contract that is not acceptable to the Agent, Windmill or such Required
Banks but excluding any determination based upon the credit quality of an
Approved Obligor if a Downgrading Event has not occurred with respect to
such Approved Obligor or any Subsidiary of such Approved Obligor,
(xvii) which is an account receivable representing all or part of the
sales price of merchandise, insurance and services within the meaning of
Section 3(c)(5) of the Investment Company Act of 1940, as amended, and
(xviii) a purchase of which with the proceeds of notes would
constitute a "current transaction" within the meaning of Section 3(a)(3) of
the Securities Act of 1933, as amended.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Tranche
Period, the sum of (i) the quotient of (a) the rate determined by the Agent to
be the rate at which deposits in Dollars are offered by ABN AMRO to first-class
banks in the London interbank market at approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first day of such Eurodollar Tranche Period,
such deposits being in the approximate amount of ABN AMRO's Pro Rata Share of
the Bank Loan Amount allocated to such Eurodollar Tranche Period and having a
maturity approximately equal to such Eurodollar Tranche Period, divided by (b)
one (1) minus the Reserve Requirement (expressed as a decimal), as defined
below, applicable to such Eurodollar Tranche Period, plus (ii) as to all
applications affecting the Banks, one and one quarter percent (1.25%) per annum.
The Eurodollar Rate shall be rounded up, if necessary, to the next higher one
sixteenth of one percent (0.0625%). The "Reserve Requirement" means the maximum
aggregate reserve requirement (including all basic, supplemental, marginal and
other reserves) which may be imposed in respect of Eurocurrency liabilities,
under and as defined in Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Eurodollar Tranche" shall mean a Tranche as to which Interest is
calculated at, or by reference to, a Eurodollar Rate.
"Eurodollar Tranche Period" shall mean, with respect to a Eurodollar
Tranche, a period of one (1) month, two (2) months or three (3) months, or such
other period as may be mutually agreeable to the parties hereto, commencing on a
Business Day selected by the Borrower or the Agent pursuant to the terms hereof.
Such Eurodollar Tranche Period shall end on the day in the succeeding calendar
month which corresponds numerically to the beginning day of such Eurodollar
Tranche Period, provided, however, that if there is no such numerically
corresponding day in such succeeding month, such Eurodollar Tranche Period shall
end on the last Business Day of such succeeding month. If a Eurodollar Tranche
Period would otherwise end on a day which is not a Business Day, such Eurodollar
Tranche Period shall end on the next succeeding Business Day, provided, however,
that if said next succeeding Business Day falls in a new month, such Eurodollar
Tranche Period shall end on the immediately preceding Business Day.
-10-
"Excess Funds" shall have the meaning ascribed to such term in Section
11.18.
"Excluded Receivable" shall mean all Tooling Receivables, Retroactive
Pricing Adjustment Receivables, Intercompany Receivables and Foreign
Receivables.
"Face Amount" shall mean the face amount of a Windmill commercial paper
note issued on a discount basis or, with respect to any Windmill commercial
paper note not issued at a discount, the principal amount of such note together
with interest thereon to stated maturity.
"Federal Bankruptcy Code" shall mean the bankruptcy code of the United
States of America codified in Title 11 of the United States Code.
"Federal Funds Effective Rate" means for any day the greater of (i) the
highest rate per annum as determined by ABN AMRO at which overnight Federal
funds are offered to ABN AMRO for such day by major banks in the interbank
market, and (ii) if ABN AMRO is borrowing overnight funds from a Federal Reserve
Bank that day, the highest rate per annum at which such overnight borrowings are
made on that day. Each determination of the Federal Funds Effective Rate by ABN
AMRO shall be conclusive and binding on the Borrower except in the case of
manifest error.
"Fee Letter" means the letter agreement dated as of the date hereof among
the Borrower, the Agent, Windmill and the Program LOC Provider.
"Filing Assets" shall have the meaning ascribed to such term in Section
5.1(e).
"Finance Charges" shall mean, with respect to a Contract, any finance,
interest, late or similar or other charges owing by an Obligor pursuant to such
Contract.
"Financial Investment" shall mean, with respect to any Person, any direct
or indirect investment by such Person in any other Person, whether by means of
share purchase, capital contribution, loan or otherwise, excluding the
incurrence of receivables arising from sales or services rendered in the
ordinary course of business.
"Fitch" shall mean Fitch, Inc.
"Foreign Receivable" shall mean any Receivable the Obligor of which, if a
natural person, is not a resident of the USA or, if a corporation or other
business organization, is not organized under the laws of the USA or does not
have its chief executive office or principal place of business in the USA.
"Funding Agreement" shall mean any agreement or instrument executed by
Windmill and executed by or in favor of any Windmill Funding Source.
"Funding Charges" means, for each day, the sum of (i) interest accrued on
Pooled Commercial Paper on such day, plus (ii) any and all accrued commissions
in respect of placement agents and commercial paper dealers in respect of such
Pooled Commercial Paper for such day, plus (iii) issuing and paying agents' fees
incurred on such Pooled Commercial Paper
-11-
for such day, plus (iv) other costs associated with funding small or odd-lot
amounts with respect to all Receivable Purchase Facilities which are funded by
Pooled Commercial Paper for such day, minus (v) any accrual of income net of
expenses received on such day from investment of collections received under all
Receivable Purchase Facilities funded with Pooled Commercial Paper, minus (vi)
any payment received on such day net of expenses in respect of Break Funding
Costs related to the prepayment of any Loan Interests held by Windmill pursuant
to the terms of any Receivable Purchase Facilities funded substantially with
Pooled Commercial Paper.
"GAAP" shall mean generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other Person as may be approved by a significant segment of the accounting
profession, which are applicable to the circumstances as of the date of
determination; provided, however, that for purposes of those certain financial
covenants set forth in Exhibit A to the Indemnity Agreement, the term GAAP shall
be GAAP as applicable on September 30, 1992.
"Governmental Authority" shall mean any Federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
or any court, in each case whether in the USA or foreign.
"Guaranty" shall mean any agreement, undertaking or arrangement by which a
Person assumes, guarantees, endorses, contingently agrees to purchase or provide
funds for the payment of, or otherwise becomes liable upon, the obligation,
Indebtedness or liability of any other Person, or agrees to maintain the net
worth or working capital or other financial condition (including dividends or
other distributions) of any other Person or otherwise assures any creditor of
such other Person against loss, including any comfort letter, operating
agreement or take-or-pay contract and shall include the contingent liability of
such Person in connection with any application for a letter of credit.
"IMF" shall have the meaning ascribed to such term in Section 11.6(c).
"Income Taxes" shall have the meaning ascribed to such term in Section
9.2(a).
"Indebtedness" shall mean a Person's (i) obligations for borrowed money,
(ii) obligations representing the deferred purchase price of property other than
accounts payable arising in the ordinary course of such Person's business on
terms customary in the trade, (iii) obligations (including leases), whether or
not assumed, secured by a lien on, 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 bonds, debentures, notes, acceptances, or
other instruments, (v) Capitalized Lease obligations and (vi) obligations for
which such Person is obligated pursuant to a Guaranty.
"Indemnified Losses" shall have the meaning ascribed to such term in
Section 9.1.
"Indemnified Party" shall have the meaning ascribed to such term in Section
9.1.
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"Indemnity Agreement" shall mean that certain Indemnity Agreement dated as
of the date hereof among, the Parent, each Originator and the Agent for the
benefit of the Agent, the Lenders and each Person to whom any of the Aggregate
Unpaids is owed.
"Insufficiency" shall have the meaning ascribed to such term in Section
11.18.
"Intended Characterization" shall have the meaning ascribed to such term in
Section 9.2(c).
"Intercompany Receivable" shall mean a Receivable the Obligor of which is
an Affiliate of the Borrower or any Originator.
"Interest" shall mean, with respect to any Tranche Period:
TR x TA x AD
----
Year
Where:
"TR" is equal to the Tranche Rate applicable to such Tranche Period;
"TA" is equal to the portion of the Loan Amount allocated to such Tranche
Period;
"AD" is equal to the actual number of days elapsed during such Tranche
Period; and
"Year" is equal to the number three hundred sixty (360);
provided, however, that no provision of this Agreement shall require the payment
or permit the collection of Interest in excess of the maximum permitted by
applicable law; and provided, further, however, that Interest shall not be
considered paid by any payment if at any time such payment is rescinded or must
be returned for any reason.
"Interest Rate" means, for any Tranche Period or Interest Period, the CP
Rate, the Eurodollar Rate or the Prime Rate.
"Interest Reserve" shall mean, at any time, the sum of (a) the accrued and
unpaid Interest for all Tranche Periods at such time, plus (b) the product of
(i) a percentage equal to the highest Tranche Rate, for any Tranche Period
outstanding at such time (or, if greater, the Eurodollar Rate) plus five percent
(5%), multiplied by (ii) the Aggregate Loan Amount at such time, multiplied by
(iii) a fraction (A) the numerator of which is the product of the Average
Collection Period multiplied by one and one half (1.5), and (B) the denominator
of which is three hundred sixty (360).
"Interest Reserve Percentage" shall mean, at any time, the quotient of (i)
the Interest Reserve at such time, divided by (ii) the Aggregate Loan Amount at
such time.
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"Interim Liquidation" means any time before the Loan Amortization Date
during which Collections shall be used to pay Loan Amounts as described in
Section 3.3, as established pursuant to Section 2.2.
"Interim Liquidation Period" shall mean any period beginning and ending on
any day designated by the Borrower in a written notice to the Agent in each case
given on or prior to, respectively, such beginning and ending day.
"Lenders" means the Committed Lenders and Windmill.
"Limited Guaranty" shall mean that certain Amended and Restated Limited
Guaranty dated the date hereof from the Parent and each of the Originators for
the benefit of the Borrower.
"Liquidation Period" means, for Windmill only, all times when Windmill is
not making Loans pursuant to Article II and, for all Lenders, all times (x)
during an Interim Liquidation and (y) on and after the Loan Amortization.
"Loan" is defined in Section 2.1(a).
"Loan Amortization Date" means the earlier to occur of (i) April 29, 2005
or (ii) the date on which a Termination Event occurs.
"Loan Amount" means, for each Lender, (a) the sum of (i) all Loans by such
Lender and (ii) the aggregate amount of any payments or exchanges made by, or on
behalf of, such Lender to any other Lender under Article III minus (b) all
Collections, amounts received from any Lenders under Article III, and other
amounts received or exchanged and, in each case, applied by the Agent or such
Lender to reduce such Lender's Loan Amount. A Lender's Loan Amount shall be
restored to the extent any amounts so received or exchanged and applied are
rescinded or must be returned for any reason.
"Loan Interest" is defined in Section 2.1(a).
"Loan Limit" means Fifty Million Dollars ($50,000,000).
"Loans" shall mean advances made to the Borrower hereunder secured by the
Receivables.
"Loans Supplement" shall have the meaning ascribed to such term in Sections
11.6(c), 11.6(e)(ii) and 11.6(f).
"Lock-Box" shall mean each post office box or bank box listed on Exhibit C
and such other boxes as such boxes may be added or deleted pursuant to the terms
hereof.
"Lock-Box Account" shall mean an account maintained by the Collection Agent
at a Lock-Box Bank for the purpose of receiving, collecting or concentrating
Collections from Receivables.
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"Lock-Box Agreement" shall mean each agreement between the Borrower and a
Lock-Box Bank with respect to the Lock-Box Accounts.
"Lock-Box Bank" shall mean each of the banks set forth in Exhibit C and
such other banks as may be added hereto or deleted herefrom as a Lock-Box Bank
pursuant to the terms hereof.
"Lock-Box Letter" shall mean a letter in substantially the form of Exhibit
D (with such changes therein as are acceptable to the Agent) from the Borrower
to each Lock-Box Bank, acknowledged and accepted by such Lock-Box Bank and the
Agent.
"Loss Reserve Percentage" shall mean, at any time, the product of (a) three
multiplied by (b) the average Loss-to-Liquidation Ratio for each of the last
three calendar months.
"Loss-to-Liquidation Ratio" shall mean, for any period of determination,
the ratio (expressed as a percentage) of (i) the Outstanding Balance of
Charge-Offs which became Charge-Offs during such period, to (ii) the aggregate
amount of Collections during such period.
"Management Company" shall mean Securitization Services, LLC, a Delaware
limited liability company.
"Matured Aggregate Loan Amount" means, at any time, the Matured Value of
Windmill's Loan Amount plus the total Loan Amounts of all other Lenders then
outstanding.
"Matured Value" means, for any Loan Amount, the sum of such Loan Amount and
all unpaid Interest, fees and other amounts scheduled to become due (whether or
not then due) on such Loan Amount during all Tranche Periods to which any
portion of such Loan Amount has been allocated.
"Maximum Incremental Loan Amount" means, at any time, the lesser of (a) the
difference between the Loan Limit and the Aggregate Loan Amount then outstanding
and (b) the difference between the Aggregate Commitment and the Matured
Aggregate Loan Amount then outstanding.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Net Receivables Balance" shall mean, at any time, the Outstanding Balance
of all Eligible Receivables at such time reduced by the sum of (a) the amount by
which the Outstanding Balance of all Eligible Receivables of any Obligor (other
than an Approved Obligor) and its Affiliates exceeds the Concentration Factor at
such time, plus (b) the amount by which the Outstanding Balance of all Eligible
Receivables of any Approved Obligor and its Affiliates exceeds its Approved
Obligor Limit, plus (c) to the extent not already included in (a) or (b) above,
the amount by which the Outstanding Balance of all Eligible Receivables of all
Permitted Foreign Obligors exceeds 10% of the Outstanding Balance of all
Receivables.
"Non-Excluded Taxes" shall have the meaning ascribed to such term in
Section 9.5.
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"Obligor" shall mean, with respect to any Receivable, the Person obligated
to make payments on such Receivable or any guarantor of such obligation.
"OECD Country" shall have the meaning ascribed to such term in Section
11.6(c).
"Originator" shall mean each of the following Delaware corporations:
BorgWarner Diversified Transmission Products Inc.; BorgWarner Emissions Systems
Inc.; BorgWarner ▇▇▇▇▇ TEC Inc.; BorgWarner Transmission Systems Inc.;
BorgWarner TorqTransfer Systems Inc.; BorgWarner Turbo Systems Inc. and
BorgWarner Thermal Systems Inc.
"Other Borrowers" shall have the meaning ascribed to such term in Section
9.1.
"Other Costs" shall have the meaning ascribed to such term in Section 9.4.
"Outstanding Balance" of any Receivable shall mean, at any time, the
aggregate of all amounts required to be paid by the related Obligor and not then
paid, whether or not then due, including any accrued and unpaid Finance Charges
but excluding any unaccrued Finance Charges.
"Parent" shall mean ▇▇▇▇-▇▇▇▇▇▇ Automotive, Inc., a Delaware corporation.
"Participant" shall have the meaning ascribed to such term in Section
11.6(b).
"Payment" shall mean any payment of funds hereunder by or on behalf of any
Lender to the Borrower.
"Payment Date" shall mean, with respect to each Payment, the Business Day
on which such Payment is made.
"Periodic Report" shall mean a monthly report, substantially in the form of
Exhibit E or in such other form as mutually agreed to by the Collection Agent
and the Agent.
"Permitted Foreign Obligor" is defined in the definition of Eligible
Receivables.
"Permitted Investments" shall mean (a) evidences of indebtedness, maturing
not more than thirty (30) days after the date of purchase thereof, issued by, or
guaranteed by the full faith and credit of, the federal government of the USA,
(b) repurchase agreements with banking institutions or broker-dealers registered
under the Securities Exchange Act of 1934, as amended, fully secured by
obligations of the kind specified in (a) above, or (c) money market funds rated
not lower than the highest rating category from Moody's and AAA(m) or AAA(m-g)
from S&P or otherwise acceptable to the Rating Agencies or (d) commercial paper
issued by any corporation incorporated under the laws of the USA, provided that
such commercial paper is rated at least A-1+ or the equivalent thereof by S&P
and at least P-1 or the equivalent thereof by Moody's.
"Person" shall mean individuals, partnerships, corporations, business
trusts, joint stock companies, trusts, unincorporated associations, joint
ventures, Governmental Authorities, or any other entity of whatever nature.
-16-
"Pool Funded Loan Interest" means each investment or loan of Windmill under
a Receivables Loan Facility funded with Pooled Commercial Paper.
"Pooled Allocation" means, for each Pool Funded Loan Interest, an amount
each day equal to the product of (i) the Pooled Percentage Share of such Loan
Interest on such day multiplied by (ii) the aggregate amount of Funding Charges
for such day.
"Pooled Commercial Paper" means commercial paper notes of Windmill except
(A) Allocated Commercial Paper, and (B) Specially Pooled Paper.
"Pooled Percentage Share" means, for each Pool Funded Loan Interest, a
fraction (expressed as a percentage) the numerator of which is equal to the Loan
Amount associated with such Pool Funded Loan Interest and the denominator of
which is equal to the aggregate amount of all outstanding investment (or
comparable terms used in any Receivable Purchase Facility) held by Windmill
which is funded substantially with Pooled Commercial Paper.
"Potential Termination Event" shall mean any event or condition which but
for the lapse of time or the giving of notice, or both, would constitute a
Termination Event.
"Prime Rate" shall mean (a) prior to the occurrence of a Termination Event
except with respect to any Tranche Period to which all or any portion of the
Loan Amount of the Banks has been allocated, a rate per annum equal to the ABN
AMRO Prime Rate and (b) on or after the occurrence of a Termination Event, the
ABN AMRO Prime Rate plus two percent (2%) per annum.
"Prime Tranche" shall mean a Tranche as to which Interest is calculated at,
or by reference to, the Prime Rate.
"Prime Tranche Period" shall mean, with respect to a Prime Tranche a period
of one (1) day or any other period selected by the Borrower or otherwise
determined, and approved by the Agent and commencing on a Business Day.
"Pro Rata Share" shall mean, as to any Bank, a fraction (expressed as a
percentage) (a) the numerator of which shall be the amount of its Bank
Commitment, and (b) the denominator of which shall be the Aggregate Commitment.
"Purchase Agreement" shall mean that certain Purchase Agreement, dated as
of December 23, 1998, among the Borrower and each Originator.
"Purchase Percentage" means, for any Put, for each Committed Lender, its
Ratable Share or such lesser percentage as is necessary to prevent the Purchase
Price of such Purchasers from exceeding its Unused Commitment.
"Purchased Asset" shall have the meaning ascribed to such term in the
Purchase Agreement.
"Purchasing Banks" shall have the meaning ascribed to such term in Section
11.6(c).
-17-
"Put" is defined in Section 3.l(a).
"Ratable Share" means, for each Committed Lender, such Committed Lender's
Commitment divided by the Commitments of all Committed Lenders.
"Rating" shall mean the ratings by a Rating Agency of the commercial paper
notes issued by Windmill.
"Rating Agency" shall mean (i) if Windmill's commercial paper notes are
then rated by Moody's, Moody's, (ii) if Windmill's commercial paper notes are
then rated by S&P, S&P, and (iii) if Windmill's commercial paper notes are then
rated by any other rating agency, such rating agency.
"Receivable" shall mean any indebtedness and other obligations owed to an
Originator (without giving effect to any sale or conveyance to the Borrower
pursuant to the Purchase Agreement or to the Agent for the benefit of the
Lenders hereunder) or any right of such an Originator to payment from or on
behalf of an Obligor whether constituting an account, chattel paper, instrument
or general intangible, arising in connection with the sale or lease of goods or
the rendering of services by such Originator (and conveyed by such Originator to
the Borrower), including the obligation to pay any Finance Charges with respect
thereto. Indebtedness and other rights and obligations arising from any one
transaction, including indebtedness and other rights and obligations represented
by an individual invoice or agreement, shall constitute a receivable separate
from a receivable consisting of the indebtedness and other rights and
obligations arising from any other transaction.
"Receivable Purchase Facility" means any receivables purchase agreement,
loan agreement or other similar contractual arrangement to which Windmill is a
party relating to the transfer, purchase or financing of receivables or other
assets.
"Records" shall mean, with respect to any Receivable, all Contracts and
other documents, books, records and other information (including computer
programs, tapes, disks, punch cards, media, data processing software and related
property and rights) relating to such Receivable and the related Obligor.
"Referral Agent" shall mean ABN AMRO, in its capacity as a referral agent
and the other Persons who become referral agents under that certain Second
Amended and Restated Referral Agreement, dated as of May 1, 2003, between
Windmill and the Referral Agent, and any successor thereto.
"Register" shall have the meaning ascribed to in such term Section 11.6(g).
"Regulatory Change" shall have the meaning ascribed to such term in Section
9.3(a).
"Related Accounts" shall mean, with respect to any Receivable, all deposit
accounts and investment accounts into which any Collections or other proceeds of
such Receivable are deposited, including all Lock-Box Accounts, and all monies
and other funds, certificates,
-18-
securities, other instruments, general intangibles and other items credited
thereto from time to time.
"Related Security" shall mean, with respect to any Receivable: (i) all of
the Borrower's right, title and interest in goods (including returned goods), if
any, the sale or lease of which by an Originator gave rise to such Receivable,
and all insurance contracts with respect thereto; (ii) all other security
interests or liens and property subject thereto from time to time, if any,
purporting to secure payment of such Receivable, whether pursuant to the
Contract related to such Receivable or otherwise, together with all financing
statements signed by an Obligor describing any collateral securing such
Receivable; (iii) all Guaranties, letters of credit, insurance and other
agreements or arrangements of whatever character from time to time supporting or
securing payment of such Receivable whether pursuant to the Contract related to
such Receivable or otherwise; (iv) all service contracts and other contracts and
agreements related to such Receivable; and (v) all Records related to such
Receivable.
"Replacement Bank" shall have the meaning ascribed to such term in Section
11.6(d).
"Required Banks" shall mean, at any time, Banks having an aggregate Bank
Commitment in excess of sixty-six and two-thirds percent (66-2/3%) of the
Aggregate Commitment then in effect or, if the Aggregate Commitments shall then
have been terminated, such Banks as together shall then own in excess of
sixty-six and two-thirds percent (66-2/3%) of the Bank Loan Amount at such time.
"Reserve" shall for each Lender mean, at any time that such Lender's Loan
Amount is greater than zero, an amount equal to the product of (a) the Reserve
Percentage at such time, multiplied by (b) an amount obtained by multiplying (i)
a fraction the numerator of which is such Lender's Loan Amount and the
denominator of which is the Loan Amount of all Lenders by (ii) the Net
Receivables Balance.
"Reserve Percentage" shall mean the greater of (a) thirty percent (30%), or
(b) the sum of (i) the Loss Reserve Percentage, plus (ii) the Interest Reserve
Percentage, plus (iii) the Collection Reserve Percentage, plus (iv) the Dilution
Reserve Percentage.
"Retroactive Pricing Adjustment Receivable" shall mean any Receivable owed
in connection with a price adjustment for the goods giving rise to such
Receivable subsequent to the original invoice sent in respect of such goods.
"Section 9.3 Costs" shall have the meaning ascribed to such term in Section
9.3(c).
"Secured Interest" is defined in Section 2.1(a).
"Settlement Date" means the 25th day of each calendar month.
"Special Borrower Subaccount" shall mean the special Borrower subaccount
for the Borrower established pursuant to that certain Amended and Restated
Depositary Agreement between Windmill and the Depositary, dated as of November
15, 1994.
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"Specially Pooled Paper" means the aggregate of all commercial paper notes
of Windmill issued in connection with Receivables Purchase Facilities designated
from time to time by the Agent (in its sole discretion). Specially Pooled Paper
will not include Pooled Commercial Paper or Allocated Commercial Paper at any
time.
"S&P" shall mean Standard & Poor's Ratings Group.
"Subordination Agreement" shall mean that certain Subordination Agreement
dated as of the date hereof among each Originator and the Agent for the benefit
of the Lenders.
"Subsidiary" shall mean, for any Person, any corporation or other business
organization fifty percent (50%) or more of the outstanding voting securities of
which shall at the time be owned or controlled, directly or indirectly, by such
Person or by one or more such corporations or organizations or by such Person
and one or more such corporations or organizations, and any partnership of which
such Person or any such corporation or organization is a general partner;
provided, however, NSK-▇▇▇▇▇▇ ▇.▇. shall not be considered a Subsidiary of any
Person unless such Person shall own or control, directly or indirectly, more
than fifty percent (50%) of the outstanding voting securities of NSK-▇▇▇▇▇▇ ▇.▇.
For purposes of this definition, the term "voting securities" shall mean capital
stock or other ownership interests having ordinary voting power under ordinary
circumstances for the election of directors (or the equivalent of such corporate
association, business organization or other entity).
"Taxes" shall mean all taxes, charges, fees, levies or other assessments
including income, gross receipts, profits, withholding, excise, property, sales,
use, license, occupation and franchise taxes (including, in each such case, any
interest, penalties or additions attributable to or imposed on or with respect
to any such taxes, charges, fees or other assessments) imposed by the USA or any
foreign government or any other jurisdiction or taxing authority.
"Termination Date" shall mean (a) with respect to Windmill, the Windmill
Termination Date and (b) with respect to the Banks, the Bank Termination Date.
"Termination Event" shall mean an event or condition described in Section
8.1.
"Tooling Receivable" shall mean any Receivable arising in connection with
the tooling of equipment utilized to manufacture the related goods (the sale of
which gave rise to such Receivable) or other start-up costs or items related
thereto which the Obligor must reimburse the Originator therefor.
