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Exhibit 10.1
EXECUTION COPY
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THE GOODYEAR TIRE & RUBBER COMPANY,
as Seller,
and
WINGFOOT A/R LLC
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RECEIVABLES PURCHASE AGREEMENT
Dated as of April 27, 2001
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS.............................................................................................1
Section 1.1. Definitions............................................................................1
Section 1.2. Other Definitional Provisions..........................................................3
ARTICLE II PURCHASE AND SALE OF RECEIVABLES.......................................................................4
Section 2.1. Purchase and Sale of Receivables.......................................................4
Section 2.2. Purchase Price.........................................................................6
Section 2.3. Payment of Purchase Price..............................................................7
Section 2.4. No Repurchase..........................................................................8
Section 2.5. Rebates, Adjustments, Returns and Reductions; Modifications............................8
Section 2.6. Limited Repurchase Obligation..........................................................8
Section 2.7. Obligations Unaffected.................................................................9
Section 2.8. Certain Charges........................................................................9
Section 2.9. Certain Allocations....................................................................9
Section 2.10. Further Assurances.....................................................................9
Section 2.11. Purchase of Seller's Interest in Designated Receivables and Receivables Property.......9
ARTICLE III CONDITIONS PRECEDENT.................................................................................10
Section 3.1. Conditions Precedent to Issuer's Initial Purchase.....................................10
Section 3.2. Conditions Precedent to All the Issuer's Purchases of Designated Receivables..........12
Section 3.3. Condition Precedent to the Seller's Obligations.......................................13
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................13
Section 4.1. Representations and Warranties of the Issuer..........................................13
Section 4.2. Representations and Warranties of the Seller..........................................14
ARTICLE V GENERAL COVENANTS......................................................................................18
Section 5.1. Affirmative Covenants of the Seller...................................................18
Section 5.2. Reporting Requirements................................................................22
Section 5.3. Negative Covenants....................................................................23
ARTICLE VI PURCHASE TERMINATION EVENTS...........................................................................24
Section 6.1. Purchase Termination Events...........................................................24
Section 6.2. Additional Remedies...................................................................26
ARTICLE VII INDEMNIFICATION......................................................................................26
Section 7.1. Indemnities by the Seller.............................................................26
ARTICLE VIII SUBORDINATED NOTE...................................................................................28
Section 8.1. Subordinated Note.....................................................................28
Section 8.2. Restrictions on Transfer of Subordinated Note.........................................28
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ARTICLE IX MISCELLANEOUS.........................................................................................28
Section 9.1. Amendment.............................................................................28
Section 9.2. Further Assurances....................................................................28
Section 9.3. Governing Law.........................................................................28
Section 9.4. Notices...............................................................................28
Section 9.5. No Waiver; Remedies...................................................................29
Section 9.6. Binding Effect........................................................................29
Section 9.7. Costs, Expenses and Taxes.............................................................29
Section 9.8. Merger and Integration................................................................29
Section 9.9. Headings..............................................................................29
Section 9.10. Execution in Counterparts.............................................................29
Section 9.11. No Bankruptcy Petition................................................................29
Section 9.12. Acknowledgment of Assignments.........................................................30
Section 9.13. Termination...........................................................................30
EXHIBITS
Exhibit A Form of UCC Certificate
Exhibit B Form of Contract
Exhibit C Form of Subordinated Note
SCHEDULES
Schedule I Calculation of Discounted Percentage
Schedule II Seller Locations
Schedule III Trade Names
Schedule IV Litigation
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RECEIVABLES PURCHASE AGREEMENT, dated as of April 27, 2001, between
THE GOODYEAR TIRE & RUBBER COMPANY, an Ohio corporation ("GOODYEAR"), as seller
(the "SELLER"), and WINGFOOT A/R LLC, a Delaware limited liability company (the
"ISSUER").
W I T N E S S E T H:
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WHEREAS, the Seller intends to sell all of its right, title and
interest in, to and under the Designated Receivables now existing or hereafter
created and the Receivables Property to the Issuer on the terms and subject to
the conditions set forth in this Agreement;
WHEREAS, the Issuer desires to purchase all of the Seller's right,
title and interest in, to and under the Designated Receivables now existing or
hereafter created and the Receivables Property from the Seller on the terms and
subject to the conditions set forth in this Agreement;
WHEREAS, the Seller and the Issuer desire the transfer of the
Designated Receivables and the Receivables Property from the Seller to the
Issuer to be a true sale providing the Issuer with the full benefits of
ownership of the Designated Receivables; and
WHEREAS, to obtain the necessary funds to purchase the Designated
Receivables, the Issuer has entered into a Base Indenture, dated as of the date
hereof (as amended, supplemented or otherwise modified from time to time, the
"BASE INDENTURE"), between the Issuer and The Chase Manhattan Bank, as indenture
trustee, pursuant to which it will issue one or more Series of Investor Notes;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. Unless otherwise defined herein, capitalized
terms which are used herein shall have the meanings assigned to such terms in
the Definitions List attached to the Base Indenture as Schedule 1. The following
terms shall have the following meanings:
"ACTUAL CLOSING DATE PURCHASE PRICE" is defined in SECTION 2.2.
"CHARGED OFF RECEIVABLE" means a Receivable that has been written off
as uncollectible in accordance with the Credit and Collection Policy.
"CUT-OFF DATE" means March 31, 2001.
"DESIGNATED RECEIVABLE" means each Receivable other than:
(i) Receivables payable by Penske Auto Centers Inc. and its
successors;
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(ii) Receivables payable by the United States federal government or
any agency, department or instrumentality thereof;
(iii) Receivables payable by the Seller or any Affiliate of the
Seller;
(iv) Receivables arising from sales to retail outlets owned by the
Seller or any Affiliate of the Seller;
(v) Receivables arising from sales made outside of the United States;
and
(vi) Receivables evidenced by promissory notes or "instruments," as
defined in Section 9-105 of the UCC as in effect in the State of
New York.
"DISCOUNTED PERCENTAGE" is defined in SCHEDULE I hereto.
"DOCUMENTS" is defined in SECTION 2.1.
"INITIAL CLOSING DATE PURCHASE PRICE" is defined in SECTION 2.2.
"INITIAL SETTLEMENT DATE" is defined in SECTION 2.2.
"KNOWLEDGE" means the actual knowledge of (i) any Authorized Officer
of the Seller or (ii) any other person employed in the Seller's Treasury
Department or Legal Department and responsible for the oversight or
administration of the transactions contemplated by the Transaction
Documents.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" (within the meaning
of Section 4001(a)(3) of ERISA) and to which the Seller or any ERISA
Affiliate of the Seller (other than one considered an ERISA Affiliate only
pursuant to subsection (m) or (o) of Section 414 of the Code) is making or
accruing an obligation to make contributions, or has within any of the
preceding five years made or accrued an obligation to make contributions.
"PAYMENT DATE" is defined in SECTION 2.3(a).
"PLAN" means, with respect to any Person, any pension plan (other than
a Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code which is maintained for employees of such Person or
any ERISA Affiliate of such Person.
"PRIME RATE" means the rate of interest per annum publicly announced
from time to time by The Chase Manhattan Bank as its prime rate in effect
at its principal office in New York, New York; each change in the Prime
Rate shall be effective from and including the date such change is publicly
announced as being effective.
"PURCHASED RECEIVABLE" means, at any time, any Designated Receivable
sold to the Issuer by the Seller pursuant to, and in accordance with the
terms of, this Agreement and not theretofore resold to the Seller pursuant
to SECTION 2.6 or SECTION 2.11.
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"PURCHASE PRICE" is defined in SECTION 2.2.
"PURCHASE TERMINATION DATE" means the date on which the Issuer's
obligation to purchase Receivables from the Seller shall terminate in
accordance with SECTION 6.1.
"PURCHASE TERMINATION EVENT" is defined in SECTION 6.1.
"RECEIVABLE" means the indebtedness and payment obligations of any
Person to the Seller or Dunlop under a Contract (including, without
limitation, payment obligations constituting an account or general
intangible or evidenced by a note, instrument, contract, security
agreement, chattel paper or other evidence of indebtedness or security)
arising from a sale of chemical products, engineered products and tire
products or the provision of related services by the Seller or Dunlop, as
the case may be, including, without limitation, any usage or mileage fees
payable in connection therewith, and including the right to payment of any
interest, sales taxes, Finance Charges, returned check or late charges and
other payment obligations of such Person with respect thereto.
"RECEIVABLES LIST" is defined in SECTION 2.1.
"RECEIVABLES PROPERTY" is defined in SECTION 2.1.
"REPORTABLE EVENT" means any reportable event as defined in Section
4043(b) of ERISA or the regulations issued thereunder with respect to a
Plan (other than a Plan maintained by an ERISA Affiliate which is
considered an ERISA Affiliate only pursuant to subsection (m) or (o) of
Section 414 of the Code).
"REPURCHASE EVENT" is defined in SECTION 2.11.
"SELLER ADJUSTMENT PAYMENT" is defined in SECTION 2.5.
"SELLER REPURCHASE PAYMENT" is defined in SECTION 2.6.
"SUBORDINATED NOTE" is defined in SECTION 8.1.
"WITHDRAWAL LIABILITIES" shall mean liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV of
ERISA.
SECTION 1.2. OTHER DEFINITIONAL PROVISIONS. (a) The words "hereof",
"herein" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section, subsection, Schedule and Exhibit references
contained in this agreement are references to Sections, subsections, Schedules
and Exhibits in or to this Agreement unless otherwise specified.
(b) The definitions contained in Section 1.1 of this Agreement are
applicable to the singular as well as the plural forms of such terms and to the
masculine, the feminine and the neuter genders of such terms.
(c) Any reference herein or in any other Transaction Document to a
provision of the Code or ERISA shall be deemed a reference to any successor
provision thereto.
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(d) All references herein to any agreement or instrument shall be
deemed references to such agreement or instrument as amended, supplemented or
otherwise modified from time to time unless there are any restrictions herein on
the amendment, supplementation or modification of such agreement or instrument.
ARTICLE II
PURCHASE AND SALE OF RECEIVABLES
SECTION 2.1. PURCHASE AND SALE OF RECEIVABLES. (a) Upon the terms set
forth herein, the Seller hereby sells, assigns transfers and conveys to the
Issuer, without recourse (except to the limited extent provided herein), all of
its right, title and interest in, to and under:
(i) all Designated Receivables existing on the Initial Closing
Date and thereafter arising from time to time until the Purchase
Termination Date;
(ii) all Related Property with respect thereto;
(iii) all Collections;
(iv) all payment, enforcement and other rights (including
rescission, replevin or reclamation), but none of the obligations,
relating to any Designated Receivable or arising therefrom;
(v) the right, title and interest of the Seller in the Dunlop
Receivables Purchase Agreement, including, without limitation, all of
the Seller's rights, remedies, powers, interests and privileges under
the Dunlop Receivables Purchase Agreement (whether arising pursuant to
the terms thereof or otherwise available to the Seller), including,
without limitation, the right to enforce the Dunlop Receivables
Purchase Agreement, to give or withhold any and all consents,
requests, notices, directions, approvals or waivers thereunder and all
amounts due and to become due thereunder, whether payable as
indemnities or damages for breach thereof; and
(vi) all monies due or to become due and all amounts received
with respect to the items listed in clauses (i), (ii), (iii), (iv)
and(v) and all proceeds (including, without limitation, whatever is
received upon the sale, exchange, collection or other disposition of
the foregoing and all "proceeds" as defined in Section 9-306 of the
UCC as in effect in the State of New York) (the property described in
the foregoing clauses (ii) through (vi) are hereinafter collectively
referred to as the "RECEIVABLES PROPERTY").
Subject to the terms and conditions set forth herein, the Issuer
hereby agrees to purchase the Designated Receivables and the Receivables
Property from time to time (until the Purchase Termination Date).
(b) On the Initial Closing Date and on the date of creation of each
newly created Designated Receivable until the Purchase Termination Date, all of
the Seller's right, title and interest in, to and under (i) in the case of the
Initial Closing Date, all then existing Designated
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Receivables and all Receivables Property in respect of such Designated
Receivables and (ii) in the case of each such date of creation, all such newly
created Designated Receivables and all Receivables Property in respect of such
Designated Receivables, shall be immediately and automatically sold, assigned,
transferred and conveyed to the Issuer pursuant to paragraph (a) above without
any further action by the Seller or any other Person.
(c) The parties to this Agreement intend that the transactions
contemplated by SECTIONS 2.1(a) and (b) shall be, and shall be treated as, a
purchase by the Issuer and a sale by the Seller of the Purchased Receivables and
the Receivables Property in respect thereof and not a lending transaction. All
transfers of Designated Receivables and Receivables Property by the Seller
hereunder shall be without recourse to, or representation or warranty of any
kind (express or implied) by, the Seller, except as otherwise specifically
provided herein. The foregoing sale, assignment, transfer and conveyance does
not constitute and is not intended to result in a creation or assumption by the
Issuer of any obligation of the Seller or any other Person in connection with
the Designated Receivables, the Receivables Property or any agreement or
instrument relating thereto, including any obligation to any Obligor. If this
Agreement does not constitute a valid sale, assignment, transfer and conveyance
of all right, title and interest of the Seller in, to and under the Purchased
Receivables and the Receivables Property in respect thereof despite the intent
of the parties hereto, the Seller hereby grants a "security interest" (as
defined in the UCC as in effect in the State of New York) in the Purchased
Receivables, the Receivables Property in respect thereof and all proceeds
thereof to the Issuer and the parties agree that this Agreement shall constitute
a security agreement under the UCC in effect in New York.
(d) In connection with the foregoing conveyances, the Seller agrees to
record and file, at its own expense, any financing statements (and continuation
statements with respect to such financing statements when applicable) or, where
applicable, registrations in the appropriate records, with respect to the
Designated Receivables and Receivables Property now existing and hereafter
created meeting the requirements of applicable law in such manner and in such
jurisdictions as are necessary or desirable to perfect the sale of the
Designated Receivables and the Receivables Property by the Seller to the Issuer,
and to deliver a file-stamped copy or certified statement of such financing
statement or registration or other evidence of such filing or registration to
the Issuer on or prior to the Initial Closing Date. The Seller hereby
irrevocably authorizes the Issuer and the Indenture Trustee to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Receivables and the Receivables Property, without the signature
of the Seller where permitted by law.
(e) In connection with the foregoing conveyances, the Seller agrees at
its own expense, on or prior to the Initial Closing Date, (i) to maintain its
computer systems and files containing its master database of Receivables so as
to enable a third party inspecting such files to readily conclude or ascertain
that all Designated Receivables included in such files and all Receivables
Property have been sold to the Issuer in accordance with this Agreement and (ii)
to deliver to the Issuer computer tapes or disks containing a true and complete
list of all Designated Receivables conveyed to the Issuer specifying for each
such Designated Receivable, as of the Cut-Off Date, (i) the identification or
reference number assigned to such Designated Receivable by the Seller and (ii)
the Outstanding Amount of such Receivable (the "RECEIVABLES LIST").
(f) As further confirmation of the sale of the Designated Receivables,
but subject to SECTION 6.2(b), it is understood and agreed that the Issuer shall
have the following rights:
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(i) the Issuer (and the Indenture Trustee, as its assignee) shall
have the right at any time to (A) notify, or require that the Seller
at its own expense notify, the respective Obligors of the Issuer's
ownership of the Purchased Receivables and Receivables Property, (B)
direct that payment of all amounts due or to become due under the
Purchased Receivables be made directly to the Issuer or its designee,
(C) xxx for collection on any Purchased Receivable or (D) sell any
Purchased Receivables to any Person for a price that is acceptable to
the Issuer (or the Indenture Trustee, as its assignee);
(ii) the Seller shall, upon written request of the Issuer, and at
the Seller's expense (A) deliver to the Issuer or a party designated
by the Issuer all documents, instruments and other records (including
credit files) that evidence or record the Designated Receivables and
all licenses, rights, copies of all relevant computer programs and any
necessary licenses for the use thereof (subject to the restrictions
contained in any license with respect thereto), related material,
computer tapes, disks, cassettes and data necessary or desirable to
the immediate collection of the Purchased Receivables by the Issuer,
with or without the participation of the Seller (collectively, the
"DOCUMENTS") and (B) make such arrangements with respect to
the collection of the Purchased Receivables as may be reasonably
required by the Issuer. In recognition of the Seller's need to have
access to any Documents which may be transferred to the Issuer
hereunder, whether as a result of its continuing business relationship
with any Obligor for Designated Receivables purchased hereunder or as
a result of its responsibilities as collection agent of accounts
receivable which are not sold to the Issuer or otherwise, the Issuer
shall provide to the Seller reasonable access to the Documents in
connection with any activity arising in the ordinary course of the
Seller's business, PROVIDED, however, that the Seller shall
not disrupt or otherwise interfere with the Issuer's use of and access
to the Documents; and
(iii) the Seller hereby grants to the Issuer an irrevocable power
of attorney (coupled with an interest) to take any and all
steps in the Seller's name necessary or desirable, in the reasonable
opinion of the Issuer, to collect all amounts due under the
Purchased Receivables, including, without limitation, enforcing the
Purchased Receivables, exercising all rights and remedies in respect
thereof and, without regard to the limitation set forth in SECTION
6.2(b), endorsing the Seller's name on checks and other instruments
representing Collections.
SECTION 2.2. PURCHASE PRICE. The amount payable by the Issuer to the
Seller (the "PURCHASE PRICE") for Designated Receivables and the Receivables
Property on any Payment Date under this Agreement shall be equal to the product
of (a) the aggregate Outstanding Balance of the Designated Receivables sold to
the Issuer hereunder since the immediately preceding Payment Date TIMES (b) the
Discounted Percentage; PROVIDED that for purposes of the Payment Date occurring
on the Initial Closing Date, the Purchase Price for the Designated Receivables
and the Receivables Property existing on the Initial Closing Date shall be based
on the Designated Receivables existing as of the Cut-Off Date (the "INITIAL
CLOSING DATE PURCHASE
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PRICE"). On the first Settlement Date occurring after the Initial Closing Date
(the "INITIAL SETTLEMENT DATE"), the Seller shall determine the Purchase Price
for the Designated Receivables and Receivables Property existing on the Initial
Closing Date based on the Designated Receivables existing on the Initial Closing
Date (the "ACTUAL CLOSING DATE PURCHASE PRICE"). If the Initial Closing Date
Purchase Price paid by the Issuer on the Initial Closing Date is greater than
the Actual Closing Date Purchase Price, the Seller shall apply that excess to
reduce the outstanding principal amount of the Subordinated Note on the Initial
Settlement Date. If the Initial Closing Date Purchase Price paid by the Issuer
on the Initial Closing Date is less than the Actual Closing Date Purchase Price,
the Issuer shall pay that difference to the Seller on the Initial Settlement
Date by increasing the outstanding principal amount of the Subordinated Note in
the amount of the difference.
SECTION 2.3. PAYMENT OF PURCHASE PRICE. (a) Upon the fulfillment of
the conditions set forth in Article III, the Purchase Price for Designated
Receivables and the Receivables Property shall be paid or provided for by the
Issuer in the manner provided below on each Business Day (each such day, a
"PAYMENT DATE").
(b) The Purchase Price for Designated Receivables and Receivables
Property shall be paid by the Issuer on each Payment Date as follows:
(i) by netting the amount of any Seller Adjustment Payments or
Seller Repurchase Payments pursuant to SECTION 2.5 or 2.6 against such
Purchase Price;
(ii) to the extent available for such purpose, in cash from
Collections released to the Issuer pursuant to the Indenture;
(iii) to the extent available for such purpose, in cash from the
net proceeds of the issuance of a Series of Investor Notes or an
increase in the Invested Amount thereof;
(iv) in cash from the proceeds of capital contributed by Goodyear
to the Issuer, if any, in respect of its equity interest in the
Issuer; and
(v) by means of an addition to the principal amount of the
Subordinated Note in an aggregate amount equal to the remaining
portion of the Purchase Price; PROVIDED HOWEVER that the Issuer may
pay the Purchase Price by means of additions to the principal amount
of the Subordinated Note only if, at the time of such payment and
after giving effect thereto, (A) the Issuer shall be in compliance
with Section 8.19 of the Base Indenture and (B) the aggregate
principal amount outstanding of the Subordinated Note would not exceed
30% of the outstanding principal amount of the Purchased Receivables
on such Payment Date. On each Settlement Date, the Seller shall
determine the net increase or the net reduction in the outstanding
principal amount of the Subordinated Note occurring during the
immediately preceding Settlement Period and shall note that increase
or reduction on the grid attached to the Subordinated Note; PROVIDED
that the failure to make any such recordation or any error in such
grid shall not adversely affect the Seller's rights.