"Tranche" shall mean a portion of the Aggregate Loan Amount allocated to a
Tranche Period.
"Tranche Maturity Date" shall mean the last day of a Tranche Period,
whether such date is the originally scheduled last day of such Tranche Period or
occurs by reason of early termination of such Tranche Period or otherwise;
provided, however, that, if any Tranche Maturity Date shall occur on any day
which is not a Business Day, such Tranche Maturity Date shall be extended to the
next following Business Day and all applicable Interest, interest and fees shall
give effect to such extension of such Tranche Maturity Date.
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"Tranche Period" shall mean a CP Tranche Period, a Eurodollar Tranche
Period or a Prime Tranche Period.
"Tranche Rate" shall mean the CP Rate, the Eurodollar Rate or the Prime
Rate.
"Transaction Documents" shall mean this Agreement, the Fee Letter, the
Purchase Agreement, the Indemnity Agreement, the Limited Guaranty, the
Subordination Agreement, the Transfer Agreement and all other documents,
instruments and agreements executed in connection herewith and therewith.
"Transfer Agreement" means the Windmill Transfer Agreement dated the date
hereof between Windmill, ABN AMRO Bank N.V., in its capacity as Windmill's Agent
and a Liquidity Provider and the other Persons who become Liquidity Providers
thereunder.
"UCC" shall mean, with respect to any state, the Uniform Commercial Code as
from time to time in effect in such state.
"Unpaid Amount" shall have the meaning ascribed to such term in Section
3.1(b).
"Unused Commitment" means, for any Committed Lender at any time, the
difference between its Commitment and its Loan Amount then outstanding.
"USA" shall mean the United States of America, including all states and
political subdivisions thereof.
"Windmill" shall have the meaning ascribed to such term in the first
paragraph of this Agreement.
"Windmill Funding Source" shall mean any insurance company, bank or other
financial institution providing liquidity, back-up purchase or credit support
for Windmill.
"Windmill Settlement" means the sum of all claims and rights to payment
pursuant to Section 2.5 or 2.7 or any other provision owed to Windmill (or owed
to the Agent or the Collection Agent for the benefit of Windmill) by the
Borrower that, if paid, would be applied to reduce Windmill's Loan Amount.
"Windmill Termination Date" means the earlier of (a) the Business Day
designated by Windmill and (b) the Bank Termination Date.
Section 1.2. Other Terms. Except as otherwise specified in this Agreement,
all references in this Agreement (i) to any Person (other than the Parent, any
Originator or the Borrower) shall be deemed to include such Person's successors
and assigns, and (ii) to any law, agreement, statute or contract specifically
defined or referred to in this Agreement shall be deemed references to such law,
agreement, statute or contract as the same may be supplemented, amended, waived,
consolidated, replaced or modified from time to time, but only to the extent
permitted by, and effected in accordance with, the terms thereof. The words
"herein," "hereof" and "hereunder" and words of similar import, when used in
this Agreement, shall refer to this
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Agreement as a whole and not to any provision of this Agreement, and references
to "Article," "Section," "paragraph," "Exhibit," "Schedule" and "Appendix" are
references to this Agreement unless otherwise specified. Whenever the context so
requires, words importing any gender include the other gender. Any of the
defined terms may, unless the context otherwise requires, be used in the
singular or the plural depending on the reference; the singular includes the
plural and the plural includes the singular. The word "or" shall not be
exclusive.
All defined terms shall have the defined meanings when used in the
Transaction Documents or, except as otherwise expressly stated therein, any
certificate, opinion or other document delivered pursuant to a Transaction
Document. In the event of a conflict in the defined meanings in a Transaction
Document and this Agreement, this Agreement shall govern.
For purposes of the Transaction Documents, all accounting terms not
otherwise defined in this Agreement or in the relevant Transaction Document
shall have the meanings assigned them in conformity with GAAP.
For purposes of the Transaction Documents, all terms used in Article 9 of
the UCC and not specifically defined in this Agreement or in the relevant
Transaction Document shall be defined herein and in the Transaction Documents as
such terms are defined in the UCC as in effect in the State of Illinois.
For purposes of the Transaction Documents, each reference to this
Agreement, any other Transaction Document, any Program Document or any other
agreement shall be a reference to such agreement together with all exhibits,
schedules, attachments and appendices thereto, in each case as amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof and hereof.
References to "writing" include telecopying, printing, typing, lithography
and other means of reproducing words in a tangible visible form including
computer generated information accessible in tangible visible form. References
to "written" include faxed, printed, typed, lithographed and other means of
reproducing words or symbols in a tangible visible form consistent with the
preceding sentence. The words "including," "includes" and "include" shall be
deemed to be followed by the words "without limitation."
Section 1.3. Computation of Time Periods. Unless otherwise expressly
provided herein, any period of time (including each Tranche Period) ending on a
day which is not a Business Day shall end on the next succeeding Business Day.
Unless otherwise stated in this Agreement or the other Transaction Documents, in
the computation of a period of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each means "to but excluding."
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ARTICLE II
LOANS TO BORROWER AND SETTLEMENTS
Section 2.1. Loans.
(a) The Secured Interest. Subject to the terms and conditions hereof, the
Borrower may, from time to time before the Bank Termination Date, request
Windmill or, only if Windmill denies such request, ratably request that the
Committed Lenders make loans secured by an undivided percentage ownership
interest in the Receivables and all related Collections. Any such loan made by
Windmill or the Committed Lenders (a "Loan") shall be made by each relevant
Lender remitting funds to the Borrower, through the Agent, pursuant to Section
2.1(c) or by the Collection Agent remitting Collections to the Borrower pursuant
to Section 2.1(d). The aggregate percentage security interest so acquired by a
Lender in the Receivables and related Collections (its "Loan Interest") shall
equal at any time the following quotient:
LA + R
------
NRB
where:
LA = the outstanding Loan Amount of such Lender at such time;
R = the Reserve for such Lender at such time; and
NRB = the Net Receivables Balance at such time.
Except during a Liquidation Period for a Lender, such Lender's Loan Interest
will change whenever its Loan Amount, its Reserve or the Net Receivables Balance
changes. During a Liquidation Period for a Lender its Loan Interest shall remain
constant, except for redeterminations of the Loan Interests of Lenders to
reflect Loan Amounts acquired from or transferred to another Lender hereunder or
under the Transfer Agreement. The sum of all Loan Interests of the Lenders at
any time is referred to herein as the "Secured Interest", which at any time is
the aggregate percentage ownership interest then held by such Lenders in the
Receivables and Collections.
(b) Windmill Loan Option and Committed Lenders' Commitments. At no time
will Windmill have any obligation to make a Loan. Each Bank (a "Committed
Lender") severally hereby agrees, subject to the terms and conditions hereof, to
make Loans before the Bank Termination Date, based on its Ratable Share of each
Loan by the Committed Lenders, to the extent its Loan Amount would not thereby
exceed its Commitment, the Aggregate Loan Amount would not thereby exceed the
Loan Limit, and the Matured Aggregate Loan Amount would not thereby exceed the
Aggregate Commitments.
(c) Loans. In order to request a Loan from a Lender, the Borrower must
provide to the Agent an irrevocable written request (including by telecopier or
other facsimile communication) substantially in the form of Exhibit K, by 10:00
a.m. (Chicago time) three Business Days before
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the requested date (the " Loan Date") of such Loan, specifying the requested
Loan Date (which must be a Business Day) and the requested amount of such Loan,
which must be in a minimum amount of $1,000,000 and multiples thereof (or, if
less, an amount equal to the Maximum Incremental Loan Amount). A Loan may only
be requested from Windmill unless Windmill, in its sole discretion, determines
not to make such Loan (and the Borrower shall be notified of such determination
by not later than 10:45 a.m. on the date of such request), in which case the
Borrower may request such Loan from the Committed Lenders. The Agent shall
promptly notify the contents of any such request to each Lender from which the
Loan is requested. If the Loan is requested from Windmill and Windmill
determines, in its sole discretion, to make the requested Loan, Windmill shall
transfer to the Agent's Account the amount of such Loan on the requested Loan
Date. If the Loan is requested from the Committed Lenders, subject to the terms
and conditions hereof, each Committed Lender shall transfer its Ratable Share of
the requested Loan Amount into the Agent's Account by no later than 12:00 noon
(Chicago time) on the Loan Date. The Agent shall transfer to the Borrower
Account the proceeds of any Loan delivered into the Agent's Account.
(d) Security Interest. To secure all of the Borrower's obligations under
the Transaction Documents, the Borrower hereby grants to the Agent (for the
benefit of the Lenders) a security interest in all of the Borrower's rights in
the Receivables, the Collections, and the Lock-Box Accounts.
Section 2.2. Optional Liquidations. The Borrower may at any time direct
that an Interim Liquidation commence for all Lenders by giving the Agent and the
Collection Agent at least three Business Days' written (including telecopy or
other facsimile communication) notice specifying the date on which the Interim
Liquidation shall commence and, if desired, when such Interim Liquidation shall
cease before the Loan Amortization Date (identified as a specific date or as
when the Aggregate Loan Amount is reduced to a specified amount). If the
Borrower does not so specify the date on which an Interim Liquidation shall
cease, it may cause such Interim Liquidation to cease at any time before the
Loan Amortization Date by notifying the Agent and the Collection Agent in
writing (including by telecopy or other facsimile communication) at least three
Business Days before the date on which it desires such Interim Liquidation to
cease.
Section 2.3. Selection of Interest Rates and Tranche Periods. (a)(1) The
provisions of this subsection (a)(1) shall apply to each Loan Amount of Windmill
funded with commercial paper issued on or before the Agent makes the election
described in clause (a)(2) below: Each Loan Amount shall be allocated to one or
more Tranches reflecting the Interest Rates at which such Loan Amount accrues
Interest and the Tranche Periods for which such Interest Rates apply. Each Loan
Amount of Windmill shall accrue Interest at the CP Rate. Each Tranche shall be
in the minimum amount of $1,000,000 and in multiples thereof. All Interest
accrued on the Loan Amount of Windmill during a Tranche Period shall be payable
by the Borrower on the last day of such Tranche Period. (2) At the Agent's
option, the Agent may notify the Borrower that the provisions of this subsection
(a)(2) shall apply to each Loan Amount of Windmill funded with Pooled Commercial
Paper issued after the Agent delivers a notice to the Borrower that it elects to
have the provisions of this clause (a)(2) to be applicable to the Loan Amount of
Windmill: The Borrower shall pay Funding Charges with respect to Windmill's Loan
Interest for each day that any Loan Amount in respect of such Loan Interest is
outstanding. Each such Loan Interest will
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accrue Funding Charges each day based on the Pooled Allocation. On each
Settlement Date the Borrower shall pay to the Agent (for the benefit of
Windmill) an aggregate amount equal to all accrued and unpaid Funding Charges in
respect of such Loan Interest for the immediately preceding Interest Period; (3)
Each Loan Amount of the Committed Lenders shall be allocated to one or more
Tranches reflecting the Interest Rates at which such Loan Amount accrues
Interest and the Tranche Periods for which such Interest Rates apply. In each
request for a Loan from a Committed Lender and three Business Days before the
expiration of any Tranche Period applicable to any Committed Lender's Loan
Amount, the Borrower may request the Tranche Period(s) to be applicable to such
Loan Amount and the Interest Rate(s) applicable thereto. Each Loan Amount of the
Committed Lenders may accrue Interest at either the Eurodollar Rate or the Prime
Rate, in all cases as established for each Tranche Period applicable to such
Loan Amount. Each Tranche shall be in the minimum amount of $1,000,000 and in
multiples thereof or, in the case of Interest accruing at the Prime Rate, in any
amount that otherwise has not been allocated to another Tranche Period. Any Loan
Amount of the Committed Lenders not allocated to a Tranche Period shall be a
Prime Tranche. During the pendency of a Termination Event, the Agent may
reallocate any outstanding Loans of the Committed Lenders to a Prime Tranche.
All Interest accrued on the Loan Amount of the Committed Lenders during a
Tranche Period shall be payable by the Borrower on the last day of such Tranche
Period or, for a Eurodollar Tranche with a Tranche Period of more than three
months, 90 days after the commencement, and on the last day, of such Tranche
Period.
(b) The Agent shall allocate the Investment of Windmill to Tranche Periods
in its sole discretion. If, by the time required in Section 2.3(a), the Borrower
fails to select an Interest Rate or Tranche Period for any Loan Amount of the
Committed Lenders, such Loans shall automatically accrue Interest at the Prime
Rate for a three Business Day Tranche Period. Any Loans purchased from Windmill
pursuant to Article III hereof shall accrue interest at the Prime Rate and have
an initial Tranche Period of three Business Days.
(c) If the Agent or any Committed Lender determines (i) that maintenance of
any Eurodollar Tranche would violate any applicable law or regulation, (ii) that
deposits of a type and maturity appropriate to match fund any of such Lender's
Eurodollar Tranches are not available or (iii) that the maintenance of any
Eurodollar Tranche will not adequately and fairly reflect the cost of such
Lender of funding Eurodollar Tranches, then the Agent, upon the direction of
such Lender, shall suspend the availability of, and terminate any outstanding,
Eurodollar Tranche so affected. All Loans allocated to any such terminated
Eurodollar Tranche shall be reallocated to a Prime Rate Tranche.
Section 2.4. Fees and Other Costs and Expenses. (a) The Borrower shall pay
to the Agent for the account of the Committed Lenders and the Agent, such
amounts as agreed to with the Committed Lenders and the Agent in the Fee Letter.
(b) If any Loan Amount allocated to any CP or Eurodollar Tranche is reduced
before the last day of its Tranche Period, or if a requested Loan at the
Eurodollar Rate does not take place on its scheduled Loan Date, the Borrower
shall pay the Early Collection Fee to each Lender that had its Loan Amount so
reduced or scheduled Loan not made.
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(c) Each Loan Amount shall be payable solely from Collections and from
amounts payable under Sections 2.5 and 2.7 (to the extent amounts paid under
Section 7.1 indemnify against reductions in or non-payment of Receivables). The
Borrower shall pay, as a full recourse obligation, all other amounts payable
hereunder, including, without limitation, all Interest, fees described in
clauses (a) and (b) above and amounts payable under Article IX.
Section 2.5. Maintenance of Secured Interest; Deemed Collection. (a)
General. If at any time before the Loan Amortization Date the Net Receivables
Balance is less than the sum of 100% plus the Reserve Percentage multiplied by
the Aggregate Loan Amount (or, if a Termination Event exists, the Matured
Aggregate Loan Amount), the Borrower shall pay to the Agent an amount equal to
such deficiency for application to reduce the Loan Amounts of the Lenders
ratably in accordance with the principal amount of their respective Loan
Amounts, applied first to Prime Tranches and second to the other Tranches with
the shortest remaining maturities unless otherwise specified by the Borrower.
Any amount so applied to reduce Windmill's Loan Amount shall be deposited in the
Special Borrower Subaccount.
(b) Deemed Collections. If on any day the outstanding balance of a
Receivable is reduced or cancelled as a result of any defective or rejected
goods or services, any cash discount or adjustment (including any adjustment
resulting from the application of any special refund or other discounts or any
reconciliation), any setoff or credit (whether such claim or credit arises out
of the same, a related, or an unrelated transaction) or other similar reason not
arising from the financial inability of the Obligor to pay undisputed
indebtedness, the Borrower shall be deemed to have received on such day a
Collection on such Receivable in the amount of such reduction or cancellation.
If on any day any representation, warranty, covenant or other agreement of the
Borrower related to a Receivable is not true or is not satisfied, the Borrower
shall be deemed to have received on such day a Collection in the amount of the
outstanding balance of such Receivable. All such Collections deemed received by
the Borrower under this Section 2.5(b) shall be remitted by the Borrower to the
Collection Agent in accordance with Section 3.3.
(c) Adjustment to Secured Interest. At any time before the Loan
Amortization Date that the Borrower is deemed to have received any Collection
under Section 2.5(b) ("Deemed Collections") that derive from a Receivable that
is otherwise reported as an Eligible Receivable, so long as no Liquidation
Period then exists, the Borrower may satisfy its obligation to deliver such
amount to the Collection Agent by instead notifying the Agent that the Secured
Interest should be recalculated by decreasing the Net Receivables Balance by the
amount of such Deemed Collections, so long as such adjustment does not cause the
Secured Interest to exceed 100%.
(d) Payment Assumption. Unless an Obligor otherwise specifies or another
application is required by contract or law, any payment received by the Borrower
from any Obligor shall be applied as a Collection of Receivables of such Obligor
(starting with the oldest such Receivable) and remitted to the Collection Agent
as such.
Section 2.6. Reduction in Commitments. The Borrower may, upon 30 days'
notice to the Agent, reduce the Aggregate Commitment in increments of
$1,000,000, so long as the Aggregate Commitment at all times equals at least the
outstanding Matured Aggregate Loan Amount. Each such reduction in the Aggregate
Commitment shall reduce the Commitment of each Committed
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Lender in accordance with its Ratable Share and shall ratably reduce the Loan
Limit so that the Aggregate Commitment remains equal to 102% of the Loan Limit.
Section 2.7. Optional Prepayments. At any time that the Aggregate Loan
Amount is less than 10% of the Aggregate Commitment in effect on the date
hereof, the Borrower may, upon thirty days' notice to the Agent, prepay the
entire Loan Amount at a price equal to the outstanding Matured Aggregate Loan
Amount and all other amounts then owed to the Lenders hereunder.
Section 2.8. Assignment of Purchase Agreement. The Borrower hereby assigns
and otherwise transfers to the Agent (for the benefit of the Agent, each Lender
and any other Person to whom any amount is owed hereunder), all of the
Borrower's right, title and interest in, to and under the Purchase Agreement.
The Borrower shall execute, file and record all financing statements,
continuation statements and other documents required to perfect or protect such
assignment. This assignment includes (a) all monies due and to become due to the
Borrower from the Originators under or in connection with the Purchase Agreement
(including fees, expenses, costs, indemnities and damages for the breach of any
obligation or representation related to such agreement) and (b) all rights,
remedies, powers, privileges and claims of the Borrower against the Originators
under or in connection with the Purchase Agreement. All provisions of the
Purchase Agreement shall inure to the benefit of, and may be relied upon by, the
Agent, each Lender and each such other Person. At any time that a Termination
Event has occurred and is continuing, the Agent shall have the sole right to
enforce the Borrower's rights and remedies under the Purchase Agreement to the
same extent as the Borrower could absent this assignment, but without any
obligation on the part of the Agent, any Lender or any other such Person to
perform any of the obligations of the Borrower under the Purchase Agreement (or
any of the promissory notes executed thereunder). All amounts distributed to the
Borrower under the Purchase Agreement from Receivables sold to the Borrower
thereunder shall constitute Collections hereunder and shall be applied in
accordance herewith.
ARTICLE III
SALES TO AND FROM WINDMILL; ALLOCATIONS
Section 3.1. Required Loans from Windmill. (a) Windmill may, at any time
sell to the Committed Lenders pursuant to the Transfer Agreement any percentage
designated by Windmill of Windmill's Loan Amount and its related Windmill
Settlement (each, a "Put").
(b) Any portion of Windmill's Loan Amount and related Windmill Settlement
purchased by a Committed Lender shall be considered part of such Lender's Loan
Amount and related Windmill Settlement from the date of the relevant Put.
Immediately upon any purchase by the Committed Lenders of any portion of
Windmill's Loan Amount, the Borrower shall pay to the Agent (for the ratable
benefit of such Lenders) an amount equal to the sum of (i) the Assigned Windmill
Settlement and (ii) all unpaid Interest owed to Windmill (whether or not then
due) to the end of each applicable Tranche Period to which any Loan Amount being
Put has been allocated, (iii) all accrued but unpaid fees (whether or not then
due) payable to Windmill in
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connection herewith at the time of such purchase and (iv) all accrued and unpaid
costs, expenses and indemnities due to Windmill from the Borrower in connection
herewith.
(c) The proceeds from each Put received by Windmill (other than amounts
described in clauses (iii) and (iv) of the last sentence of Section 3.1(b)),
shall be transferred into the Special Borrower Subaccount and used solely to pay
that portion of the outstanding commercial paper of Windmill issued to fund or
maintain the Loan Amount of Windmill so transferred. Until used to pay
commercial paper notes, all proceeds of any Put pursuant to this Section shall
be invested in Permitted Investments. All earnings on such Permitted Investments
shall be promptly remitted to the Borrower.
Section 3.2. Loans by Windmill. Windmill may at any time deliver to the
Agent and each Committed Lender a notification of assignment in substantially
the form of Exhibit F. If Windmill delivers such notice, each Committed Lender
shall sell to Windmill and Windmill shall purchase in full from each Committed
Lender, the Loan Amount of the Committed Lenders on the last day of the relevant
Tranche Periods, at a purchase price equal to such Loan Amount plus accrued and
unpaid Interest thereon. Any sale from any Committed Lender to Windmill pursuant
to this Section 3.2 shall be without recourse, representation or warranty except
for the representation and warranty that the Loan Amount sold by such Committed
Lender is free and clear of any Adverse Claim created or granted by such
Committed Lender and that such Purchaser has not suffered a Bankruptcy Event.
Section 3.3. Allocations and Distributions.
(a) Settlement Dates. On the Business Day following each Deposit Date
occurring prior to the Bank Termination Date (unless an Interim Liquidation is
in effect), the Collection Agent shall set aside from Collections the amounts
necessary to make all distributions to the Agent, the Committed Lenders and the
Collection Agent required by this Section 3.3(a) with respect to the next
succeeding Settlement Date. The balance of such Collections shall be released to
the Borrower on a daily basis. On each Settlement Date prior to the Bank
Termination Date (unless an Interim Liquidation is in effect), all Collections
so set aside during the preceding Discount Period shall be applied where
applicable by the Collection Agent (or, if the Agent is then in control of any
Collections, by the Agent) in the following order:
(i) all fees and other amounts due and payable to the Agent;
(ii) ratably to the Committed Lenders, all Funding Charges and
Discount due and payable on such date;
(iii) ratably to the Committed Lenders, all other amounts due and
payable to the Committed Lenders under the Transaction Documents;
(iv) to the Collection Agent, an amount equal to the Collection Agent
Fee due and payable on such date; and
(v) to the Seller.
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On the last day of each Tranche Period for a Eurodollar Tranche or Prime
Tranche, the Collection Agent (or, if the Agent is then in control of any
Collections, the Agent) shall pay Interest due and payable to such Committed
Lenders from accounts set aside for such purpose pursuant to Section 3.2(a).
If any part of the Secured Interest in any Collections is applied to pay
any amounts that are recourse obligations of the Borrower pursuant to Section
2.4(c) and after giving effect to such application the Secured Interest is
greater than 100%, the Borrower shall pay, as a recourse obligation for
distribution as part of the Secured Interest in Collections, to the Collection
Agent the amount so applied to the extent necessary so that after giving effect
to such payment the Secured Interest is no greater than 100%.
(b) Bank Termination Date and Interim Liquidations. On each day during any
Interim Liquidation and on each day on and after the Bank Termination Date, the
Collection Agent shall set aside and hold in trust solely for the account of the
Agent, for the benefit of the Agent and the Purchasers, (or deliver to the
Agent, if so instructed pursuant to Section 7.2(a)) the Secured Interest in all
Collections received on such day and such Collections shall be allocated as
follows:
(i) first, to the Agent until all amounts owed to the Agent have been
paid in full;
(ii) second, to the Committed Lenders until all amounts owed to the
Committed Lenders have been paid in full;
(iii) third, to any other Person (other than the Borrower, the
Collection Agent or an Originator) to whom any amounts are owed under the
Transaction Documents until all such amounts have been paid in full; and
(iv) fourth, to the Collection Agent until all amounts owed to the
Collection Agent under the Agreement have been paid in full; and
(v) fifth, to the Borrower.
On the last day of each Tranche Period (unless otherwise instructed by the Agent
pursuant to Section 7.2(a)), the Collection Agent shall deposit into the Agent's
Account, from such set aside Collections, all amounts allocated to such Tranche
Period and all Tranche Periods that ended before such date that are due in
accordance with clause (ii) above. No distributions shall be made to pay amounts
under clauses (iii) - (v) until sufficient Collections have been set aside to
pay all amounts described in clauses (i) and (ii) that may become payable for
all outstanding Tranche Periods. All distributions by the Agent shall be made
ratably within each priority level in accordance with the respective amounts
then due each Person included in such level unless otherwise agreed by the Agent
and all Purchasers. If any part of the Secured Interest in any Collections is
applied to pay any amounts payable hereunder that are recourse obligations of
the Borrower pursuant to Section 2.4(c) and after giving effect to such
application the Secured Interest is greater than 100%, the Borrower shall pay,
as a recourse obligation for distribution in
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respect of each applicable Committed Lender's Loan Amount as part of the Secured
Interest in Collections, to the Collection Agent the amount so applied to the
extent necessary so that after giving effect to such payment the Secured
Interest is no greater than 100%.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties. The Borrower represents and
warrants to the Agent and each Lender that:
(a) Corporate Existence and Power. Each of the ▇▇▇▇-▇▇▇▇▇▇ Entities is a
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation and has all corporate power and all governmental
licenses, authorizations, consent and approvals required to carry on its
business in each jurisdiction in which its business is now conducted except
where failure to obtain such licenses, authorizations, consents and approvals
would not have (i) an adverse effect on its ability to perform its obligations
under each of the Transaction Documents to which it is a party, (ii) an adverse
effect on the enforceability of any of the Transaction Documents, (iii) a
material adverse effect on its business or financial condition, (iv) a material
adverse effect on the interests of the Agent or any Lender hereunder or under
any of the other Transaction Documents, or (v) a material adverse effect on the
enforceability or collectibility of any Receivable.
(b) Corporate and Governmental Authorization; Contravention. The execution,
delivery and performance by each of the ▇▇▇▇-▇▇▇▇▇▇ Entities of each Transaction
Document to which it is (or is stated to be) a party are within its corporate
powers, have been duly authorized by all necessary corporate action, require no
action by or in respect of, or filing with, any Governmental Authority, and do
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-laws of any such
▇▇▇▇-▇▇▇▇▇▇ Entity or of any agreement, judgment, injunction, order, decree or
other instrument binding upon it or result in the creation or imposition of any
lien on assets of any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of its Subsidiaries.
(c) Binding Effect. Each of the Transaction Documents constitutes the
legal, valid and binding obligation of each ▇▇▇▇-▇▇▇▇▇▇ Entity which is (or is
stated to be) a party thereto enforceable against each such ▇▇▇▇-▇▇▇▇▇▇ Entity
in accordance with its terms, except to the extent that such enforcement may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity.
(d) Perfection. Immediately preceding the Loans hereunder, each Originator
shall have been the owner and shall have effectively sold all receivables and
other property that constitute Purchase Assets to the Borrower, free of any
Adverse Claim, and the Borrower shall be the owner of all of the receivables
purported to be transferred as Receivables hereunder. On or prior to the date
hereof and prior to the Borrower's acquisition of any new receivable from an
Originator, all financing statements and other documents required to be recorded
or filed in order to perfect and maintain the Agent's (for the benefit of the
Lender's) interest in the Secured Interest and in any additional property
conveyed pursuant to Article II against all creditors of and
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purchasers from the Borrower and all creditors of and purchasers from any
Originator will have been duly filed in each filing office necessary for such
purpose and all filing fees and Taxes, if any, payable in connection with such
filings shall have been paid in full. Notwithstanding the foregoing, nothing in
this Section 4.1(d) shall constitute a representation with respect to any
Receivable the Obligor of which is a government or governmental subdivision or
agency to the extent that such representation requires compliance with any
federal laws of the USA relating to the transfer or perfection of such
Receivable.
(e) Accuracy of Information. All information heretofore furnished by any
▇▇▇▇-▇▇▇▇▇▇ Entity to Windmill, the Agent or any Bank 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 any ▇▇▇▇-▇▇▇▇▇▇ Entity to Windmill, the Agent or any Bank
will be, true and accurate in every material respect and will not omit any
information necessary to make the statements therein not materially misleading,
on the date such information is stated or certified.
(f) Eligible Receivables. Each Receivable at any time included in the Net
Receivables Balance as an Eligible Receivable at the time of any computation
hereunder shall in fact be an Eligible Receivable at such time.
(g) Actions, Suits. There are no actions, suits or proceedings pending, or
to the knowledge of the Borrower threatened, against or affecting the Borrower
or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or any Subsidiary of any ▇▇▇▇-▇▇▇▇▇▇ Entity or
any of their respective properties, in or before any Governmental Authority,
arbitrator or other body, which may materially adversely affect the financial
condition of the Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or the collectibility
of the Receivables or materially adversely affect the ability of any ▇▇▇▇-▇▇▇▇▇▇
Entity to perform its obligations under each of the Transaction Documents to
which it is (or is stated to be) a party; the Borrower is not in default with
respect to any contractual obligation or any order of any court, arbitrator or
Governmental Authority; and no ▇▇▇▇-▇▇▇▇▇▇ Entity nor any Subsidiary of any
▇▇▇▇-▇▇▇▇▇▇ Entity is in material default with respect to any material
contractual obligation or any order of any court, arbitrator or Governmental
Authority.
(h) No Material Adverse Change. Since September 30, 1998, there has been no
material adverse change in the financial condition, business, operations or
prospects of any ▇▇▇▇-▇▇▇▇▇▇ Entity, or in the ability of any ▇▇▇▇-▇▇▇▇▇▇ Entity
to perform its obligations hereunder or under any other Transaction Document or
in the collectibility of the Receivables.
(i) Credit and Collection Policy. The Borrower and each Originator has
complied in all material respects with the Credit and Collection Policy in
regard to each Receivable and related Contract and since September 30, 1998,
there has been no material change in such Credit and Collection Policy.
(j) Use of Proceeds. No proceeds of the Loans will be used by any
▇▇▇▇-▇▇▇▇▇▇ Entity to acquire any security in any transaction which is subject
to Section 13 or 14 of the Securities Exchange Act of 1934, as amended.
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(k) Place of Business. The chief place of business and chief executive
office of the Borrower and each Originator are located at the respective
addresses of each such Person set forth on Exhibit G and such offices have been
so located for six months prior to the date hereof.
(l) Lock-Box Arrangements. All Lock-Box Banks, Lock-Box numbers and Lock
Box Account numbers are listed on Exhibit C or described in a notice provided by
the Borrower to the Agent. The Borrower has sent a copy of all Lock-Box
Agreements to the Agent.
(m) Payments on Receivables. Each Obligor is required to send all payments
with respect to each Receivable (other than Tooling Receivables) to a Lock-Box
in the exclusive control of the Lock-Box Bank for deposit in a Lock-Box Account,
and no funds other than payments with respect to the Receivables (which may be
Tooling Receivables) are deposited in any such Lock-Box Account.
(n) Good Title. Upon the Loans and upon each Payment, the Agent shall have,
for the benefit of the Lenders, a valid and perfected first priority interest in
each item comprising the Secured Interest as it exists at the time of the Loans
or such Payment and in any additional property conveyed pursuant to Article II,
free and clear at all such times of any Adverse Claim.
(o) Names. Except as described in Exhibit H, the Borrower has not used any
corporate names, tradenames or assumed names other than its name set forth on
the signature pages of this Agreement.
(p) Coverage Requirement. The product of the Secured Interest (expressed as
a percentage) multiplied by the Net Receivables Balance equals or exceeds the
Coverage Amount.
(q) Net Worth. The Borrower has a positive tangible net worth of at least
One Million Dollars ($1,000,000) as determined in accordance with GAAP.
(r) Subsidiaries. The Borrower has no Subsidiaries and does not own or
hold, directly or indirectly, any capital stock or equity security of, or equity
interest in, any Person.
(s) Termination Event. No Termination Event or Potential Termination Event
has occurred and is continuing.
(t) 1933 and 1940 Acts. Each Receivable is an account receivable
representing all or part of the sale prices of merchandise, insurance and
services within the meaning of Section 3(c)(5) of the Investment Company Act of
1940, as amended, and a purchase price of each Receivable with the proceeds of
notes would constitute a "current transaction" within the meaning of Section
3(a)(3) of the Securities Act of 1933, as amended.
Section 4.2. Reaffirmation of Representations and Warranties. On each day
that a Payment is made hereunder, the Borrower, by accepting such Payment, shall
be deemed to have certified that (i) all representations and warranties
described in Section 4.1 are correct in all material respects on and as of such
day as though made on and as of such day and (ii) no event
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has occurred or is continuing, or would result from any such Payment, which
constitutes a Termination Event or a Potential Termination Event.
ARTICLE V
CONDITIONS PRECEDENT AND SUBSEQUENT
Section 5.1. Conditions to Closing. This Agreement shall become effective
on the first date (the "Effective Date") on which all of the conditions set
forth in this Section 5.1 shall have been satisfied. On or prior to the
Effective Date, the Borrower shall deliver to the Agent, with a copy to each
Lender, the following documents, instruments and opinions, all of which shall be
in form and substance acceptable to the Agent and each Lender:
(a) A certificate of the secretary or any assistant secretary of each
of the ▇▇▇▇-▇▇▇▇▇▇ Entities certifying (i) the names and signatures of the
officers authorized on its behalf to execute each Transaction Document to
which it is (or is stated to be) a party (on which certificate the Agent
and each Lender may conclusively rely until such time as the Agent and each
Lender shall receive from it a revised certificate meeting the requirements
of this Section 5.1(a)) and (ii) a copy of its by-laws.
(b) Such other approvals, opinions or documents as the Agent may
reasonably request.
(c) 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.
Section 5.2. Condition to Each Loan. Neither the Agent nor Windmill shall
have any obligation to make a Loan hereunder. No Bank shall have any obligation
to make any Loan, if at the time of such Loan and after giving effect thereto,
there shall exist a Termination Event or Potential Termination Event.
ARTICLE VI
COVENANTS
Section 6.1. Affirmative Covenants of the Borrower. The Borrower hereby
covenants, undertakes and agrees that at all times from the date hereof until
the termination of this Agreement pursuant to Section 11.1, unless the Agent,
with the consent of Windmill (at any time that the Windmill Loan Amount is
greater than zero), the Required Banks, shall otherwise consent in writing:
(a) Financial Reporting. The Borrower will maintain, and will cause
each ▇▇▇▇-▇▇▇▇▇▇ Entity to maintain, for itself and each of its
Subsidiaries, a system of account established and administered in
accordance with GAAP, and the Borrower will furnish to the Agent and to
each Lender:
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(i) Annual Financial Statements. Within one hundred twenty (120)
days after each fiscal year of the Parent (beginning with the fiscal
year ending December 31, 1997), copies of the annual audited financial
statement of the Parent certified by an independent certified public
accountant satisfactory to the Agent and prepared on a consolidated
basis in conformity with GAAP, together with the certificate described
in clause (iii) below. Within one hundred twenty (120) days after each
fiscal year of each of the ▇▇▇▇-▇▇▇▇▇▇ Entities (other than the
Parent), copies of the annual balance sheet for such ▇▇▇▇-▇▇▇▇▇▇
Entity and, in the case of the Borrower, an annual profit and loss
statement, in each case certified by a Designated Financial Officer of
such ▇▇▇▇-▇▇▇▇▇▇ Entity and prepared on a consolidated basis, together
with the certificate described in clause (iii) below.
(ii) Quarterly Financial Statement. Within forty-five (45) days
after each quarter (except the last quarter) of each fiscal year of
the Parent, copies of the unaudited financial statement of the Parent
prepared in the same manner as the report referred to in preceding
clause (i), signed by a Designated Financial Officer of the Parent and
consisting of at least a balance sheet as at the close of such quarter
and statements of earnings and source and application of funds for the
period from the beginning of such fiscal year to the close of such
quarter, together with the certificate described in clause (iii)
below. Within forty-five (45) days after each quarter (except the last
quarter) of each fiscal year of the Borrower, a quarterly balance
sheet and profit and loss statement of the Borrower for the period
from the beginning of such fiscal year to the close of such quarter
certified by a Designated Financial Officer of the Borrower, together
with the certificate described in clause (iii) below.
(iii) Officer's Certificate. Together with the balance sheet or
financial statements furnished with respect to the Borrower and the
Parent under preceding clauses (i) and (ii), a compliance certificate
in substantially the form of Exhibit J, signed by a Designated
Financial Officer of the Borrower or the Parent, as the case may be,
and dated the date of such annual balance sheet or financial statement
or such quarterly balance sheet or financial statement, as the case
may be, to the effect that no Termination Event or Potential
Termination Event has occurred and is continuing, or, if there is any
such event, describing it and the steps, if any, being taken to cure
it, and containing a computation of, and showing compliance with, each
of the financial ratios and restrictions contained in this Agreement
and the Indemnity Agreement respectively.
(iv) Other Information. Such other information (including
non-financial information) as the Agent or any Lender may from time to
time reasonably request.
(b) Notices. The Borrower will notify the Agent in writing of any of
the following immediately upon learning of the occurrence thereof,
describing the same and, if applicable, the steps being taken by the
Person(s) affected with respect thereto:
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(i) Termination Events or Potential Termination Events. The
occurrence of any Termination Event or Potential Termination Event,
and such notice shall include a statement of a Designated Financial
Officer of the Borrower, setting forth the date of such occurrence and
the nature thereof.
(ii) Representations and Warranties. The failure of any
representation or warranty to be true (when made or at any time
thereafter) in any material respect with respect to any Receivable.
(iii) Downgrading. Any lowering in the rating of any indebtedness
below the rating that it has on the date hereof of any Approved
Obligor or any ▇▇▇▇-▇▇▇▇▇▇ Entity or any Subsidiary of any of the
foregoing by any rating agency, setting forth the indebtedness
affected and the nature of such change.
(iv) Litigation. The institution of any litigation, arbitration
proceeding or governmental proceeding which is reasonably likely to be
material to any ▇▇▇▇-▇▇▇▇▇▇ Entity.
(v) Judgment. The entry of any judgment or decree against any
▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective Subsidiaries if the
aggregate amount of all judgments and decrees then outstanding against
the ▇▇▇▇-▇▇▇▇▇▇ Entities and their Subsidiaries exceeds Ten Million
Dollars ($10,000,000) after deducting (a) the amount with respect to
which any ▇▇▇▇-▇▇▇▇▇▇ Entity or any such Subsidiary is insured and
with respect to which the insurer has assumed responsibility in
writing, and (b) the amount for which any ▇▇▇▇-▇▇▇▇▇▇ Entity or any
such Subsidiary is otherwise indemnified if the terms of such
indemnification are satisfactory to the Agent.
Promptly upon receipt of any such notice, the Agent will deliver copies
thereof to each of the Lenders.
(c) Conduct of Business. The Borrower will, and will cause each other
▇▇▇▇-▇▇▇▇▇▇ Entity to, do all things necessary to remain duly incorporated,
validly existing and in good standing as domestic corporations in its
jurisdiction of incorporation and maintain all requisite authority to
conduct its business in each jurisdiction in which its business is
conducted.
(d) Compliance with Laws. The Borrower will, and will cause each other
▇▇▇▇-▇▇▇▇▇▇ Entity (in all material respects and in all respects that could
have an effect on the enforceability of any Transaction Document) to,
comply with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject.
(e) Furnishing of Information and Inspection of Records. The Borrower
will furnish to the Agent and the Lenders from time to time such
information with respect to the Receivables as the Agent or any Lender
shall reasonably request, including listings
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identifying the Obligor and the Outstanding Balance for each Receivable.
The Borrower will permit, at any time and from time to time either (i) upon
two (2) days prior notice or (ii) after the occurrence of a Potential
Termination Event or a Termination Event, during regular business hours,
the Agent or any Lender, or any of their respective agents or
representatives, (i) to examine and make copies of and abstracts from all
Records and (ii) to visit the offices and properties of the Borrower for
the purpose of examining such Records, and to discuss matters relating to
Receivables or the Borrower's performance hereunder with any of the
officers or employees of the Borrower having knowledge of such matters. The
agent will, within sixty (60) days of the receipt of the annual balance
sheet of the Borrower delivered pursuant to Section 6.1(a), utilize the
services of an independent certified public accounting firm or auditing
firm to conduct an annual audit of the Records of the Borrower and/or to
make test verifications of the Receivables (at the expense of the Borrower
pursuant to Section 9.4).
(f) Keeping of Records and Books.
(i) The Borrower will, and will cause each Originator as
sub-collection agent to, maintain and implement administrative and
operating procedures (including 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 records adequate to
permit the immediate identification of each new Receivable and all
Collections of and adjustments to each existing Receivable). The
Borrower will give the Agent notice of any material change in the
administrative and operating procedures referred to in the previous
sentence.
(ii) The Borrower will, and will cause each other ▇▇▇▇-▇▇▇▇▇▇
Entity to, keep true books of record and account of itself and its
Subsidiaries in which full, true and correct entries in accordance
with GAAP will be made of all dealings or transactions in relation to
its business and activities, including the setting up on its books,
from income, reserves which, on a consolidated basis, are adequate in
the judgment of such Person for obsolescence, depreciation, depletion
and amortization of its properties during each year.
(g) Separate Corporate Existence. The Borrower will take all actions
necessary to maintain its identity as a separate legal entity from each
other ▇▇▇▇-▇▇▇▇▇▇ Entity, including each of the activities listed on
Exhibit L.
(h) Performance and Compliance with Receivables and Contracts. The
Borrower will, and will cause each Originator to, at its expense timely and
fully 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.
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(i) Credit and Collection Policy. The Borrower will, and will cause
each Originator to, comply in all material respects with the Credit and
Collection Policy in regard to each Receivable and the related Contract.
Section 6.2. Negative Covenants of the Borrower. Until the termination of
this Agreement pursuant to Section 11.1, unless the Agent, with the consent of
Windmill (at any time that the Windmill Loan Amount is greater than zero), and
the Required Banks, shall otherwise consent in writing:
(a) Sales and Liens Relating to Receivables. Except as otherwise
provided herein, the Borrower will not transfer, convey, sell, assign (by
operation of law or otherwise) or otherwise dispose of, or create or suffer
to exist any Adverse Claim upon (including the filing of any financing
statement) or with respect to (i) any inventory or goods (other than sales
in the ordinary course of business), the sale of which may give rise to a
Receivable, (ii) any Receivable or (iii) any related Contract, Related
Security, Collection or Related Account with respect to any Receivable, or
assign any right to receive income in respect to any of the foregoing.
(b) Extension or Amendment of Receivables. Except as otherwise
permitted in Section 7.2, the Borrower will not extend, amend or otherwise
modify the terms of any Receivable, or amend, modify or waive any term or
condition of any Contract related thereto.
(c) Change in Business or Credit and Collection Policy. The Borrower
will not, and will not permit any Originator to, make any change in the
character of its business or in its Credit and Collection Policy, which
change would, in either case, impair the collectibility of any Receivable.
(d) Merger, etc. The Borrower will not merge with or into or
consolidate with or into, or convey, transfer, lease or otherwise dispose
of (whether in one transaction or in a series of transactions), any of its
assets (whether now owned or hereafter acquired), or acquire any of the
assets or capital stock or other ownership interest of, any Person (other
than in connection with asset dispositions and acquisitions contemplated
hereunder or in connection herewith or under or in connection with any of
the other Transaction Documents), or otherwise enter into any partnership
or joint venture arrangement with any other Person.
(e) Accounting of Sales under the Purchase Agreement. The Borrower
will not, nor will it permit any Originator to, prepare any financial
statements which shall account for the transactions contemplated by the
Purchase Agreement in any manner other than as a sale of Receivables by the
Originators to the Borrower, and will not in any other respect account for
or treat the transactions contemplated thereby (including but not limited
to for accounting and tax purposes) in any manner other than as a sale of
Receivables by the Originators to the Borrower.
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(f) Change in Purchase Agreement. The Borrower will not amend, modify,
waive or terminate any terms or conditions of the Purchase Agreement, which
right to amend, modify, waive or terminate has been assigned to the Agent
for the benefit of the Agent and the Lenders.
(g) Contingent Liabilities. The Borrower will not guarantee, endorse
or otherwise be or become contingently liable (including by agreement to
maintain balance sheet tests) in connection with the obligations of any
other Person, except endorsements of negotiable instruments for collection
in the ordinary course of business and reimbursement or indemnification
obligations in favor of the Agent or the Lenders as provided for under this
Agreement.
(h) Limitation on Investments. The Borrower will not make any
Financial Investment in any person, including any of its Affiliates, except
for:
(i) Permitted Investments; and
(ii) endorsements of instruments or items of payment for deposit
to the Borrower's bank accounts.
(i) Limitation on Transactions with Affiliates. The Borrower will not
enter into, or be a party to, any transaction with any Affiliate of the
Borrower, except for:
(i) the transactions contemplated by the Transaction Documents;
and
(ii) other transactions upon fair and reasonable terms materially
no less favorable to the Borrower than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate.
(j) Bank Accounts. The Borrower will not maintain any bank accounts
other than the Lock-Box Accounts and the Borrower Account.
(k) Expenditures. The Borrower will not make any expenditure (by
long-term or operating lease or otherwise) for capital assets (both realty
and personalty) or any other assets if such expenditure, when added to
other such expenditures made by the Borrower during the same calendar year
(including as contemplated by Section 6.2(n)) would, in the aggregate,
exceed Ten Thousand Dollars ($10,000).
(l) Incurrence of Indebtedness. The Borrower shall not incur, assume,
suffer to exist or otherwise become or remain directly or indirectly liable
with respect to any Indebtedness other than (i) Indebtedness to the Agent
or any Lender pursuant to the terms and provisions of this Agreement, (ii)
Indebtedness to the Collection Agent hereunder or, if it is then serving as
Collection Agent, to any Originator in its capacity as sub-collection agent
for the amount of any reasonable collection agency fee, (iii) Indebtedness
to each Originator (that is payable solely to the extent that the Borrower
has funds that are not necessary to satisfy any obligation hereunder) in
connection with the purchase of such
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Originator's receivables pursuant to the terms and provisions of the
Purchase Agreement and (iv) Indebtedness to any ▇▇▇▇-▇▇▇▇▇▇ Entity that is
expressly subordinated to Indebtedness to the Agent and the Lenders on
terms satisfactory to the Agent.
(m) Prohibition of Dividends. The Borrower will not declare any
dividends on, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, retirement
or other acquisition of any shares of stock of the Borrower, whether now or
hereafter outstanding, or make any other distribution in respect thereof,
either directly or indirectly, whether in cash or property or in
obligations of the Borrower.
(n) Business Activities. The Borrower will not carry on any business
or engage in any business transactions other than the business and
transactions contemplated by or related to this Agreement or the other
Transaction Documents or incidental to the purposes hereof. The Borrower
will not be a party to any documents, agreements or instruments other than
the Transaction Documents and any office or equipment leases necessary in
connection herewith or incidental to the purposes hereof which office or
equipment leases shall not create or evidence an obligation of the Borrower
that, when added to the other expenditures made by the Borrower during the
same calendar year (including as contemplated by Section 6.2(k)) would, in
the aggregate, exceed Ten Thousand Dollars ($10,000).
(o) Net Worth. The Borrower shall, at all times, have a tangible net
worth of not less than One Million Dollars ($1,000,000) determined in
accordance with GAAP.
ARTICLE VII
ADMINISTRATION AND COLLECTIONS
Section 7.1. Appointment of Collection Agent. (a) The servicing,
administering and collection of the Receivables shall be conducted by the Person
(the "Collection Agent") so designated from time to time in accordance with this
Section 7.1. Initially, ▇▇▇▇-▇▇▇▇▇▇ Automotive Inc., shall be the Collection
Agent. Until the Agent gives notice to the Borrower (in accordance with this
Section 7.1) of the designation of a new Collection Agent, the Parent is hereby
designated as, and hereby agrees to perform the duties and obligations of, the
Collection Agent pursuant to the terms hereof. Either (i) upon thirty (30) days
prior written notice to the Borrower or (ii) upon the occurrence and during the
continuance of a Termination Event, the Agent may designate as Collection Agent
any Person (including itself or any Bank) to succeed the Parent or any successor
Collection Agent, on the condition in each case that any such Person so
designated shall agree to perform the duties and obligations of the Collection
Agent. Whether or not it is then serving as Collection Agent, upon the
occurrence and during the continuance of a Termination Event, the Agent may
notify any Obligor of the transfer to the Agent of the Secured Interest.
(b) In the case of Receivables arising out of the sale or lease of goods or
the rendering of services by any Originator, the Parent may, and if requested by
the Agent shall, delegate its duties and obligations as Collection Agent with
respect to such Receivables to such Originator
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(acting as sub-collection agent), on the condition in each case that such
Originator shall agree in writing to perform the duties and obligations of the
Collection Agent; provided, however, that notwithstanding such delegation, the
Parent shall remain primarily liable to the Agent and the Lenders for the
performance of the duties and obligations so delegated and the Agent and each
Lender shall have the right to look solely to the Parent for such performance;
provided, further, however, that either (i) upon thirty (30) days prior written
notice to the Parent or (ii) upon the occurrence and during the continuance of a
Termination Event, the Agent may replace an Originator as sub-collection agent.
(c) The Parent agrees that it will terminate its activities as Collection
Agent and cause each Originator to terminate such Originator's activities as
sub-collection agent in a manner which the Agent determines will facilitate the
transition of the performance of such activities to the new Collection Agent,
and the Parent shall cooperate with and assist such new Collection Agent. Such
cooperation shall include access to, and transfer of, all Records and use by the
new Collection Agent of all licenses, hardware or software necessary or
desirable to collect the Affected Assets if permitted or not prohibited by the
applicable contract. The Parent hereby agrees that if at any time it shall cease
to be the Collection Agent, it shall act (if the then current Collection Agent
so requests) as the data-processing agent of the Collection Agent and, in such
capacity, the Parent shall conduct the data-processing functions of the
administration of the Receivables and the Collections in substantially the same
way that the Parent conducted such data-processing functions while it acted as
the Collection Agent.
(d) The Parent acknowledges that the Agent and each Lender have relied on
the Borrower's agreement to act as Collection Agent and on each Originator's
agreement to act as sub-collection agent with respect to Receivables originated
by each such Originator in making their decision to execute and deliver this
Agreement. Accordingly, the Parent agrees that it will not voluntarily resign as
Collection Agent nor will it permit any Originator to voluntarily resign as a
sub-collection agent.