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The Issuer hereby acknowledges that the Seller shall have no obligation to make
further capital contributions to the Issuer in respect of the Seller's equity
interest in the Issuer in order to provide funds to pay the Purchase Price to
the Seller hereunder or otherwise.
(c) The Issuer shall pay all amounts in respect of the Purchase Price
of Purchased Receivables and Receivables Property to an account of the Seller
designated by the Seller in writing to the Issuer. All payments under this
Agreement shall be made not later than 2:00 p.m. (New York City time) on the
date specified therefor in Dollars in same day funds.
(d) Whenever any payment to be made under this Agreement shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day. Amounts not paid when due in accordance
with the terms of this Agreement shall bear interest at a rate equal at all
times to the Prime Rate PLUS 2%, payable on demand.
SECTION 2.4. NO REPURCHASE. Except to the extent expressly set forth
herein, the Seller shall not have any right or obligation under this Agreement,
by implication or otherwise, to repurchase from the Issuer any Purchased
Receivables or Receivables Property or to rescind or otherwise retroactively
affect any purchase of any Purchased Receivables or Receivables Property after
the Payment Date relating thereto.
SECTION 2.5. REBATES, ADJUSTMENTS, RETURNS AND REDUCTIONS;
MODIFICATIONS. From time to time, the Seller or Dunlop may make Dilution
Adjustments to Receivables in accordance with this SECTION 2.5 or Section 2.5 of
the Dunlop Receivables Purchase Agreement, as the case may be. The Seller agrees
to pay to the Issuer, on the first Reporting Date immediately succeeding the
date of the grant of any Dilution Adjustment, the amount of any such Dilution
Adjustment (a "SELLER ADJUSTMENT PAYMENT") by depositing such amount into the
Collection Account; PROVIDED that, prior to the Purchase Termination Date, any
such Seller Adjustment Payment due to the Issuer shall be netted against the
Purchase Price of newly created Designated Receivables in accordance with
SECTION 2.3(c)(i) on the first Payment Date after the grant of such Dilution
Adjustment to the extent of such Purchase Price and the remaining amount of such
Seller Adjustment Payment due to the Issuer after such netting, if any, shall be
paid to the Issuer on such date in cash by depositing such amount into the
Collection Account. The amount of any Dilution Adjustment made on any Business
Day shall be set forth on the first Monthly Settlement Statement prepared after
the date of the grant of such Dilution Adjustment.
SECTION 2.6. LIMITED REPURCHASE OBLIGATION(a) . In the event that (i)
any representation or warranty contained in SECTION 4.2(c), (i), (l) or (m) in
respect of any Purchased Receivable transferred to the Issuer is not true and
correct in any material respect on the date of such transfer, or (ii) there is a
breach of any covenant contained in SECTION 5.1(c) or (f) or SECTION 5.3(a), (b)
or (c) with respect to any Purchased Receivable in any material respect or (iii)
the Issuer's interest in any Purchased Receivable is not a first priority
perfected ownership or security interest at any time as a result of any action
taken by, or any failure to take action by, the Seller, then the Seller agrees
to pay to the Issuer an amount equal to the Purchase Price paid by the Issuer in
respect of such Purchased Receivable (whether the Issuer paid such Purchase
Price in cash or otherwise) less Collections received by the Issuer in respect
of such Purchased Receivable as of the date of repurchase by depositing such
amount into the Collection Account, such payment to occur no later than the
Settlement Date occurring on the 30th day (or, if such 30th day is not a
Settlement Date, on the Settlement Date immediately succeeding such 30th day)
after the day such breach or incorrectness becomes known to the Seller (unless
such breach or incorrectness shall have been cured on or before such day, in
which case the Seller shall have no
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obligation to repurchase such Purchased Receivable under this Section 2.6);
PROVIDED that, prior to the Purchase Termination Date, any such payment due and
owing to the Issuer shall be netted against the Purchase Price of newly created
Designated Receivables in accordance with SECTION 2.3(c)(i) on the first Payment
Date to occur after such 30th day to the extent of such Purchase Price and the
remaining amount of such payment due to the Issuer after such netting, if any,
shall be paid to the Issuer in cash to the extent still unpaid on such Payment
Date by depositing such amount into the Collection Account. Any payment by the
Seller pursuant to this SECTION 2.6 is referred to as a "SELLER REPURCHASE
PAYMENT". The obligation to reacquire any Purchased Receivable pursuant to this
Section 2.6 shall, upon satisfaction thereof, constitute the sole remedy
respecting the event giving rise to such obligation of the Seller and is
expressly limited to the Purchased Receivable affected by such event.
Simultaneously with any Seller Repurchase Payment with respect to any Purchased
Receivable, such Purchased Receivable and the Receivables Property with respect
thereto shall immediately and automatically be sold, assigned, transferred and
reconveyed by the Issuer to the Seller without any further action by the Issuer
or any other Person.
SECTION 2.7. OBLIGATIONS UNAFFECTED. The obligations of the Seller to
the Issuer under this Agreement shall not be affected by reason of any
invalidity, illegality or irregularity of any Designated Receivable or any sale
of a Designated Receivable.
SECTION 2.8. CERTAIN CHARGES. The Seller and the Issuer agree that
late charge revenue, reversals of discounts, other fees and charges and other
similar items, whenever created, accrued in respect of Purchased Receivables
shall be the property of the Issuer notwithstanding the occurrence of a Purchase
Termination Event and all Collections with respect thereto shall continue to be
allocated and treated as Collections in respect of Purchased Receivables.
SECTION 2.9. CERTAIN ALLOCATIONS. The Seller hereby agrees all
Collections and other proceeds received from an Obligor in respect of
Receivables shall be applied to Receivables owed by such Obligor (including
Purchased Receivables) in the order in which such Receivables were created;
PROVIDED, HOWEVER, that notwithstanding the foregoing, if an Obligor indicates
that a particular Collection is to be applied to a specific Receivable of such
Obligor, then such Collection shall be applied to pay such Receivable.
SECTION 2.10. FURTHER ASSURANCES. From time to time at the request of
the Seller, the Issuer shall deliver to the Seller such documents, assignments,
releases and instruments of termination as the Seller may reasonably request to
evidence the reconveyance by the Issuer to the Seller of a Receivable pursuant
to the terms of SECTION 2.6 or 2.11(b); PROVIDED that the Issuer shall have been
paid all amounts due thereunder; and the Issuer and the Collection Agent shall
take such action as the Seller may reasonably request, at the expense of the
Seller, to assure that any such Receivable, the Related Property and Collections
with respect thereto do not remain commingled with other Collections hereunder.
SECTION 2.11. PURCHASE OF SELLER'S INTEREST IN DESIGNATED RECEIVABLES
AND RECEIVABLES PROPERTY. (a) In the event of any breach of any of the
representations and warranties set forth in SECTION 4.2(a), (b), (d) or (e), as
of the date made, which breach has a material adverse effect on the interests of
the Issuer in the Purchased Receivables and the Receivables Property (taken as a
whole) (a "REPURCHASE EVENT"), then the Issuer, by notice then given in writing
to the Seller, may direct the Seller to purchase all Purchased Receivables and
Receivables Property and the Seller shall be obligated to make such purchase on
the next Settlement Date occurring at least ten Business Days after receipt of
such notice on the terms and
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conditions set forth in SECTION 2.11(b) below; PROVIDED, HOWEVER, that no such
purchase shall be required to made if, by such Settlement Date, such material
adverse effect shall have been cured and no other Repurchase Event shall be in
existence.
(b) The Seller agrees to pay to the Issuer an amount equal to the
Purchase Price of the Purchased Receivables being repurchased pursuant to this
Section 2.11 paid by the Issuer in respect of such Purchased Receivables
(whether the Issuer paid such Purchase Price in cash or otherwise) less
Collections received by the Issuer in respect of such Purchased Receivables as
of the date of repurchase, by depositing such amount into the Collection Account
on the Settlement Date specified in Section 2.11(a). The obligation to reacquire
Purchased Receivables pursuant to this Section 2.11 shall, upon satisfaction
thereof, constitute the sole remedy respecting the event giving rise to such
obligation of the Seller. Simultaneously with the payment of such amount, all
Purchased Receivables and Receivables Property shall immediately and
automatically be sold, assigned, transferred and conveyed by the Issuer to the
Seller without any further action by the Issuer or any other Person.