Section 7.2. Duties of Collection Agent. (a) The Collection Agent shall
take or cause to be taken all such action as may be necessary or advisable to
collect each Receivable from time to time, all in accordance with this Agreement
and all applicable laws, rules and regulations, with reasonable care and
diligence, and in accordance with the Credit and Collection Policy. Each of the
Borrower, the Agent and each Lender hereby appoints as its agent the Collection
Agent, from time to time designated pursuant to Section 7.1, to enforce its
respective rights and interests in and under the Affected Assets. The Collection
Agent shall set aside for the accounts of the Borrower, the Agent, the Lenders
and any other Person entitled thereto the amount of the Collections to which
each is entitled in accordance with Article III. If the amount of the
Collections held by the Collection Agent is not sufficient to pay the amount to
which a group or class of the Lenders are entitled hereunder, the Collection
Agent shall distribute such Collections as provided in Article III on a pro rata
basis according to the respective claims of each of the members of such class or
group. If instructed by the Agent, the Collection Agent shall segregate and
deposit with the Agent the amount of Collections to which all Lenders are
entitled pursuant to Article III, on the first (1st) Business Day following
receipt by the Collection Agent of such Collections and the Agent shall
distribute such amounts in accordance with Article III. So long as no
Termination Event shall have occurred and be continuing, the Parent, while it is
the
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Collection Agent may, in accordance with the Credit and Collection Policy,
extend the maturity of any Receivable (but not beyond thirty (30) days) and
extend the maturity or adjust the Outstanding Balance of any Defaulted
Receivable as the Collection Agent may determine to be appropriate to maximize
Collections thereof; provided, however, that such extension or adjustment shall
not alter the status of such Receivable as a Delinquent Receivable or a
Defaulted Receivable or limit the rights of the Agent or the Lenders under any
other provision of this Agreement. If a Termination Event has occurred and the
Parent is still serving as Collection Agent, the Parent may make such extension
or adjustment only upon the prior written approval of the Agent and the Lenders.
The Borrower shall deliver to the Collection Agent and the Collection Agent
shall hold in trust for the benefit of the Borrower, the Agent and the Lenders
in accordance with their respective interests, all Records with respect to each
Receivable. Notwithstanding anything to the contrary contained herein, the Agent
shall have the absolute, unlimited and unconditional right to, and may, direct
the Collection Agent (whether the Collection Agent is the Parent or any other
Person) to commence or settle any legal action to enforce collection of any
Receivable or to foreclose upon or repossess any Related Security; provided,
however, that no such direction may be given unless either (i) a Potential
Termination Event or a Termination Event has occurred and is continuing
hereunder or (ii) such legal action, foreclosure or repossession shall affect a
material portion of the Receivables.
(b) The Collection Agent shall, as soon as practicable following receipt,
turn over to the Borrower (i) that portion of all Collections which is not part
of the Secured Interest, less, in the event the Parent is not the Collection
Agent, all reasonable and appropriate out-of-pocket costs and expenses of such
Collection Agent of servicing, collecting and administering the Receivables and
(ii) the collections of any indebtedness that is not a Receivable; provided,
however, that if the Parent is not the Collection Agent, the Collection Agent
shall not be under any obligation to remit any such funds to the Borrower unless
and until the Collection Agent has received from the Borrower evidence
satisfactory to the Agent and the Collection Agent that the Borrower is entitled
to such funds hereunder and under applicable law. The Collection Agent, if other
than the Parent, shall as soon as practicable upon demand, deliver to the
Borrower all records in its possession which evidence or relate to any
indebtedness that is not a Receivable, and copies of Records in its possession
which evidence or relate to any indebtedness that is a Receivable.
(c) Notwithstanding anything to the contrary contained in this Article VII,
the Collection Agent, if not the Parent, shall have no obligation to collect,
enforce or take any other action described in this Article VII with respect to
any indebtedness that is not a Receivable other than to deliver to the Borrower
the collections and records with respect to any such indebtedness as described
in Section 7.2(b).
Section 7.3. Lock-Box Arrangements. The Agent is hereby authorized by all
of the other parties hereto, and it is hereby agreed to by such other parties
that the Agent shall be entitled, whether or not it is then serving as
Collection Agent, to, at any time, do any or all of the following: (i) give
notice to each Lock-Box Bank that the Agent is exercising its rights under the
Lock-Box Letters, (ii) have the exclusive ownership and control of the Lock-Box
Accounts (and all funds deposited, or to be deposited, therein) transferred to
the Agent and to exercise exclusive dominion and control over the funds
deposited therein, (iii) have the proceeds that are sent to the
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respective Lock-Boxes be redirected pursuant to its instructions rather than
deposited in the applicable Lock-Box Account, and (iv) take all other actions
permitted under such Lock-Box Letter. If the Agent, at any time, takes the
actions set forth in the preceding sentence, the Agent shall have exclusive
ownership and control of the accounts and post office boxes to which the
Obligors shall make payments and in which Collections may be concentrated and
control of the proceeds (including Collections) of all Receivables and the
Borrower agrees to take any action that the Agent may reasonably request to
transfer such control. In case any authorized signatory of the Borrower whose
signature shall appear on any Lock-Box Letter shall cease to have such authority
before the delivery of such Lock-Box Letter, such signature shall nevertheless
be valid and sufficient for all purposes as if such authority had remained in
force at the time of such delivery. Any proceeds of Receivables received by the
Borrower thereafter shall be sent immediately to the Agent. The parties hereto
acknowledge that if at any time the Agent takes control of any Lock-Box Account,
the Agent shall not have any rights to the funds therein in excess of the
Aggregate Unpaids and the Agent shall distribute or cause to be distributed such
funds in accordance with Section 7.2(b) and Article II; provided, however, that
the Agent shall not be under any obligation to remit any such funds to the
Borrower or any other Person unless and until the Agent has received from the
Borrower or such Person evidence satisfactory to the Agent that the Borrower or
such Person is entitled to such funds hereunder and under applicable law. In the
event that the Agent shall then be receiving disbursements from a Lock-Box
Account, whether because it is then the Collection Agent or because it has
submitted Lock-Box Letters or for any other reason, the Agent shall promptly
remit to the Borrower any amounts received by it from a Lock-Box Bank (i) upon
its receipt of evidence reasonably satisfactory to it that such amounts do not
constitute Collections with respect to Receivables or the proceeds of other
Affected Assets and (ii) to the extent of the Borrower's residual interest, if
any, therein after accounting for each Interest. In determining whether the
Borrower has, in any instance, presented reasonably satisfactory evidence of its
ownership of items that do not constitute Collections or the proceeds of other
Affected Assets, the Agent shall be entitled to the presumption that, in respect
of any collections or other items for which the remitting Obligor has not
expressly indicated its intended application on the face of the payment item or
the accompanying documentation, the appropriate application thereof shall be to
Receivables of such Obligor, and thus subject to the Secured Interest hereunder,
and, if there shall be more than one Receivable of such Obligor, to the oldest
first.
Section 7.4. Enforcement Rights. (a) At any time following the designation
of a Collection Agent (other than the Borrower or any of the Borrower's
Affiliates) pursuant to Section 7.1:
(i) Upon the occurrence and during the continuance of a Termination
Event, the Agent may direct the Obligors and the Lock-Box Banks that
payment of all amounts payable under any Receivable be made directly to the
Agent or its designee. The Agent may, and the Borrower shall at the Agent's
request, withhold the identity of the Lenders from any Lock-Box Bank or
Obligor.
(ii) Upon the occurrence and during the continuance of a Termination
Event, the Agent may instruct the Borrower to give, and upon such request
the Borrower shall give, at the Borrower's expense notice of the Agent's
ownership of the Secured Interest,
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to each Obligor and direct that payments be made directly to the Agent or
its designee. The Borrower shall, at the Agent's request, withhold the
identity of the Lenders in any such notification.
(iii) The Agent may request the Borrower to, and upon such request the
Borrower shall, (A) assemble all of the Records, the Related Security and
transfer, or license the use of, to the new Collection Agent all software
necessary or desirable to collect the Receivables and the Related Security,
and shall make the same available to the Agent or its designee at a place
selected by the Agent, and (B) segregate all cash, checks and other
instruments received by it from time to time constituting Collections with
respect to the Receivables in a manner acceptable to the Agent and shall,
promptly upon receipt, remit all such cash, checks and instruments, duly
endorsed or with duly executed instruments of transfer, to the Agent or its
designee.
(b) The Borrower hereby authorizes, and irrevocably appoints, the Agent as
its attorney-in-fact coupled with an interest, with full power of substitution
and with full authority in the place and stead of the Borrower, to take any and
all steps in the name of the Borrower and on behalf of the Borrower necessary or
desirable, in the determination of the Agent, (i) to collect any and all amounts
or portions thereof due under any and all Receivables or Related Security,
including endorsing the name of the Borrower on checks and other instruments
representing Collections and enforcing such Receivables, Related Security and
the related Contracts and (ii) upon the occurrence and during the continuance of
a Termination Event, to exercise any and all of the Borrower's rights and
remedies under the Purchase Agreement and the Limited Guaranty. The Borrower's
conferring of powers upon the Agent under this Section 7.4(b) shall not subject
the Agent to any liability if any action taken by it shall prove to be
inadequate or invalid, nor shall they confer any obligations upon the Agent in
any manner whatsoever.
(c) Neither the Agent nor the Lenders shall have any obligation to take any
action or commence any proceedings to realize upon any Receivable (including any
Defaulted Receivables) or to enforce any of their respective rights, powers,
privileges or remedies with respect thereto.
Section 7.5. Responsibilities of the Borrower. (a) Anything herein to the
contrary notwithstanding, the Borrower shall, and shall cause each Originator
to, (i) perform all of its obligations under the Contracts related to the
Receivables to the same extent as if interests in such Receivables had not been
transferred hereunder and the exercise by the Agent or any Lender of its rights
hereunder shall not relieve the Borrower from such obligations, and (ii) pay
when due any and all Taxes, including any and all sales Taxes payable in
connection with the Receivables and their creation and satisfaction. The Agent
and the Lenders shall not have any obligation or liability with respect to any
Receivable, any Related Security or any related Contract, nor shall any of them
be obligated to perform any of the obligations of the Borrower under any of the
foregoing.
(b) The Borrower irrevocably agrees that if at any time it shall cease to
be the Collection Agent, it shall act (if the then current Collection Agent so
requests) as the data-processing agent of the Collection Agent and, in such
capacity, the Borrower shall conduct the
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data-processing functions of the administration of the Receivables and the
Collections in substantially the same way that the Borrower conducted such
data-processing functions while it acted as the Collection Agent.
Section 7.6. Collection Agent Fee. On or prior to the twenty-fifth (25th)
day of each month, the Borrower shall pay to the Collection Agent the Collection
Agent Fee with respect to the immediately preceding month as compensation for
its services. The Collection Agent may apply only Collections that are not part
of the Secured Interest (or that have been reinvested pursuant to Section
2.1(d)) to the payment of the Collection Agent Fee. The Agent may, in its sole
and absolute discretion with the prior written consent of the Required Banks and
Windmill, pay all or any portion of the Collection Agent Fee to the Collection
Agent from Collections that are part of the Secured Interest. Any Collections so
applied by the Agent pursuant to the immediately preceding sentence shall not be
distributed to the Lenders or to any other Person pursuant to Section 3.3.
Section 7.7. Indemnities by the Collection Agent. Without limiting any
other rights any Person may have hereunder or under applicable law, the
Collection Agent hereby indemnifies and holds harmless the Agent and each Lender
and their respective officers, directors, agents and employees (each an
"Indemnified Party") from and against any and all damages, losses, claims,
liabilities, penalties, Taxes, costs and expenses (including attorneys' fees and
court costs) (all of the foregoing collectively, the "Indemnified Losses") at
any time imposed on or incurred by any Indemnified Party arising out of or
otherwise relating to:
(i) any written representation or warranty made by the Collection
Agent (or any employee or agent of the Collection Agent) in this Agreement,
any other Transaction Document, any Periodic Report or any other
information or report delivered by the Collection Agent pursuant hereto,
which shall have been false or incorrect in any material respect when made;
(ii) the failure by the Collection Agent to comply with any applicable
law, rule or regulation related to any Receivable, or the nonconformity of
any Receivable with any such applicable law, rule or regulation;
(iii) any loss of a perfected security interest (or in the priority of
such security interest) as a result of any commingling by the Collection
Agent of funds to which the Agent or any Lender is entitled hereunder with
any other funds; or
(iv) any failure of the Collection Agent, to perform its duties or
obligations in accordance with the provisions of this Agreement or any
other Transaction Document to which the Collection Agent is a party;
whether arising by reason of the acts to be performed by the Collection Agent
hereunder or otherwise, excluding only Indemnified Losses to the extent (a) such
Indemnified Losses resulted solely from negligence or willful misconduct of the
Indemnified Party seeking indemnification, (b) solely due to the credit risk of
the Obligor and for which reimbursement would constitute recourse to the
Collection Agent for uncollectible Receivables, (c) such Indemnified Losses
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include Taxes on, or measured by, the overall net income of the Agent or any
Lender computed in accordance with the Intended Characterization, (d) the
applicable Originator is the plaintiff and the Indemnified Party is the
defendant unless such Indemnified Party prevails in such legal action or (e)
such Indemnified Losses arise from events occurring after another Person has
been designated as a successor Collection Agent; provided, however, that nothing
contained in this sentence shall limit the liability of the Collection Agent or
limit the recourse of the Agent and each Lender to the Collection Agent for any
amounts otherwise specifically provided to be paid by the Collection Agent
hereunder.
ARTICLE VIII
TERMINATION EVENTS
Section 8.1. Termination Events. The occurrence of any one or more of the
following events shall constitute a Termination Event:
(a) (i) the Collection Agent (or any sub-collection agent) shall fail
to perform or observe any term, covenant or agreement hereunder (other than
as referred to in clause (ii) of this Section 8.1(a)) and such failure
shall remain unremedied for three (3) Business Days or (ii) either the
Collection Agent or the Borrower shall fail to make any payment or deposit
to be made by it hereunder when due; or
(b) the Borrower shall default in the observance or performance of any
agreement contained in Sections 5.2 or 6.2 or the Parent shall default in
the observance or performance of any financial covenant set forth in the
Indemnity Agreement; or
(c) any representation, warranty, certification or statement made by
any ▇▇▇▇-▇▇▇▇▇▇ Entity in this Agreement or in any other Transaction
Document shall prove to have been incorrect in any material respect when
made or deemed made; provided, however, that, with respect to any
representation, warranty, certification or statement made pursuant to
Section 4.1(p) which shall prove to have been incorrect in any material
respect when made or deemed made, a Termination Event shall only occur if
such incorrect representation, warranty, certification or statement remains
incorrect for more than one (1) day; or
(d) any ▇▇▇▇-▇▇▇▇▇▇ Entity shall default in the performance of any
undertaking hereunder or under any other Transaction Document (other than
those covered by Section 7.1(a) or 7.1(b)) and such default shall continue
for ten (10) days; or
(e) failure of any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective
Subsidiaries to pay any Indebtedness when due (except for any such payments
on account of any such Indebtedness in any aggregate principal amount at
any one time outstanding of up to Ten Million Dollars ($10,000,000)); or
the default by any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective
Subsidiaries in the performance of any term, provision or condition
contained in any agreement under which any Indebtedness (except for any
such Indebtedness in an aggregate principal amount at any one time
outstanding of up to Ten Million Dollars ($10,000,000)) was created or is
governed, the effect of which is to cause such
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Indebtedness to become due prior to its stated maturity; or any
Indebtedness 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; or there shall occur a default, termination event or
similar event by or with respect to any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their
respective Subsidiaries under any agreement providing for the sale,
transfer or conveyance by any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective
Subsidiaries of any of its financial assets; or
(f) (i) any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective Subsidiaries
shall make a general assignment for the benefit of creditors; or any
proceeding shall be instituted by or against any ▇▇▇▇-▇▇▇▇▇▇ Entity or any
of their respective 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 which remains unvacated or unstayed for a period of 30
days or (ii) any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective Subsidiaries
shall take any corporate action to authorize any of the actions set forth
in clause (i) above in this Section 8.1(f); or
(g) any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective 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
(h) the Delinquency Ratio at any time shall exceed six and one half
percent (6.5%), the Default Ratio at any time shall exceed four percent
(4%), or the Loss-to-Liquidation Ratio at the end of any calendar month
measured for the three (3) month period then ending shall exceed one
percent (1%); or
(i) the Secured Interest (expressed as a percentage) multiplied by the
Net Receivables Balance at any time exceeds 100%at such time and such
failure shall continue for one (1) day after the Borrower has knowledge
thereof; or
(j) there shall occur a material adverse change in the financial
condition, business, operations or prospects of the Parent and its
Subsidiaries taken as a whole or in the Borrower, or in the ability of any
▇▇▇▇-▇▇▇▇▇▇ Entity to perform its obligations under any Transaction
Document to which it is (or is stated to be) a party, including, but not
limited to, the collection of the Receivables or in the collectibility of
the Receivables; or
(k) any ▇▇▇▇-▇▇▇▇▇▇ Entity shall, directly or indirectly, disaffirm or
contest in any manner the effectiveness, validity, binding nature or
enforceability of any of the Transaction Documents, or any of the
Transaction Documents shall fail to be the binding and enforceable
obligation of any ▇▇▇▇-▇▇▇▇▇▇ Entity that is (or is stated to be) a party
thereto; or
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(l) the Parent shall cease to own or control, directly or indirectly,
one hundred percent (100%) of the issued and outstanding voting stock of
the Borrower and each Originator or the Parent shall enter into any
agreement or take any action that would result in such event; or
(m) individuals who constitute the board of directors of the Parent on
the Effective Date (or individuals whose election or nomination for
election was approved by a vote of at least seventy-five percent (75%) of
the directors then in office who either were directors on the Effective
Date or whose election was previously so approved) cease for any reason to
constitute at least a majority of the board of directors of the Parent at
any time; or
(n) any ▇▇▇▇-▇▇▇▇▇▇ Entity shall (i) sell, convey, transfer or
otherwise dispose of all or any substantial part of its assets in a single
transaction or in a series of related transactions or (ii) enter into any
transaction of merger or consolidation (other than a merger or
consolidation with respect to any Originator in which such Originator is
the surviving Person); or
(o) the financial condition of the Parent shall be materially
different than the most-recent written projections of the financial
condition of the Parent given by any ▇▇▇▇-▇▇▇▇▇▇ Entity to the Agent on or
prior to the date hereof; or
(p) there shall be any amendment to the certificate of incorporation
of the Borrower without the prior written consent of the Agent and the
Required Banks; or
(q) the Purchase Agreement shall fail to vest and maintain vested in
the Borrower a valid first priority perfected ownership interest in the
receivables (other than receivables the Obligor of which is a government or
governmental subdivision or agency to the extent that the transfer thereof
requires compliance with any federal laws of the USA) and other assets
purported to be sold thereunder; or
(r) this Agreement shall fail to vest and maintain vested in the Agent
for the benefit of the Lenders a valid first priority perfected interest in
the Secured Interest.
If (x) such event is a Termination Event described in Section 8.1(f) with
respect to any ▇▇▇▇-▇▇▇▇▇▇ Entity or any of their respective Subsidiaries, then
automatically all of the Bank Commitments to purchase Bank Interests shall
thereupon terminate without notice of any kind, which is hereby waived by the
Borrower, and (y) such event is any other Termination Event, then the Agent may,
and at the direction of the Required Banks shall, by notice to the Borrower
terminate all of the Bank Commitments to purchase Bank Interests. Upon the
termination of all of the Bank Commitments to purchase Bank Interests, whether
pursuant to this Article VIII or otherwise, and the collection or other final
resolution of the Secured Interest such that the Aggregate Unpaids and the Loan
Amount in respect of each Lender shall have been reduced to zero, the Agent
shall, at the expense of the Borrower, execute such UCC termination statements
and such other documents as the Borrower may reasonably request to evidence the
termination of the Secured Interest. It is expressly understood that the
termination of the Bank Commitments
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under this Section 8.1 shall relate solely to the commitment of the Banks to
make purchases from the Borrower. No termination of the Bank Commitments under
this Section 8.1 shall waive, release or otherwise affect the commitment of the
Banks to make purchases from Windmill under Article III.
ARTICLE IX
INDEMNIFICATION
Section 9.1. Indemnities by the Borrower. Without limiting any other rights
that the Agent or any Lender may have hereunder or under applicable law, the
Borrower hereby agrees to indemnify the Agent and each Lender and its respective
officers, directors, agents and employees (each an "Indemnified Party") from and
against any and all damages, losses, claims, liabilities, costs and expenses,
including reasonable attorneys' fees (which such attorneys may be employees of
the Agent, any Lender, or any assignee, if any) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Losses") awarded
against or incurred by any of them arising out of or as a result of this
Agreement or any other Transaction Document or the acquisition, either directly
or indirectly, by the Agent, for the benefit of the Lenders, of the Secured
Interest or in respect of any action taken by the Borrower or any Originator
(whether acting as Collection Agent or otherwise) relative to any Receivable,
excluding, however, (i) Indemnified Losses to the extent final judgment of a
court of competent jurisdiction holds such Indemnified Losses resulted solely
from gross negligence or willful misconduct on the part of the Indemnified Party
seeking indemnification or (ii) Indemnified Losses to the extent the same
include losses in respect of uncollectible Receivables solely due to the credit
risk of the Obligor and reimbursement therefor would constitute recourse to the
Borrower or the Collection Agent for the amount of uncollectible Receivables;
provided, however, that nothing contained in this sentence shall limit the
liability of the Borrower or the Collection Agent or limit the recourse of the
Agent and each Lender to the Borrower or the Collection Agent for any amounts
otherwise specifically provided to be paid by the Borrower or the Collection
Agent under the terms of this Agreement, including under the terms of the next
succeeding sentence. Without limiting the generality of the foregoing
indemnification, the Borrower shall indemnify the Agent and each Lender for
Indemnified Losses (including losses in respect of uncollectible Receivables,
regardless of whether reimbursement therefor would constitute recourse to the
Borrower or the Collection Agent) relating to or resulting from:
(a) the transfer to the Agent, for the benefit of the Lenders, of an
undivided percentage interest in any Receivable other than an Eligible
Receivable, if, on the date of the most recent transfer of any interest in
a Receivable or a transfer of an Interest from one Lender to another
Lender, the product of the Secured Interest multiplied by the Net
Receivables Balance was less than the Coverage Amount;
(b) any representation or warranty made by any ▇▇▇▇-▇▇▇▇▇▇ Entity or
the Collection Agent (or any officers of any ▇▇▇▇-▇▇▇▇▇▇ Entity or the
Collection Agent) under or in connection with any of the Transaction
Documents, including any Periodic Report or any other information or report
delivered by any ▇▇▇▇-▇▇▇▇▇▇ Entity or the Collection Agent pursuant hereto
or thereto, that shall have been false or incorrect in any material respect
when made or deemed made;
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(c) any alleged failure by the Borrower, the Collection Agent (if the
Collection Agent is the Borrower or any Affiliate of the Borrower), any
Originator or any other Person (acting for, on behalf of, or together with,
the Borrower or the Collection Agent (if the Collection Agent is the
Borrower or any Affiliate of the Borrower)) to comply with any applicable
law, rule or regulation with respect to any Receivable, or the
collectability thereof, or any Contract related thereto, or imposed by any
governmental or regulatory body, including any requirements of licensing,
registration, authorizations, consents and approvals necessary or desirable
to enter into any Contract or create any Receivable or the transfer to the
Agent for the benefit of the Lenders hereunder and including laws, rules
and regulations relating to usury, disclosures, truth in lending, fair
credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices, trade practices, consumer protection and privacy, or
any of the foregoing which may affect the enforceability of any Receivable,
or the nonconformity of any Receivable or Contract included therein or
transfer to the Agent, for the benefit of the Lenders, with any such
applicable law, rule or regulation;
(d) the failure of the Borrower to vest and maintain vested in the
Agent, for the benefit of the Lenders, a perfected interest in the Secured
Interest and the property conveyed pursuant to Section 2.8, free and clear
of any Adverse Claim;
(e) the failure of the Borrower to vest and maintain vested in the
Agent, for the benefit of the Lenders, a perfected security interest in all
of the property listed in Sections 2.1(d) and 2.8, free and clear of any
Adverse Claim;
(f) the failure of any Originator to vest and maintain vested in the
Borrower a perfected ownership interest in and to the Purchased Assets free
and clear of any Adverse Claim;
(g) the failure of the Borrower, the Collection Agent, any Originator
or any sub-collection agent to file, 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 the Filing
Assets;
(h) any commingling of funds to which the Agent or any Lender is
entitled hereunder with any other funds;
(i) failure of any Lock-Box Bank to comply with the terms of the
applicable Lock-Box Letter;
(j) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
included in the Affected Assets (including a defense based on such
Receivable or the Contract relating to such Receivable 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 or
lease of goods or the rendering of services related to such Receivable or
the furnishing or failure to furnish any such goods or services;
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(k) any failure of any ▇▇▇▇-▇▇▇▇▇▇ Entity to perform its duties or
obligations in accordance with the provisions of this Agreement and each of
the other Transaction Documents to which such ▇▇▇▇-▇▇▇▇▇▇ Entity is (or is
stated to be) a party;
(1) any action taken by the Agent as attorney-in-fact for the Borrower
pursuant to Section 7.4(b); or
(m) any environmental liability claim, products liability claim or
personal injury or property damage suit or other similar or related claim
or action of whatever sort, whether sounding in tort, contract or other
legal theory, arising out of or in connection with any Receivable or the
Related Security therefor or any other suit, claim or action of whatever
sort relating to any of the Transaction Documents;
provided, however, that if any Lender enters into agreements for the transfer of
interests in receivables from one or more other Persons ("Other Borrowers"),
such Lender shall allocate such Indemnified Losses that are attributable to the
Borrower and to the Other Borrowers to the Borrower and to each Other Borrower;
and provided, further, that if such Indemnified Losses are attributable to the
Borrower and not attributable to any Other Borrower, the Borrower shall be
solely liable for such Indemnified Losses, or if such Indemnified Losses are
attributable to Other Borrowers and not attributable to the Borrower, such Other
Borrowers shall be solely liable for such Indemnified Losses.