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.1. CONDITIONS PRECEDENT TO ISSUER'S INITIAL PURCHASE. The
obligation of the Issuer to purchase Designated Receivables and Receivables
Property hereunder on the Initial Closing Date from the Seller is subject to the
conditions precedent that the Issuer shall have received on or before the date
of such purchase the following, each (unless otherwise indicated) dated the day
of such sale and in form and substance satisfactory to the Issuer:
(a) SECRETARY'S CERTIFICATE. A certificate of the Secretary or an
Assistant Secretary of the Seller, dated the Initial Closing Date, and
certifying (i) that attached thereto is a true and complete copy of
the by-laws of the Seller, as in effect on the Initial Closing Date
and at all times since a date prior to the date of the resolutions
described in clause (ii) below, (ii) that attached thereto is a true
and complete copy of the resolutions, in form and substance reasonably
satisfactory to the Issuer, of the Board of Directors of the Seller or
committees thereof authorizing the execution, delivery and performance
of this Agreement and the other Transaction Documents to which it is a
party and the transactions contemplated hereby and thereby, and that
such resolutions have not been amended, modified, revoked or rescinded
and are in full force and effect, (iii) that the articles of
incorporation of the Seller have not been amended since the date of
the last amendment thereto shown on the certificate of good standing
(or its equivalent) furnished pursuant to clause (b) below and (iv) as
to the incumbency and specimen signature of each officer executing
this Agreement and any other Transaction Documents or any other
document delivered in connection herewith or therewith on behalf of
the Seller (on which certificates the Issuer may conclusively rely
until such time as the Issuer shall receive from the Seller a revised
certificate with respect to the Seller meeting the requirements of
this subsection (a));
(b) CORPORATE DOCUMENTS. A short form good standing certificate
describing the articles of incorporation, including all amendments
thereto, of the Seller, certified as of a recent date by the Secretary
of State or other appropriate authority of the state of incorporation,
and a certificate of compliance, of status or of good standing, as and
to the extent applicable, of the Seller as of a recent date, from the
Secretary of State or other appropriate authority of such
jurisdiction;
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(c) GOOD STANDING CERTIFICATES. Certificates of compliance, of
status or of good standing, dated as of a recent date, from the
Secretary of State or other appropriate authority of Alabama,
Illinois, North Carolina, Oklahoma, Tennessee and Texas, with respect
to the Seller;
(d) CONSENTS, LICENSES, APPROVALS, ETC. A Certificate dated the
Initial Closing Date of an Authorized Officer of the Seller stating
either (i) that all material consents, licenses and approvals required
in connection with the execution, delivery and performance by the
Seller of this Agreement and the validity and enforceability of this
Agreement against the Seller are in full force and effect or (ii) that
no such consents, licenses or approvals are so required;
(e) NO LITIGATION. Confirmation that, except as set forth in
Schedule IV, there is no pending or, to its knowledge after due
inquiry, threatened action or proceeding affecting the Seller or any
of its Subsidiaries before any Governmental Authority that could
reasonably be expected to have a Seller Material Adverse Effect;
(f) UCC CERTIFICATE; UCC FINANCING STATEMENTS. (i) A UCC
Certificate, substantially in the form of Exhibit A, duly executed by
an Authorized Officer of the Seller and dated the Initial Closing Date
and (ii) executed copies of such proper financing statements, filed
prior to the Initial Closing Date, naming the Seller as the seller and
the Issuer as the purchaser of the Designated Receivables and the
Receivables Property, in proper form for filing in each jurisdiction
in which the Issuer (or any of its assignees) deems it necessary or
desirable to perfect the Issuer's ownership interest in all Designated
Receivables and Receivables Property (to the extent that the
Receivables Property constitutes property an ownership interest in
which may be perfected by filing a financing statement under the UCC
in the Applicable Jurisdictions) under the UCC or any comparable law
of such jurisdiction;
(g) LIEN SEARCHES. A written search report listing all effective
financing statements that name the Seller as debtor or assignor and
that are filed in the jurisdictions in which filings were made
pursuant to subsection (f) above and in any other jurisdictions that
the Issuer determines are necessary or appropriate, together with
copies of such financing statements (none of which, except for those
described in subsection (f) above, shall cover any Designated
Receivables or Receivables Property, after giving effect to the
termination statements described in subsection (h) below), and tax and
judgment lien searches showing no such liens that are not permitted by
the Transaction Documents;
(h) TERMINATION STATEMENTS. Executed copies of proper termination
statements (Form UCC-3), if any, necessary to release all security
interests and other rights of any Person in the Designated Receivables
and the Receivables Property previously granted by the Seller;
(i) OTHER TRANSACTION DOCUMENTS. Original copies, executed by
each of the parties thereto, of each of the other Transaction
Documents to be executed and delivered in connection herewith,
including each of the Lock-Box Agreements;
(j) LEGAL OPINIONS. (i) An opinion of Xxxxxxxxx & Xxxxxxx
(containing customary assumptions, limitations and qualifications) to
the effect that:
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(A) the sales of Purchased Receivables by the Seller to the
Issuer pursuant to this Agreement are true sales under New York law
and that such Purchased Receivables would not be property of the
Seller's bankruptcy estate; and
(B) a bankruptcy court would not order the substantive
consolidation of the assets and liabilities of the Issuer with those
of the Seller;
(ii) One or more legal opinions from outside counsel to the
Seller and counsel to the Issuer (containing customary assumptions,
limitations and qualifications):
(A) to the effect that the Seller and the Issuer, as applicable,
has all approvals, judicial, regulatory, legal or otherwise, needed to
execute, deliver and perform each Transaction Document to which it is
a party and that no conflict or default shall occur as a result of the
execution, delivery and performance thereof;
(B) to the effect that the Issuer has a perfected, first
priority, security interest in the Purchased Receivables and the
proceeds thereof; and
(C) addressing other customary matters;
(k) RECEIVABLES LIST. A copy of the Receivables List; and
(l) SYSTEMS. Evidence reasonably satisfactory to the Issuer that
the Seller's systems, procedures and record keeping relating to the
Purchased Receivables are in all material respects sufficient and
satisfactory in order to permit the purchase and administration of the
Purchased Receivables in accordance with the terms and intent of this
Agreement.
SECTION 3.2. CONDITIONS PRECEDENT TO ALL THE ISSUER'S PURCHASES OF
DESIGNATED RECEIVABLES. The obligation of the Issuer to pay for any Designated
Receivable and the Receivables Property with respect thereto on each Payment
Date (including the Initial Closing Date) shall be subject to the further
conditions precedent that, on and as of such Payment Date:
(a) the following statements shall be true (and the acceptance by the
Seller of the Purchase Price for such Designated Receivable on such Payment Date
shall constitute a representation and warranty by the Seller that on such
Payment Date such statements are true):
(i) the representation and warranties of the Seller contained in
SECTION 4.2 shall be true and correct in all material respects on and
as of such Payment Date as though made on and as of such date except
to the extent any such representation or warranty is expressly made
only as of another date (in which case it shall be true and correct in
all material respects on and as of such other date); and
(ii) no Potential Purchase Termination Event arising from the
occurrence of an Insolvency Event with respect to the Seller described
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in paragraph (a)(ii) of the definition thereof shall have occurred and
be continuing;
(b) the Issuer shall have received payment in full of all amounts for
which payment is due from the Seller pursuant to SECTIONS 2.5, 2.6 or
7.1; and
(c) the Seller shall have complied with all of its covenants in all
material respects and satisfied all of its obligations in all material respects
under this Agreement required to be complied with or satisfied as of such date;
PROVIDED, HOWEVER, that the failure of the Seller to satisfy any of the
foregoing conditions shall not prevent the Seller from subsequently selling
Designated Receivables upon satisfaction of all such conditions or exercising
its rights under SECTION 2.1(b).
SECTION 3.3. CONDITION PRECEDENT TO THE SELLER'S OBLIGATIONS. The
obligation of the Seller to sell any Designated Receivable generated by it on
any date (including on the Initial Closing Date) shall be subject to the
condition precedent that, on the related Payment Date, the following statement
shall be true (and the payment by the Issuer of the Purchase Price for such
Designated Receivable on such date shall constitute a representation and
warranty by the Issuer that on such Payment Date such statement is true): no
Purchase Termination Event or Termination Event or Potential Termination Event
of a type set forth in SECTION 6.1(h) shall have occurred and be continuing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.1. REPRESENTATIONS AND WARRANTIES OF THE ISSUER. The Issuer
represents and warrants as to itself for the benefit of the Seller as follows:
(a) It is a special purpose limited liability company duly
formed, validly existing and in good standing under the laws of the
State of Delaware, (b) is duly qualified to do business as a foreign
limited liability company and in good standing under the laws of each
jurisdiction where the character of its property, the nature of its
business or the performance of its obligations make such qualification
necessary or which shall be necessary to protect the validity and
enforceability of this Agreement, and (c) has all powers and all
governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted and for purposes of the
transactions contemplated by this Agreement.
(b) The execution, delivery and performance by the Issuer of this
Agreement (i) is within the Issuer's power, has been duly authorized
by all necessary action, (ii) requires no consent or action by or in
respect of, or filing with, any governmental body, agency or official
which has not been obtained and (iii) does not contravene, or
constitute a default under, any Requirement of Law or any agreement or
instrument binding on it or result in the creation or imposition of
any Adverse Claim on any of its assets, other than Permitted Liens.
This Agreement has been executed and delivered by a duly authorized
officer of the Issuer.
(c) This Agreement is a legal, valid and binding obligation of
the Issuer enforceable against the Issuer in accordance with its terms
(except as such enforceability
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may be limited by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally or by general equitable principles, whether
considered in a proceeding at law or in equity and by an implied
covenant of good faith and fair dealing).
SECTION 4.2. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller
hereby represents and warrants for the benefit of the Issuer and its assigns
(including the Indenture Trustee):
(a) CORPORATE EXISTENCE. The Seller (i) is a corporation duly
incorporated, validly existing and in good standing under the laws of
the jurisdiction of its organization, (ii) has all requisite corporate
power and authority, and all legal right, to own and operate its
properties, to lease the properties it operates as lessee and to
conduct its business as now conducted, (iii) is duly qualified as a
foreign corporation to do business and in good standing (or is exempt
from such requirements) under the laws of each jurisdiction in which
the ownership or lease of property or the conduct of its business
requires such qualification and (iv) is in compliance with all
Requirements of Law, except, in the case of clauses (ii), (iii) and
(iv), to the extent that a failure to have such power, authority or
right or to qualify and be in good standing or to comply, as the case
may be, could not reasonably be expected to have a Seller Material
Adverse Effect.
(b) CORPORATE POWER; AUTHORIZATION; CONSENTS. The Seller has the
corporate power and authority, and the legal right, to execute,
deliver and perform this Agreement and the other Transaction Documents
to which it is a party and has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement
and the other Transaction Documents to which it is a party. No consent
or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement and the other Transaction Documents
to which it is a party by or against the Seller other than (i) those
consents which have duly been obtained or made and are in full force
and effect on the Initial Closing Date or the relevant Payment Date,
as the case may be, (ii) any filings of UCC-1 financing statements
necessary to perfect the Issuer's or the Indenture Trustee's interest
in the Purchased Receivables and the Receivables Property and (iii)
any such consent, authorization, filing, notice or other act, the
absence of which could not reasonably be expected to have a Seller
Material Adverse Effect. This Agreement and each other Transaction
Document to which it is a party have been duly executed and delivered
on behalf of the Seller.
(c) VALID SALE; BINDING OBLIGATIONS. Each transfer of Designated
Receivables and related Receivables Property made pursuant to this
Agreement shall constitute a valid sale, transfer and assignment of
such Designated Receivables and the related Receivables Property to
the Issuer, enforceable against creditors of, and purchasers from, the
Seller; and this Agreement and each other Transaction Document to
which it is a party constitute the legal, valid and binding obligation
of the Seller enforceable against it in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights
generally and except as such enforceability may be limited by general
principles of equity (whether considered in a proceeding at law or in
equity).
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(d) NO LEGAL BAR. The execution, delivery and performance of,
this Agreement and the other Transaction Documents and the fulfillment
of the terms hereof and thereof shall not violate any Requirement of
Law applicable to the Seller or its property or Contractual Obligation
of the Seller (other than any violation which could not reasonably be
expected to have a Seller Material Adverse Effect), and shall not
result in, or require, the creation or imposition of any Adverse Claim
(other than Permitted Liens) on any of its properties pursuant to any
such Requirement of Law or Contractual Obligation.
(e) NO PROCEEDINGS. Except as set forth on Schedule IV, there are
no actions, suits, investigations or proceedings at law or in equity
or by or before any arbitrator, court or Governmental Authority now
pending or, to the knowledge of the Seller, threatened against or
affecting it or any of its properties, revenues or rights which (i)
involve this Agreement, any of the other Transaction Documents to
which the Seller is a party or any of the transactions contemplated
hereby or thereby or (ii) could individually or in the aggregate
reasonably be expected to have a Seller Material Adverse Effect.
(f) NO DEFAULT. No Potential Purchase Termination Event arising
from the occurrence of an Insolvency Event with respect to the Seller
described in paragraph (a)(ii) of the definition thereof shall have
occurred and be continuing.
(g) REQUIREMENTS OF LAW. The Seller is not in default under or
with respect to any Requirement of Law applicable to the Seller or its
property where such default could reasonably be expected to have a
Seller Material Adverse Effect.
(h) BULK SALES ACT. No transaction contemplated by this Agreement
or any other Transaction Document with respect to the Seller requires
compliance with, or shall be subject to avoidance under, any bulk
sales act or similar law.
(i) ELIGIBLE RECEIVABLES. Each Purchased Receivable conveyed by
it hereunder and included in the Aggregate Outstanding Balance was on
the date transferred to the Issuer hereunder an Eligible Receivable.
(j) LOCATION OF RECORDS; CHIEF EXECUTIVE OFFICE. The chief
executive office of the Seller is as indicated on SCHEDULE II hereto
and is the place where the Seller is "located" for the purposes of
Section 9-103(3)(d) of the UCC as in effect in the State of New York.
The state and county where the chief executive office of the Seller is
"located" for the purposes of Section 9-103(3)(d) of the UCC as in
effect in the State of New York has not changed in the past four
months. The offices where the Seller keeps its records concerning the
Receivables and related Contracts and all other agreements related to
the Receivables are as indicated for the Seller on SCHEDULE II hereto
(or at such other locations, notified to the Issuer and the Indenture
Trustee in accordance with SECTION 5.1(g), in jurisdictions where all
action required by SECTION 9.2 has been taken and completed).
(k) MARGIN REGULATIONS. No proceeds of the sale of the Designated
Receivables hereunder shall be used by the Seller to purchase or carry
any margin stock (as defined in Regulation U of the Board of Governors
of the Federal Reserve System, as in effect from time to time).
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(l) QUALITY OF TITLE. Each Designated Receivable and all
Receivables Property which is to be transferred to the Issuer by the
Seller shall be transferred by the Seller free and clear of any
Adverse Claim (other than any Permitted Lien); prior to such transfer
the Seller shall have made all filings under applicable law in each
relevant jurisdiction that can be made to protect and perfect the
Issuer's ownership interest in all Purchased Receivables and
Receivables Property (to the extent that the Receivables Property
constitutes property an ownership interest in which may be perfected
by filing a financing statement under the UCC in the Applicable
Jurisdictions) against all creditors of, and purchasers from, the
Seller and all filing fees and taxes, if any, payable in connection
with such filings shall have been paid in full; and the Issuer shall
have acquired and shall continue to have maintained a valid and
perfected first priority ownership interest in each Purchased
Receivable and the Receivables Property (to the extent that the
Receivables Property constitutes property an ownership interest in
which may be perfected by filing a financing statement under the UCC
in the Applicable Jurisdictions) free and clear of any Adverse Claim
(other than any Permitted Lien); and no effective financing statement
or other instrument similar in effect covering any Purchased
Receivable, any interest therein or any Receivables Property with
respect thereto is on file in any recording office except such as may
be filed (i) in favor of the Issuer pursuant to this Agreement or (ii)
in favor of the Indenture Trustee.
(m) VALID TRANSFERS. No transfer of any Designated Receivables or
any Receivables Property to the Issuer by the Seller constitutes a
fraudulent transfer or fraudulent conveyance or is otherwise void or
voidable under similar laws or principles, the doctrine of equitable
subordination or for any other reason. The transfers of the Designated
Receivables and the Receivables Property by the Seller to the Issuer
pursuant to this Agreement, and all other transactions between the
Seller and the Issuer, have been and shall be made in good faith and
without intent to hinder, delay or defraud creditors of the Seller,
and the Seller acknowledges that it has received and shall receive
fair consideration and reasonably equivalent value for the purchases
by the Issuer of the Designated Receivables and the Receivables
Property hereunder. The purchase of the Designated Receivables and the
Receivables Property by the Issuer from the Seller constitutes a true
sale of the Designated Receivables and the Receivables Property under
applicable state law.
(n) TRADE NAMES. The Seller uses no trade name in the furnishing
of its products or services which generate Receivables other than its
actual corporate name and the trade names set forth in SCHEDULE III.
During the five years preceding the date hereof, except as set forth
in SCHEDULE III, (i) the Seller has not been known by any legal name
or trade name other than its corporate name nor (ii) has the Seller
been the subject of any merger or other corporate reorganization
within the last five years.
(o) TAXES. The Seller has filed or caused to be filed all U.S.
federal income tax returns which are required to have been filed by it
and has paid or caused to be paid (or made adequate provision for the
payment of) all U.S. federal income taxes shown thereon to be due and
payable. No tax lien has been filed in respect of unpaid U.S. federal
income taxes on any property of the Seller. The Seller has filed or
caused to be filed all tax returns, other than U.S. federal income tax
returns, which are required to have been filed by it unless the
failure to file any such other tax return, individually or in the
aggregate, could not reasonably be expected to have a Seller Material
Adverse Effect
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and has paid or caused to be paid (or made adequate provision for the
payment of) all such other taxes shown thereon to be due and payable,
and any assessments made against it or any of its property unless the
failure to pay such other taxes or assessments, individually or in the
aggregate, could not reasonably be expected to have a Seller Material
Adverse Effect or is contesting any such tax, assessment or other
governmental charge in good faith through appropriate proceedings. For
purposes of this paragraph, "taxes" shall mean any present or future
tax, levy, impost, duty, charge, assessment or fee of any nature
(including interest, penalties and additions thereto) that is imposed
by any Governmental Authority.
(p) ERISA MATTERS.
(i) The Seller and each of its ERISA Affiliates is in
compliance in all material respects with the applicable
provisions of ERISA and the regulations and published
interpretations thereunder with respect to each Plan of the
Seller or any of its ERISA Affiliates, except for such
noncompliance which could not reasonably be expected to result in
a Seller Material Adverse Effect;
(ii) No Reportable Event has occurred or is reasonably
expected to occur that, when taken together with all other such
Reportable Events, could reasonably be expected to result in a
Seller Material Adverse Effect;
(iii) The present value of all benefit liabilities under
each Plan of the Seller or any of its ERISA Affiliates (on an
ongoing basis and based on those assumptions used to fund such
Plan) did not, as of the last valuation report applicable
thereto, exceed the value of the assets of such Plan;
(iv) Neither the Seller nor any of its ERISA Affiliates has
incurred any Withdrawal Liability that could reasonably be
expected to result in a Seller Material Adverse Effect; and
(v) Neither the Seller nor any of its ERISA Affiliates has
received any notification that any Multiemployer Plan is in
reorganization or has been terminated within the meaning of Title
IV of ERISA, or that a reorganization or termination has resulted
or could reasonably be expected to result, through increases in
the contributions required to be made to such Plan or otherwise,
in a Seller Material Adverse Effect.
(q) CONTRACTS; CREDIT AND COLLECTION POLICY. The forms of
Contracts used by the Seller or Dunlop to originate Designated
Receivables are attached as EXHIBIT B.
(r) INVESTMENT COMPANY ACT. The Seller is not (i) an "investment
company" registered or required to be registered under the 1940 Act,
or (ii) a "holding company", or a "subsidiary company" or an
"affiliate" of a "holding company" within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
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(s) INDEBTEDNESS TO ISSUER. Immediately prior to consummation of
the transactions contemplated hereby on the Initial Closing Date, the
Seller had no outstanding Indebtedness to the Issuer.
(t) RECEIVABLES LIST. The Receivables List sets forth in all
material respects an accurate and complete listing as of the Cut-Off
Date of all Designated Receivables to be transferred to the Issuer on
the Initial Closing Date and the information contained therein with
respect to the identity and Outstanding Balance of each such
Designated Receivable is true and correct in all material respects as
of the Cut-Off Date.
(u) LOCK-BOX ACCOUNTS. The names and addresses of the Lock-Box
Banks, together with the account numbers of the Lock-Box Accounts at
such Lock-Box Banks, are specified in Exhibit B to the Collection
Agency Agreement. All Obligors of Designated Receivables have been
instructed to make payments to a Lock-Box Account.
The representations and warranties set forth in this SECTION 4.2
shall survive the transfer and assignment of Designated Receivables to the
Issuer pursuant to this Agreement. The Seller hereby represents and warrants to
the Issuer, as of the Initial Closing Date and each Payment Date, that the
representations and warranties of the Seller set forth in SECTION 4.2 are true
and correct as of such date. Upon discovery by the Seller or the Issuer of a
breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice to the other.