Section 9.2. Tax Indemnification and Characterization. (a) The Borrower
hereby agrees to pay, and to indemnify, protect, save and hold harmless, on an
after-Tax basis, the Agent and each Lender from and against any and all (i)
Taxes that may at any time be imposed or asserted by reason of, in connection
with or in respect of the Receivables or any transactions contemplated hereby or
by any of the Transaction Documents or the receipt of payment under this Section
9.2, whether imposed on the Agent, any Lender, the Borrower, the Receivables,
any other corporation or entity or otherwise, and whether arising by reason of
the acts to be performed by the Borrower hereunder or otherwise and (ii)
damages, losses, claims, liabilities and related costs and expenses of the Agent
and each Lender in connection with the imposition or assertion of any Tax
described in clause (i) above; provided, however, this Section 9.2(a) shall not
apply with respect to Taxes on or measured by the overall net income of the
Agent or any Lender ("Income Taxes") to the extent that the computation of such
Income Taxes is consistent with the Intended Characterization.
(b) In addition to and not in limitation of the indemnifications contained
in Section 9.2(a), the Borrower hereby agrees to pay to, and to indemnify,
protect, save and hold harmless, the Agent and each Lender, on an after-Tax
basis from and against, (i) the excess of (x) the aggregate state and local
Taxes on or measured by net income or profits (and Taxes in lieu thereof)
payable by the Agent and any Lender in connection with or in respect of the
Receivables or any transactions contemplated hereby or the receipt of payment
under this Section 9.2, over (y) the amount of such state and local Income Taxes
that would have been payable on the Agent's and any Lender's net income in
connection with or in respect of the Receivables or any transactions
contemplated hereby, had the entire amount of such income been subject to Tax in
the jurisdiction in which the Agent's and any Lender's respective principal
executive office is
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located, and only in such jurisdiction and (ii) any and all damages, losses,
claims, liabilities and related costs and expenses of the Agent and each Lender
in connection with clause (i) above.
(c) It is the intention of the parties hereto that for the purposes of all
Taxes, the transactions with respect to the Borrower, the Agent and the Lenders
contemplated hereby shall be treated as a loan by the Agent (on behalf of the
Lenders) or the Lenders to the Borrower that is secured by the Receivables (the
"Intended Characterization"). The parties hereby agree to report such
transactions for the purposes of all Taxes, and otherwise to act for the
purposes of all Taxes, in a manner consistent with the Intended
Characterization.
(d) All payments due pursuant to this Section 9.2 shall be paid no later
than ten (10) days after demand for such payment has been made by the Agent or
any Lender. Without in any way limiting the Agent's and any Lender's remedies,
any such amount not paid when due shall bear interest at a rate equal to the ABN
AMRO Prime Rate plus two percent (2%) per annum. Any claim that the Agent or any
Lender makes for payment pursuant to this Section 9.2 shall be accompanied by a
statement of the Agent's or such Lender's accountants which attests that the
claim has been computed in conformity with the requirements of this Section 9.2.
Section 9.3. Increased Cost and Reduced Return. If after the date hereof,
the adoption of any applicable law, rule or regulation, 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 by any Windmill Funding
Source, the Agent or any Lender with any request or directive (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency (a "Regulatory Change"): (i) shall subject any Windmill
Funding Source, the Agent or any Lender to any charge or withholding on or with
respect to the applicable Funding Agreement or this Agreement in connection with
the Secured Interest or other property conveyed hereunder or funds advanced in
connection therewith, or such Person's obligations under the applicable Funding
Agreement or this Agreement, as the case may be, or shall change the basis of
taxation of payments to any Windmill Funding Source, the Agent or any Lender of
any amounts payable under the applicable Funding Agreement or this Agreement, as
the case may be (except for changes in the rate of Tax on the overall net income
of such Windmill Funding Source, the Agent or any Lender), (ii) shall impose,
modify or deem applicable any reserve, assessment, insurance charge, special
deposit or similar requirement against assets of, deposits with or for the
account of any Windmill Funding Source, the Agent or any Lender, or credit
extended by such Person or (iii) shall impose any other condition, and the
result of any of the foregoing is to impose a cost on or increase the cost to
any Windmill Funding Source, the Agent or any Lender of its commitment under the
applicable Funding Agreement or hereunder, as the case may be, or purchasing,
maintaining or funding of any property interests under the applicable Funding
Agreement or of the Secured Interest or other property interests hereunder, as
the case may be, or to reduce the amount of any sum received or receivable by
any Windmill Funding Source, the Agent or any Lender under this Agreement or
under the applicable Funding Agreement, as the case may be, or to require any
payment calculated by reference to the amount of interests or loans held or
interest received by it, then, upon demand by the Agent or any Lender, the
Borrower shall pay to the Agent or such Lender such additional amount or amounts
as will compensate the Agent or such
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Lender for such increased cost or reduction or, in the case of Windmill, will
enable Windmill to compensate any Windmill Funding Source for such increased
cost or reduction.
(b) If after the date hereof, any Windmill Funding Source, the Agent
or any Lender shall have determined that any Regulatory Change, including any
such Regulatory Change that results in or results from or otherwise relates to
any transaction in connection with any Funding Agreement or this Agreement or
any commitment thereunder or hereunder being classified as a highly leveraged
transaction for regulatory or other purposes, has or would have the effect of
reducing the rate of return on such Windmill Funding Source's, the Agent's or
such Lender's capital as a consequence of such Windmill Funding Source's, the
Agent's or such Lender's obligations or commitment under the applicable Funding
Agreement or this Agreement, to a level below that which such Windmill Funding
Source, the Agent or such Lender could have achieved but for such Regulatory
Change (taking into consideration such Windmill Funding Source's, the Agent's or
such Lender's policies with respect to capital adequacy), the from time to time,
upon demand by the Agent or any Lender, the Borrower shall pay to the Agent or
such Lender such additional amount or amounts as will compensate the Agent or
such Lender for such reduction or, in the case of Windmill, will enable Windmill
to compensate any Windmill Funding Source for such reduction.
(c) Anything in this Section 9.3 to the contrary notwithstanding, if
the Agent or any Lender enters into agreements with Other Borrowers, the Agent
(upon consultation with any applicable Lender) shall allocate the liability for
any amounts under this Section 9.3 ("Section 9.3 Costs") to the Borrower and to
each Other Borrower; provided, however, that if such Section 9.3 Costs are
attributable to the Borrower and not attributable to any Other Borrower, the
Borrower shall be solely liable for such Section 9.3 Costs or if such Section
9.3 Costs are attributable to Other Borrowers and not attributable to the
Borrower, such Other Borrowers shall be solely liable for such Section 9.3
Costs.
Section 9.4. Other Costs and Expenses. The Borrower shall pay to the Agent
and Windmill on demand all costs and expenses in connection with the
preparation, execution, delivery and administration of this Agreement and the
other Transaction Documents, including reasonable fees and out-of-pocket
expenses of legal counsel for the Agent and Windmill (which such counsel may be
employees of the Agent or Windmill) with respect thereto and with respect to
advising the Agent, Windmill and any financial institution providing funding to
Windmill as to its rights and remedies under this Agreement, any other
Transaction Document or any related funding agreement and all costs and
expenses, if any, including reasonable counsel fees and expenses of the Agent,
each Lender and each such financial institution in connection with the
enforcement of this Agreement, the other Transaction Documents and any such
funding agreement and in connection with any restructuring or workout of this
Agreement or such other Transaction Documents or the administration of this
Agreement and the other Transaction Documents following a Termination Event;
provided, however, that the Borrower shall have no obligation to pay any such
amounts to the extent such amounts are expressly stated in the Fee Letter not to
be payable by the Borrower. The Borrower shall reimburse the Agent for the cost
of the Agent's auditors (which such auditors may be employees of the Agent)
auditing the books,
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records and procedures of the Borrower. The Borrower shall reimburse Windmill
for any amounts Windmill must pay to any Windmill Funding Source pursuant to any
Funding Agreement on account of any Tax described in Section 9.2 and applicable
to such Windmill Funding Source. The Borrower shall reimburse Windmill on demand
for any and all issuing and paying agents' agent fees and rating agency fees and
commissions of placement agents and commercial paper dealers in respect of
commercial paper notes issued by Windmill to fund any CP Tranche hereunder. The
Borrower shall reimburse Windmill on demand for all other reasonable costs and
expenses incurred by Windmill or any shareholder of Windmill ("Other Costs")
including the cost of auditing Windmill's books by certified public accountants,
the cost of the Ratings, and the reasonable fees and out-of-pocket expenses of
counsel for Windmill or any counsel for any shareholder of Windmill with respect
to advising Windmill or such shareholder as to matters relating to Windmill's
operation; provided, however, that if Windmill enters into agreement with Other
Borrowers, Windmill shall allocate the liability for such Other Costs to the
Borrower and to each Other Borrower; and provided, further, that if such Other
Costs are attributable to the Borrower and not attributable to any Other
Borrower, the Borrower shall be solely liable for such Other Costs, or if such
Other Costs are attributable to Other Borrowers and not attributable to the
Borrower, such Other Borrowers shall be solely liable for such Other Costs.
Section 9.5. Withholding Taxes. (a) All payments made by the Borrower under
this Agreement shall be made free and clear of, and without reduction or
withholding for or on account of, any present or future Taxes, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority
or other taxing authority excluding, in the case of the Agent and each Lender,
net income taxes imposed on the Agent or such Lender by the jurisdiction under
the laws of which the Agent or such Lender is organized or any political
subdivision or taxing authority thereof or therein (such non-excluded Taxes
being hereinafter called "Non-Excluded Taxes"). If any Non-Excluded Taxes are
required to be withheld from any amounts payable to the Agent or any Lender
hereunder, the amounts so payable to the Agent or such Lender shall be increased
to the extent necessary to yield to the Agent or such Lender (after payment of
all Taxes) all such amounts payable hereunder at the rates or in the amounts
specified in this Agreement. Whenever any Non-Excluded Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Agent for its own account or for the account of such Lender, as the case may be,
a certified copy of an original official receipt received by the Borrower
showing payment thereof. If the Borrower fails to pay any Non-Excluded Taxes
when due to the appropriate taxing authority or fails to remit to the Agent the
required documentary evidence, the Borrower shall indemnify the Agent and the
Lenders for such Non-Excluded Taxes and any incremental Taxes that may become
payable by the Agent or any Lender as a result of any such failure. The
agreements in this Section 9.5(a) shall survive the termination of this
Agreement.
(b) At least five (5) Business Days prior to the first (1st) date on which
any payments, including Interest or fees, are payable under this Agreement for
the account of any Lender, each Lender (including each Purchasing Bank that
becomes party to this Agreement pursuant to Section 11.6(c)) that is not
incorporated under the laws of the United states of America, or a state thereof,
agrees that it will deliver to each of the Borrower and the Agent two (2) duly
completed copies of (i) United States Internal Revenue Service Form W-8BEN or
W-8ECI, certifying in
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either case that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes, and (ii) United States Internal Revenue Service Form W-8 or W-9 or
successor applicable form, as the case may be, to establish an exemption from
United States backup withholding tax. Each Lender which so delivers a Form
W-8BEN or W-8ECI and Form W-8 or W-9 further undertakes to deliver to each of
the Borrower and the Agent two (2) additional copies of such form (or a
successor form) on or before the date that such form expires or becomes obsolete
or after the occurrence of any event requiring a change in the most recent forms
so delivered by it, and such amendments thereto or extensions or renewals
thereof as may be reasonably requested by the Borrower or the Agent, in each
case certifying that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes, unless an event (including any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect to it and
such Lender advises the Borrower and the Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax, and in the case of Form W-8 or W-9, establish an exemption from
United States backup withholding tax. If a Lender that is not incorporated under
the laws of the United States of America, or a state thereof, does not deliver
the forms described in this Section 9.5(b), the Borrower or the Agent shall
withhold United States federal income taxes from any payments made under this
Agreement at the applicable statutory rate. Each Lender agrees to indemnify and
hold the Borrower and the Agent harmless for any United States federal income
taxes, penalties, interest and other costs and losses incurred or payable by the
Borrower or the Agent as a result of either (i) such Lender's failure to submit
any form that it is required to provide pursuant to this Section 9.5(b) or (ii)
the Borrower's or Agent's reliance on any such form that such Lender has
provided pursuant to this Section 9.5(b).
Section 9.6. Allocations. All allocations to be made pursuant to the
foregoing provisions of this Article IX shall be made by the Agent in its
reasonable discretion and shall be binding on the Borrower and each Lender. Upon
the reasonable request of the Borrower, the Agent shall provide the Borrower
with the basis of any calculations made pursuant to the foregoing provisions of
this Article IX (or, to the extent that the Agent determines in its sole
discretion that such calculations do not contain proprietary information, such
calculations) which, in the absence of manifest error, shall be conclusive and
binding for all purposes.
ARTICLE X
THE AGENT
Section 10.1. Appointment. Each Lender hereby irrevocably designates and
appoints ABN AMRO Bank N.V. as Agent hereunder, and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and to exercise
such powers and perform such duties as are expressly delegated to the Agent by
the terms of this Agreement, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Agent shall not have any duties or responsibilities, except
those expressly set forth herein, or any fiduciary relationship with any Lender,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of the Agent
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shall be read into this Agreement or otherwise exist against the Agent. The
provisions of this Article X are solely for the benefit of the Agent and the
Lenders and the Borrower shall not have any rights as a third-party beneficiary
or otherwise under this Article X. In performing its functions and duties, the
Agent shall act solely as the agent of the Lenders and does not assume nor shall
be deemed to have assumed any obligation or relationship of trust or agency with
or for the Borrower or any of its respective successors and assigns. The Agent
shall not be required to expend its funds if repayment or adequate indemnity is
not assured to it under terms and conditions acceptable to the Agent. The Agent
shall hold that portion of the Secured Interest consisting of the Interest of a
Lender for the benefit of such Lender.
Section 10.2. Delegation of Duties. The Agent may execute any of its duties
under this Agreement by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
The Agent shall not be responsible for the negligence or misconduct of any
agents or attorneys-in-fact selected by it with reasonable care.
Section 10.3. Exculpatory Provisions. Neither the 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 10.2 under, or in connection with, this Agreement (except for its, their
or such Person's own gross negligence or willful misconduct), or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower contained in this Agreement,
any other Transaction Document 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 any other Transaction Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement, any other Transaction Document or any other document furnished in
connection herewith or for any failure of the Borrower to perform its
obligations or for the satisfaction of any condition specified in Article V,
except receipt of items required to be delivered to the Agent. The Agent shall
not be under any obligation to any Lender 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 Borrower. This Section 10.3 is intended solely to govern the relationship
between the Agent, on the one hand, and the Lenders, on the other.
Section 10.4. Reliance by Agent. The 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, facsimile, 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 and upon advice and
statements of legal counsel (including counsel to the Borrower), independent
accountants and other experts selected by the Agent. The 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 Windmill, any Bank, the Required
Banks or all of the Lenders, as applicable, as it deems appropriate or it shall
first be indemnified to its satisfaction by the 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 (excluding any such liability, cost or
expense which shall have been incurred by the Agent as a result of its own gross
negligence or willful
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misconduct in the taking of any such action). The Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement in
accordance with a request of Windmill, any Bank, the Required Banks or all of
the Lenders, as applicable, and such request and any action taken or failure to
act pursuant thereto shall be binding upon all the Lenders.
Section 10.5. Notice of Termination. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Termination Event or Potential
Termination Event unless the Agent has received notice from any Lender or the
Borrower referring to this Agreement, stating that a Termination Event or
Potential Termination Event has occurred hereunder and describing such
Termination Event or Potential Termination Event. In the event that the Agent
receives such a notice, the Agent shall promptly give notice thereof to each
Lender and at all times prior to the Windmill Termination Date and thereafter
until the Windmill Interest is reduced to zero, to each CP Dealer and each
Rating Agency. The Agent shall take such action with respect to such Termination
Event or Potential Termination Event as shall be directed by Windmill and the
Required Banks (or, if applicable, all of the Lenders); provided, however, that
unless and until the Agent shall have received such directions, the Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Termination Event or Potential Termination Event as
the Agent shall deem advisable and in the best interests of the Lenders.
Section 10.6. Non-Reliance on Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Agent, nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by the Agent hereafter
taken, including any review of the affairs of the Borrower, shall be deemed to
constitute any representation or warranty by the Agent. Each Lender represents
and warrants to the Agent that it has, independently and without reliance upon
the Agent or any other Lender 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 Borrower, the other ▇▇▇▇-▇▇▇▇▇▇ Entities and the
Affected Assets and made its own decision to enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Agent or any other Lender, 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 any Transaction
Document, 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 ▇▇▇▇-▇▇▇▇▇▇ Entities. The Agent shall not
have any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, prospects, financial
and other condition or creditworthiness of the Borrower or any other Person
which may come into the possession of the Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates other than the
Periodic Reports provided by the Borrower or the Collection Agent, information
received by the Agent pursuant to Section 6.1(a) or 6.1(b) and such additional
information as a Lender may reasonably request and which the Agent has obtained
on any inspection conducted under Section 6.1(e).
Section 10.7. Indemnification. The Banks agree to indemnify, defend,
protect, save and hold harmless the Agent and its officers, directors,
employees, representatives and agents (to the
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extent not reimbursed by the Borrower and without limiting the obligation of the
Borrower), ratably according to the percentage its Bank Commitment is of the
Aggregate Commitment, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, court costs,
settlements, expenses or disbursements of any kind or nature whatsoever
(including the fees and disbursements of counsel for the Agent or such Person in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not the Agent or such Person shall be
designated a party thereto, which counsel may include employees of the Agent or
such Person) that may at any time be imposed on, incurred by or asserted against
the 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 under any of
the Transaction Documents or the execution, delivery or performance of the
Transaction Documents or any other document furnished in connection herewith
(but excluding any such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, court costs, settlements, expenses or
disbursements resulting solely from the gross negligence or willful misconduct
of the Agent or such Person as finally determined by a court of competent
jurisdiction). The obligations of the Banks under this Section 10.7 shall
survive the termination of this Agreement.
Section 10.8. Agent in Its Individual Capacity. The Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Borrower or any Affiliate of the Borrower as though
the Agent were not the Agent. With respect to the acquisition of the Secured
Interest, the Agent shall have the same rights and powers under this Agreement
as any Bank and may exercise the same as though it were not the Agent, and the
terms Bank and Lender (as the case may be) shall include the Agent in its
individual capacity. Moreover, the Agent, in its capacity as Agent, shall be
considered a Lender for all purposes and benefits hereunder to the extent that
it has advanced funds pursuant to Article II on behalf of any Lender and has not
been reimbursed therefor by the Borrower or such Lender.
Section 10.9. Successor Agent. The Agent may, upon at least five (5) days
written notice to the Borrower and each of the Lenders, and the Agent will, upon
the direction of all of the Lenders (for purposes of this reference to Lenders,
Lenders shall not include the Agent, in its individual capacity, nor any Lender
that is an Affiliate of the then Agent) and with the consent of the Borrower
(which consent shall not be unreasonably withheld) resign as Agent; provided,
however, that the resignation of the Agent may not become effective until a
successor agent is appointed and has succeeded to the rights, powers and duties
of the Agent as provided in this Section 10.9. If the Agent shall resign as
Agent, then Windmill and the Required Banks, during such notice period, shall,
with the consent of the Borrower (which consent shall be unreasonably withheld),
appoint from among the Banks a successor agent, whereupon such successor agent
shall succeed to the rights, powers and duties of the Agent and the term "Agent"
shall mean such successor agent, effective upon its appointment, and the former
Agent's rights, powers and duties as Agent shall be terminated, without any
other or further act or deed on the part of such former Agent or any of the
parties to this Agreement. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article X and Article IX shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent.
Section 10.10. ABN AMRO Conflict Waiver. ABN AMRO, as agent for Windmill
and subagent of the Management Company, acts as Administrator for Windmill, acts
as Referral
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Agent, provides other backup credit facilities for Windmill, and may provide
other services or facilities from time to time (the "ABN AMRO Roles"). Without
limiting the generality of Section 10.8, each Lender acknowledges and consents
to any and all ABN AMRO Roles, waives any objections it may have to any actual
or potential conflict of interest caused by ABN AMRO's acting as Agent and
acting as or maintaining any of the ABN AMRO Roles, and agrees that in
connection with any ABN AMRO Role, ABN AMRO may take, or refrain from taking,
any action which it in its discretion deems appropriate, including in its role
as administrative agent for Windmill the giving of notice to the Agent of
mandatory or voluntary purchases pursuant to Article III. Nothing contained in
this Article X shall limit or alter the duties and obligations that ABN AMRO
otherwise owes to Windmill in its role as agent for Windmill under any other
agreement or arrangement.
Section 10.11. Certain Actions. Upon the direction of Windmill (at any time
the Windmill Loan Amount is greater than zero), the Required Banks, the Agent
shall make or give any requests, designations, instructions, directions or
notices or exercise any other rights it is otherwise entitled to make, give or
exercise; provided, however, that the Agent, unless it has obtained the written
consent of the Required Banks, shall not give its consent under Section 6.1,
4.1(i) or 6.2(b). Upon the request of any Lender, the Agent shall (i) request
information pursuant to Section 6.1(a) or 6.1(e) and (ii) exercise the rights
described in Section 6.1(e) (and give any notice required to exercise the same).
Following a Termination Event, the Agent promptly shall give a written notice to
the Borrower specifying the Bank Termination Date if requested to do so by the
Required Banks, whereupon the Bank Commitments shall terminate. Promptly upon
receipt of any notice or information received by the Agent pursuant to Section
6.1(b) or 6.1(e), the Agent will deliver copies thereof to each of the Lenders
and at all times prior to the Windmill Termination Date and at all times
thereafter until the Windmill Interest is reduced to zero, to each CP Dealer and
each Rating Agency.
ARTICLE XI
MISCELLANEOUS
Section 11.1. Term of Agreement. Windmill shall cease to be a party to this
Agreement on the first (1st) Business Day following the Windmill Termination
Date on which the Matured Value of the Windmill Loan Amount has been reduced to
zero and all Aggregate Unpaids payable to Windmill have been paid in full. This
Agreement shall terminate following the Loan Amortization Date when all amounts
payable hereunder have been indefeasibly paid in full. Notwithstanding the
foregoing, (i) the rights and remedies of the Agent and each Lender with respect
to any representation and warranty made, or deemed to be made, by the Borrower,
(ii) the indemnification and payment provisions of Article IX and Article X, and
(iii) any other provision which by its own terms survives the termination of
this Agreement (including Sections 11.11, 11.16, 11.17 and 11.18), shall be
continuing and shall survive any termination of this Agreement.
Section 11.2. Waivers; Amendments. (a) No failure or delay on the part of
the Agent or any Lender in exercising any power, right, privilege or remedy
under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right, privilege or remedy preclude any
other or further exercise thereof or the exercise of any other power, right,
privilege or remedy. The rights, powers, privileges and remedies herein provided
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shall be cumulative and not exclusive of any rights, powers, privileges 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) This Agreement may not be amended, supplemented, modified or waived
except in accordance with the provisions of Section 11.2(b), 11.6(c), 11.6(e) or
11.6(f). No amendment, supplement or other modification to this Agreement shall
be effective unless the Borrower and the Required Banks are parties thereto and
it is signed by the other required parties. Notwithstanding the foregoing, no
amendment, supplement, modification or waiver shall without the written consent
of: (i) all the Banks, (A) extend the Bank Termination Date or the date of any
payment or deposit of Collections by the Borrower to the Collection Agent or by
the Collection Agent to the Agent for the benefit of the Lenders, (B) reduce the
rate or extend the time of payment of Interest (or any component thereof) for
any Tranche other than a CP Tranche, (C) reduce or extend the time of payment of
any fee payable to the Agent for the benefit of the Lenders, (D) release or
transfer all or any portion of, or otherwise change (other than as provided
herein) the amount of, the Bank Interest, (E) change the amount of any Bank
Commitment or increase the Aggregate Commitment, other than as provided herein,
(F) amend, modify or waive any provision of the definition of Required Banks or
Termination Event or Sections 2.1, 5.2, 9.1, 9.2, 9.3 or 11.2(b) or any
provision of the Indemnity Agreement or any obligation of any ▇▇▇▇-▇▇▇▇▇▇ Entity
thereunder, (G) consent to or permit the assignment or transfer by the Borrower
of any of its rights and obligations under this Agreement or of any of its
right, title or interest in or to the Receivables, (H) amend, modify or waive
any defined term (or any defined term used directly or indirectly in such
defined term) used in clauses (A) through (G) above in a manner which would
circumvent the intention of the restrictions set forth in such clauses; or (ii)
the Agent, amend, modify or waive any provision of this Agreement if the effect
thereof is to affect the indemnities to, or the rights or duties of, such Agent
or reduce any fee payable to the Agent's own account; or (iii) Windmill, amend,
supplement or otherwise modify (A) Sections 11.2(b)(iii), or 11.3 or Articles II
or IX or (B) any other provision if the effect of such modification in such
other provision shall be to limit the discretion of, or impose any new
commitment or obligation on, Windmill. Notwithstanding the foregoing, without
the prior consent of any of the Banks (but only with the prior written consent
of the Borrower), the Agent or Windmill, as the case may be, may change the
amount of any fee or other payment due and payable to either the Agent (solely
in its capacity as Agent) or Windmill, as the case may be, from the Borrower
under this Agreement, the Fee Letter or any other agreement in connection
herewith or therewith. Windmill shall not knowingly issue any waiver of any
condition precedent set forth in Article V in respect of any purchase then being
made by it without the prior written consent of the Required Banks. Any
amendment, supplement, modification or waiver entered into in accordance with
this Section 11.2(b) shall apply to each of the Lenders equally and shall be
binding upon the Borrower, the Lenders and the Agent. In the case of any waiver,
the Borrower, the Lenders and the Agent shall be restored to their former
position and rights and any Potential Termination Event or Termination Event
waived shall be deemed to be cured and not continuing, but no such waiver shall
extend to any subsequent or other Potential Termination Event or Termination
Event, or impair any right consequent upon such subsequent or other Potential
Termination Event or Termination Event. Notwithstanding the foregoing, any
additional Interest that has accrued after a Termination Event prior to the
execution of a waiver thereof, solely as a result of the occurrence of such
Termination Event, may be waived by the
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Agent at the direction of Windmill or the Required Banks (in each case, to the
extent such additional Interest is payable to such Lender or the Banks, as the
case may be). Notwithstanding the foregoing, at all times prior to the Windmill
Termination Date and thereafter until the Windmill Interest is reduced to zero,
no (a) material amendment, waiver, alteration, modification or supplement of or
to any provision of this Agreement, (b) assignment contemplated by Section 11.6,
or (c) termination, resignation or removal contemplated by Article V, Section
11.1 or Article X shall be effective unless a written statement is obtained from
each Rating Agency that the Rating will not be downgraded or withdrawn or
suspended as a result of such amendment, waiver, alteration, modification,
supplement, assignment, termination, resignation or removal. At all times prior
to the Windmill Termination Date and thereafter until the Windmill Interest is
reduced to zero, Windmill shall provide each CP Dealer and each Rating Agency
with at least ten (10) Business Days prior notice of each event described in
clauses (a), (b) and (c) of the prior sentence, together with a copy of the form
of the proposed amendment, waiver, alteration, modification or supplement (other
than the Fee Letter).
Section 11.3. Notices. Except as provided below, all communications,
demands and notices provided for hereunder shall be in writing (including bank
wire, telex, telecopy or electronic facsimile transmission or similar writing)
and shall be given to each other party at its address, telecopy number or telex
number set forth on the signature page hereof or at such other address, telecopy
number or telex number as such party may hereafter specify for the purposes of
notice to such party. Each such notice or other communication shall be effective
(i) if given by telecopy, upon the receipt thereof, (ii) if given by telex, when
such telex is transmitted to the telex number specified in this Section 11.3 and
the appropriate answerback is received, (iii) if given by mail, three (3)
Business Days after the time such communication is deposited in the mails with
first-class postage prepaid or (iv) if given by any other means, when received
at the address specified in this Section 11.3; provided, however, that, in the
case of any notice to be given under Article III, such notice shall not be
effective until receipt thereof by the Person to whom such notice is to be
given. However, anything in this Section 11.3 to the contrary notwithstanding,
the Borrower hereby authorizes the Agent to effect Loans, Payments and Tranche
Period and Tranche Rate selections based on telephonic notices made by any
Person which the Agent in good faith believes to be acting on behalf of the
Borrower. The Borrower agrees to deliver promptly to the Agent a written
confirmation of each telephonic notice signed by an authorized officer of the
Borrower. However, anything in this Section 11.3 to the contrary
notwithstanding, each Lender hereby authorizes the Agent to effect the purchases
described in Article II based on telephonic notices made by any Person which the
Agent in good faith believes to be acting on behalf of the Lenders. The Borrower
and each of the Lenders hereby authorize the Agent, at the Agent's option, to
tape record all or any part of telephonic notices and any other related
conversations. The Agent's records as to all such matters shall be deemed
correct. Each Lender agrees to deliver promptly to the Agent a written
confirmation of each telephonic notice signed by an authorized office of said
Lender. The absence of any written confirmation shall not affect the validity of
the notice. If the written confirmation differs in any material respect from the
action taken by the Agent, the records of the Agent shall govern absent manifest
error.
Section 11.4. Governing Law; Submission to Jurisdiction; Integration. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS. Each Person party
hereto
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hereby submits to the nonexclusive jurisdiction of any United States District
Court for the Northern District of Illinois and of any Illinois state court
sitting in Chicago, Illinois for purposes of all legal proceedings arising out
of or relating to this Agreement or the transactions contemplated hereby. Each
Person party hereto hereby irrevocably waives, to the fullest extent it may
effectively do so, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum.
Section 11.5. Severability; Counterparts. 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. 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.
Section 11.6. Successors and Assigns; Participations; Assignments. (a)
Successors and Assigns. This Agreement shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and assigns,
provided, however, that, except as otherwise provided herein, the Borrower may
not assign or transfer any of its rights or delegate any of its duties without
the prior written consent of the Agent and all the Lenders. The Banks may not
participate, assign, transfer or sell any of its Bank Commitment except as
required by operation of law, in connection with the merger, consolidation or
dissolution of such Person or as provided in this Section 11.6.
(b) Participations. Any Lender may, in the ordinary course of its business
and in accordance with applicable law, at any time sell to one or more Persons
(each a "Participant") participating interests in the interests of such Lender
hereunder. Notwithstanding any such sale by a Lender of participating interests
to a Participant, such Lender's rights and obligations under this Agreement
shall remain unchanged, such Lender shall remain solely responsible for the
performance thereof, and the Borrower and the Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. The Borrower hereby agrees that if any of the
Aggregate Unpaids are due and unpaid, or shall have been declared or shall have
become due and payable upon the occurrence and during the continuance of a
Termination Event, each Participant shall be deemed to have the right of setoff
in respect of its participating interest in amounts owing under this Agreement
to the same extent as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement; provided, however, that such
right of setoff shall be subject to the obligations of such Participant to share
with the Lenders, and the Lenders agree to share with such Participant. The
Borrower also agrees that each Participant shall be entitled to the benefits of
Article IX. Each Lender agrees that any agreement between such Lender and any
such Participant in respect of such participating interest shall not restrict
such Lender's right to agree to any amendment, supplement, waiver or
modification to this Agreement or to the Transfer Agreement, except for any
amendment, supplement, waiver or modification described in subclauses (A), (B),
(C), (D), (F), (G) or (H) of clause (i) in the third sentence of Section
11.2(b).
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(c) Assignments to Purchasing Banks. Any Bank may at any time and from time
to time, (i) without the consent of the Borrower or the Agent, to any Person
that at such time is a Lender or that is an Affiliate of such Lender and (ii)
with the prior written consent of the Borrower, which consent shall not be
unreasonably withheld, and the prior written consent of the Agent, assign to one
or more Persons ("Purchasing Banks") all or any part of its Bank Commitment and
all or any portion of the Bank Interest of such Bank relating to such Bank
Commitment pursuant to a supplement to this Agreement and to the Transfer
Agreement, substantially in the form of Exhibit M with any changes as have been
approved by the parties thereto (a "Loans Supplement"), executed by such
Purchasing Bank, such selling Bank and the Agent. If required in connection with
the maintenance of the Rating, each such Loans Supplement must be accompanied by
an opinion of counsel of the Purchasing Bank as to such matters as Windmill and
the Agent may reasonably request. Any such assignment of the Bank Commitment
cannot be for an amount less than Five Million Dollars ($5,000,000). Such
Purchasing Bank must be a depository institution organized under the laws of a
country (each an "OECD Country") which is a full member of the Organization of
Economic Cooperation and Development, or which has concluded special lending
arrangements with the International Monetary Fund (the "IMF") associated with
the IMF's General Arrangements to Borrow. Each such Purchasing Bank shall pay a
fee of Two Thousand Five Hundred Dollars ($2,500) to the Agent. Any such partial
assignment shall be an assignment of an identical percentage of such selling
Bank's Interest and its Bank Commitment hereunder and under the Transfer
Agreement. Upon (i) such execution of such Loans Supplement, (ii) delivery of an
executed copy thereof to the Borrower and the Agent and (iii) payment by such
Purchasing Bank to such selling Bank of an amount equal to the purchase price
agreed between such selling Bank and such Purchasing Bank, such selling Bank
shall be released from its obligations hereunder and under the Transfer
Agreement to the extent of such assignment and such Purchasing Bank shall for
all purposes be a Bank party to this Agreement and shall have all the rights and
obligations of a Bank under this Agreement to the same extent as if it were an
original party hereto and to the Transfer Agreement, and no further consent or
action by the Borrower, the Lenders or the Agent shall be required. The amount
of the Bank Interest allocable to such Purchasing Bank shall be equal to the
amount of the Bank Interest transferred regardless of the purchase price paid
therefor. Such Loans Supplement shall be an amendment of this Agreement to the
extent, and only to the extent, necessary to reflect the addition of such
Purchasing Bank as a Bank and the resulting adjustment of the Bank Commitments,
if any, arising from the purchase by such Purchasing Bank of all or a portion of
the Bank Commitment of such selling Bank.
(d) Affected Bank. In the event that any Bank shall cease to have a
short-term debt rating of A-1+ or better by S&P and P-1 or better by ▇▇▇▇▇'▇ (an
"Affected Bank"), Windmill may direct the Agent to obtain a replacement Bank (a
"Replacement Bank") acceptable to Windmill for such Affected Bank. Upon notice
to an Affected Bank by the Agent of the identification of a Replacement Bank
willing to accept such assignment, the Affected Bank shall promptly assign all
of its rights and obligations hereunder to such Replacement Bank in accordance
with Section 11.6(c) or 11.6(f), as the case may be.
(e) Windmill. (i) General. Windmill may assign, participate, grant security
interests in, or otherwise transfer all or any portion of its beneficial
interest in the Windmill Interest, including any such transfer pursuant to the
Transfer Agreement. The Borrower, the Agent and
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each of the Banks further agree and consent to the complete assignment by
Windmill of all of its rights under, interest in, title to and obligations under
this Agreement to ABN AMRO or any other Person, and upon such assignment
Windmill shall be released from all obligations and duties under this Agreement.
(ii) Assignment. Except as provided in Article III and 11.6(e)(i), Windmill
may, without the consent of the Borrower, assign to any other Person all or any
portion of the Windmill Interest. As between Windmill and any such assignee,
each such assignment shall be upon such terms and conditions as Windmill and
such assignee may mutually agree. Windmill may not, without the prior written
consent of the Required Banks, transfer any of its rights under the Transfer
Agreement to cause the Banks to purchase the Windmill Interest unless the Lender
(A) is a corporation the principal business of which is the purchase of assets
of a type like the receivables with the proceeds of commercial paper issued by
such corporation, (B) has requested that ABN AMRO agree, and ABN AMRO has
agreed, to act as the administrative agent therefor and (C) issues commercial
paper with credit ratings assigned by nationally recognized rating agencies in
respect thereof which are substantially comparable to the ratings assigned by
such rating agencies to the commercial paper issued by Windmill. Windmill shall
deliver to the assignee a supplement to this Agreement, substantially in the
form of Exhibit N with any changes as have been approved by the parties thereto
(also, a "Loans Supplement"), duly executed by Windmill, assigning any such
Windmill Interest, or portion thereof, to the assignee, and Windmill shall
promptly execute and deliver all further instruments and documents, and take all
further action, that the assignee may reasonably request, in order to perfect,
protect or more fully evidence the assignee's right, title and interest in and
to such Windmill Interest (or portion thereof) and to enable the assignee to
exercise or enforce any rights hereunder. Upon the assignment of any Windmill
Interest (or portion thereof) from Windmill as described above, the respective
assignee receiving such assignment shall have all of the rights of Windmill
hereunder with respect to such Windmill Interest, except that the Interest
therefor shall thereafter accrue at the rate, or shall be in the amount,
determined in accordance with Article II unless the Borrower and the assignee
shall have agreed in writing upon a different Interest. Windmill shall promptly
notify the Agent of any such assignment by Windmill and the Agent shall in turn
give prompt notice thereof to the Borrower. Windmill authorizes the Agent to,
and the Agent agrees that it shall, enter an appropriate entry on the Register
to reflect any assignments.
Section 11.7. Further Assurances. The Borrower agrees, from time to time,
to do and perform any and all acts and to execute any and all further
instruments required or reasonably requested by the Agent to more fully effect
the purposes of this Agreement and the transfer of the Secured Interest,
including the execution of any financing statements or continuation statements
relating to the Affected Assets for filing under the provisions of the UCC of
any applicable jurisdiction.
Section 11.8. Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of any Termination
Event, each Lender is hereby authorized at any time or from time to time,
without presentment, demand, protest or other notice of any kind to the Borrower
or to any other Person, any such notice being hereby expressly waived, to setoff
and to appropriate and apply any and all deposits (general or special, time or
demand, provisional
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or final, and in whatever currency denominated) and any other indebtedness at
any time held or owing by such Lender (including by branches and agencies of
such Lender wherever located) to or for the credit or the account of the
Borrower against and on account of the Aggregate Unpaids of the Borrower to such
Lender under this Agreement, including all interests in Aggregate Unpaids
purchased by such Lender pursuant to Section 2.6(j), and all other claims of any
nature or description arising out of or connected with this Agreement,
irrespective of whether or not such Lender shall have made any demand hereunder
and although said Aggregate Unpaids, liabilities or claims, or any of them,
shall be contingent or unmatured.
Section 11.9. Waiver of Confidentiality. Anything herein to the contrary
notwithstanding, the Borrower hereby consents to the disclosure of any nonpublic
information with respect to it (i) to the Agent or the Lenders by the other, and
(ii) by the Agent or the Lenders to any prospective or actual assignee or
participant of any of them (only if such nonpublic information is accompanied by
a statement that such prospective or actual assignee or participant agrees, by
receipt of such information, to maintain the confidentiality of such
information) or any rating agency or provider of a surety, guaranty or credit or
liquidity enhancement to any of them or any entity organized for the purpose of
purchasing, or making loans secured by, financial assets for which ABN AMRO
provides managerial services or acts as the administrative agent, or the
Administrator, the Management Company, the Referral Agent, the Depositary, any
commercial paper dealer or placement agent, or any officers, directors,
employees, outside accountants, auditors, Governmental Authorities having
jurisdiction over them or lawyers of any of the foregoing. In addition, the
Agent and/or the Lenders 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 and effect of law).
Section 11.10. Confidentiality of Agreement. The parties hereto agree to
hold the Transaction Documents or any other confidential or proprietary
information received in connection therewith in confidence and agree not to
provide any Person with copies of any Transaction Document or such other
confidential or proprietary information other than to (i) any officers,
directors, members, managers, employees or outside accountants, auditors or
attorneys thereof, (ii) any prospective or actual assignee or participant which
(in each case) has signed a confidentiality agreement containing provisions
substantively identical to this Section, (iii) any rating agency, (iv) any
surety, guarantor or credit or liquidity enhancer to the Agent or any Purchaser
which (in each case) has signed a confidentiality agreement substantially in the
form of the confidentiality agreement signed by the Agent prior to the date
hereof, (v) any entity organized to loan, or make loans secured by, financial
assets for which ABN AMRO provides managerial services or acts as an
administrative agent which (in each case) has signed a confidentiality agreement
substantially in the form of the confidentiality agreement signed by the Agent
prior to the date hereof, (vi) Windmill's administrator, management company,
referral agents, issuing agents or depositaries or CP Dealers and (vii)
Governmental Authorities with appropriate jurisdiction. Notwithstanding the
above stated obligations, provided that the other parties hereto are given
notice of the intended disclosure or use, the parties hereto will not be liable
for disclosure or use of such information which such Person can establish by
tangible evidence: (i) was required by law, including pursuant to a valid
subpoena or other legal process, (ii) was in such Person's possession or known
to such Person prior to receipt or (iii) is or
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becomes known to the public through disclosure in a printed publication (without
breach of any of such Person's obligations hereunder).
Section 11.11. Bankruptcy Petition Against Windmill. Each of the Lenders,
(excluding Windmill), the Agent, the Borrower and the Collection Agent hereby
covenants and agrees that, prior to the date which is one (1) year and one (1)
day after the payment in full of all outstanding commercial paper of Windmill,
such party will not institute against, or join any other Person in instituting
against, Windmill any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of the USA.
The provisions of this Section 11.11 shall survive the termination of this
Agreement.
Section 11.12. Limitation of Liability. No claim may be made by the
Borrower, the Collection Agent or any other Person against the Agent or any
Lender or their respective Affiliates, directors, officers, employees, attorneys
or agents for any special, indirect, consequential or punitive damages in
respect of any claim for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated by this Agreement, or
any act, omission or event occurring in connection therewith; and the Borrower,
for itself, the Collection Agent and all other Persons claiming by or through
the Borrower, hereby waives, releases and agrees not to ▇▇▇ upon any claim for
any such damages, whether or not accrued and whether or not known or suspected
to exist in its favor.
Section 11.13. Headings. Article and Section headings used herein are for
convenience and reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting
this Agreement.
Section 11.14. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ALL RIGHT OF TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT OR ANY MATTER ARISING HEREUNDER.
Section 11.15. Administrator. Each of the parties hereto acknowledges and
agrees that each and every responsibility, function, duty and agreement of
Windmill may be performed by the Administrator for, in the name of and on behalf
of Windmill, as Windmill's agent. It is further acknowledged and agreed that
notwithstanding the Administrator's undertaking to so perform Windmill's
responsibilities, functions, duties and agreements for, in the name of and on
behalf of Windmill, as Windmill's agent, Windmill'S responsibilities, functions,
duties and agreements shall remain obligations of Windmill and shall not
constitute obligations of the Administrator.
Section 11.16. No Recourse. The obligations of each of the Management
Company, the Administrator, Windmill and the Referral Agent are solely the
corporate obligations of such Person. No recourse shall be had with respect to
this Agreement or any of the other Transaction Documents, including the
enforcement of the obligations of the Management Company, the Administrator,
Windmill or the Referral Agent thereunder or for the payment of any fee or other
amount payable thereunder for any claim based on, arising out of or relating to
any provision of this Agreement or any of the other Transaction Documents,
against any stockholder, employee, officer, director, incorporator, affiliate,
agent or servant of any of the Management Company, the
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Administrator, Windmill or the Referral Agent. Each of the parties hereto agrees
to look solely to the Management Company, the Administrator, Windmill or the
Referral Agent for payment or performance of all obligations of such Person and
claims against the Management Company, the Administrator, Windmill or the
Referral Agent based on, arising out of or relating to this Agreement, any
Program Document to which such Person is (or is intended to be) a party or any
other Transaction Document. The provisions of this Section 11.16 shall survive
the termination of this Agreement.
Section 11.17. Reliance on Information Obtained from Third Parties. Each of
the parties hereto recognizes that the accuracy and completeness of the records
maintained and the information supplied by Windmill and supplied by the Referral
Agent, the Management Company and the Administrator, for, in the name of and on
behalf of Windmill as Windmill's agent is dependent upon the accuracy and
completeness of the information obtained by Windmill, the Referral Agent, the
Management Company and the Administrator from other Persons and other sources
and neither Windmill, the Referral Agent, the Management Company nor the
Administrator shall be responsible for any inaccuracy in the information so
obtained or for any inaccuracy in the records maintained by Windmill, the
Referral Agent, the Management Company or the Administrator which may result
therefrom. All calculations and determinations made by Windmill or by the
Referral Agent, the Management Company or the Administrator for, in the name of
or on behalf of Windmill, are based on the most recent information provided to
Windmill, the Referral Agent, the Management Company and the Administrator and
entered into the Administrator's or the Referral Agent's computerized
information system. Consequently, some of the information relied upon in making
such calculations and determinations may not reflect the actual current facts
and neither Windmill, the Referral Agent, the Management Company nor the
Administrator shall be liable for any loss, cost or expense arising, directly or
indirectly, as a result of or in connection with any discrepancy attributable to
such timing differential. The provisions of this Section 11.17 shall survive the
termination of the Agreement.
Section 11.18. Excess Funds. Notwithstanding any provisions contained in
this Agreement to the contrary, Windmill shall not, and shall not be obligated
to, pay any amount pursuant to this Agreement unless (i) Windmill has received
funds which may be used to make such payment and which funds are not required to
repay its commercial paper notes when due and (ii) after giving effect to such
payment, either (x) Windmill could issue commercial paper notes to refinance all
of its outstanding commercial paper notes (assuming such outstanding commercial
paper notes matured at such time) in accordance with the program documents
governing Windmill's securitization program or (y) all of Windmill's commercial
paper notes are paid in full. Any amount which Windmill does not pay pursuant to
the operation of the preceding sentence shall not constitute a claim (as defined
in Section 101 of the United States Bankruptcy Code) against or corporate
obligation of Windmill for any such insufficiency unless and until Windmill
satisfies the provisions of clauses (i) and (ii) above. This Section shall
survive the termination of this Agreement.
Section 11.19. Enforceability of Receivables. The obligations of the
Borrower under this Agreement shall not be affected by reason of any invalidity,
illegality or irregularity of any Receivable or any transfer of a Secured
Interest.
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Section 11.20. Integration. This Agreement contains the final and complete
integration of all prior expressions by the parties hereto with respect to the
subject matter hereof and shall constitute the entire agreement among the
parties hereto with respect to the subject matter hereof superseding all prior
oral or written understandings.
Section 11.21. Elimination of Program LOC Provider. From and after the date
here, the Program LOC Provider shall no longer be a party to this Agreement and
shall not have a commitment hereunder.
Section 11.22. Original Receivables Loan Agreement. This Agreement amends
and replaces in its entirety the Original Receivables Loan Agreement. Reference
to this specific Agreement need not be made in any agreement, document,
instrument, letter, certificate, the Original Receivables Loan Agreement itself,
or any communication issued or made pursuant to or with respect to the Original
Receivables Loan Agreement, any reference to the Original Receivables Loan
Agreement being sufficient to refer to the Original Receivables Loan Agreement
as amended and restated hereby.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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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.
ABN AMRO BANK N.V., as a Bank Title:
---------------------------------
By: By:
--------------------------------- ------------------------------------
Title: Title:
------------------------------ ---------------------------------
Address: ABN AMRO BANK N.V.
Structured Finance, Asset
By: Securitization
--------------------------------- ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------ Attention: Administrator-
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Program LOC Provider
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Lender Agent- Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Windmill
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
ABN AMRO BANK N.V., as the Agent
By:
---------------------------------
Title:
------------------------------
By:
---------------------------------
Title:
------------------------------
Address: Structured Finance, Asset
Securitization
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Lender Agent-
Windmill
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Consented and Agreed:
ABN AMRO BANK N.V., as the Program
LOC Provider
By:
---------------------------------
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BWA RECEIVABLES CORPORATION WINDMILL FUNDING CORPORATION
By: By:
--------------------------------- ------------------------------------
Title: Title:
------------------------------ ---------------------------------
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Address: c/o Global Securitization
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Services, LLC
Attention: Vice President ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
BORGWARNER INC. With a copy
to:
By:
--------------------------------- ABN AMRO Bank N.V.
Title: Structured Finance, Asset
------------------------------ Securitization
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President Attention: Administrator -
and Treasurer Windmill
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-69-
EXHIBIT A
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
BWA RECEIVABLES CORPORATION
CREDIT AND COLLECTION POLICY
EXHIBIT B-1
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
FORM OF CONTRACT
EXHIBIT B-2
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
CONTRACT TERMS
EXHIBIT C
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
LOCKBOXES AND LOCKBOX BANKS
BANK ACCOUNT TITLE ACCOUNT NUMBER LOCKBOX NUMBER LOCKBOX ADDRESS
---- ------------------------------------ -------------- -------------- -------------------------
EXHIBIT D
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
FORM OF LOCK-BOX LETTER
[Lock-Box Bank]
Ladies and Gentlemen:
Reference is made to the lock-box numbers ______________ and ___________ in
______________________ and the lock-box account numbers _________ and
___________ respectively maintained with you (such lock-boxes and lock-box
accounts being collectively referred to herein as the "Accounts"), each in the
name of [Originator]. [Originator] hereby unconditionally transfers exclusive
ownership of the Accounts to BWA Receivables Corporation and confirms that
[Originator] has sold all Receivables (as defined below) to BWA Receivables
Corporation. [Originator] hereby authorizes and directs you to endorse all
checks, drafts and other payments remitted to the Accounts to BWA Receivables
Corporation. [Originator] shall have control of and access to the Accounts prior
to delivery of the Agent's Notice (defined below) solely in its role as
collection agent.
In connection with a receivables transaction entered into by BWA
Receivables Corporation pursuant to a Second Amended and Restated Receivables
Loan Agreement, dated as of ____________, 2004, among BWA Receivables
Corporation (the "Borrower"), BorgWarner Inc., as Collection Agent, the banks
from time to time party thereto (collectively, the "Banks"), Windmill Funding
Corporation ("WINDMILL"), and ABN AMRO Bank N.V., as agent (the "Agent") for
WINDMILL and the Banks (collectively, the "Lenders"), as amended or otherwise
modified from time to time (the "Receivables Loan Agreement"), BWA Receivables
Corporation has assigned to the Agent for the benefit of the Lenders an
undivided percentage interest in the accounts, chattel paper, instruments or
general intangibles (collectively, the "Receivables") with respect to which
payments are or may hereafter be made to the Accounts, and has granted to the
Agent for the benefit of the Lenders a security interest in its retained
interest in such Receivables, and as is the customary practice in this type of
transaction, we hereby request that you execute this letter agreement. All
references herein to "we" and "us" refer to [Originator] and BWA Receivables
Corporation. Your execution hereof is a condition precedent to our continued
maintenance of the Accounts with you.