ARTICLE V
GENERAL COVENANTS
SECTION 5.1. AFFIRMATIVE COVENANTS OF THE SELLER. The Seller
hereby covenants that, until the Purchase Termination Date shall have occurred
and there are no amounts outstanding with respect to the Purchased Receivables
(other than Charged Off Receivables), the Seller shall:
(a) PRESERVATION OF CORPORATE EXISTENCE AND NAME. Preserve and
maintain its corporate existence, rights, franchises and privileges in the
jurisdiction of its incorporation, and qualify and remain qualified in good
standing as a foreign corporation in each jurisdiction where the failure to
preserve and maintain such existence, rights, franchises, privileges and
qualification could reasonably be expected to have a Seller Material
Adverse Effect.
(b) MAINTENANCE OF PROPERTY. Keep all material tangible property
useful and necessary in its business in good working order and condition
(normal wear and tear excepted), except to the extent that the failure to
do any of the foregoing with respect to any such property could not
reasonably be expected to have a Seller Material Adverse Effect.
(c) COMPLIANCE WITH LAWS, ETC. Comply in all material respects
with all laws, rules, regulations and orders applicable to the Designated
Receivables and the Receivables Property, including, without limitation,
rules and regulations relating to truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt collection
practices and privacy.
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(d) VISITATION RIGHTS. At any reasonable time during normal
business hours on any Business Day and from time to time, upon reasonable
prior notice (and upon one Business Day's prior notice if a Purchase
Termination Event has occurred)), permit (i) the Issuer, or any of its
agents or representatives, (A) to examine and make copies of and abstracts
from the records, books of account and documents (including, without
limitation, computer tapes and disks) of the Seller relating to the
Receivables and (B) following the termination of the appointment of
Goodyear as the Collection Agent with respect to the Designated
Receivables, to be present at the offices and properties of the Seller to
administer and control the collection of amounts owing on the Purchased
Receivables and (ii) the Issuer, or any of its agents or representatives,
to visit the properties of the Seller to discuss the business, operations,
properties and financial and other condition of the Seller with any of its
officers or directors and, with reasonable prior notice to the Seller,
together with the Seller, with its independent certified public
accountants.
(e) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing the Purchased
Receivables and the Receivables Property in the event of the destruction of
the originals thereof), and keep and maintain all documents, books, records
and other information which are reasonably necessary for the collection of
all Purchased Receivables and the Receivables Property (including, without
limitation, records adequate to permit the daily identification of each new
Designated Receivable and all Collections of and adjustments to each
existing Purchased Receivable). Upon the request of the Issuer, the Seller
shall deliver copies of all books and records maintained pursuant to this
SECTION 5.1(e) to the Indenture Trustee or its representatives.
(f) DELIVERY, PERFORMANCE AND COMPLIANCE WITH CREDIT AND
COLLECTION POLICY, RECEIVABLES AND CONTRACTS. (i) Deliver a copy of the
Credit and Collection Policy relating to the Contracts and the Designated
Receivables, as in effect on the Initial Closing Date, to the Issuer and
the Indenture Trustee within two weeks of the Initial Closing Date, (ii)
perform its obligations in all material respects in accordance with and
comply in all material respects with the Credit and Collection Policy, as
amended from time to time in accordance with the Transaction Documents,
and, (iii) at its expense, comply in all material respects with all
material provisions, covenants and other promises required to be observed
by it under the Purchased Receivables and the Contracts related to the
Purchased Receivables and any other agreements related to the Purchased
Receivables.
(g) LOCATION OF RECORDS. Keep its principal place of business and
chief executive office, and the offices where it keeps its records
concerning the Purchased Receivables, all Receivables Property, all
Contracts and other agreements related to the Purchased Receivables (and
all original documents relating thereto), at the address(es) of the Seller
referred to in SCHEDULE II or, upon 30 days' prior written notice to the
Issuer and the Indenture Trustee, at such other locations in jurisdictions
where all action required by SECTION 9.2 shall have been taken and
completed.
(h) OBLIGATION TO RECORD AND REPORT. To the fullest extent
permitted by GAAP and by applicable law, treat each conveyance of the
Designated Receivables as a sale on its books and records and financial
statements.
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(i) COLLECTIONS. Cause each invoice issued to an Obligor to
indicate that payments in respect of its Designated Receivables shall be
made by such Obligor to a Lock-Box Account and otherwise direct the
Obligors to pay all such payments directly to a Lock-Box Account. In the
event that any payments in respect of any Designated Receivables are made
directly to the Seller, the Seller shall, within two Business Days of
receipt thereof, forward such amounts to a Lock-Box Account and, prior to
forwarding such amounts, the Seller shall hold such payments in trust as
custodian for the Issuer and the Indenture Trustee. The Seller shall use
commercially reasonable efforts to prevent the deposit of any funds other
than Collections into any of the Lock-Box Accounts or the Collection
Account and, to the extent that the Seller determines that any such funds
are nevertheless deposited into any Lock-Box Account or the Collection
Account, promptly (and in any event within two Business Days of such
determination) identify any such funds to the Collection Agent for
segregation and remittance to the owner thereof.
(j) SEPARATE CORPORATE EXISTENCE OF THE ISSUER. The Seller hereby
acknowledges that the Issuer and the other parties to the Transaction
Documents are entering into the transactions contemplated by the
Transaction Documents in reliance upon the Issuer's identity as a legal
entity separate from the Seller and its Affiliates. Therefore, from and
after the date hereof, the Seller shall take (or refrain from taking, as
the case may be) such actions and shall cause each of its Affiliates to
take (or refrain from taking, as the case may be) such actions, as shall be
required in order that the Issuer shall at all times:
(i) practice and adhere to organizational formalities, such as
maintaining appropriate books, records and accounts separate from
those of any other Person;
(ii) observe all organizational formalities in connection with
all dealings between itself and any of its members and any Affiliate
of any thereof or any unaffiliated entity;
(iii) observe all procedures required by its certificate of
formation and its operating agreement and the Delaware Limited
Liability Company Act;
(iv) act solely in its name and through its duly authorized
officers or agents in the conduct of its businesses;
(v) manage its business and affairs by or under the direction of
its Board of Managers;
(vi) ensure that its Board of Managers duly authorizes all of its
actions;
(vii) own or lease (including through shared arrangements with
its Affiliates) all office furniture and equipment necessary to
operate its business;
(viii) maintain at least one member of its Board of Managers who
is an Independent Manager;
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(ix) not (A) have or incur any indebtedness to any of its members
or any Affiliate of any of its members (other than the Subordinated
Note); (B) guarantee or otherwise become liable for any obligations of
any of its members or any Affiliate of any thereof; (C) have
obligations guaranteed by any of its members or any Affiliate of any
thereof; (D) hold itself out as responsible for debts of any of its
members or any Affiliates of any thereof or for decisions or actions
with respect to the affairs of any of its members or any Affiliate of
any thereof; (E) operate or purport to operate as an integrated,
single economic unit with respect to any of its members or any
Affiliate of any thereof or any unaffiliated entity; (F) seek to
obtain credit or incur any obligation to any third party based upon
the assets of any of its members or any Affiliate of any thereof or
any unaffiliated entity; (G) induce any such third party to reasonably
rely on the creditworthiness of any of its members or any Affiliate of
any thereof or any unaffiliated entity or (H) be directly or
indirectly named as a direct or contingent beneficiary or loss payee
on any insurance policy of any of its members or any Affiliate of any
thereof;
(x) other than as provided in the Transaction Documents, maintain
its deposit and other bank accounts and all of its assets separate
from those of any other Person;
(xi) maintain its financial records separate and apart from those
of any other Person;
(xii) not suggest in any way, within its financial statements,
that its assets are available to pay the claims of creditors of any of
its members or any Affiliate of any thereof or any unaffiliated
entity;
(xiii) compensate all its employees, officers, consultants and
agents for services provided to it by such Persons out of its own
funds or reimbursing any of its Affiliate in respect of amounts paid
by such Affiliates for such services;
(xiv) maintain office space separate and apart from that of any
of its members or any Affiliate of any thereof (even if such office
space is subleased from or is on or near premises occupied by any of
its members or an Affiliate of any thereof) and a telephone number
separate and apart from that of any of its members or any Affiliate of
any thereof;
(xv) conduct all oral and written communications, including,
without limitation, letters, invoices, purchase orders, contracts,
statements, and applications solely in its own name;
(xvi) have separate stationery, invoices and checks from any of
its members, any Affiliate of any thereof or any unaffiliated entity;
(xvii) account for and manage all of its liabilities separately
from those of any of its members or any Affiliate of any thereof and
pay its own liabilities out of its own funds;
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(xviii) allocate, on an arm's length basis, all shared corporate
operating services, leases and expenses, including, without
limitation, those associated with the services of shared consultants
and agents and shared computer and other office equipment and
software; and otherwise maintain an arm's length relationship with any
of its members, any Affiliate of any thereof and any unaffiliated
entity;
(xix) refrain from filing or otherwise initiating or supporting
the filing of a motion in any bankruptcy or other insolvency
proceeding involving any of its members or any Affiliate of any
thereof to substantively consolidate any of its members or any
Affiliate of any thereof with the Issuer;
(xx) remain solvent;
(xxi) not commingle its property with the property of any of its
members or any other Person;
(xxii) prepare separate financial statements, prepared in
accordance with GAAP and susceptible to audit, or in the event the
Issuer's financial statements are consolidated with those of another
entity, note on such financial statements the separate existence and
obligations of the Issuer;
(xxiii) maintain a sufficient number of employees in light of its
contemplated business operations;
(xxiv) not acquire obligations or securities of any of its
members;
(xxv) hold itself out as a separate entity and correct any known
misunderstanding regarding its separate identity;
(xxvi) maintain adequate capital in light of its contemplated
business operations; and
(xxvii) conduct no other business other than in connection with
the transactions contemplated by the Transaction Documents and enter
into no other agreements other than as contemplated by the Transaction
Documents.
SECTION 5.2. REPORTING REQUIREMENTS. The Seller shall furnish to the
Issuer and the Indenture Trustee from the date hereof until the Purchase
Termination Date shall have occurred and until there are no amounts outstanding
with respect to Purchased Receivables (other than Charged Off Receivables):
(a) GOODYEAR FINANCIALS. (i) As soon as available, but in any
event not later than 120 days after the end of each fiscal year of the
Seller, a copy of the annual report of the Seller on Form 10-K filed with
the U.S. Securities and Exchange Commission; and
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(ii) as soon as practicable, but in any event not later than 60
days after the end of each fiscal quarter of the Seller, a copy of
each quarterly report of the Seller on Form 10-Q filed with the U.S.
Securities and Exchange Commission.
(b) COMPLIANCE CERTIFICATE. Not later than 90 days after the end
of each fiscal year and not later than 45 days after the end of each of the
first three fiscal quarters of each fiscal year, a certificate of an
Authorized Officer of the Seller stating that, to the best of such
Authorized Officer's knowledge, the Seller during such period, has observed
or performed all of its covenants and other agreements, and satisfied every
condition, contained in this Agreement to be observed, performed or
satisfied by it, and that such Authorized Officer has obtained no knowledge
of any Purchase Termination Event or Potential Purchase Termination Event
except as specified in such certificate;
(c) ERISA. If and when the Seller or any ERISA Affiliate (i)
gives or is required to give notice to the PBGC of any Reportable Event
with respect to any Plan which might constitute grounds for a termination
of such Plan under Title IV of ERISA, or knows that the plan administrator
of any Plan has given or is required to give notice of any such Reportable
Event, a copy of the notice of such reportable event given or required to
be given to the PBGC; (ii) receives notice of any accrued and payable
Withdrawal Liabilities or notice that any Multiemployer Plan is in
reorganization, is insolvent or has been terminated, a copy of such notice;
or (iii) receives notice from the PBGC under the Title IV of ERISA of an
intent to terminate, impose liability (other than for premiums under
Section 4007 of ERISA) in respect of or appoint a trustee to administer any
Plan, a copy of such notice;
(d) TERMINATION EVENTS; OTHER MATERIAL EVENTS. As soon as
possible and in any event within two Business Days after the Seller obtains
Knowledge of each Purchase Termination Event, Potential Purchase
Termination Event, Collection Agent Termination Event, Potential Collection
Agent Termination Event, Termination Event or Potential Termination Event
or any other event that has a material likelihood of having a Seller
Material Adverse Effect (including, without limitation, any pending or
threatened action or proceeding affecting the Seller or its Subsidiaries
before any court, governmental agency or arbitrator that has a material
likelihood of having a Seller Material Adverse Effect), a written statement
of the treasurer, any assistant treasurer or chief financial officer of the
Seller setting forth details of such event and the action that the Seller
proposes to take with respect thereto; and
(e) OTHER. Promptly, from time to time, such other information,
documents, records or reports respecting the Designated Receivables or the
condition or operations, financial or otherwise, of the Seller as the
Issuer or the Indenture Trustee may from time to time reasonably request.
SECTION 5.3. NEGATIVE COVENANTS. The Seller hereby covenants
that, until the Purchase Termination Date shall have occurred and there are no
amounts outstanding with respect to Purchased Receivables (other than Charged
Off Receivables), the Seller shall not:
(a) SECURITY INTERESTS. Except for the conveyances hereunder and
as provided below, sell, pledge, assign or transfer to any other Person, or
grant, create, incur, assume or suffer to exist any other Adverse Claim on
any Purchased Receivable,
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whether now existing or hereafter created, or the Receivables Property or
any Lock-Box Account; the Seller shall promptly notify the Issuer of the
existence of any Adverse Claim (other than a Permitted Lien) on any
Purchased Receivable or Receivables Property; and the Seller shall defend
the right, title and interest of the Issuer in, to and under the Purchased
Receivables and the Receivables Property, whether now existing or hereafter
created, against all claims of third parties claiming through or under the
Seller; PROVIDED, HOWEVER, that nothing in this SECTION 5.3(a) shall
prevent or be deemed to prohibit the Seller from suffering to exist upon
any of the Designated Receivables any Permitted Lien.
(b) CHANGE IN CREDIT AND COLLECTION POLICY. Make or permit to be
made any material change or modification to the Credit and Collection
Policy without the prior written consent of the Issuer and the Indenture
Trustee (acting at the direction of the Holders of a Majority in Interest
of each Series of Outstanding Investor Notes).
(c) CHANGE IN FORM OF CONTRACTS. Make or permit to be made any
material change or modification to the Contracts without the prior written
consent of the Issuer and the Indenture Trustee (acting at the direction of
the Holders of a Majority in Interest of each Series of Outstanding
Investor Notes).
(d) CHANGE IN NAME. Change its name, identity or corporate
structure in any manner which would or might make any financing statement
or continuation statement (or other similar instrument) relating to this
Agreement seriously misleading within the meaning of Section 9-402(7) of
the UCC, or impair the perfection of the Issuer's interest in any
Designated Receivable under any other similar law, without having (i)
delivered 30 days' prior written notice to the Issuer, the Collection Agent
and the Indenture Trustee and (ii) taken all action required by SECTION
9.2.
(e) CHANGES IN PAYMENT INSTRUCTIONS. Add, terminate or make any
change to any Lock-Box Account, except in accordance with the Collection
Agency Agreement, or instruct Obligors to make payments of the Designated
Receivables other than to a Lock-Box Account.
(f) ACCOUNTING CHANGES. Prepare any financial statements (other
than consolidated financial statements) which shall account for the
transactions contemplated hereby in any manner other than as a sale of the
Purchased Receivables by the Seller to the Issuer nor in any other respect
account for or treat the transactions contemplated hereby (including for
financial accounting purposes) in any manner other than as sales of the
Purchased Receivables to the Issuer.
ARTICLE VI
PURCHASE TERMINATION EVENTS
SECTION 6.1. PURCHASE TERMINATION EVENTS. If any of the following
events (each, a "PURCHASE TERMINATION EVENT") shall have occurred and be
continuing:
(a) failure by the Seller to pay any amount or make any deposit
required to be paid by it hereunder on or before the date occurring two Business
Days after the date such payment or deposit is due;
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(b) failure on the part of the Seller duly to observe or perform in
any material respect any other covenants or agreements of the Seller set forth
herein which failure continues unremedied for 30 days after the earlier to occur
of (i) the date upon which the Seller obtains knowledge of such failure or (ii)
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Seller by the Issuer or the Indenture
Trustee, or to the Seller, the Issuer and the Indenture Trustee by any Investor
Noteholder;
(c) any representation, warranty or certification made by the Seller
herein or in any report or certificate delivered pursuant hereto shall prove to
have been incorrect in any material respect when made or deemed made which
failure, if capable of being remedied, continues unremedied for 30 days after
the earlier to occur of (i) the date upon which the Seller obtains knowledge
thereof and (ii) the date on which written notice of such failure, requiring the
same to be remedied, shall have been given to the Seller by the Issuer or the
Indenture Trustee or to the Seller, the Issuer and the Indenture Trustee by any
Investor Noteholder;
(d) the Seller shall fail to pay any principal of Funded Debt of the
Seller which is then outstanding in a principal amount in excess of $25,000,000
at the scheduled maturity thereof, such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Funded Debt, and such Funded Debt is not paid within ten
Business Days after the earlier of (i) the day on which an Authorized Officer
first obtains actual knowledge of such failure or (ii) written notice of such
failure shall have been given to the Seller by the holder or holders of such
Funded Debt; or Funded Debt of the Seller which is then outstanding in a
principal amount in excess of $25,000,000 shall become due and payable prior to
the scheduled maturity thereof as a result of the lawful acceleration thereof
due to the occurrence of an event of default thereunder and such Funded Debt is
not paid, or such acceleration thereof is not rescinded or annulled, within ten
Business Days following such lawful acceleration thereof;
(e) any material provision of this Agreement shall cease, for any
reason, to be in full force and effect or the Seller shall so assert in writing;
(f) the long-term unsecured senior debt of the Seller shall be rated
below BB by S&P or below Ba2 by Xxxxx'x;
(g) there shall have been filed against the Seller or Dunlop (i) a
notice of federal tax lien from the Internal Revenue Service or (ii) a notice of
lien from the PBGC under Section 412(n) of the Code or Section 302(f) of ERISA
for a failure to make a required installment or other payment to a plan to which
either of such sections applies;
(h) an Insolvency Event shall occur with respect to the Seller;
(i) a Termination Event with respect to each Series of Outstanding
Investor Notes shall have deemed to have occurred or shall have been declared to
have occurred in accordance with the terms of the applicable Indenture
Supplement; or
(j) the Issuer shall for any reason cease to have a valid and
perfected first priority ownership interest in the Purchased Receivables and the
Receivables Property (to the extent that the Related Property constitutes
property an ownership interest in which may be perfected by filing a financing
statement under the UCC in the Applicable Jurisdictions), free and clear of any
Adverse Claims, other than Permitted Liens, or any of the Seller or any
Affiliate thereof shall so
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assert in writing; PROVIDED, HOWEVER that a Purchase Termination Event shall not
be deemed to have occurred under this paragraph (j) if there shall be a lien on
one or more Purchased Receivables and (x) the Seller shall repurchase such
Purchased Receivables in accordance with SECTION 2.6 or (y) the Collection Agent
shall make payment of a Collection Agent Indemnification Amount in respect of
such Purchased Receivables in accordance with Section 5.2 of the Collection
Agency Agreement;
then, (x) in the case of any Purchase Termination Event described in paragraph
(h) or (i) above, the obligation of the Issuer to purchase Designated
Receivables shall thereupon automatically terminate without further notice of
any kind, which is hereby waived by the Seller and (y) in the case of any other
Purchase Termination Event, so long as such Purchase Termination Event shall be
continuing, the Issuer may terminate its obligation to purchase Designated
Receivables from the Seller by written notice to the Seller.