We hereby transfer exclusive ownership and control of the Accounts to the
Agent, subject only to the condition subsequent that the Agent shall have given
you notice of its election to assume such ownership and control, which notice
may be in the form attached hereto as Annex A or in any other form that gives
you reasonable notice of such election (the "Agent's Notice").
We hereby irrevocably instruct you, at all times from and after the date of
your receipt of the Agent's Notice as described above, to make all payments to
be made by you out of or in
connection with the Accounts directly to the Agent, at its address set forth
below its signature hereto or as the Agent otherwise notifies you, or otherwise
in accordance with the instructions of the Agent.
We also hereby notify you that, at all times from and after the date of
your receipt of the Agent's Notice as described above, the Agent shall be
irrevocably entitled to exercise in our place and stead any and all rights in
respect of or in connection with the Accounts, including, without limitation,
(a) the right to specify, when payments are to be made out of or in connection
with the Accounts and (b) the right to require preparation of duplicate monthly
bank statements on the Accounts for the Agent's audit purposes and mailing of
such statements directly to an address specified by the Agent. At all times from
and after the date of your receipt of the Agent's notice, neither we nor any of
our affiliates shall be given any access to the Accounts.
The Agent's Notice may be personally served or sent by Telex, facsimile or
U.S. mail, certified return receipt requested, to the address, Telex or
facsimile number set forth under your signature to this letter agreement (or to
such other address, Telex or facsimile number as to which you shall notify the
Agent in writing). If the Agent's Notice is given by Telex or facsimile, it will
be deemed to have been received when the Agent's Notice is sent and the
answerback is received (in the case of Telex) or receipt is confirmed by
telephone or other electronic means (in the case of facsimile). All other
notices will be deemed to have been received when actually received or, in the
case of personal delivery, delivered.
By executing this letter agreement, you acknowledge the existence of the
Agent's right to ownership and control of the Accounts and its ownership of and
security interest in the amounts from time to time on deposit therein and agree
that from the date hereof the Accounts shall be maintained by you for the
benefit of, and amounts from time to time therein held by you as agent for, the
Agent on the terms provided herein. The Accounts are to be entitled "BWA
Receivables Corporation and ABN AMRO Bank N.V., as Agent for the Lenders."
Except as otherwise provided in this letter agreement, payments to the Accounts
are to be processed in accordance with the standard procedures currently in
effect. All service charges and fees with respect to the Accounts shall continue
to be payable by us as under the arrangements currently in effect.
By executing this letter agreement, you irrevocably waive and agree not to
assert, claim or endeavor to exercise, irrevocably bar and estop yourself from
asserting, claiming or exercising, and acknowledge that you have not heretofore
received a notice, writ, order or any form of legal process from any other party
asserting, claiming or exercising, any right of set-off, banker's lien or other
purported form of claim with respect to the Accounts or any funds from time to
time therein. Except for your right to payment of your service charges and fees
and to make deductions for returned items, you shall have no rights in the
Accounts or funds therein. To the extent you may ever have such rights, you
hereby expressly subordinate all such rights to all rights of the Agent. To the
extent that the Agent actually receives funds from you relating directly to a
returned item, the Agent agrees to remit such funds to you up to the actual
returned amount relating to such returned item (the provisions of this sentence
shall survive the termination of the Accounts and this letter agreement).
D-2
Notwithstanding any other provision of this letter agreement, unless you
are grossly negligent or engaged in willful misconduct in performance or
nonperformance in connection with this letter agreement and the Accounts, we and
the Agent agree to hold you harmless and we and the Agent agree not to assert a
claim against you for any claims, damages, losses or expenses incurred by any
party in connection herewith; in the event you breach the standard of care set
forth herein, we and the Agent expressly agree that your liability shall be
limited to damages directly caused by such breach and in no event shall you be
liable for any incidental, indirect, punitive or consequential damages
whatsoever. In performing your functions and duties under this letter agreement,
you shall not be deemed to have assumed any fiduciary obligation towards or
relationship of trust with or for us or the Agent.
You may terminate this letter agreement by canceling the Accounts
maintained with you, which cancellation and termination shall become effective
only upon thirty (30) days prior written notice thereof from you to the Agent.
Incoming mail addressed to the Accounts (including, without limitation, any
direct funds transfer to the Accounts) received after such cancellation shall be
forwarded in accordance with the Agent's instructions. This letter agreement may
also be terminated upon written notice to you by the Agent stating that the
Receivables Loan Agreement is no longer in effect. Except as otherwise provided
in this paragraph, this letter agreement may not be terminated without the prior
written consent of the Agent.
This letter agreement contains the entire agreement between the parties
with respect to the subject matter hereof, and may not be altered, modified or
amended in any respect, nor may any right, power or privilege of any party
hereunder be waived or released or discharged, except upon execution by you, us
and the Agent of a written instrument so providing. The terms and conditions of
any agreement between us and you (a "Lock-Box Service Agreement") (whether now
existing or executed hereafter) with respect to the lock-box arrangements, to
the extent not inconsistent with this letter agreement, are made part of this
letter agreement with respect to matters not explicitly covered in this letter
agreement. In the event that any provision in this letter agreement is in
conflict with, or inconsistent with, any provision of any such Lock-Box Service
Agreement, this letter agreement will exclusively govern and control. Each party
agrees to take all actions reasonably requested by any other party to carry out
the purposes of this letter agreement or to preserve and protect the rights of
each party hereunder.
THIS LETTER AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER WILL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF STATE OF ILLINOIS. This letter agreement may be executed in any
number of counterparts and all of such counterparts taken together will be
deemed to constitute one and the same instrument.
D-3
Please indicate your agreement to the terms of this letter agreement by
signing in the space provided below. This letter agreement will become effective
immediately upon execution of a counterpart of this letter agreement by all
parties hereto.
Very truly yours,
[ORIGINATOR]
By:
------------------------------------
Title:
---------------------------------
BWA RECEIVABLES CORPORATION
By:
------------------------------------
Title:
---------------------------------
Accepted and confirmed as of
the date first written above:
By: ABN AMRO BANK N.V., as Agent
By:
---------------------------------
Title:
------------------------------
By:
---------------------------------
Title:
------------------------------
Address of notice:
ABN AMRO Bank N.V.
Structured Finance, Asset Securitization
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Lender Agent-WINDMILL
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
D-4
Acknowledged and agreed to as of
the date first written above:
[LOCK-BOX BANK]
By
---------------------------------
Title:
------------------------------
Address for notice:
---------------------------------
---------------------------------
---------------------------------
D-5
ANNEX A to
Lock-Box Letter
[LOCK-BOX BANK]
Re: BWA Receivables Corporation
Lock-Box Numbers ___________ and _____________
and Lock-Box Account Numbers _________________
and _____________________
Ladies and Gentlemen:
Reference is made to the letter agreement dated _________________ (the
"Letter Agreement") among [Originator], BWA Receivables Corporation, the
undersigned, as Agent, and you concerning the above-described lock-boxes, and
lock-box accounts (collectively, the "Accounts"). We hereby give you notice of
our assumption of ownership and control of the Accounts as provided in the
Letter Agreement.
We hereby instruct you not to permit any other party to have access to the
Accounts and to make all payments to be made by you out of or in connection with
the Accounts directly to the undersigned upon our instructions, at our address
set forth above.
Very truly yours,
ABN AMRO BANK N.V., as Agent
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
EXHIBIT E
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
FORM OF PERIODIC REPORT
EXHIBIT F
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
FORM OF ASSIGNMENT
[FROM A BANK TO WINDMILL]
This Assignment (this "Assignment"), dated _______________, 20__, is by and
between [INSERT NAME OF BANK] (the "Assignor") and Windmill Funding Corporation
("WINDMILL"). Reference is hereby made to that certain Second Amended and
Restated Receivables Loan Agreement (as amended, supplemented or otherwise
modified through the date hereof, the "Loan Agreement"), dated as of
___________, 2004, by and among WINDMILL, BWA Receivables Corporation (the
"Borrower"), BorgWarner Inc., as Collection Agent, the banks from time to time
party thereto (collectively, the "Banks"), and ABN AMRO Bank N.V., as agent (the
"Agent") for the Banks and WINDMILL. Unless otherwise defined herein,
capitalized terms used herein shall have the meaning ascribed to such term in
the Loan Agreement.
WITNESSETH THAT:
WHEREAS, this Assignment is being executed and delivered in accordance with
Section 3.2 of the Loan Agreement,
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. On the terms and subject to the conditions of this Assignment and
the Loan Agreement, the Assignor hereby sells, transfers, assigns, sets
over and otherwise conveys to WINDMILL, and WINDMILL hereby acquires from
the Assignor, all of the Assignor's right, title and interest in and to the
Interest designated in the Notice attached hereto (the "Purchased
Interest"), after giving effect to the payment (or exchange) of the
purchase price as calculated in accordance with Section 3.2 of the Loan
Agreement (the "Loan Price"), all without recourse, representation or
warranty (except as explicitly described below).
2. Each of the parties to this Assignment 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.
3. By executing and delivering this Assignment, each of WINDMILL and
the Assignor confirms and agrees with the other as follows: other than the
representation and warranty that the Assignor is transferring the Purchased
Interest free and clear of any Adverse Claim created or granted by the
Assignor, the Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Purchased Interest or the
Loan
Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Purchased Interest or the Loan
Agreement or any other instrument or document furnished pursuant thereto or
in connection therewith.
4. THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF ILLINOIS.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed by their respective duly authorized officers.
WINDMILL FUNDING CORPORATION
By:
------------------------------------
Title:
---------------------------------
[INSERT NAME OF ASSIGNOR]
By:
------------------------------------
Title:
---------------------------------
[By:
----------------------------------
Title:
--------------------------------]
Acknowledged:
ABN AMRO Bank N.V., as
Agent under the Loan Agreement
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
F-2
FORM OF SECTION 3.2 WINDMILL PURCHASE NOTICE
Dated _____________, 200__
ABN AMRO Bank N.V.,
as Agent for the Lenders
Asset Securitization, Structured Finance
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Lender Agent - WINDMILL
BWA Receivables Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President and Treasurer
Ladies and Gentlemen:
Reference is made to the Second Amended and Restated Receivables Loan
Agreement, dated as of ___________, 2004 (as amended, the "Loan Agreement"),
among BWA Receivables Corporation, a Delaware corporation (the "Borrower"),
BorgWarner Inc., a Delaware corporation, as Collection Agent, Windmill Funding
Corporation, a Delaware corporation ("WINDMILL"), the banks from time to time
party thereto (collectively, the "Banks"), ABN AMRO Bank N.V., as agent (the
"Agent") for WINDMILL and the Banks. Unless expressly otherwise defined herein,
terms defined in the Loan Agreement are used herein with the same meaning.
WINDMILL hereby advises the Agent that, at the request of the Borrower, it
intends to exercise its right under Section 3.2 of the Loan Agreement to acquire
the portion of the other Lenders' Interest identified below on _______________,
200__ (the "WINDMILL Purchase Date"). The purchase price as calculated in
accordance with Section 3.2 of the Loan Agreement (the "Loan Price") in the
amount of ____________ Dollars ($____________) shall be payable in full to the
Agent, for the account of the applicable Lender, on such WINDMILL Purchase Date.
The Loan Price has been calculated in the manner described on Schedule I
attached hereto and made a part hereof.
In connection with the transfer of the Interest described above (the
"Assigned Interest"), the undersigned Assignor agrees as follows:
1. The Assignor hereby assigns to the Agent for the account of
WINDMILL, effective as of the WINDMILL Purchase Date specified above, all
right, title and interest of the Assignor in the Assigned Interest in
consideration of the payment to the Assignor of the Loan Price specified
above.
F-3
ABN AMRO Bank N.V.,
BWA Receivables Corporation
Dated _____________, 200__
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the Assigned Interest and that such interest is free
and clear of any Adverse Claim created by the Assignor; (ii) represents and
warrants that, on and as of the WINDMILL Purchase Date, it is not the
subject of any bankruptcy, insolvency or other similar proceeding, (iii)
makes no representation and warranty and assumes no responsibility with
respect to any statements, warranties, or representations made in or in
connection with the Loan Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Agreement,
any Interest (whether the Assigned Interest or otherwise), any Receivables,
or Related Security or any other instrument or document or other Affected
Asset related to the foregoing; and (iv) makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Borrower, the Parent, any Originator or any Obligor, the
collectibility of any Receivable or the performance or observance by the
Borrower (whether as the Borrower, in its capacity as Collection Agent or
otherwise) of any of its obligations under the Loan Agreement or any other
instrument or document related thereto.
3. This notice is delivered to the Agent for, among other purposes,
recording by the Agent. From and after the later to occur of the WINDMILL
Purchase Date specified above, the date the Assignor shall receive payment
in full of the Loan Price specified above, and the execution and delivery
of an Assignment in the form of Exhibit F of the Loan Agreement, the Agent
shall make all payments under the Loan Agreement in respect of the Assigned
Interest (including, without limitation, all payments on account of the
Receivables and of Interest with respect thereto) to WINDMILL.
4. THIS NOTICE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF ILLINOIS.
F-4
ABN AMRO Bank N.V.,
BWA Receivables Corporation
Dated _____________, 200__
IN WITNESS WHEREOF, the Assignor and WINDMILL have caused this notice to be
executed by an authorized signatory as of the date first above written.
WINDMILL FUNDING CORPORATION
By:
------------------------------------
Title:
---------------------------------
ASSIGNOR:
[INSERT NAME OF ASSIGNOR]
By:
------------------------------------
Title:
---------------------------------
[By:
----------------------------------
Title:
--------------------------------]
F-5
SCHEDULE I
TO
NOTICE
Dated _____________, 200_
CALCULATION OF THE LOAN PRICE
(AS SPECIFIED IN SECTION 3.2 OF THE LOAN AGREEMENT)
(To be attached at the time the notice is submitted, demonstrating compliance
with the requirements for calculation set forth in the Loan Agreement)
EXHIBIT G
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
ADDRESSES OF BORROWER AND ORIGINATOR
BorgWarner Inc.
(HEADQUARTERS)
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: N/A
BorgWarner Diversified Transmission Products Inc.
(Executive Office):
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
(OPERATING DIVISION) Muncie, Indiana
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: Muncie, Indiana (see address above)
BorgWarner Emissions Systems Inc.
(Executive Office):
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
(OPERATING DIVISION) Dixon, Illinois
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Dixon, Illinois (see address above)
(OPERATING DIVISION) Water Valley, Mississippi
State ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Water Valley, Mississippi (see address above)
BorgWarner TorqTransfer Systems Inc.
(Executive Office):
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
(OPERATING DIVISION) Seneca, South Carolina
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Seneca, South Carolina (see address above)
(OPERATING DIVISION) Longview, Texas
▇▇. ▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Longview, Texas (see address above)
BorgWarner ▇▇▇▇▇ TEC Inc.
(Executive Office/Tech Center):
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
Sales ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
(OPERATING DIVISION) Ithaca, New York
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(OPERATING DIVISION) Cortland, NY
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: Cortland, NY (see address above)
(OPERATING DIVISION) Sallisaw, Oklahoma
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Sallisaw, OK (see address above)
G-2
BorgWarner Transmission Systems Inc.
(Executive Office):
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
Aftermarket Center
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: Lombard, IL (see above address)
North American Sales ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
(OPERATING DIVISION): Bellwood, Illinois
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Bellwood, Illinois (see address above)
(OPERATING DIVISION): Frankfort, Illinois
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Frankfort, Illinois (see address above)
BorgWarner Turbo Systems Inc.
(Executive Office/Operating Division):
Asheville, North Carolina
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records Asheville, North Carolina: (see address above)
BWA Receivables Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: N/A
G-3
BorgWarner Thermal Systems Inc.
(Executive Office):
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(TECH CENTER) ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: N/A
(OPERATING DIVISION) Cadillac, Michigan
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Cadillac, Michigan: (see address above)
(OPERATING DIVISION) Fletcher, North Carolina
(remanufacturing) ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A/R Records: Fletcher, North Carolina
Sales Office:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
A/R Records: N/A
G-4
EXHIBIT H
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
BORROWER'S AND ▇▇▇▇-▇▇▇▇▇▇ ENTITIES' CORPORATE NAMES; TRADE NAMES;
ASSUMED NAMES
1.) BorgWarner Inc.
2.) BorgWarner TorqTransfer Systems Inc.
3.) BorgWarner Diversified Transmission Products Inc.
4.) BorgWarner Emissions Systems Inc.
- BorgWarner Emissions/Thermal Systems, "E/TS"
5.) BorgWarner ▇▇▇▇▇ TEC Inc.
- ▇▇▇▇▇ Chain Systems
6.) BorgWarner Transmission Systems Inc.
7.) BorgWarner Turbo Systems Inc.
8.) BorgWarner Thermal Systems Inc.
- BorgWarner Emissions/Thermal Systems, "E/TS"
EXHIBIT I
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
INTENTIONALLY OMITTED
EXHIBIT J
FORM OF COMPLIANCE CERTIFICATE
To: ABN AMRO Bank N.V., as Agent, and
each Lender
This Compliance Certificate is furnished pursuant to Section [5.1(d)],
[6.1(a)(iii)] of that certain Second Amended and Restated Receivables Loan
Agreement, dated as of December 6, 2004 (as amended, supplemented or otherwise
modified through the date hereof, the "Loan Agreement"), among BWA Receivables
Corporation (the "Borrower"), BorgWarner Inc., as Collection Agent, the banks
from time to time party thereto (collectively, the "Banks"), Windmill Funding
Corporation ("WINDMILL") and ABN AMRO Bank N.V. as agent for the Lenders (in
such capacity, the "Agent"). Terms used in this Compliance Certificate and not
otherwise defined herein shall have the respective meanings ascribed thereto in
the Loan Agreement.
THE UNDERSIGNED HEREBY REPRESENTS, WARRANTS, CERTIFIES AND CONFIRMS THAT:
1. I am a duly elected Designated Financial Officer of ____________.
2. Attached hereto is a copy of the [BALANCE SHEET] [FINANCIAL
STATEMENTS] described in Section 6.1(a)(i) or 6.1(a)(ii) of the Loan
Agreement.
3. I have reviewed the terms of the Transaction Documents and I have
made, or have caused to be made under my supervision, a detailed review of
the transactions and the conditions of the Borrower and each other
▇▇▇▇-▇▇▇▇▇▇ Entity during and at the end of the accounting period covered
by the attached [BALANCE SHEET] [FINANCIAL STATEMENTS].
4. The examinations described in paragraph 3 hereof did not disclose,
and I have no knowledge of, the existence of any condition or event which
constitutes a Termination Event or Potential Termination Event, during or
at the end of the accounting period covered by the attached [BALANCE SHEET]
[FINANCIAL STATEMENTS] or as of the date of this Compliance Certificate,
except as set forth below.
[5. SCHEDULE I ATTACHED HERETO SETS FORTH DATA AND COMPUTATIONS WITH
RESPECT TO THE FINANCIAL COVENANTS SET FORTH IN THE LOAN AGREEMENT AND/OR
IN SECTION 4.2 OF THE INDEMNITY AGREEMENT, EVIDENCING THE COMPLIANCE WITH
EACH SUCH FINANCIAL COVENANT, ALL OF WHICH DATA AND COMPUTATIONS ARE TRUE,
COMPLETE AND CORRECT, AND ALL INFORMATION WHICH IS BASED ON ESTIMATES HAS
BEEN CALCULATED USING METHODS OF ESTIMATION ON A CONSISTENT BASIS AND
WITHOUT ANY INTENT TO CHANGE OR DISTORT SUCH INFORMATION TO SHOW COMPLIANCE
WITH SUCH FINANCIAL COVENANTS.]
Described below are the exceptions, if any, to paragraph 4 listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which
_____________________________ has taken, is taking or proposes to take with
respect to each such condition or event:
The foregoing certifications, together with the computations set forth in
Schedule I hereto and the [BALANCE SHEET] [FINANCIAL STATEMENTS] delivered with
this Compliance Certificate in support hereof, are made and delivered this ____
day of ___________, 20__.
[NAME OF BORROWER or PARENT]
By:
------------------------------------
Designated Financial Officer
J-2
EXHIBIT K
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
FORM OF LOAN REQUEST
______________, 200_
ABN AMRO BANK N.V., as Agent
Asset Securitization, Structured Finance
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Lender Agent--WINDMILL
Re: BWA Receivables Corporation
Ladies and Gentlemen:
The undersigned, BWA Receivables Corporation, a Delaware corporation (the
"Borrower"), hereby refers to the Second Amended and Restated Receivables Loan
Agreement, dated as of December 6, 2004 (the "Loan Agreement"; capitalized terms
used and not otherwise defined herein shall have the meanings ascribed to such
terms in the Loan Agreement), among the Borrower, BorgWarner Inc., a Delaware
corporation, as Collection Agent, the banks from time to time party thereto
(collectively, the "Banks"), Windmill Funding Corporation, a Delaware
corporation ("WINDMILL"), and ABN AMRO Bank N.V., as agent (the "Agent") for the
Banks and WINDMILL, and hereby gives the Agent notice, irrevocably, pursuant to
Section 2.1(c) of the Loan Agreement, of a proposed (the "Proposed Loan(s)"). In
connection therewith, please find attached hereto as Exhibit A, the information
relating to the Proposed Loan(s) required by Section 2.1(c) of the Loan
Agreement. In the event that, on the date of this Loan Request ("Notice"), any
Interim Liquidation shall then be in effect, this Notice shall be revoked,
effective immediately, and Collections shall be set aside in accordance with
Section 3.3(b) of the Loan Agreement.
The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on [each of] the proposed Loan Date(s) referenced
on Exhibit A:
(i) Both before and after giving effect to [each of] the Proposed
Loan[s] contemplated hereby and the use of the proceeds therefrom, the
representations and warranties contained in Section 4.1 of the Loan
Agreement are true and correct in all material respects on and as of such
Loan Date as though made on and as of such Loan Date;
(ii) Both before and after giving effect to [each of] the Proposed
Loan[s] contemplated hereby, no Termination Event or Potential Termination
Event has occurred and is continuing, or would result in connection with
such Proposed Loan or the use of the proceeds therefrom; and
(iii) All of the requirements of Section 5.2 of the Loan Agreement
have been satisfied in connection with each Loan.
Very truly yours,
BWA RECEIVABLES CORPORATION
By:
------------------------------------
Title:
---------------------------------
K-2
EXHIBIT A
TO
LOAN REQUESTS
SUMMARY OF INFORMATION RELATING TO PROPOSED LOAN(S)
1. Dates, Amounts, Lender(s), Proposed Tranche Periods
A1 Date of Notice _________
A2 Measurement Date (the last Business Day of
the week immediately preceding the week
in which the Date of Notice occurs) _________
A3 Proposed Loan Dates (each of which is a
Business Day) _________ _________ _________ _________
A4 Respective Proposed Loan on each such Loan
Date $_________ $_________ $_________ $_________
(A4A) (A4B) (A4C) (A4D)
A5 Proposed Allocation among Lenders
WINDMILL $_________ $_________ $_________ $_________
Banks $_________ $_________ $_________ $_________
A6 Tranche Period
Starting Date _________ _________ _________ _________
Ending Date _________ _________ _________ _________
Number of Days _________ _________ _________ _________
Notes:
(i) Each proposed Loan Date must be a Business Day, and must occur no later
than two (2) weeks after the Measurement Date set forth above. The choice
of Measurement Date is a risk undertaken by the Borrower. If a selected
Measurement Date is other than the applicable Loan Date, notwithstanding
the disclosure of such choice herein, such choice shall not in any manner
diminish, waive, reduce or otherwise affect the obligation of the Borrower
to assure the Lenders that, after giving effect to the Proposed Loan, the
actual
Percentage Factor (including the aggregate for all Lenders) as of the date
of such Proposed Transfer shall not exceed one hundred percent (100%), such
assurance being a fundamental condition on which the willingness of any
Lender to make the related purchase shall be based.
(ii) Except as set forth in Section 2.1(c) of the Loan Agreement, each Loan
shall not be less than One Million Dollars ($1,000,000).