SECTION 6.2. ADDITIONAL REMEDIES. (a) Upon the occurrence of any
Purchase Termination Event, the Issuer shall have, in addition to all other
rights and remedies under this Agreement or otherwise, all other rights and
remedies provided under the UCC of each applicable jurisdiction and other
applicable laws, which rights shall be cumulative. Without limiting the
foregoing, the occurrence of a Purchase Termination Event shall not deny to the
Issuer any remedy (in addition to termination of the Issuer's obligation to
purchase Designated Receivables from the Seller) to which the Issuer may be
otherwise appropriately entitled, whether by statute or other applicable law, at
law or in equity.
(b) Unless a Purchase Termination Event has occurred and is
continuing, the Issuer shall not exercise the rights granted to it pursuant to
SECTION 2.1(F).
ARTICLE VII
INDEMNIFICATION
SECTION 7.1. INDEMNITIES BY THE SELLER. Without limiting any other
rights that the Issuer may have hereunder or under applicable law, the Seller
hereby agrees to indemnify the Issuer from and against any and all claims,
losses and liabilities (including reasonable attorneys' fees) (all the foregoing
being collectively referred to as "INDEMNIFIED AMOUNTS") arising out of or
resulting from any of the following, excluding, however, Indemnified Amounts (a)
to the extent resulting from the gross negligence or willful misconduct on the
part of the Issuer (or any assignee thereof, including without limitation the
Indenture Trustee or any Investor Noteholder), (b) constituting recourse for
Designated Receivables which are not collected, not paid or uncollectible on
account of the insolvency, bankruptcy, inability to pay or lack of
creditworthiness of the applicable Obligor or (c) attributable to any Excluded
Taxes:
(a) the transfer by the Seller of any interest in any Purchased
Receivable or Receivables Property or proceeds thereof to a Person other
than the Issuer;
(b) reliance on any representation or warranty or statement made or
deemed made by or on behalf of the Seller under or in connection with this
Agreement or in any certificate or report delivered pursuant hereto that,
in either case, shall have been false or incorrect when made or deemed
made;
(c) the failure by the Seller to comply with any applicable law, rule
or regulation of any governmental authority with respect to any Purchased
Receivable or
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related Receivables Property, or the nonconformity of any Purchased
Receivable or related Receivables Property with any such applicable law,
rule or regulation;
(d) the failure to vest and maintain vested in the Issuer an ownership
interest in any Purchased Receivable or related Receivables Property, free
and clear of any Adverse Claim, other than Permitted Liens, whether
existing at the time of the purchase of such Purchased Receivable or
related Receivables Property or at any time thereafter;
(e) the failure 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 any Purchased
Receivables or related Receivables Property of the Seller;
(f) any dispute, claim, offset or defense of the Obligor to the
payment of any Purchased Receivable (including, without limitation, a
defense based on such Purchased Receivable or the related Contract not
being fully enforceable against the Obligor in accordance with its terms),
or any other claim resulting from the sale of the goods or services related
to any such Purchased Receivable or the furnishing or failure to furnish
such goods or services;
(g) any failure of the Seller to perform its duties or obligations
under this Agreement or the other Transaction Documents;
(h) any products liability claim or claim involving environmental
liability arising out of or in connection with goods or services that are
the subject of any Purchased Receivable or Receivables Property;
(i) the commingling of Collections at any time with other funds of the
Seller;
(j) any tax or governmental fee or charge (but not including any
Excluded Taxes), all interest and penalties thereon or with respect
thereto, and all out-of-pocket costs and expenses, including the reasonable
fees and expenses of counsel in defending against the same, which may arise
by reason of the purchase or ownership of any Purchased Receivable or
related Receivables Property, or any interest therein or in any merchandise
which secure any such Purchased Receivables, such related Receivables
Property or any other rights or assets transferred hereunder; or
(k) any governmental investigation, litigation or proceeding related
to this Agreement or in respect of any Purchased Receivable or related
Receivables Property of the Seller.
The Seller shall pay on demand to the Issuer any and all amounts
necessary to indemnify the Issuer from and against any and all Indemnified
Amounts. Notwithstanding the foregoing, the Seller shall not be required to
indemnify the Issuer for any Indemnified Amount that results from any delay in
the collection of any Purchased Receivables or any default by an Obligor with
respect to any Purchased Receivables.
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ARTICLE VIII
SUBORDINATED NOTE
SECTION 8.1. SUBORDINATED NOTE. (a) On the Initial Closing Date, the
Issuer shall issue to the Seller a subordinated note substantially in the form
of EXHIBIT D (as amended, supplemented or otherwise modified from time to time,
the "SUBORDINATED NOTE"). The aggregate principal amount of the Subordinated
Note at any time shall be equal to the excess, if any, of (i) the aggregate
principal amount thereof upon original issuance and each addition to the
principal amount of such Subordinated Note pursuant to the terms of SECTION 2.3
as of such time, over (ii) the aggregate amount of all payments made in respect
of the principal of such Subordinated Note as of such time. Interest on the
outstanding principal amount of the Subordinated Note shall accrue at a rate per
annum equal to the Prime Rate in effect from time to time and shall be paid (x)
on each Settlement Date with respect to the principal amount of the Subordinated
Note outstanding from time to time during the Settlement Period immediately
preceding such Settlement Date and/or (y) on the maturity date thereof.
Principal thereunder not paid or prepaid pursuant to the terms thereof shall be
payable on the maturity date of the Subordinated Note. Notwithstanding any
contrary provision of any Transaction Document, default in the payment of
principal or interest under the Subordinated Note shall not constitute an Event
of Default, a Purchase Termination Event, a Collection Agent Termination Event
or Termination Event.
SECTION 8.2. RESTRICTIONS ON TRANSFER OF SUBORDINATED NOTE. The Seller
shall not assign, transfer, exchange, pledge, hypothecate, participate or convey
the Subordinated Note or any right of the Seller to receive payments thereunder
other than to an Affiliate of the Seller.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. AMENDMENT. This Agreement may only be amended in writing
by the Seller and the Issuer with the prior written consent of the Holders of a
Majority in Interest of each Series of Outstanding Investor Notes.
SECTION 9.2. FURTHER ASSURANCES. From time to time, at its own
expense, the Seller shall promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary or desirable
or that the Issuer may reasonably request, to protect or more fully evidence the
Issuer's ownership, right, title and interest in the Purchased Receivables and
the Receivables Property and its rights under the Contracts with respect
thereto, or to enable the Issuer to exercise or enforce any of its rights
hereunder or under any other Transaction Document. Without limiting the
generality of the foregoing, the Seller shall upon the request of the Issuer
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or, in the
reasonable opinion of the Issuer or the Indenture Trustee, desirable.
SECTION 9.3. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.4. NOTICES. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when
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delivered by hand, or five days after being sent by first class mail, postage
prepaid, or, in the case of facsimile notice, when delivered addressed as set
forth in Section 13.4 of the Base Indenture.
SECTION 9.5. NO WAIVER; REMEDIES. No failure on the part of the Issuer
or the Indenture Trustee, as assignee, to exercise, and no delay in exercising,
any right under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 9.6. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the Seller and the Issuer and their respective
successors and assigns.
SECTION 9.7. COSTS, EXPENSES AND TAXES. In addition to, and without
duplication of, the limited rights of indemnification granted to the Issuer
under Article VII hereof, the Seller agrees to pay on demand all reasonable
out-of-pocket costs and expenses of the Issuer in connection with the
preparation, execution and delivery of this Agreement and the documents to be
delivered hereunder, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Issuer with respect thereto and with
respect to advising the Issuer as to its rights and remedies under this
Agreement, and all costs and expenses (including, without limitation, reasonable
counsel fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement and the other
Transaction Documents to be delivered hereunder. In addition, the Seller agrees
to pay any and all stamp and other taxes and governmental fees payable or
determined to be payable in connection with the execution, delivery, filing and
recording of this Agreement or the other Transaction Documents to be delivered
hereunder, and agrees to hold the Issuer harmless from and against any and all
liabilities with respect to or resulting from any delay in paying or omitting to
pay such taxes and fees.
SECTION 9.8. MERGER AND INTEGRATION. This Agreement and the other
Transaction Documents set forth the entire understanding of the parties relating
to the subject matter hereof, and all prior understandings, written or oral, are
superseded by this Agreement and the other Transaction Documents.
SECTION 9.9. HEADINGS. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 9.10. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by facsimile transmission shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 9.11. NO BANKRUPTCY PETITION. The Seller hereby covenants and
agrees that, prior to the date which is one year and one day after the payment
in full of all Investor Notes, it will not institute against, or join any other
Person in instituting against, the Issuer any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any federal or state bankruptcy or similar law.
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SECTION 9.12. ACKNOWLEDGMENT OF ASSIGNMENTS. The Seller hereby
acknowledges and consents to the assignment by the Issuer of the Purchased
Receivables and the Receivables Property and the rights of the Issuer under this
Agreement pursuant to the Indenture. The Seller acknowledges that the Issuer
shall grant a security interest in the Collection Account and the Lock-Box
Accounts to the Indenture Trustee for the benefit of the Investor Noteholders.
The Seller agrees to take any action that the Indenture Trustee may reasonably
request in connection with such assignment or security interest.
SECTION 9.13. TERMINATION. This Agreement shall terminate at such time
as (a) a Purchase Termination Event shall have occurred and the Issuer's
obligations to purchase Receivables hereunder shall have been terminated in
accordance with Section 6.1 and (b) all Purchased Receivables purchased
hereunder have been collected, and the proceeds thereof turned over to the
Issuer and all other amounts owing to the Issuer hereunder shall have been paid
in full or, if Purchased Receivables sold hereunder have not been collected,
such Receivables have become Charged Off Receivables and the Issuer shall have
completed its collection efforts with respect thereto; PROVIDED, HOWEVER, that
the indemnities of the Seller to the Issuer set forth in this Agreement shall
survive such termination and PROVIDED further that the Issuer shall remain
entitled to receive any collections on Receivables sold hereunder which have
become Defaulted Receivables.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
THE GOODYEAR TIRE & RUBBER COMPANY
By: /s/ Xxxxxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Vice President and Treasurer
Address: 0000 Xxxx Xxxxxx Xxxxxx
Xxxxx, Xxxx 00000-0000
WINGFOOT A/R LLC
By: /s/ Xxxxxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Vice President and Treasurer
Address: 0000 Xxxx Xxxxxx Xxxxxx
Xxxxx, Xxxx 00000-0000