A-2
EXHIBIT L
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
ACTIVITIES TO MAINTAIN SEPARATE CORPORATE
EXISTENCE OF ▇▇▇▇-▇▇▇▇▇▇ ENTITIES
The Borrower shall:
1. compensate all employees, consultants and agents directly, from the
Borrower's bank accounts, for services provided to the Borrower by such
employees, consultants and agents and, to the extent any employee, consultant or
agent of the Borrower is also an employee, consultant or agent of any other
▇▇▇▇-▇▇▇▇▇▇ Entity, allocate the compensation of such employee, consultant or
agent between the Borrower and such ▇▇▇▇-▇▇▇▇▇▇ Entity on a basis which reflects
the services rendered to the Borrower and such ▇▇▇▇-▇▇▇▇▇▇ Entity;
2. clearly identify and occupy space that is separate and distinct from any
space occupied by any other ▇▇▇▇-▇▇▇▇▇▇ Entity even if such space is leased or
subleased from, or is on or near premises occupied by, any other ▇▇▇▇-▇▇▇▇▇▇
Entity;
3. have separate stationery and other business forms;
4. conduct its business solely in its own name through its duly authorized
officers or agents including, without limitation, in all oral and written
communications such as letters, invoices, purchase orders, contracts, statements
and applications;
5. make independent decisions with respect to its daily business and
affairs and not be controlled in making such decisions by any other ▇▇▇▇-▇▇▇▇▇▇
Entity;
6. allocate all overhead expenses (including, without limitation, telephone
and other utility charges) for items shared between the Borrower and any other
▇▇▇▇-▇▇▇▇▇▇ Entity 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;
7. at all times have at least two member of its board of directors (each,
an "Independent Director") (which Independent Director shall have a fiduciary
duty to creditors of the Borrower) who is not (A) a director, officer or
employee of any other ▇▇▇▇-▇▇▇▇▇▇ Entity, (B) a person related to any officer or
director of any ▇▇▇▇-▇▇▇▇▇▇ Entity, (C) a holder (directly or indirectly) of
more than one percent (1%) of any voting securities of any ▇▇▇▇-▇▇▇▇▇▇ Entity,
or (D) a person related to a holder (directly or indirectly) of more than one
percent (1%) of any voting securities of any other ▇▇▇▇-▇▇▇▇▇▇ Entity;
8. ensure that all corporate actions with respect to (i) the filing for any
petition of bankruptcy of the Borrower, (ii) transactions with Affiliates of the
Borrower and (iii) compensation of officers of the Borrower, are duly authorized
by unanimous vote of its board of directors (and duly authorized by its
stockholders when necessary);
9. maintain complete and correct books and records of account and minutes
of meetings and other proceedings of its stockholder and board of directors;
10. maintain its financial, corporate and other books and records separate
from those of any other ▇▇▇▇-▇▇▇▇▇▇ Entity;
11. prepare its financial statements separately from those of other
▇▇▇▇-▇▇▇▇▇▇ Entities and insure that any consolidated financial statements of
any other ▇▇▇▇-▇▇▇▇▇▇ Entity that include the Borrower have detailed notes
clearly stating that the Borrower is a separate corporate entity;
12. maintain a cash management system separate from any other ▇▇▇▇-▇▇▇▇▇▇
Entity and not commingle funds or other assets of Borrower with those of any
other ▇▇▇▇-▇▇▇▇▇▇ Entity and not maintain bank accounts or other depository
accounts to which any other ▇▇▇▇-▇▇▇▇▇▇ Entity is an account party, into which
any other ▇▇▇▇-▇▇▇▇▇▇ Entity makes deposits or from which any other ▇▇▇▇-▇▇▇▇▇▇
Entity has the power to make withdrawals (except as agent to the special purpose
corporation as specifically contemplated by any servicing agreement between such
parties approved by WINDMILL);
13. pay operating expenses and liabilities from its own funds and not
permit any other ▇▇▇▇-▇▇▇▇▇▇ Entity to pay any of the Borrower's operating
expenses or liabilities (except pursuant to allocation arrangements that comply
with the requirements of paragraph 2 above);
14. maintain adequate capitalization in light of its business and purpose;
15. not hold itself out or permit itself to be held out as having agreed to
pay or as being liable for the debts of any other ▇▇▇▇-▇▇▇▇▇▇ Entity nor will it
hold any other ▇▇▇▇-▇▇▇▇▇▇ Entity out or permit any other ▇▇▇▇-▇▇▇▇▇▇ Entity to
be held out as having agreed to pay or as being liable for the debts of the
Borrower (except as contemplated by the Receivables Loan Agreement) nor will it
fail to correct any known misrepresentation with respect to the foregoing;
16. not operate or purport to operate as an integrated, single economic
unit with one or more of the other ▇▇▇▇-▇▇▇▇▇▇ Entities;
17. not seek or obtain credit or incur any obligation to any third party
based upon the assets of one or more of the other ▇▇▇▇-▇▇▇▇▇▇ Entities or induce
any such third party to reasonably rely on the creditworthiness of one or more
of the other ▇▇▇▇-▇▇▇▇▇▇ Entities;
L-2
18. not guaranty or otherwise become liable with respect to indebtedness of
any other ▇▇▇▇-▇▇▇▇▇▇ Entity nor permit guaranties or liability by any other
▇▇▇▇-▇▇▇▇▇▇ Entity of the indebtedness of the Borrower (except as contemplated
by the Receivables Loan Agreement);
19. maintain an arm's-length relationship with each other ▇▇▇▇-▇▇▇▇▇▇
Entity, including, without limitation, payment of an arm's-length servicing fee
for any receivables-servicing functions performed by any other ▇▇▇▇-▇▇▇▇▇▇
Entity on behalf of the Borrower; and
20. not, directly or indirectly, be named and shall not enter into any
agreement to be named as a direct or contingent beneficiary or loss payee on any
insurance policy covering the property of any other ▇▇▇▇-▇▇▇▇▇▇ Entity.
L-3
EXHIBIT M
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
LOANS SUPPLEMENT
[FORM OF ASSIGNMENT FOR BANK COMMITMENT]
LOANS SUPPLEMENT, dated as of the date set forth in Item 1 of Schedule I
hereto, between the Selling Bank set forth in Item 2 of Schedule I hereto (the
"Selling Bank"), and the Purchasing Bank set forth in Item 3 of Schedule I
hereto (the "Purchasing Bank").
WITNESSETH:
WHEREAS, this Loans Supplement is being executed and delivered in
accordance with Section 11.6(c) of the Second Amended and Restated Receivables
Loan Agreement, dated as of December 6, 2004, among BWA Receivables Corporation,
a Delaware corporation (the "Borrower"), BorgWarner Inc., a Delaware
corporation, as Collection Agent, ABN AMRO Bank N.V., as agent for the Lenders
(in such capacity on behalf of the Lenders, the "Agent"), and the banks from
time to time party thereto (collectively the "Banks"), and Windmill Funding
Corporation, a Delaware corporation ("WINDMILL") (WINDMILL together with the
Banks, the "Lenders") (as amended, supplemented or otherwise modified from time
to time, the "Loan Agreement"). Terms defined therein being used herein (and in
the Schedules hereto) have the same meaning as defined in the Loan Agreement).
WHEREAS, the Purchasing Bank wishes to become a Bank party to the Loan
Agreement; and
WHEREAS, the Selling Bank is selling and assigning to the Purchasing Bank
certain rights and obligations under the Loan Agreement as set forth herein;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Upon receipt by the Agent of ten (10) counterparts of this Loans
Supplement, to each of which is attached a fully completed Schedule I and
Schedule II, and each of which has been executed by the Selling Bank, the
Purchasing Bank, the Agent and the Borrower, and upon the satisfaction of
all of the requirements set forth in clauses (i) through (iii) of Section
11.6(c) of the Loan Agreement and delivery of an opinion of counsel of the
Purchasing Bank as described therein, the Agent will transmit to the
Borrower, the Selling Bank and the Purchasing Bank a Transfer Effective
Notice, substantially in the form of Schedule III to this Loans Supplement
(a "Transfer Effective Notice"). Such Transfer Effective Notice shall set
forth, inter alia, the date on which the transfer effected by this Loans
Supplement shall become effective (the "Transfer Effective Date"), which
date shall be two (2) Business Days following the date of such
Transfer Effective Notice (or such other date selected by the Agent in its
sole discretion). From and after the Transfer Effective Date, the
Purchasing Bank shall be a Bank party to the Loan Agreement for all
purposes thereof as if the Purchasing Bank were an original party thereto
and the Purchasing Bank agrees to be bound by all of the terms and
provisions contained therein.
2. At or before 12:00 noon, local time of the Selling Bank, on the
Transfer Effective Date, if the Selling Bank owns any Loan Amount under the
Loan Agreement, the Purchasing Bank shall pay to the Selling Bank, in
immediately available funds, an amount equal to the sum of (i) that portion
of the Selling Bank's Loan Amount based upon that portion of its Bank
Commitment hereby transferred (the "Purchasing Bank Investment"), plus (ii)
all accrued but unpaid (whether or not then due) Interest attributable to
such Purchasing Bank Investment, plus (iii) all accrued but unpaid fees and
other costs and expenses (whether or not then due) payable in respect of
the Bank Commitment hereby transferred, plus (iv) any breakfunding cost
incurred by the Selling Bank as a result of any reduction in such Selling
Bank's Loan Amount in a Eurodollar Tranche due to the reduction of such
Selling Bank's allocable portion of the Bank Loan Amount pursuant hereto
(the "Loan Price"). Effective upon receipt by the Selling Bank of the Loan
Price from the Purchasing Bank, the Selling Bank hereby transfers and
assigns to the Purchasing Bank, without recourse, representation or
warranty (except as explicitly set forth below), and the Purchasing Bank
hereby irrevocably takes, receives and assumes from the Selling Bank, that
portion of the Selling Bank's beneficial interest in the Secured Interest
held by the Agent on its behalf, if any, allocable to the portion of the
Bank Commitment hereby transferred.
3. Concurrently with the execution and delivery hereof, the Selling
Bank will provide to the Purchasing Bank copies of all documents requested
by such Purchasing Bank which were delivered to such Selling Bank pursuant
to the conditions precedent set forth in Article V of the Loan Agreement.
4. Each of the parties to this Loans Supplement 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 Loans Supplement.
5. By executing and delivering this Loans Supplement, the Selling Bank
and the Purchasing Bank confirm to and agree with each other and the Agent
and the other Lenders as follows: (i) other than the representation and
warranty that it has not created any Adverse Claim upon any interest being
transferred hereunder, the Selling Bank makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Loan Agreement or any
other Transaction Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Agreement,
any other Transaction Document, any Interest, any Receivable, or any other
Affected Asset or any other instrument or document furnished pursuant
thereto or the perfection, priority, condition, value or sufficiency of any
collateral; (ii) the Selling Bank makes no
M-2
representation or warranty and assumes no responsibility with respect to
the financial condition of the Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or
any other Affiliate of the Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or any
Obligor or the performance or observance by the Borrower or any other
▇▇▇▇-▇▇▇▇▇▇ Entity or any other Affiliate of the Borrower or any other
▇▇▇▇-▇▇▇▇▇▇ Entity of any of its obligations under the Loan Agreement, any
other Transaction Document or any other instrument or document furnished
pursuant thereto or the collectibility of any Receivable; (iii) the
Purchasing Bank confirms that it has received a copy of the Loan Agreement
(other than the Fee Letter), together with such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into this Loans Supplement; (iv) the Purchasing Bank
will, independently and without reliance upon the Agent, the Selling Bank
or any other 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, or in connection with, the Loan
Agreement; (v) the Purchasing Bank appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers under,
or in connection with, the Loan Agreement as are delegated to the Agent by
the terms thereof, together with such powers as are reasonably incidental
thereto, all in accordance with Article X of the Loan Agreement; (vi) the
Purchasing Bank agrees that it will perform in accordance with their terms
all of the obligations which by the terms of the Loan Agreement are
required to be performed by it as a Bank; and (vii) the Purchasing Bank
specifies as its address for notices the address set forth in Schedule II
hereto.
6. Each party hereto represents and warrants to and agrees with the
Agent that each party hereto is aware of and will comply with all of the
provisions of the Loan Agreement.
7. Schedule II hereto sets forth the revised Bank Commitment of the
Selling Bank and the Purchasing Bank, respectively, as well as
administrative information with respect to the Purchasing Bank.
8. Following the execution of this Loans Supplement by the Selling
Bank and the Purchasing Bank, it will be delivered to the Agent for
acceptance and recording by the Agent. This Loans Supplement shall be
effective as of the Transfer Effective Date but only after it has been
accepted and recorded by the Agent.
9. Upon acceptance and recording of this Loans Supplement by the
Agent, as of the Transfer Effective Date, (i) the Purchasing Bank shall be
a party to the Loan Agreement and, to the extent provided in this Loans
Supplement and in the Loan Agreement and to the extent transferred
hereunder, have the rights and obligations of the Selling Bank thereunder
and (ii) the Selling Bank shall, to the extent provided in this Loans
Supplement and the Loan Agreement, relinquish its rights and be released
from its obligations under the Loan Agreement.
10. From and after the later of the Transfer Effective Date and the
date of acceptance and recording of this Loans Supplement by the Agent, the
Agent shall make
M-3
all payments under the Loan Agreement in respect of the interest assigned
hereby (including, without limitation, all payments on account of the
Purchasing Bank Investment and of Interest with respect thereto) to the
Purchasing Bank. The Selling Bank and the Purchasing Bank shall make
directly between themselves all appropriate adjustments in payments under
the Transfer Agreement for periods, if any, prior to the later of the dates
specified in the preceding sentence.
11. The Selling Bank and the Purchasing Bank hereby advise the Agent
that, to the extent the consent of the Borrower or any other Person is
required for the transfer contemplated herein, such consent has been duly
obtained and remains in full force and effect.
12. This Loans Supplement 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 Loans
Supplement.
13. THIS LOANS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS.
IN WITNESS WHEREOF, the parties hereto have caused this LOANS SUPPLEMENT to
be executed by their respective duly authorized officers on Schedule I hereto as
of the date set forth in Item 1 of Schedule I hereto.
M-4
SCHEDULE I
TO LOANS
SUPPLEMENT
COMPLETION OF INFORMATION
AND SIGNATURES FOR
LOANS SUPPLEMENT
Re: Second Amended and Restated Receivables Loan Agreement, dated as of
__________, 2004, with BWA Receivables Corporation
Item 1 Date of Loans Supplement:
Item 2 Selling Bank:
Item 3 Purchasing Bank:
, as
------------------------------------
Selling Bank
By:
------------------------------------
Title:
---------------------------------
[By:
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Title:
--------------------------------]
, as
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Purchasing Bank
By:
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Title:
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Consented To and Acknowledged:
ABN AMRO BANK N.V., as Agent
By:
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Title:
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By:
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Title:
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BWA RECEIVABLES CORPORATION
By:
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Title:
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SCHEDULE II
TO LOANS
SUPPLEMENT
LIST OF OFFICES AND ADDRESSES
FOR NOTICES AND COMMITMENT AMOUNTS
Selling Bank: Revised Bank Commitment:
Purchasing Bank: Bank Commitment:
Address for Notices for Purchasing Bank:
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Attention:
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Telephone:
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Telecopy:
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SCHEDULE III
TO LOANS
SUPPLEMENT
TRANSFER EFFECTIVE NOTICE
To: THE PURCHASING BANK LISTED
ON SCHEDULE I HERETO
The undersigned, as Agent under the Second Amended and Restated Receivables
Loan Agreement, dated as of December 6, 2004, among BWA Receivables Corporation,
BorgWarner Inc., as Collection Agent, ABN AMRO Bank N.V., as Agent, the banks
from time to time party thereto and Windmill Funding Corporation (as amended,
supplemented, or otherwise modified from time to time, the "Loan Agreement")
acknowledges receipt of ten (10) executed counterparts of a completed Loans
Supplement, dated as of the date set forth in Item 1 of Schedule I hereto,
between the Selling Bank set forth in Item 2 of Schedule I hereto and the
Purchasing Bank set forth in Item 3 of Schedule I hereto, and schedules thereto.
Terms defined in such Loans Supplement are used herein as therein defined.
1. Pursuant to such Loans Supplement, you are advised that the Transfer
Effective Date will be __________________.
2. Pursuant to such Loans Supplement the Purchasing Bank is required to pay
its Loan Price, if any, to the Selling Bank at or before 12:00 noon, local time
of the Selling Bank, on the Transfer Effective Date in immediately available
funds.
Very truly yours,
ABN AMRO BANK N.V., as Agent
By:
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Title:
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By:
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Title:
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EXHIBIT N
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
LOANS SUPPLEMENT
[FORM OF ASSIGNMENT FOR WINDMILL]
LOANS SUPPLEMENT, dated as of the date set forth in Item 1 of Schedule I
hereto, between the Assignor set forth in Item 2 of Schedule I hereto (the
"Assignor"), and the Assignee set forth in Item 3 of Schedule I hereto (the
"Assignee").
WITNESSETH:
WHEREAS, this Loans Supplement is being executed and delivered in
accordance with Section 11.6(e)(ii) of the Second Amended and Restated
Receivables Loan Agreement, dated as of December 6, 2004, among BWA Receivables
Corporation, a Delaware corporation (the "Borrower"), BorgWarner Inc., a
Delaware corporation, as Collection Agent, ABN AMRO Bank N.V., as agent for the
Lenders (in such capacity on behalf of the Lenders, the "Agent"), and the banks
from time to time party thereto (collectively the "Banks"), and Windmill Funding
Corporation, a Delaware corporation ("WINDMILL") (WINDMILL together with the
Banks, the "Lenders") (as amended, supplemented or otherwise modified from time
to time, the "Loan Agreement"). Terms defined therein being used herein (and in
the Schedules hereto) have the same meaning as defined in the Loan Agreement).
WHEREAS, the Assignee wishes to become a party to the Loan Agreement; and
WHEREAS, the Assignor is selling and assigning to the Assignee all of its
Loan Amount and Interest and all rights and obligations related thereto under
the Loan Agreement as set forth herein;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Upon receipt by the Agent of ten (10) counterparts of this Loans
Supplement, to each of which is attached a fully completed Schedule I and
Schedule II, and each of which has been executed by the Assignor, the
Assignee, the Agent and the Borrower, and upon the satisfaction of all of
the requirements set forth in Section 11.6(e)(ii) of the Loan Agreement,
including delivery of an opinion of counsel of the Assignee as described
therein, the Agent will transmit to the Borrower, the Assignor and the
Assignee a Transfer Effective Notice, substantially in the form of Schedule
III to this Loans Supplement (a "Transfer Effective Notice"). Such Transfer
Effective Notice shall set forth, inter alia, the date on which the
transfer effected by this Loans Supplement shall become effective (the
"Transfer Effective Date"), which date shall be two (2) Business Days
following the date of such Transfer Effective Notice (or such other
date selected by the Agent in its sole discretion). From and after the
Transfer Effective Date, (i) the Assignee shall be a party to the Loan
Agreement for all purposes thereof as if the Assignee were an original
party thereto, all references to "WINDMILL" in the Loan Agreement and all
other Transaction Documents shall be references to the Assignee and the
Assignee agrees to be bound by all of the terms and provisions contained
therein, and the Assignor shall be substituted, released and discharged
from any further obligations under the Loan Agreement.
2. At or before 12:00 noon, local time of the Assignor, on the
Transfer Effective Date, if the Assignor owns any Loan Amount under the
Loan Agreement, the Assignee shall pay to the Assignor, in immediately
available funds, an amount equal to the sum of (i) the Loan Amount of the
Assignor, plus (ii) all unpaid Interest owed to, or which may become
payable to, the Assignor under the Loan Agreement to the end of all Tranche
Periods applicable to such Loan Amount, plus (iii) all accrued but unpaid
fees and other costs and expenses (whether or not then due) payable to the
Assignor under or in connection with the Loan Agreement (the "Loan Price").
Effective upon receipt by the Assignor of the Loan Price from the Assignee,
the Assignor hereby transfers and assigns to the Assignee, without
recourse, representation or warranty (except as explicitly set forth
below), and the Assignee hereby irrevocably takes, receives and assumes
from the Assignor, all of the Assignor's beneficial interest in the Secured
Interest held by the Agent on its behalf, if any.
3. Concurrently with the execution and delivery hereof, the Assignor
will provide to the Assignee copies of all documents requested by the
Assignee which were delivered to the Assignor pursuant to the conditions
precedent set forth in Article V of the Loan Agreement.
4. Each of the parties to this Loans Supplement 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 Loans Supplement.
5. By executing and delivering this Loans Supplement, the Assignor and
the Assignee confirm to and agree with each other and the Agent and the
other Lenders as follows: (i) other than the representation and warranty
that it has not created any Adverse Claim upon any interest being
transferred hereunder, the Assignor makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Loan Agreement or any
other Transaction Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Agreement,
any other Transaction Document, any Interest, any Receivable, or any other
Affected Asset or any other instrument or document furnished pursuant
thereto or the perfection, priority, condition, value or sufficiency of any
collateral; (ii) the Assignor makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or any other Affiliate of the
Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or any Obligor or the performance
or observance by the
N-2
Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity or any other Affiliate of the
Borrower or any other ▇▇▇▇-▇▇▇▇▇▇ Entity of any of its obligations under
the Loan Agreement, any other Transaction Document or any other instrument
or document furnished pursuant thereto or the collectibility of any
Receivable; (iii) the Assignee confirms that it has received a copy of the
Loan Agreement (other than the Fee Letter), together with such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Loans Supplement; (iv) the
Assignee will, independently and without reliance upon the Agent, the
Assignor or any other Lender 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, or in connection with, the
Loan Agreement; (v) the Assignee appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under, or in
connection with, the Loan Agreement as are delegated to the Agent by the
terms thereof, together with such powers as are reasonably incidental
thereto, all in accordance with Article X of the Loan Agreement; (vi) the
Assignee agrees that it will perform in accordance with their terms all of
the obligations which by the terms of the Loan Agreement are required to be
performed by it as "WINDMILL" under the Loan Agreement; and (vii) the
Assignee specifies as its address for notices the address set forth in
Schedule II hereto.
6. Each party hereto represents and warrants to and agrees with the
Agent that each party hereto is aware of and will comply with all of the
provisions of the Loan Agreement.
7. Schedule II hereto sets forth administrative information with
respect to the Assignee.
8. Following the execution of this Loans Supplement by the Assignor
and the Assignee, it will be delivered to the Agent for acceptance and
recording by the Agent. This Loans Supplement shall be effective as of the
Transfer Effective Date but only after it has been accepted and recorded by
the Agent.
9. Upon acceptance and recording of this Loans Supplement by the
Agent, as of the Transfer Effective Date, (i) the Assignee shall be a party
to the Loan Agreement and, to the extent provided in this Loans Supplement
and in the Loan Agreement and to the extent transferred hereunder, have the
rights and obligations of the Assignor thereunder and (ii) the Assignor
shall, to the extent provided in this Loans Supplement and the Loan
Agreement, relinquish its rights and be released from its obligations under
the Loan Agreement.
10. From and after the later of the Transfer Effective Date and the
date of acceptance and recording of this Loans Supplement by the Agent, the
Agent shall make all payments under the Loan Agreement in respect of the
interest assigned hereby (including, without limitation, all payments on
account of the Assignor and of Interest with respect thereto) to the
Assignee. The Assignor and the Assignee shall make directly between
themselves all appropriate adjustments in payments under the Loan Agreement
for periods, if any, prior to the later of the dates specified in the
preceding sentence.
N-3
11. The Assignor and the Assignee hereby advise the Agent that, to the
extent the consent of the Borrower or any other Person is required for the
transfer contemplated herein, such consent has been duly obtained and
remains in full force and effect.
12. This Loans Supplement 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 Loans
Supplement.
13. THIS LOANS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS.
IN WITNESS WHEREOF, the parties hereto have caused this Loans Supplement to
be executed by their respective duly authorized officers on Schedule I hereto as
of the date set forth in Item 1 of Schedule I hereto.
N-4
SCHEDULE I
TO LOANS
SUPPLEMENT
COMPLETION OF INFORMATION
AND SIGNATURES FOR
LOANS SUPPLEMENT
Re: Second Amended and Restated Receivables Loan Agreement, dated as of
December 6, 2004, with BWA Receivables Corporation
Item 1 Date of Loans Supplement:
Item 2 Assignor:
Item 3 Assignee:
, as
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Assignor
By:
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Title:
---------------------------------
, as
-----------------------------------
Assignee
By:
------------------------------------
Title:
---------------------------------
Consented To and Acknowledged:
ABN AMRO BANK N.V., as Agent
By:
--------------------------------
Title:
------------------------------
By:
--------------------------------
Title:
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BWA RECEIVABLES CORPORATION
By:
--------------------------------
Title:
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SCHEDULE II
TO LOANS
SUPPLEMENT
LIST OF OFFICES AND ADDRESSES
FOR NOTICES
Address for Notices:
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-------------------------------------
-------------------------------------
Attention:
--------------------------
Telephone:
--------------------------
Telecopy:
---------------------------
SCHEDULE III
TO LOANS
SUPPLEMENT
TRANSFER EFFECTIVE NOTICE
To: THE ASSIGNEE LISTED
ON SCHEDULE I HERETO
The undersigned, as Agent under the Second Amended and Restated Receivables
Loan Agreement, dated as of December 6, 2004, among BWA Receivables Corporation,
BorgWarner Inc., as Collection Agent, ABN AMRO Bank N.V., as Agent, the banks
from time to time party thereto and Windmill Funding Corporation (as amended,
supplemented, or otherwise modified from time to time, the "Loan Agreement"),
acknowledges receipt of ten (10) executed counterparts of a completed Loans
Supplement, dated as of the date set forth in Item 1 of Schedule I hereto,
between the Assignor set forth in Item 2 of Schedule I hereto, and the Assignee
set forth in Item 3 of Schedule I hereto, and schedules thereto. Terms defined
in such Loans Supplement are used herein as therein defined.
1. Pursuant to such Loans Supplement, you are advised that the Transfer
Effective Date will be __________________.
2. Pursuant to such Loans Supplement the Assignee is required to pay its
Loan Price, if any, to the Assignor at or before 12:00 noon, local time of the
Assignor, on the Transfer Effective Date in immediately available funds.
Very truly yours,
ABN AMRO BANK N.V., as Agent
By:
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Title:
---------------------------------
By:
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Title:
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SCHEDULE I
TO
SECOND AMENDED AND RESTATED
RECEIVABLES LOAN AGREEMENT
BANKS AND BANK COMMITMENTS
Name of Liquidity Provider Commitment
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ABN AMRO Bank N.V. $51,000,000
